Litigation risk: Measurement and impact on M&A transaction terms

The purpose of the paper is to propose an original proprietary proxy of a firm's litigation risk. We extend the scope of litigation risk outside of the conflicts with shareholders and the domain of security litigation. We demonstrate that the source of the risk of litigation can be found in the firm's policies and in its management's operational or strategic decisions, even if a sector conditioning effect exists. Based on a sample of 465 US M&A transactions between 2000 and 2014, we provide evidence that the level of litigation risk, at the acquirer's level, has a positive and significant impact on the takeover premium. We also provide evidence that a significant relationship exists between the acquirer's litigation risk and the means of payment. An extension of the sample to international transactions is used as a robustness check; it confirms the previous results.     

Stock Market Reaction to Monetary Policy: An Event Study Analysis of the Brazilian Case

This article examines the relationship between the monetary policy implemented by the Central Bank of Brazil and the stock market. We implement event study analysis and analyze the effect of the anticipated and unanticipated components of monetary policy decisions on the returns of the IBOVESPA index and 53 stocks. We find that monetary policy has a significant effect on the stock market, but is only responsible for a small proportion of market variation. The analysis at the sector level with expected returns identifies that the financial sector is the most affected by this policy, whereas with excess returns only industrial goods are significantly affected. Moreover, individual assets respond in a rather heterogeneous fashion to monetary policy; however, when we look at excess returns, we identify a reduction in the intensity and in the number of companies impacted by monetary policy. Finally, the monetary shock is explained by unanticipated variations in the unemployment rate, in the Industrial Production Index, in the General Market Price Index, and in the Broad Consumer Price Index.     

Information and Knowledge as Antecedents of Consumer Attitudes and Intentions to Buy and Recommend Fair-Trade Products

The authors propose and empirically test a causal model to understand how the availability of fair-trade information and consumer knowledge about this issue affect consumers’ attitudes and intentions toward fair-trade products. The model is built upon the attitude-behavior paradigm and the premises of agency theory. It is tested through structural equation modeling with a sample of 292 Spanish consumers. The findings are that consumers do not have good knowledge about fair trade and that this is significantly determined by the lack of information about this in the market. It is also observed that consumers’ perceptions about the availability of fair-trade information have negative effects on their concern about this issue and that such information as is available is not effective in reducing consumer skepticism. The research represents an extension of previous fair-trade literature because the role of information and communication in improving consumer attitudes and buying intentions has rarely been explored in the case of ethical products.     

Central bank disclosure as a macroprudential tool for financial stability

The Basel Capital Accord (pillar 3) states that disclosure of information (transparency) is essential to financial stability. This study analyzes, through inflation reports, the disclosure of information from the Central Bank of Brazil concerning the credit market. We consider credit risk and capital buffers as measures of financial stability in this analysis. Furthermore, in order to measure the perception of the monetary authority on the credit market, we built two indices based on the central bank’s communication on credit development. We performed a panel data analysis based on a sample of 125 banks for the period from June 1999 to September 2014 (7000 observations). The findings suggest that central bank communication regarding expectations concerning the credit market contributes to financial stability. Therefore, this kind of communication of central banks (about credit development) may constitute an important macroprudential tool to improve financial stability.     

Toward a Typology of Family Firm Corporate Entrepreneurship

Family involvement in business creates idiosyncrasies in firm behavior that promote long‐term, often transgenerational, strategic logics that ostensibly align with the motivations and outcomes of corporate entrepreneurship. Interestingly, extant research provides only minimal insight into the heterogeneous nature of corporate entrepreneurship orientations pursued by family firms. To better understand this heterogeneity, we develop a typology of corporate entrepreneurship in family firms providing a reconciliatory approach to this literary diversity and suggest that the varied corporate entrepreneurship orientations of family firms are impacted by the duality of a family's distinct intention to pursue transgenerational succession and capabilities to acquire external knowledge.     

A model of biased intermediation

We study situations in which consumers rely on a biased intermediary's advice when choosing among sellers. We introduce the notion that sellers' and consumers' payoffs can be congruent or conflicting, and show that this has important implications for the effects of bias. Under congruence, the firm benefiting from bias has an incentive to offer a better deal than its rival and consumers can be better‐off than under no bias. Under conflict, the favored firm offers lower utility, and bias harms consumers. We study various policies for dealing with bias and show that their efficacy also depends on whether the payoffs exhibit congruence or conflict.     

Vulnerability,due process,and reform in modern Mexico

Constitutional Political Economy - In this paper, we examine the relationship between socioeconomic vulnerabilities and due process violations in contemporary Mexico, using a novel survey of...     

Mapping themes in the study of new work practices

Both shaping and shaped by technological, economic and social facets, the world of work has witnessed a wide array of changes. This review article sets out to provide a synthesis of some of the main directions and insights of existing research connected to the new world of work. In particular, we approached the topic of new work practices through four key dimensions: (1) Conceptual and methodological dimensions in the study of new work practices; (2) Spatial and temporal manifestations of new work practices in the collaborative economy; (3) Individuals, organizations and new work configurations; (4) Power and control. The review article critically discusses the future of work and argues that the ‘new’ world of work simply repeats asymmetrical power relations and inequalities that characterise work activities, with the potential of exacerbating even further disparities, inequalities and precarity.     

Transfer Fees in Professional Soccer

International Advances in Economic Research -     

Technological leadership and sectorial employment growth: A spatial econometric analysis for U.S. counties

This paper studies the determinants of technological catch‐up considering spatial and sectoral aggregation of industries. We investigate how geographical and technological proximity to the technology leader impact regional employment growth. We model technological progress by means of a hierarchical process of catch‐up to the technology leader. We also incorporate measures for knowledge spillover effects to test the roles of competition, specialisation, and diversity at the industry level. Empirical results using data at the county level for different economic sectors (2‐dig NAICS) for the United States indicate that human capital plays a crucial role in promoting sectoral employment growth. The association between technological/geographical distance to the technology leader and employment growth varies across sectors.