Foreign direct investment and industry response to organized crime: The Mexican case

Organized crime is a disincentive for investment and business activity. We use murders as a proxy for presence of regional organized crime and study the relation between direct foreign investment and organized crime for different industries in Mexico. Our contribution is the focus on sectoral differences. The data is for net foreign direct investment from 116 countries into the 32 Mexican states from 2004 to 2010. Imputing causality, we find that organized crime deters foreign investment in financial services, commerce, and agriculture, but not oil and mining sectors for which we find increased crime associated with increased investment. There is no effect of organized crime on foreign investment in manufacturing.     

The determinants of foreign direct investment in Malaysia: A case for electrical and electronic industry

This study attempts to analyse the determinants of inward FDI in the electrical and electronic (E&E) industry in Malaysia using bounds test approach for the 1980–2008 period. It is found that GDP, real exchange rate, financial development, corporate income tax, macroeconomic uncertainty and social uncertainty factors significantly affect inward FDI in E&E sector in Malaysia. Empirical results indicate that GDP, real exchange rate, financial development and macroeconomic uncertainty are positively related to inward FDI in E&E sector in the long run. However, corporate income tax and social uncertainty have a negative impact on inward FDI in E&E sector. Furthermore, the Granger causality results also indicate that all explanatory variables Granger-cause FDI in the long-run, but in the short-run only macroeconomic and social uncertainties Granger-cause FDI. The impact of social uncertainty is found to be greater than macroeconomic uncertainty. Thus, foreign investors in E&E sector seem to be more concern about the level of social security and safety when choosing their investment destination.     

Beyond Brenner's investment overhang hypothesis: the case of the steel industry

This article challenges the way liberal economic governance has come to be theorised as a passive and depoliticised form of governance. Using the classic case of the gold standard, it shows how state intervention came to be shaped by considerations of state power and diverged considerably from the traditional emphasis on free markets and stable conditions of investments. As I argue, the gold standard was constructed through political struggles over monetary governance which involved significant constraints for capitalist investors. Its institutions helped establish a new structure for exerting control over finance. By resituating the gold standard in a broader historical perspective, I show how nineteenth-century monetary governance, far from leading to a retreat of the state, established in fact the foundations of a new form of state intervention: modern central banking.     

Sources of investment inefficiency: The case of fixed-asset investment in China

This study attempts to measure the inefficiency associated with aggregate investment in a transitional economy. The inefficiency is decomposed into allocative and technical inefficiency based on standard production theory. Allocative inefficiency is measured by the deviation of actual investment from the theoretically desired investment demand. Institutional factors are then identified as part of the driving force of the deviation. The resulting model is applied to Chinese provincial panel data. The main findings are: Chinese investment demand is strongly receptive to expansionary fiscal policies and inter-provincial network effects; the tendency of over-investment remains, even with signs of increasing allocative efficiency and improving technical efficiency.     

实物期权在项目投资柔性上的应用

经营管理柔性的存在使得投资者在投资决策过程中具有某种相机选择权,这种相机选择权与实物期权具有相似的特点。文章针对这个问题,分析了传统投资项目决策NPV法的缺陷与不足,提出从实物期权中的扩张期权的角度来分析投资决策上的管理柔性,进一步揭示隐含在不确定性投资中的价值,并对扩张期权的应用提出了改进建议。     

Environmental adders in the real world

This paper evaluates the use of environmental ‘adders’ as a regulatory instrument. It evaluates their likely performance in meeting the policy objective of social costing given the changes in the electric utility industry's structure and in environmental policy since the efforts to estimate these costs were initiated. The prognosis is largely negative — suggesting that environmental adders are inconsistent with the increased competition already underway in the utility industry, as well as with the trend toward greater use of true market-based approaches to environmental policy that are not subject to detailed economic regulation.     

厦门电子业外商投资面面观

发展经济学理论认为,外国投资对发展中国家经济的发展具有扩展性的影响,它给发展中国家带来的不仅仅是资金,而且还包括管理技术、现代技术、充分就业和进入世界市场的能力。跨国公司的“一揽子”投资,是发展中国家经济快速发展的不可或缺的因素之一。本文试图以厦门特区电子产业外商投资为案例,对跨国公司“一揽子”投资的成效进行探讨。 一、厦门特区外商电子产业直接投资概况 自１９８０年厦门经济特区成立之后,特区政府即把引进外资作为推动其经济增长的主要动力。截至２０００年底,厦门市累计批准外商投资企业４９９１项,投资总…     

