The impact of initial public offerings on innovations: Short-termism or initial governance force exit?

We study the impact of initial public offerings (IPOs) on corporate innovations in China. The findings suggest that going public significantly impedes corporate innovations by lowering overall innovation quality. For firms with shareholders selling or pledging less shares after IPO, the number of patents increases, but the nonself-citations per patent decrease relative to matched non-IPO firms. In contrast, for firms with shareholders selling or pledging more shares after IPOs, both the number of patents and nonself-citations per patent decrease. The magnitudes of impact in the latter are stronger than those of former, supporting the initial governance force exit hypothesis.     

Efficiency in public schools: Does competition matter?

The focus of many recent school reforms has been on changing the incentives faced by school administrators, mainly through increased competition. In this study, we assess whether competition amongst public schools influences the efficiency in which these schools operate, using a two-stage estimation procedure and data from the state of Illinois from 1997–1998. We find some evidence that public school districts become more efficient as neighboring districts become more efficient. However, such spillovers only occur if districts operate within a financially flexible environment.     

Cross-listings of blockchain-based tokens issued through initial coin offerings: Do liquidity and specific cryptocurrency exchanges matter?

Decisions in Economics and Finance - Initial coin offerings (ICOs) represent a novel funding mechanism where digital tokens are issued on the blockchain and sold to investors. One major reason for...     

Does organization capital matter? An analysis of the performance implications of CEO power

Chief executive officer (CEO) power reflects the ability of the CEO to influence the firm's decision-making. Whether the CEO of the firm could manage the firm’s investment assets to support maximizing the efficiency of resource allocation is an important issue. As previous studies found, organization capital is a key intangible asset that improves the firm’s production efficiency and affects long-term performance. This study explores how CEO power affects organization capital investments and how it further affects the efficiency of firm resource allocation. We use the following three variables to measure CEO power: CEO founder, CEO-only insider and CEO duality. Our results indicate that the level of CEO power can influence a firm’s value by controlling the organization capital. When the firm’s CEO is also the founder, the CEO will attempt to increase investments in organization capital to create growth opportunities for the firm, which will therefore increase the firm's value. Specifically, when the company is in financial distress, the powerful CEO's increasing in organizational capital investment will expose the company to greater risk of loss of intangible assets. This result may further increase the company's price volatility.     

Does intellectual capital matter? Assessing the profitability and marketability of IC design companies

Under a highly competitive market and a dynamic industrial environment, how to evaluate and enhance an integrated circuit (IC) design company??s good performance is important. This paper develops a two-stage data envelopment analysis (DEA) combined intellectual capital theory through financial and non-financial data to evaluate a performance process on the IC design company. It adopts a new slacks-based measure (SBM) to obtain a more accurate performance estimation and rank between companies. This paper further uses the Simar and Wilson procedure with a truncated regression to explore the impact of intellectual capital variables on performance and competitive advantage. From the study we suggest to the company in how to enhance precisely its performance to create company value and success.     

Entrepreneurial orientation,environmental sustainability and new venture performance: Does stakeholder integration matter?

Previous research has theorised that the link between entrepreneurial orientation (EO) and performance is mediated by environmental sustainability orientation (ESO). However, firm‐level factors that may moderate this relationship are lacking. This paper attempts to fill this gap by examining how and when EO enhances new venture performance by considering ESO as mediator and stakeholder integration as an important contingent factor. Using primary data obtained from 242 chief executive officers/entrepreneurs, it was found that the indirect relationship between EO and new venture performance is strengthened at high levels of stakeholder integration. Theoretical and practical implications are discussed.     

Does public transit reduce car travel externalities? Quasi-natural experiments' evidence from transit strikes

One of the unanswered questions in the field of urban economics is to which extent subsidies to public transit are justified. We examine one of the main benefits of public transit, a reduction in car congestion externalities, the so-called congestion relief benefit, using quasi-natural experimental data on citywide public transit strikes for Rotterdam, a city with mild congestion levels. On weekdays, a strike induces travel times to increase only marginally on the highway ring road (0.017 min/km) but substantially on inner city roads (0.224 min/km). During rush hour, the strike effect is much more pronounced. The congestion relief benefit of public transit is substantial, equivalent to about 80% of the public transit subsidy. We demonstrate that during weekends, travel time does not change noticeably due to strikes. Furthermore, we show that public transit strikes induce similar increases in number of cyclists as number of car travelers suggesting that bicycling-promoting policies to reduce car congestion externalities might be attractive in combination with first-best congestion pricing.     

