Investment commitment and the valuation of underwriting agreements for rights issues

I extend the option pricing framework for the underwriting of rights issues, by considering that the funds received at maturity may already have been committed to a project at the time of signing of the underwriting agreement (investment commitment). The model yields valuations that are up to several times the amount implied by no investment commitment, and this is most pronounced for large issues. An upper bound for the model’s explanatory power is obtained by assuming that all issues exhibit full investment commitment; under this assumption, the model explains 40–65% of the overpricing of underwriting agreements in the United Kingdom.     

Innovation efforts and performances of Brazilian firms

We analyze the relationship between innovation and firms' performance in Brazil using a comprehensive database that cross-references innovation information by PINTEC (Technological Innovation Research) of the IBGE (Brazilian Institute of Geography and Statistics) and financial information from Serasa and Gazeta Mercantil. Results from the structural equation modeling suggest that variables associating with investments in innovation, which are connected to the innovative effort of a company, do not explain financial performance significantly.     

Expressions of Relationship Networking in International Entrepreneurship

The role of networks is a major factor in the internationalization process for entrepreneurs. In this article, we analyze the influence of social networks in international entrepreneurship. We developed a multiple case study based on a qualitative perspective, selecting four fruit exporters from the Brazil’s semi-arid region and used a qualitative and longitudinal design. These firms are among the largest fruit exporters in Brazil. Content analysis was derived by examining organizational documents, bibliographical material, and semi-structured interviews with 30 managers and consultants. We used ATLAS.ti software to analyze the collected material. The major networks were formed with buyers and competitors, affording benefits such as trust and information; relationships were therefore formed in both vertical and horizontal directions. Consequently, and due to their influence on the internationalization process, social networks are considered a relevant subject in international entrepreneurship. Moreover, the expressions of social networking have interfaces with both the exploration of international opportunities and attitude towards risk, as well as the development of competitive features that are the fundamental dimensions of international entrepreneurship. The results reveal that social networks are fundamental to entrepreneurs’ businesses and are strategic for their development and maintenance. Recognition of such role of these networks in international entrepreneurship is the main contribution of this paper.     

Analysis of an integrated plan for expanding broadband access in Colombia

Colombian telecommunications exhibit remarkable growth in the mobile sector and television market evolution and some degree of stagnation in fixed telephony and broadband access. Only recently the Colombian government has started to seriously address the need to deploy a plan for rapid and effective broadband growth, adding to the worldwide wave of government planned investments on fibre-optic broadband access expansion. This paper analyses the current state of the Colombian government’s broadband plan, named Vive Digital, comparing its proposed actions with the plans and achievements of three OECD countries’ experiences on broadband policies. Several aspects, either collectively or individually, from the three international cases are used as guidelines of what an integrated, efficient broadband policy may be. The analysis takes consideration of the contextual differences between the studied cases for the benefit of identifying the strengths and weaknesses of the Colombian plan, and is focused on the incentive structure needed to advance the development of infrastructure, services, applications and user involvement.     

Book Reviews

Daniel T. Sicular, Scavengers, Recyclers, and Solutions for Solid Waste Management in Indonesia, Monograph No. 32, International and Area Studies, Berkeley: Center for Southeast Asia Studies, University of California at Berkeley, 1992, pp. xii + 201. US$16.50.

Pearl lmada and Seiji Naya (eds), AFTA: The Way Ahead, Singapore: Institute of Southeast Asian Studies, 1992, pp. xv + 143. Paper: S$19.

J.W.T. Bottema, F. Dauphin and G. Gijsbers, Soybean Research and Development in Indonesia, Proceedings of a Workshop held in Cipayung, CGPRT No. 10, Bogor: CGPRT Centre, 1987, pp. 477.

Aman Djauhari, Adimesra Djulin and Irlin Soejono, Maize Production in Java: Prospects for Improved Farm-Level Production Technology, CGPRT No. 13, Bogor: CGPRT Centre, 1988, pp. 50.

World Bank Support for Industrialization in Korea, India, and Indonesia, Washington DC: Operations Evaluation Department, World Bank, 1992, pp. x + 65.

Cornelis Fasseur, The Politics of Colonial Exploifation: Java, the Dutch, and the Cultination System, translated by R.E. Elson and Ary Kraal, edited by R.E. Elson, Studies of Southeast Asia, Ithaca: Southeast Asia Program, Cornel1 University, 1992, pp. 266.

P. Bwmgaard (ed.), The Colonial Past: Dutch Sources on lndonesian History, Bulletin 323, Amsterdam: Royal Tropical Institute, 1991, pp. 64. Dfl. 20.00.

John Sullivan, Local Government and Community in Java: An Urban Case-study, Southeast Asian Social Science Monographs, Singapore: Oxford University Press, 1992, pp. xvii + 242. A$59.95.