投资性房地产准则应用疑难及解决办法

随着新企业会计准则的实施,《企业会计准则第3号——投资性房地产》首次出现在我国会计准则体系中,这是我国会计准则与国际会计准则趋同的一个鲜明体现。但同时,投资性房地产会计准则应用中也暴露出一些问题,需要我们进行全面深入的分析和研究。     

Access pricing and investment: a real options approach

This paper examines a three-period model of an investment decision in a network industry characterized by demand uncertainty, economies of scale and sunk costs. In the absence of regulation we identify the market conditions under which a monopolist decides to invest early as well as the overall welfare generated by this decision. In a regulated environment, we consider a vertically integrated network provider that is required to provide access to downstream competitors and compare two distinct access pricing methodologies: the Efficient Component Pricing Rule (ECPR) and the Option to Delay Pricing Rule (ODPR). We identify the welfare-maximizing access prices using the unregulated market output as a benchmark and show that optimal access regulation depends on market conditions (that is, the nature of demand) with two possible outcomes: (i) access prices that provide a positive payoff to the incumbent, that is, provide a positive compensation to account for the option to delay; and (ii) access prices that yield a zero payoff to the incumbent. Moreover, unlike the earlier literature that argues in favor of an ECPR-type methodology to account for the interaction between irreversibility and demand uncertainty, we find that, except under very specific conditions, an access price that accounts for the option to delay value is welfare-superior to the ECPR.      

Roadmapping a disruptive technology: A case study: The emerging microsystems and top-down nanosystems industry

If technological roadmapping is important in the process of rapid technology commercialization, and if a method tailored to roadmapping nascent disruptive technologies does not exist, and if these very same disruptive technologies portend to be the future economic engines for firms, countries, and regions, then there is cause for concern. This article seeks to shed some light on the process in industrial disruptive technology roadmapping by focusing on the fundamental differences between sustaining and disruptive technologies. This article investigates the utility of theoretical and practitioner traditional technology roadmapping tools in an international industrial roadmapping effort focusing on microtechnology and top-down nanotechnology. I then modify the traditional technology roadmapping approaches generating a model for an industrial worldwide disruptive technology roadmapping process. I utilize the International Industrial Microsystems and Top-Down Nanosystems Roadmap (IIMTDNR) effort, which included nearly 400 people, from nearly as many firms, from over five continents and was developed over a 5-year period. The IIMTDNR process is used to provide the basis for a model for a commercial disruptive technology roadmapping process.     

Managerial flexibility, uncertainty, and corporate investment: The real options effect

This paper examines how changes in uncertainty affect corporate investment and how managerial flexibility influences this effect. Consistent with existing evidence, this study shows that increased uncertainty reduces a firm's capital expenditures even after controlling for investment opportunities and fund availability. It further shows that the negative effect of increased uncertainty on corporate investment is more pronounced for firms with fewer financial constraints and larger size. Overall, the results suggest that managerial flexibility proxied by certain firm characteristics affects the negative relation between uncertainty and investment.     

Problem-oriented modeling in industrial technology: The steel industry

The development of up-to-date industrial technology and improving efficiency can be achieved by operational control and management and by research and design. These three problems and the corresponding subproblems can be formulated, investigated, and solved on the basis of problem-oriented mathematical models.The general approach to the development of the problem-oriented models has several particular features that depend on the problems to be solved—knowledge and data about the systems to be modeled, demand for model accuracy, type of model solution (off-line or on-line), computer type, and so on.The results of implementing problem-oriented models to improve the efficiency of industrial technology is considered for the case of steelmaking in basic oxygen furnaces (BOF), which is the most widely used technology in the world.The problems that were formulated, the approaches to the development of the mathematical models, and the processes that occur in BOF technology are typical for other different kinds of industrial technology, such as chemicals, the cement industry, atomic reactors, and the glass industry.     

The selection of technology for late-starters: A case study of the energy-smart photovoltaic industry

Technology selection, which influences the competitive advantages of an enterprise or a country, is a multi-criteria decision issue. In addition, it is increasingly difficult to identify the right technologies because technologies are increasing in number and complexity. This study proposes a technology selection process integrating the fuzzy analytic hierarchy process (AHP) and Delphi method. The former effectively conducts the fuzziness existing in experts' responses and identifies the strength of technology selection criteria and the relationship between the two. The latter provides the main technology alternatives for Taiwan's future photovoltaic industry. Finally, through the two-way linkage between technology selection criteria and main industrial technologies, the technology fields of the photovoltaic industry can be identified. The empirical results indicate that the benefit of a technology is the most important factor among technological selection criteria, and that Taiwan should adopt and develop microcrystalline silicon film multi-junction and amorphous-silicon solar cells as its main industrial technologies. The results may serve to guide industrial technology acquisition and the work of resource allocations on the behalf of government and enterprises.     

