Product Market Competition,Monetary Policy Regimes and Inflation Dynamics: Evidence from a Panel of OECD Countries

We empirically analyze the impact of product market competition on the responsiveness of inflation to macroeconomic imbalances. If competition is high the response of inflation to lagged inflation, unemployment and import prices is reduced, while inflation is more responsive to changes in productivity growth in countries in which competition is above the OECD average. Given the (‘good luck’) macroeconomic trajectories of the 1990s–2000s, the structural reforms that made goods markets more competitive improved the ability of OECD economies to smooth (dis)inflationary shocks, while changes in the monetary policy framework had a modest role in taming inflation during the Great Moderation.     

Monetary policy rules with PID control features: evidence from the UK,USA and EU

ABSTRACT

This paper considers the extent to which the monetary policy operations of three major central banks can be regarded as an application of Proportional-Integral-Derivative (PID) control rules. The paper outlines the general PID framework and estimates a series of dynamic models to identify how interest rate policy adjustments are affected by the rate of inflation and the level of macroeconomic activity. The paper examines data for the UK, the USA and the Eurozone. The results suggest that the PID rules can provide a useful theoretical and empirical framework for estimating central bank responses to the inflation and macroeconomic activity variables by improving the explanatory power of the Taylor rule model and determining the effect of the parameters.     

Subsidiary-specific advantages for inter-regional expansion: The role of intermediate units

This paper explores the distinctive deployment of resources and capabilities by subsidiaries in order to develop an intermediate role within the MNC. Based on the regional management perspective, we focus on a specific intermediate role—the springboard subsidiary—that helps overcome the liability of inter-regional foreignness. Our results, which are based on a dataset covering 188 subsidiaries, show that the probability of taking on this role is contingent upon experiential knowledge about the target region, as well as a rich knowledge base derived from a wide range of activities and a broad geographical scope. Our findings also show that possession of slack resources does not necessarily mean that a subsidiary will take on this role, as such slack must be combined with experiential knowledge. This paper serves as a first step in helping MNCs plan resource allocation to handle inter-regional expansion.     

Has the CSR engagement of electrical companies had an effect on their performance? A closer look at the environment

Even though electrical companies attain a top ranking in the publication of CSR reports, they are often accused of 'green‐washing' due to their bad environmental reputation. The current economic crisis is testing their real CSR commitment more than ever, especially when this goes beyond its economic consequences. Based on a worldwide sample of electrical companies, we are going to study why companies are being socially responsible. We wish to know if it is due to the impact on the firms' performance or whether there are other motives (legitimation, improving their reputation) that lead companies to carry out these practices. We will also consider if it changes across the kind of CSR action considered. The results show that there is an economic justification beyond the socially responsible behaviour of the electrical companies. Additionally, most kinds of CSR action (community, diversity, corporate governance, product responsibility) are also carried out looking for economic rewards. However, the CSR actions oriented to the environment are mainly motivated by their need to improve their image and reverse their negative impact. Copyright © 2014 John Wiley & Sons, Ltd and ERP Environment     

Sales forecasting in financial distribution: a comparison of quantitative forecasting methods

This paper deals with the issue of forecastability of sales activities of independent financial advisers (agents). Employing the most common quantitative methods on a diverse sample of timelines from multiple advisory companies, we have found that under most settings, these methods offer sub-par performance with high relative errors and no statistical differences between them. When a more granular approach is applied (reflecting sales unit size), ARIMA and the simple moving average emerge as significantly less accurate. This outcome is true for all sales units regardless of their size, when relative error is concerned. Thus, our analysis confirms the difficult forecastability of financial sales, speaking against the utilisation of more sophisticated forecasting methods, which mostly fail when compared to their much simpler and less costly counterparts.

     

Distinctive Features of Environmental Innovators: An Econometric Analysis

This paper analyzes the main determinants influencing environmental innovators (i.e. firms developing or adopting environmental innovations) in Spain with respect to non‐environmental innovators. Similarly to other contributions in the literature, our results show that Spanish environmental innovators respond to regulatory stimulus in the form of demand‐pull and technology‐push instruments. They have a high internal technological capability and combine internal and external information sources, mostly in cooperation with knowledge institutions. Environmental innovators are more concentrated in mature, traditionally highly polluting sectors, but new firms are not more environmentally innovative than incumbents. Most importantly, in contrast to other environmental innovation studies, mostly carried out in a German context, we have not found evidence of a market pull from either the domestic or international markets. Furthermore, cost savings are not found to be a distinctive driver for environmental innovators. These differential results are possibly related to the special features of Spain regarding its national innovation system and the degree of stringency of environmental regulation and environmental consciousness of its consumers. Copyright © 2013 John Wiley & Sons, Ltd and ERP Environment.     

Do institutional investors drive corporate transparency regarding business contribution to the sustainable development goals?

Institutional investors show increasing interest in how companies align their corporate social responsibility strategies with the sustainable development goals (SDGs) proposed by the United Nations (UN). The information disclosed in this regard is essential to know and monitor business contribution to the 2030 Agenda. In this paper, we analyze the influence that institutional investors have on the adoption of the disclosure strategy established by UN and the Global Reporting Initiative (GRI)—GRI‐SDG Compass. The results obtained for a sample of 989 international companies, which prepare their sustainability reports following the GRI guidelines, show that ownership by foreign investors, pension funds, and “other” investors boosts the relevance of the information disclosed in relation to the 2030 Agenda. On the contrary, government, financial institutions, and cross holdings have no impact on the information systems developed.     

A Geometrical Interpretation of Collinearity: A Natural Way to Justify Ridge Regression and Its Anomalies

Justifying ridge regression from a geometrical perspective is one of the main contributions of this paper. To the best of our knowledge, this question has not been treated previously. This paper shows that ridge regression is a particular case of raising procedures that provide greater flexibility by transforming the matrix X associated with the model. Thus, raising procedures, based on a geometrical idea of the vectorial space associated with the columns of matrix X , lead naturally to ridge regression and justify the presence of the well-known constant k on the main diagonal of matrix X ^′ X . This paper also analyses and compares different alternatives to raising with respect to collinearity mitigation. The results are illustrated with an empirical application.