Information effects of loan portfolio quality on bank value

In this paper, the authors test whether loan-loss reserve announcements by individual commercial banks can have contagion effects on the banking industry. It is found that increased loan-loss reserves related to LDC debt do not have an effect on other banks. However, increased loan-loss reserves related to bad real estate loans elicited a negative share price response at other banks. The signal from a loss reserve adjustment is dependent on the reason for the adjustment. While LDC debt problems were restricted to money center banks and were well publicized, real estate loan problems can be contagious throughout the industry. Consequently, signals of real estate loan problems at some banks can cause a reduced valuation of other banks.     

Industrial Structures and Economic Growth: an Input–Output Perspective

The slow-down of economic growth in European countries in recent years raises important economic policyissues. Most economic observers consider that the reasons for the slow-down are structural and are to be found in rigidities on the markets of primary factors or lack of technological innovative capabilities. Input–Output analysis can provide valuable insights into the nature of the phenomenon, and could help to design structural policies in order to foster economic growth.     

Business and Social Reputation: Exploring the Concept and Main Dimensions of Corporate Reputation

Different theoretical approaches highlight the growing relevance of corporate reputation as strategic factor. Among these approaches the arguments of the Resource-Based View are special worthwhile (Grant, 1991, California Management Review 33(3), 114–135; Barney, 1999, Sloan Management Review Spring, 137–145). Nevertheless, this topic poses several methodological problems (Barney et al., 2001), as the unavailability to identify and measure this organizational factor, that is “socially complex” and intangible in its nature. In this work, using the findings of our empirical research on Spanish biotechnology firms, we carry out an identification and measurement of corporate reputation, highlighting its two key components: “business reputation” and “social reputation”. Dr. Gregorio Martín de Castro is Assistant Professor at the Business Administration Department in Universidad Complutense de Madrid (Spain). He has several years of research experience at CIC Spanish Knowledge Society Research Centre, he holds an Expert Diploma in Intellectual Capital and Knowledge Management from INSEAD (France), and he was a Post-Doctoral Research Fellow at Harvard University during 2004–2005. He is author and co-author of several papers concerning Resource-Based View, Intellectual Capital and Knowledge Management. Dr. José Emilio Navas López is Professor and Head of the Business Administration Department in Universidad Complutense de Madrid (Spain). He is author and co-author of several books and papers concerning Technology Management, Strategy and Knowledge Management. He has held the first Knowledge Management Chair in Spain at I.U. Euroforum Escorial. Dr. Pedro López Sáez is Assistant Professor at the Business Administration Department in Universidad Complutense de Madrid (Spain) and he was a Research Fellow at Harvard University during 2004–2005. He has several years of research experience at CIC Spanish Knowledge Society Research Centre and he is author and co-author of several papers concerning Resource-Based View, Intellectual Capital and Knowledge Management.     

Entrepreneurship persistence with and without personnel: The role of human capital and previous unemployment

By considering entrepreneurs who hire employees (employers) and entrepreneurs without personnel (own-account workers) as related but distinct entrepreneurship groups, this work analyses factors in entrepreneurship survival from a new perspective: we contrast the determinants of employers’ survival with those affecting own-account workers’ survival. Discrete choice models under competing risks frameworks are applied to data drawn from the European Community Household Panel for the EU-15 (EUROSTAT). Our results suggest that survival chances are markedly higher for employers than for own-account workers—especially when non-employment exits are considered. We also observe that high qualifications have positive and statistically significant effects on survival rates of employers, regardless of exit routes, while high qualifications have no significant effect on survival rates of own-account workers. Finally, we find that entering entrepreneurship from unemployment—the target group for entrepreneurship incentives—strongly increases the probability of re-entering unemployment for both entrepreneurship groups. Thus, entrepreneurship and higher education policies should be considered together to develop high quality entrepreneurial businesses.     

Inter-industry Distribution of Productivity Gains

In an input–output framework the gains of total factor productivity or the benefits of process innovation can be measured as a reduction in time of the total cost per unit of output, for any industry, when costs and outputs are measured at constant prices. These benefits are distributed to the economic agents (consumers, suppliers, workers, capital owners) through changes in prices, reflecting the structure of the different markets for products and for primary inputs. Theoretical considerations about this process of distribution of the benefits of innovation are complemented with computations related to the evolution of the Spanish economy between 1975 and 1980.     

The rise and fall of WebTrust

While prior research mainly focused on the impact of third-party-certified web assurance seals on consumers' perceptions and purchasing behaviors, little research has been conducted on the managerial decision-making process about the selection, implementation, and the abandonment of such seals. Of particular interest here is the WebTrust seal, jointly developed by the AICPA and the CICA. We take a qualitative case study approach to understand the motivations and rationale of a large North American telecommunications firm's management behind the decisions about the selection, implementation, and abandonment of its WebTrust seal. Our case firm was one of the first to obtain the seal on its online shopping website. Semi-structured interview results suggest that the implementation and the subsequent abandonment of WebTrust may be explained by several theoretical frameworks — the managerial accounting perspective, organizational slack theory, innovation theory, and institutional theory. First, the case firm's leader attitude in innovation, its extra resources available, coupled with the endorsement of the accounting profession led to the implementation of WebTrust. Second, when the benefits of WebTrust versus its costs were questioned and other companies increasingly abandoned the seal, our case firm decided to follow this trend.     

Cooperation support through the use of group decision systems

This article considers the development of the group decision support system (GDSS) field both from organizational and technological perspectives. The growing importance of teamwork, lateral coordination, and activities integration inside modern business organizations is emphasized. Technological and knowledge specialization, quick transformation of business environments, reduction of response time, and so on, are some of the reasons that can explain the renewed relevance of teamwork. Also, the development of information technology (IT) is analyzed in relation to the role it is assuming in supporting group activities. Research in the GDSS field is then introduced. A proposal concerning the identification of three different phases in GDSS studies is developed, ranging from decision rooms to distributed systems. Each phase shows distinctive research topics and application fields, together with different organizational goals. Results of these developments are the growth of potential application areas of GDSS tools. These theoretical considerations, together with empirical experiences coming from the study of a real manufacturing environment (an IBM plant where group cooperation plays a fundamental role for production efficiency), constitute the basis for a research GDSS prototype (GROUPS). Prototype features are designed to support executives in facing production‐planning problems through an improvement in communications and in knowledge representation.     

Price mechanism and endogenous productivity in an open economy stock‐flow consistent model

This paper combines a Stock‐Flow Consistent open economy two‐country model with the Verdoorn‐Kaldor law, which posits a positive relationship between the rate of growth of output and productivity growth. The model shows the role of endogenous productivity as a shock magnifier and underlines the limits of the mechanisms of adjustment that rely exclusively on the “buffer” provided by flexible exchange rates. It also provides arguments in support of fiscal policy both in the context of flexible exchange rates and fixed exchange rates. Finally, it challenges the sustainability of austerity measures aimed to achieve external balance.