A note on transfer prices and exchange rate pass-through

The paper builds a model of a parent corporation selling an intermediate product to a foreign subsidiary. The model is used to explain the response of foreign prices to changes in the exchange rate between the country of the parent affiliate and the foreign subsidiary. The model examines this response with and without an external market for the intermediate product.     

Impacts of revenue sharing,profit sharing and transfer pricing on quality-improving investments

We compare revenue sharing with different profit-sharing rules and constant transfer prices in a buyer-seller setting, in which the incompleteness of contracts causes decentralization costs. Our focus is on a situation where a manufacturing department or a supplier of an intermediate product can invest in a quality improvement of the final product and thereby increase customer demand. We analyze the willingness of the supplier to invest under a revenue-sharing rule, three profit-sharing rules and a transfer-pricing scheme. Our analysis shows that the performance of sharing rules is likely to decrease when the sharing basis consists of fewer cost components. Remarkably, this is not true for the revenue-sharing rule. To the contrary, this less prominent scheme can be shown to maximize total profit under a variety of cost combinations.     

Successful antitakeover defenses,top management turnover and stock prices

Previous studies have not addressed the question of whether successful targets of hostile bids adopt specific defenses, or whether a relation exists between the type of defense and subsequent management turnover. This study finds that sale or buyback of stock is the most common-and probably the most successful-form of defense employed by targets to defeat hostile bidders, and that stock buyback leads to management retrenchment in the post-defeat period. The management turnover announcement has no impact on the target stock price and appears to convey no new information to the market.     

Gaining sustainable development by green supply chain innovation: Perspectives of specific investments and stakeholder engagement

Despite general attention has been given to sustainable development and green innovation, little empirical effort has been made to explore the factors influencing green innovation performance in the context of supply chain relationships, especially in emerging countries like China. To address this research gap, from the perspectives of specific investments, we examine the role of specific investments in relation to the outcome of green supply chain innovation. Drawing on knowledge management theory, we propose that knowledge transfer plays a mediating role underlying the relationship. On the basis of the stakeholder involvement theory, we argue that partner social responsibility plays moderating roles not only in specific investments—green supply chain innovation performance link—but also in the link of knowledge transfer and performance. We tested the proposed relationships with a sample consisted of 331 questionnaires and validated responses from 187 high‐tech firms in China. The results generally support the proposed hypotheses, and the integrative model—moderated mediation—is also supported. As such, this study contributes to understand about how specific investments affect the performance of green supply chain innovation, providing new insights on stakeholder involvement and knowledge transfer in green supply chain innovation management.     

Adaptation investments and homeownership

This article develops a model where ownership improves the efficiency of the housing market as it enhances the utility of housing consumption for some consumers. The model is based on an extended Hotelling–Lancaster utility approach in which the ideal variant of housing is obtainable only by adapting the home through a supplementary investment. Ownership offers low costs of adaptation, but has high contract costs compared with renting. Consumers simultaneously choose housing demand and tenure, and because of the different cost structure only consumers with strong preferences for individual adaptation of the home choose ownership. This article analyses the consumer’s optimization. The model provides an explanation for the observation that homeowners typically live in larger dwelling units than tenants. It also provides an explanation for a high price of housing services tending to reduce homeownership rates.     

Forecasting inflation with online prices

Are survey-based forecasts unbeatable? They are not. This paper uses online price indices to forecast the Consumer Price Index. We find that online price indices anticipate changes in official inflation trends more than one month in advance. Our baseline one-month forecast outperforms Bloomberg surveys of forecasters, which only predict the contemporaneous inflation rate. Our baseline specification also outperforms statistical benchmark forecasts for Australia, Canada, France, Germany, Greece, Ireland, Italy, the Netherlands, the United Kingdom, and the United States. Similarly, our quarterly forecast for the US inflation rate substantially outperforms the Survey of Professional Forecasters.     

Corporate investments and growth options

Real options theory models certain corporate investments as investments in growth options, yet there is little direct evidence on whether firms actually capture growth option value from these investments. In the current paper, we attempt to bridge this empirical gap, and we also examine the conditions under which the growth option value embedded in such investments is enhanced. Results from a sample of manufacturing firms during 1989–2000 reveal that investments in research and development and joint venture (JV) investments contribute to firms' growth option values. We also show that, among JVs of different ownership structures, only minority JVs increase growth option value. Our findings affirm options theory's assertion that real options can help firms capture valuable upside opportunities, they highlight the value of examining contingencies that drive option value, and they also point to the challenges firms face in realizing the unique benefits the theory emphasizes. Copyright © 2007 John Wiley & Sons, Ltd.     

Manpower targets and educational investments

Quadratic programming can be useful to compute the optimal investment trajectory for an education system which is planned on the base of manpower targets. The computation of optimal investments required to approach manpower targets more closely becomes non trivial if the budget available is insufficient to meet manpower targets exactly, or if the manpower target trajectory is erratic.The quadratic programming problem consists of three components: (1) an optimization criterion which reflects the objective to minimize the squared deviation of actual manpower available from the manpower target; (2) a set of time difference equations which reflect the flow of students, the manpower stock flow and the flow of investments in the education subsystem; (3) a constraint on the budget, available for this branch of education over a planning period.This education investment problem is worked out for middle level technical manpower training in Bangladesh.     

Quantities vs. prices: monopoly regulation without transfer under asymmetric demand information

Economics of Governance - This paper examines the optimal monopoly regulation without transfer based on Basso, Figueroa and Vásquez (Rand J Econ 48(3):557–578, 2017), which compare the...     

