Translating Sustainabilities between Green Niches and Socio-Technical Regimes

A role for green niches has risen to prominence in the environment and innovation literature. The role of idealistic enthusiasts in the creation of sustainability initiatives in niches is widely recognized. The importance of tensions in incumbent socio-technical regimes is acknowledged to provide niches with development opportunities. However, the literature currently gives insufficient consideration to the processes by which niches and regimes interact and are interdependent. This paper addresses this by considering socio-technical translations between niches and regimes. It does so by analysing niche-regime interactions in the areas of food and housing and the development of eco-housing and organic food in the UK. Three kinds of translations are identified that affect the sustainabilities practiced in niches and regimes, and which do not all flow from green niche to incumbent regime.     

Stakeholders,industry knowledge and adaptive management in the Australian whale-watching industry

Whale watching has become an economically valuable tourism sector. The whale-watching industry is complex, involves multiple stakeholders and can involve multilevel governance. This paper uses the concept of adaptive management to underpin an investigation of industry knowledge and information exchange between two key stakeholder groups in whale watching in Australia – whale-watching operators and environmental resource managers. Twenty commercial operators and nine environmental resource managers were interviewed using both quantitative and open-ended questions. Findings showed key differences between stakeholders involved, and inconsistent perspectives across the industry. Resource managers found biological issues, species health and numbers and interpretation important; operators sought clear and consistent knowledge on compliance, legislation and rules. Only half of the operators had direct access to research and researchers. Managers found the industry to be relatively unprofessionally qualified, especially small and non-specialised operators. Whale-watching operators did not specify that any information (about new knowledge, regulations or policy) was obtained from environmental resource managers through information exchanges. There was inconsistent contact between stakeholders, limiting information exchange and the knowledge-building potential of the industry. Improved dialogue between these groups may not only address existing uncertainties, but also lead to more sustainable outcomes across the industry.     

An introduction to security returns

The equity premium - the difference between the return achievable from investment in the equity market (R_M ) and the risk-free rate of return (R_F )- plays an important part in corporate finance. The expression equity premium (sometimes referred to as the equity risk premium) is used to denote the ex ante expectation of investors. The term excess return refers to the ex post achievement of stock returns over and above the risk-free return. If we compare US and UK returns, we find that total returns, real returns and the value of (R_M - R_F ) are all marginally higher for the UK. Summarized evidence appears in Table 1 and Table 6. Such greater returns may be due to an increased risk premium related to increasing unexpected inflation. Particularly important in estimating the equity risk premium is whether excess returns are measured using a geometric or an arithmetic mean return. To a significant extent, this question revolves around mean reversion in stock returns. Evidence of mean reversion is substantial, although it cannot be proved unequivocally. Given the weight of evidence of mean reversion, there may be a strong case for the use of a geometric mean with an equity premium of between 3% and 5% - or even less.     

Monitoring Financial Distress in a High-Stress Financial World: The Role of Option Prices as Bank Risk Metrics

The current financial crisis offers a unique opportunity to investigate the leading properties of market indicators in a stressed environment and their usefulness from a banking supervision perspective. One pool of relevant information that has been little explored in the empirical literature is the market for bank’s exchange-traded option contracts. In this paper, we first extract implied volatility indicators from the prices of option contracts on financial firms’ equity. We then examine empirically their ability to predict financial distress by applying survival analysis techniques to a sample of large US financial firms. We find that market indicators extracted from option prices significantly explain the survival time of troubled financial firms and do a better job in predicting financial distress than other time-varying covariates typically included in bank failure models. Overall, both accounting information and option prices contain useful information of subsequent financial problems and, more importantly, their combination produces good forecasts in a high-stress financial world.     

Does tax convexity matter for risk? A dynamic study of tax asymmetry and equity beta

The purpose of this study is to explore the effect of tax convexity on firms’ market risk, where tax convexity measures the progressivity of firms’ tax function. We examine the relation between equity beta and tax convexity based on a standard contingent-claims model, in which firms face nonlinear tax schedules. We verify that in the presence of default and growth options, the effect of tax convexity on beta is significant and depends on several countervailing forces. Tax convexity has a direct, positive effect on beta, as well as two indirect countereffects through default and growth options. The overall effect is ambiguous and quantitatively significant. As asymmetric tax schedules are used in most countries, assuming a linear tax schedule in the valuation framework may misestimate beta and thus fail to assess risk accurately. Our theoretical model shows that tax convexity should be taken into consideration when estimating equity beta.     

Core tensions in Wales's new politics: pluralist trends in a majoritarian system

This article examines aspects of Wales's new political system. It identifies a core tension between traditional, majoritarian-designed institutions and procedures, and a new political pluralism. There is a fundamental disconnection between current politics and the original system design which has added complexity and inefficiency to the operation, management and administration of most aspects of devolved politics. Moreover, understanding the contours of the nascent and inchoate system in W ales has been obscured by debates about the distribution of legislative powers between Westminster and Cardiff. The article identifies lessons from coalition government in Wales, both for academics working on the implications of coalitions and for practitioners—specifically for ‘constitution managers’ and those engaged in policy-making.     

‘Carry on up the east coast’— a case study in railway franchising

Welsh policy-makers have rejected customer-driven market approaches to the delivery of public services. Instead they espouse a model of delivery rooted in collaboration and citizen engagement. Empirical evidence from two recent wide-ranging reviews of public services in Wales suggests that this approach could offer a viable alternative to user choice and competition but, for it to be fully effective, central and local government need to embrace other drivers of improvement.     

Does the unemployment invariance hypothesis hold for Romania?

This article questions whether the unemployment invariance hypothesis of Layard et al. (2005), which states that movements in labour force do not significantly affect unemployment rates, holds true for Romania. Using quarterly labour force data for the 1996–2012 period, we explore the time-series properties of the two variables. We find that unemployment rates and participation rates have unit roots, and that they are not cointegrated, meaning that no significant long-term relationship exists between them. The analysis carried out on the first differences of unemployment rates and participation rates shows discouraged and added worker effects for Romania’s female labour force. This conclusion diverges from findings that point out to a stable, long-term relationship between unemployment and participation in several developed countries (Japan, Sweden, USA) and shows that Romanian labour market is highly adaptive, where changes in labour force participation do not lead to increases in unemployment. This finding can help model the influence of adverse developments such as ageing and emigration, and show their true impact beyond demographic doom scenarios. It also points out the role played by labour demand in shaping the evolution of the Romanian labour market.