Entrepreneur: do social capital and culture matter?

This paper analyzes the effect of the individual perceptions of social capital and culture in entrepreneurial aspirations before and after the economic crisis in Western Europe. Following the approach of the Theory of Planned Behavior (Ajzen in Organizational Behavior and Human Decision Processes, 50, 179–211, 1991), we advance the analysis of the effect of the perception of subjective norms in the entrepreneurial intentions. We studied the Total Early-Stage Entrepreneurial Activity (TEA) of twelve countries in 2006 and 2010. The results reveal that the perception of having social networks is significant for the TEA, and it increases after the economic crisis. However, the cultural factors do not have a significant impact, except the one related with the perception of social equality. The results obtained through the double perspective of this analysis (individual’s social capital vs cultural factor of individualistic perspective) offers a certain dilemma when we try to understand the entrepreneurial intntion through the individual’s perception of subjective norms, following the Ajzen’s model. The more individualist is a person, the lower the weight of its social capital. However, the more a person has access to social networks, the greater his entrepreneurial intention will be. This result opens future lines of research focused on understanding the value of the individual’s social capital for different countries and groups of entrepreneurs.

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Reshoring: Does home country matter?

The role of the country, either home or host, in firms' internationalization has been widely analysed in the International Business field. A large number of studies have shown that home country shapes many aspects of firms' internationalization processes such as investment decisions, location selections, and entry modes. However, these studies mainly focus on the firms' foreign expansion. Little is known about the relations between firms’ home country and reshoring processes. This paper aims to analyse whether and how reshoring projects are different across countries, thereby further exploring the underlying home country-related factors contributing to reshoring peculiarities. By using a dataset including 529 cross-industry reshoring projects developed by companies headquartered in five countries (i.e., US, Germany, UK, France, and Italy), the study shows that these projects differ in terms of industry, entry mode, firm size and motivations. Thus, reshoring turns out to be a phenomenon where each country has its own peculiarities. The research further sheds light on the possible institutional, cultural/cognitive and industry/resource-related factors underlying these specificities.This study contributes to both reshoring and international business literature by highlighting how reshoring differs across countries. It also provides policy and managerial implications, at a time when several governments are considering the economic and employment potential of this phenomenon.     

Foreign capital inflows and poverty linkages in South Asia: Do the forms of capital inflows matter?

The relationship between foreign direct investment and poverty reduction has received modest attention in the empirical literature. However, little is known about the relative significant impact of different forms of capital inflows on poverty reduction. This study attempts to investigate the impact of different forms of capital inflows (foreign direct inflows, portfolio equity and portfolio debt inflows) on poverty reduction in major South Asian economies during the post-reform period. The capital inflows-poverty nexus is explored using panel econometric methods robust to cross-sectional dependence. Our empirical results show that while portfolio equity inflows exert a favorable impact on poverty reduction, foreign direct inflows and debt inflows fail to influence poverty. The panel causality results demonstrate that portfolio equity inflows also support poverty alleviation via stimulating economic growth and trade openness. The findings of our study highlight the importance of considering the differential welfare impacts of different forms of capital inflows while implementing capital account liberalization.     

Revisiting the roles of gold: Does gold ETF matter?

This study investigates whether the role of gold changes due to the introduction of gold exchange-traded funds (ETFs) using sample data of seven countries in which physically-backed gold ETFs have been issued. The results show that the traditional roles of gold do change after the introduction of gold ETFs, particularly in the corresponding stock markets. The functions of hedge and safe haven provided by gold wear off during the post-ETF period in stock markets. In currency markets, however, gold still serves as a hedge and safe haven asset, and such effects become stronger during the post-ETF period. Moreover, gold ETFs play a role of relative strong safe haven than the physical gold does while the leading (lagged) stock returns extremely decline. Like the purposes of using physical gold assets, gold ETFs also provide hedge and safe haven effects to the exchange rate risks. Therefore, we might confirm that physical gold could be largely replaced by gold ETFs and investors could utilize gold ETFs to avoid potential risks in financial markets.     