Contractual solutions to hold-up problems with quality uncertainty and unobservable investments

Consider a seller and a buyer who write a contract. After that, the seller produces a good. She can influence the expected quality of the good by making unobservable investments. Only the seller learns the realized quality. Finally, trade can occur. It is always ex post efficient to trade. Yet, it may be impossible to achieve the first best, even though the risk-neutral parties are symmetrically informed at the contracting stage and complete contracts can be written. The second best is characterized by distortions that are reminiscent of adverse selection models (i.e., models with precontractual private information but without hidden actions).     

Double-edged effect of talent management on organizational performance: the moderating role of HRM investments

Abstract

More than a decade after the publication of the book The War for Talent, there has been growing interest in the role of talent management in achieving organizational success. Although past studies have empirically investigated the role of talent management and its positive association with organizational performance, few studies have integrated the bright and dark sides of talent management. Using a sample of 444 firms in South Korea, this study finds that talent management has a double-edged effect on firm outcomes, including innovation and voluntary turnover rate. Moreover, it finds that the effect of talent management considerably varies across organizational contexts. Specifically, this study identifies the conditions under which the negative role of talent management changes across different levels of human resource management investments. Demonstrating the dual direct effect and contextual effect of talent management, this study provides reference for future studies on talent management, specifically those that aim to discover the mechanisms influencing the distinguished role of talent management in organizational outcomes. This study further discusses the theoretical and practical implications.     

Information from successive changes in gold and silver prices during phases of the business cycles

This paper concerns the behavior of gold and silver prices on a daily, weekly and monthly time span during January 1970 to December 1989. The methodology consists of extracting the predictive power of time series of changes in past prices for obtaining optimal forecasts for next-period changes in prices. Optimizations are made in the context of information theory via minimizing the degree of diversity between the actual and predicted changes in prices. This methodology has merit in that it does not rest on, generally speaking, unacceptable assumptions regarding the shape of the distribution, stationarity of variance or its existence. The behavior of gold and silver prices are studied during peak to trough and trough to peak of the business cycles over 1970–1989. It is generally shown that information contained in past prices of gold and silver does not allow one to predict next-period changes in prices in the short run. However, longer-term predictions are possible. This study further reveals that as the length of the time interval expands, gold prices exhibit a higher degree of dependency on past prices than silver.     

Forecasting crude oil prices with DSGE models

In this study, we conducted an oil prices forecasting competition among a set of structural models, including vector autoregression and dynamic stochastic general equilibrium (DSGE) models. Our results highlight two principles. First, forecasts should exploit the fact that real oil prices are mean reverting over long horizons. Second, models should not replicate the high volatility of the oil prices observed in samples. By following these principles, we show that an oil sector DSGE model performs much better at real oil price forecasting than random walk or vector autoregression.     

Asset prices with non-permanent shocks to consumption

Most standard asset-pricing models assume that all shocks to consumption are permanent. We relax this assumption and allow also for non-permanent shocks. In our specification, the long-run mean of consumption growth is constant; consumption levels are subject to short-run deviations from their long-run trend. The implications of our model are dramatically different from those obtained in the prior literature. A canonical and parsimonious asset pricing model with CRRA preferences and non-permanent shocks can reproduce the equity premium, high return volatility and return predictability with a coefficient of relative risk aversion below ten. This finding suggests that non-permanent shocks can play an important role in explaining asset pricing puzzles.     

2007年第一季度 城市地价动态监测报告

根据中国城市地价动态监测系统对全国重点地区和主要城市监测结果的分析，2007年第一季度我国主要城市地价状况如下——     

Aging and house prices

The paper investigates how aging will affect house prices. It uses for the first time a house price dataset covering 22 advanced economies. The analysis finds that demography did and will affect real house prices significantly. The results suggest that a major shift is taking place. In the past 40 years, on average demography increased advanced economy real house prices by around 30 basis points per annum, while in the next 40 years aging will decrease them on average by around 80 basis points per annum compared to neutral demographics. The shift from demographic tailwinds to headwinds might also be relevant when thinking about financial asset prices.     

三项举措应对物业服务价格松绑

<正>通过各方的努力,放开物业服务收费价格一定会让物业管理迎来新的发展,更有利于促进社区和谐建设。非保障性住房物业服务价格的放开,一时间成为业界议论的热点。许多业主担心物业服务企业会任性涨价,这也为政府管理部门提出了课题。笔者以为,政府监管部门应从以下几个方面入手应对物业服务价格的放开。     

Mergers,strategic investments and antitrust policy

Established firms can diversify into new markets in two distinct modes: through internal development or through conglomerate merger. Building on a dynamic three-stage bargaining model with variable threats, this paper shows that a lenient antitrust position toward horizontal mergers can induce established firms that would otherwise not have entered to enter via conglomerate merger. The vigor of antitrust enforcement toward horizontal mergers also affects the conglomerate acquisition price but it does not influence the choice of entry mode. Finally, the paper brings to light a heretofore neglected avenue through which conglomerate mergers can increase welfare.     

Behavioral uncertainty and investments in cooperative relationships

We study a cooperative relationship between two economic agents, in which one agent can make investments in the relationship to reduce the probability that the other agent defects. The probability of defection is derived from an incomplete information decision model of the transaction partner. We show that the relationship between investment and probability of defection depends on the type of uncertainty considered and analyze the effects of parameter changes on the optimal level of investment. Copyright © 2004 John Wiley & Sons, Ltd.