A Minimizing Risk Strategy for Brazilian Fixed-Income Portfolios

This study presents various risk immunization strategies for fixed-income portfolios, including not only classical measures like duration, convexity, and dispersion but also modern measures such as VaR (value-at-risk) and ES (expected shortfall). Empirical tests are conducted in the Brazilian domestic and international bond market. Because it has had one of highest interest rates since the 1990s, Brazil offers an interesting case study for fixed-income studies. Our results are different for domestic and international bonds. For domestic bonds, using the highest convexity criterion to choose the best portfolio is better than using minimum dispersion, and there is a coincidence between the optimum portfolio selected by the convexity, historical VaR, and ES criteria. For international bonds, our findings indicate that the minimum dispersion strategy performs much better than the maximum convexity strategy. The overall performance of portfolios chosen by minimum VaR and ES criteria is also good, with satisfactory realized returns and squared errors.     

Trade Patterns in the Automobile Industry: Some Evidence from South Africa

In this article the authors analyze trade patterns in the South African automobile industry using disaggregated harmonized system product-level data. The significance of intraindustry trade is estimated and separated into patterns of horizontally differentiated (by variety) intraindustry trade and vertically differentiated (by quality) intraindustry trade. The results indicate the presence of significant levels of intraindustry trade in automotive trade flows between South Africa and bilateral trading partners. In accordance with theoretical expectations, the empirical investigation reveals that intraindustry trade in South Africa's automobile industry is dominated by vertical intraindustry trade. Moreover, in recent years the analysis reveals some evidence that, within vertical intraindustry trade, South Africa's automobile industry produces and exports high-quality automotive products aligned with international fragmentation-based production and trade.     

Microenterprise,Multinational Business Support,and Poverty Alleviation in South Africa's Informal Economy

The authors examine corporate programs that support microenterprise development in Africa. Specifically, the analysis assesses the extent to which local income and sales are affected by Coca-Cola's initiatives to assist South Africa's microenterprise in the retail trade sector. To quantify the impact, questionnaires were obtained from owners of small-scale retail establishments in the country's vast informal economy. Regression analysis is performed on key variables from the survey, testing hypotheses advanced to explain the size of an owner's income and sales. In addition to business development support, the explanatory variables include startup capital, size, and male/female ownership. It appears that business development support has a positive effect on lifting income and reducing poverty for microenterprise owners, after controlling for other influences.     

The ‘recession-push’ hypothesis reconsidered

The relationship between unemployment and self-employment has been studied extensively. Due to its complex, multifaceted nature, various scholars have found a large array of different results, so that the exact nature of the relation is still not clear. An important element of the relation is captured by the recession-push hypothesis which states that in times of high unemployment individuals are pushed into self-employment for lack of alternative sources of income such as paid employment. We make two contributions to this literature. First, we argue that official unemployment rates may not capture the ??true?? rate of unemployment as it does not include ??hidden?? unemployed who are out of the labour force. Therefore, we propose a new method where the ??recession-push?? effect relates not only to the (official) unemployed but also to the inactive population. Second, we argue that the magnitude of the recession-push effect is non-linear in the business cycle, i.e. the effect is disproportionally stronger when economic circumstances are worse. We provide empirical support for our hypotheses by estimating an econometric model on Spanish data.     

Disentangling the link between stock and accounting performance in acquisitions

We study the accounting and stock performance of 4547 US acquisitions during 1989 and 2008. We categorise acquisitions into four types based on the four possible combinations of positive or negative abnormal stock performance and abnormal accounting performance. First, we compare the bidder, bid and target characteristics across the four types of acquisitions. We find significant differences. Second, with the help of existing theories we explain these differences in bidder, bid and target characteristics by differences in the acquisition motives.     

Determining the environmental effects of indirect subsidies: integrated method and application to the Netherlands

The term ‘environmentally damaging subsidies’ covers all sorts of direct and indirect subsidies with negative consequences for the environment. This article presents a method to determine the environmental impact of these subsidies. It combines a microeconomic framework with an environmental impact module. The method is particularly useful for analysing indirect subsidies. These are often hidden, and therefore, not recognized as subsidies. Use of the method will provide a basis for formulating corrective policy. The method is applied to several important subsidies in the Netherlands, in agriculture, energy and transport sectors. The results reveal large environmental effects, which deserve serious attention from policy makers. To illustrate the specific features of the method, its application to a particular subsidy, namely the exemption of excise taxes on aviation fuels, is presented in full detail.     

Human resource management and cultural diversity: a case study in Mozambique

A limited number of studies in Africa have reconciled human resource management (HRM) programs with cultural diversity as represented by Hofstede's cultural dimensions. The objective of this study is to examine how Western-based HRM can be modified to embrace cultural diversity in an African context. A mixed methodology employed a survey, as well as a case study in Mozambique. The results indicate high levels of power distance, collectivism, uncertainty avoidance, and feminism that are very similar to Kenya. These dimensions differed across a spectrum of employee levels illustrating cultural hybridization at firm level in a multinational operating in Africa. The results also illustrate the importance of a range of health, family, and societal beliefs in the workplace. Finally, a series of HRM recommendations were developed in an African context with respect to the selection, training, performance measurement, and management programs of the company.     

Linking Purchasing to Ethical Decision-Making: An Empirical Investigation

The aim of this study is to examine the decision-making processes at work among French buyers—whether beginners or more experienced individuals, when confronted with a dilemma involving an ethical or non-ethical choice to be made. We go on to illustrate these dilemmas through the use of five original scenarios that reproduce typical situations that arise in a purchasing context in relation to the environment, physical integrity, conflict of interest, or paternalism. Based on 172 participants, the results of our study show that, ethical decision-making depends very clearly on two main factors: expertise and gender. The study also reveals that there is not always a coherent link between ethical choices made and the reasons and justifications given for those choices. Ethical options chosen are not exclusively justified on the grounds of purely ethical reasons but also on the grounds of commercial or economic reasons, or else reasons of avoidance.     

Insight into the impact of energy caps on the costs of cellular networks with different layouts and technologies

We investigate the options of a network operator who needs to reduce its carbon footprint, expressed in terms of a global energy cap. First, we propose two ways to meet the energy limitations: by efficiently managing the energy consumed by the legacy networks or by installing additional capacity to the initial topology. We show the power savings that can be obtained in both cases as well as the incurred costs. Then we identify the initial composition of the network and the available technology in the upgrade phase as the factors that have the most influence on the ability of a network to meet the energy caps. Finally, we show the intrinsic unfairness of the energy caps, which are imposed to all the networks without taking into account the differences among them. In conclusion, we highlight the fundamental role of carbon markets and emission trading systems to guarantee a measure of fairness between the operators.