The impact of country risk ratings on U.S. firms in large cross-border acquisitions

This study investigates the impact of country risk ratings on the wealth gains to large U.S. bidders involved in cross-border acquisitions. The findings indicate that U.S. bidders experience positive wealth gains during the merger announcements, though this is concentrated in transactions involving European targets. There are also differences in wealth gains to bidders with respect to industry classification and location of foreign targets. The country risk factors including economic, political, and financial risk ratings all play a significant role in explaining the wealth gains to bidders. Furthermore, the wealth gains are higher for the firms with acquisitions in developed countries and are significantly related to GNP growth rate.     

International mergers and acquisitions: A jump diffusion model application

This paper empirically investigates international mergers and acquisitions (M&As) of foreign targets and bidders by analyzing the stock price behavior of the firms involved. The jump diffusion model is employed to study the effects of the M&A announcements on stock prices. The results indicate that acquisition announcements are perceived as a surprise by the market, but prices seem to adjust rather rapidly, supporting the semi-strong form of the market efficiency hypothesis. In addition, a comparison of the pure diffusion and jump diffusion models indicates that the jump diffusion model is statistically superior to the traditional event study methodology (pure diffusion model). (JEL G34)     

Duality and convergence for binomial markets with friction

We prove limit theorems for the super-replication cost of European options in a binomial model with friction. Examples covered are markets with proportional transaction costs and illiquid markets. A dual representation for the super-replication cost in these models is obtained and used to prove the limit theorems. In particular, the existence of a liquidity premium for the continuous-time limit of the model proposed in Çetin et al. (Finance Stoch. 8:311–341, 2004) is proved. Hence, this paper extends the previous convergence result of Gökay and Soner (Math Finance 22:250–276, 2012) to the general non-Markovian case. Moreover, the special case of small transaction costs yields, in the continuous limit, the G-expectation of Peng as earlier proved by Kusuoka (Ann. Appl. Probab. 5:198–221, 1995).     

Estimation of food demand in Turkey: method of an almost ideal demand system

In this study, data of the household income and consumption expenditure surveys conducted by the Turkish Statistical Institute for 1994 and 2003 years were used; income, price, and cross price elasticities under six aggregated product groups were estimated within the framework of the an almost ideal demand system approach for food expenditures; and estimation of household consumers’ food demand in Turkey was analyzed. According to the findings obtained, it was established that a price-bound change would appear in the food demand, and elasticities were calculated. Expenditures by product groups and price elasticities were obtained, and the product groups were aggregated as bread and cereals; meat, fish, and poultry; milk and dairy products, oil and egg; vegetables and fruits; various fast food and alcoholic and non-alcoholic beverages.     

Examining the returns of American depository receipts: Evidence from emerging and developed markets

The purpose of this article is to explain the returns of American Depository Receipts (ADRs), comparing the results across emerging and developed markets. Using a sample of 167 ADRs from 14 emerging and 17 developed markets (31 markets in total) for the period 2000–2004, we found variations in the impacts of specific variables and in the explanatory power of models associated with the annual holding‐period return of firms. Dividing ADRs into emerging and developed markets suggests that firm size and local market conditions influenced returns in the two groups in similar ways. However, firm‐specific business risk and country‐specific economic risk are only important to emerging markets' ADRs, while country‐specific exchange‐rate variables are more important to developed markets' ADRs. © 2009 Wiley Periodicals, Inc.     

Web content analysis of agricultural cooperatives located in Turkey

After the appearance of the globalization process post of 1980＇s, world has becaming a big village, that had been brought many important outcomes related with cooperatives which are aimed to emit the capital to the base. These conditions have been forced the movement to adopt themselves to this process vitally. As of year 2007, there are 26 several types of cooperatives with 90.086 unit cooperatives which have total number of 8,561.618 partners that are all dependent to Turkish cooperative association as well as Ministry of Industry and Commerce. In this study, the web sites of Turkish agricultural cooperatives were examined in terms of their contents. Also, it is tried to find out the sufficiency level of their electronic marketing activities. Within the context of this study, web sites of 5 agricultural cooperatives are examined in terms of their design.     

Economics of upgrading gravel roads to Otta seal surface

Maintenance of low volume roads especially gravel roads is costly, and millions of funding annually are spent for aggregate replacement alone. Otta seal, compared to other bituminous surface treatments (BSTs) for low volume roads that require high-quality materials and specialized expertise, can be constructed using cheaper local aggregates and accessible equipment. However, only three states have reported Otta seal constructions and performance in the US. In this study, an economic analysis was conducted to compare the cost of maintaining a gravel road to the cost of upgrading an existing gravel road to a double Otta seal surface. This analysis was conducted at three levels: deterministic life-cycle cost analysis (LCCA), a stochastic Monte Carlo simulation-based LCCA, and a traffic based economic analysis. A generic one-mile rural road in Midwest was considered as a case study location. Although, according to the analysis conducted in this paper, an upgrade to Otta seal investment might be justified by maintenance savings, resorting to only such justification cannot warrant investment in most cases. The upgrade from gravel road to Otta seal, or any other BSTs, might be justified in terms of enhancing safety for road users and also encouraging economic development beneficial to local areas.