Determining the going market value of a business in an emerging information technology industry: The case of the cellular communications industry

Given the phenomenal growth or the anticipation of growth in certain information technology industries, concerns for economy of scale, market access and expansion, and the need for ongoing research and development are resulting in mergers, acquisitions, and strategic alliances. A key question in such industries is what is, or should be the going market value of a business? This paper suggests an approach to imbed market penetration models in the popular value-based planning approach suggested by Rappaport [36] to obtain the going market value of a business. The model developed in implementing the approach is tailored for the cellular communications industry. Limitations and adaptations of the approach to other industries are discussed.     

Government intervention in industry: The case of Israel

Industrial activity in Israel is marked by considerable government intervention, especially in the capital market. This paper examines its effect on rates of return, risk, exports, and the structure of industry (concentration and firm size). The results (1965–1980) show that risk (whose main element is the probability of bankruptcy), R&D spending and human capital were positively related to the rate of return; the effect of firm size and concentration was negative, an unexpected result reflecting mainly government support generating excess investment and unutilized capital. Although most industries in Israel are private and competitive government measures had a substantial, mostly indirect, negative effect on the determinants of industrial performance.     

Understanding Chinese provincial real estate investment: A Global VAR perspective

This article investigates the spatial interdependence within China's real estate industry, a sector assuming increasing importance in the national economy. The Global Vector Autoregressive (GVAR) model allows us to explicitly address the presence of spatial linkages, including spillover and backwash effects, without a stringent requirement on data. Applying the model to monthly Chinese provincial data for the first time we highlight clear advantages in forecasting and steady-state value prediction. We also demonstrate through the contemporaneous correlation coefficients a growing divide between the previously highly industrialized north and the rest of China. The insights provided by our empirical study have clear value to a wide range of audiences, including researchers, policy makers, and business investors.     

The co-evolution of technology and methods of standard setting: the case of the mobile phone industry

This paper applies the concept of co-evolution to technology, institutions, and industry structure in the mobile phone industry with a focus on technology and the institution/method of standard setting. The paper shows how changes in technology have caused the method of standard setting to come full circle. New switching technologies, in particular electronic switching, enabled a change from integral to modular problem solving and thus a change from quasi-vertical integration to open standard setting in the wireline telecommunications industry in the late 1970s and later in the mobile phone industry. Growth in those mobile phone markets that initially implemented an open standard setting process encouraged other countries to adopt similar types of standard setting where government agencies and firms were the mechanisms for this transmission of open standard setting methods. However, the latest technological change, the mobile Internet, requires integral problem solving and this has caused quasi-vertical integration to return in the form of service providers determining the mobile Internet standards and the specifications for the phones that support their mobile Internet services. A new set of firms is transmitting these methods of standard setting to the rest of the world.

Marriage traditions and investment in education: The case of bride kidnapping

The cultural practice of bride kidnapping in Kyrgyzstan may alter the returns to education for young women in an ambiguous direction due to two competing effects. On the one hand, women facing a risk of kidnapping may reduce education investment due to uncertain returns. Alternatively, since kidnapping is less likely to occur while a woman is in school, women may increase education investment to lower their personal risk of being kidnapped into marriage. Understanding how education is affected by kidnapping risk allows us to better anticipate changes in education when the laws are enforced and the risk declines. We develop a two-period utility model to highlight the effects of kidnapping risk on education and to help identify those girls who are most likely to increase their education when faced with positive regional kidnapping risk and thus most likely to reduce education if the risk is eliminated. We test the implications of the theory empirically using the Life in Kyrgyzstan data. Difference-in-difference regression results point to a negative relationship between regional kidnapping rates and education, suggesting that the elimination of kidnapping is likely to induce higher education rates of women in Kyrgyzstan. The results are informative to the literature at the intersection of marriage traditions, women's bargaining power and education attainment.     

World real interest rates: a global savings and investment perspective

Over the past 15 years, long-term interest rates have declined to levels not seen since the 1970s. This article explores possible shifts in global savings and investment that have led to this fall in the world real interest rate. There are several key findings. First, the authors identify the relative weakness in investment demand as more important than the relative increase in desired global savings to explain the decline in global interest rates. Second, the results indicate that the key factors explaining movements in savings and investment are variables that evolve relatively slowly over time, such as labour force growth and age structure. The conclusions suggest that over the coming years, world real interest rates are likely to continue to adjust slowly, reflecting long-term trends.