Economic and capital market antecedents of venture capital commitments (1960–2010)

Using vector autoregression technique, we examine the interrelation between venture capital flows, economic development, capital market fund-raising activities, and capital market valuation, based on annual data of the United States over the past half-century. We find that venture capital commitments appear to be correlated with GDP and capital market valuation. While capital market fund-raising activities (Initial Public Offerings and Seasoned Equity Offerings) are also correlated with venture capital flows, these effects are subsumed by GDP, indicating that the overall economy drives both venture capital flows and capital market financing activities. Analyses from impulse response functions suggest that shocks to GDP have a permanent effect on venture capital flows, while the impact of capital market valuation (Standard & Poor 500 returns) on venture capital flows is rather short lived. Overall, both economy-wide development and financial market fluctuations seem to impact venture capital flows.     

Firm leverage decisions: Does industry matter?

We use a standard capital structure mode l to investigate the firm leverage decisions of 1620 companies listed in the Australian Securities Exchange (ASX) across a span of 13 years (2000–2012), dividing the sample into mining and other industries (non-mining). We also test for significant differences in leverage decisions between these two groups by applying a dummy variable approach. Our findings show that fundamental differences exist between mining and non-mining companies when making leverage decisions. We find evidence that mining firms are more sensitive to profitability and asset tangibility where neither profitability nor asset tangibility has significant association for non-mining firms. Overall results suggest that industry-type does matter for firms making leverage decisions.     

The hotly debate of human capital and economic growth: why institutions may matter?

Quality & Quantity - In neo-classical theory, evidences are found that human capital is a progressive contributor of economic growth. However, empirically the relationship may not always hold...     

Growth of born globals: the role of the entrepreneur’s personal factors and venture capital

This paper examines to what extent the human capital of entrepreneurs and the receipt of venture capital (VC) financing affect the growth of born globals (BGs). The study analyzes a sample of 242 BGs resulting from a survey on high-tech start-ups operating in the ICT and electronics sectors, located in different countries throughout the world. A multivariate explorative analysis controlling for the endogenous nature of VC is conducted. The results indicate that the experience of the entrepreneur in having previously established another entrepreneurial firm positively affects the growth of BGs. A negative effect is associated with the presence of heterogeneity in the management team in terms of education background. With regard to the linkage between financial capital and growth, it is found that both VC financing and the number of founders (a proxy for the availability internal capital) positively influence the growth of BGs.     

Determinants of bank interest margins in Russia: Does bank ownership matter?

This paper analyzes interest margin determinants in the Russian banking sector with a particular emphasis on the bank ownership structure. Using unique bank-level data covering Russia's entire banking sector for the 1999–2007 period, we find that the impact of a number of commonly used determinants such as market structure, credit risk, liquidity risk and size of operations differs across state-controlled, domestic-private and foreign-owned banks. At the same time, the influence of operational costs and risk aversion is homogeneous across ownership groups. The results overall suggest that the form of bank ownership needs to be considered when analyzing interest margin determinants.     

Adaptive expectations and cobweb phenomena: Does heterogeneity matter?

This paper studies a cobweb-type commodity market characterized by a strictly monotone demand and supply, in which n types of firms operate. Types differ in a key parameter governing price expectations which are supposed to be adaptive. The unique steady state of the resulting economic dynamics is characterized in terms of stability and the impact of the number of firms types is studied: to this end the notions of structural and behavioural degree of instability, which are introduced in the paper, prove to be crucial in determining whether stability or instability prevail. The case of market integration is also considered and conditions to have stability (or instability) in terms of the original markets' parameters are given. The baseline structure is extended in two directions. The first extension assumes the point of view of an authority who is uncertain about the firms types. In this case the structural degree of instability determines how heterogeneity affects the probability of ending up with a stable outcome. The second extension consists in endogenizing the choice of predictors through a discrete choice-based evolutionary mechanism. In both cases the amount of the heterogeneity and its possible variations play a critical role in shaping the range of possible long-run outcomes of the model.     

Early labor market outcomes of university graduates: Does time to degree matter?

Using university administrative and survey data drawn from the AlmaLaurea Consortium, we analyze the effect of time to degree on the early labor market performance of Italian graduates. The empirical strategy allows identifying separately the impact of elapsed time to degree on the transition from university to work and on earnings from other determinants specific to the academic path completed. Findings suggest that delayed graduation reduces the employment probability (0.8% points for each year of delay), and this effect is still persistent five years after graduation. Once employed, graduates not completing their degree within the minimum period are also penalized in their net monthly earnings, even five years after graduation. The most penalized groups are women and graduates in non-scientific fields.