Analytical Solutions for Expected Loss and Standard Deviation of Loss with an Additional Loan

We evaluate the expected loss and the standard deviation of loss of a bank loan, considering the bank’s strategic control of the expected return on the loan. Assuming that the bank supplies an additional loan to minimize the expected loss of the total loan, we provide analytical formulations for the expected loss and the variance of loss with bivariate normal distribution functions. Using a given expected growth rate and interest rates, two thresholds for the asset/liability ratio can specify three cases. The bank supplies an additional loan to decrease the expected loss in two cases: (i) the asset/liability ratio of the firm is low, and its expected growth rate is high; and (ii) the asset/liability ratio of the firm is high, and the lending interest rate is high. The bank maintains the current loan amount when the asset/liability ratio lies between the two thresholds. Depending on the bank’s strategy, the bank can decrease the initial expected loss of the loan. Conversely, the bank would face a greater risk of the standard deviation of loss.     

The SIML Estimation of Integrated Covariance and Hedging Coefficient Under Round-off Errors,Micro-market Price Adjustments and Random Sampling

For estimating the integrated volatility and covariance by using high frequency data, Kunitomo and Sato (Math Comput Simul 81:1272–1289, 2011; N Am J Econ Finance 26:289–309, 2013) have proposed the separating information maximum likelihood (SIML) method when there are micro-market noises. The SIML estimator has reasonable finite sample properties and asymptotic properties when the sample size is large when the hidden efficient price process follows a Brownian semi-martingale. We shall show that the SIML estimation is useful for estimating the integrated covariance and hedging coefficient when we have round-off errors, micro-market price adjustments and noises, and when the high-frequency data are randomly sampled. The SIML estimation is consistent, asymptotically normal in the stable convergence sense under a set of reasonable assumptions and it has reasonable finite sample properties with these effects.     

What makes a die-hard entrepreneur? Beyond the ‘employee or entrepreneur’ dichotomy

The article makes three contributions to the economics literature on entrepreneurship. We offer a new measure of entrepreneurship which accounts for variations in persistence in self-employment and as a result avoids the weakness of approaches which categorise an individual as an entrepreneur by observing their occupation at just one point in their career. We outline an econometric methodology to account for this approach and find, via a statistical test of model selection, that it is superior to probit/logit models, which have dominated the literature. While our results indicate that this existing literature is good at explaining an individual’s propensity to try self-employment, we find that entrepreneurial persistence is determined by a different model and unearth some new insights. Early self-employment encourages entrepreneurial persistence. For men, inheritance encourages persistence, and facilitates initial self-employment. Having a self-employed father as a role model makes sons persist longer. However, somewhat surprisingly, early experience of unemployment does not affect the probability of self-employment, while reducing persistence. The popular ‘unemployment push effect’ is thus rejected in our sample.

Cultural and Ethical Effects in Budgeting Systems: A Comparison of U.S. and Chinese Managers

This study developed and tested a model of culture’s effect on budgeting systems, and hypothesized that system variables and reactions to them are influenced by culture-specific work-related and ethical values. Most organizational and behavioral views of budgeting fail to acknowledge the ethical components of the problem, and have largely ignored the role of culture in shaping organizational and individual values. Cross-cultural differences in reactions to system design variables, and in the behaviors motivated or mitigated by those variables, has implications for the design and effectiveness of budgeting systems. The data largely support our research model, demonstrating the hypothesized national cultural differences in system design variables (e.g., participation, standards tightness, budget emphasis, etc. which we characterized as the opportunity and incentives to create budgetary slack), and the expected relationship between incentives (but not opportunity) to create slack and slack creation behavior. The data demonstrate hypothesized cultural differences in ethical ideology but show ethical ideology related to slack creation behavior only for U.S. managers. A discussion of the results and their implications is included.     

The Born-Global Phenomenon: A Comparative Case Study Research

This qualitative, case-based research investigates the most relevant traits shown by several new, export-involved born-global firms and their entrepreneurs-managers versus other more traditional and also recently-established exporting SMEs in a specific geographic region inside Spain. More concretely, we aim to shed light on the type of factors and specific conditions underlying the emergence and further expansion of born-global exporters, as compared to other counterparts, which do not share their rapid internationalising character from inception. From our cross-comparison of four firm cases investigated in this setting against a number of factors generally associated with the born-global or gradual internationalisation paths, our results indicate that both constitute two consistent and distinctive patterns of international development. Another relevant finding in this research is that born globals seem indeed to be more entrepreneurial regarding their export entry behaviour into foreign markets than gradual exporters. Relevant academic, managerial, and policy-making implications are also outlined from these results.     

Institutional Barriers to Small- and Medium-Sized Enterprise Operations in Transition Countries

Building on institutional theory and on existing literature regarding barriers to private businesses in transition countries, this paper examines the inter-related effect of nineteen factors grouped into four types of barriers (formal, informal, environmental and skills) on existing small- and medium-sized enterprise operations in Lithuania. Regression analyses on a sample of 332 business owners indicate that perceived formal barriers are associated with perceived informal barriers such as corruption and perceived environmental barriers are associated with perceived skill barriers such as management problems. The transition effect based on business start-up date was not found to play a significant role.     

Global Entrepreneurship Monitor: Data Collection Design and Implementation 1998–2003

The Global Entrepreneurship Monitor research program was designed as a comprehensive assessment of the role of entrepreneurship in national economic growth. The conceptual model reflected in a wide range of factors associated with national variations in entrepreneurial activity and the major contextual features. Empirical tests of the many relationships in the model required four major data collection activities: adult population surveys, unstructured interviews with national experts, self-administered questionnaires completed by national experts, and assembly of relevant standardized measures from existing cross-national data sets. Adult population surveys were implemented to identify those entrepreneurially active, which required a set of precise criteria and careful processing to ensure harmonized counts and prevalence rates across 41 countries. Existing evidence on measures of reliability indicates that the measures met contemporary standards and the project was cost-effective.     

On the Closeness Aspect of Three Voting Rules: Borda – Copeland – Maximin

This paper provides a comparison of three voting rules, the Borda rule, the Copeland rule and the maximin rule. Our analysis based on the rankings derived from those voting rules will shed new light on existing comparisons based on “closeness” between the three voting rules under investigation. In particular it will be shown that both, the rankings derived from the Borda rule and the maximin rule and the rankings derived from the Copeland rule and the maximin rule, will be exactly the opposite for certain preference profiles.     

Using sublexical priming to enhance brand name phonetic symbolism effects in young children

We examine whether phonetic symbolism effects are conditional on the development of phonological awareness (an ability to recognize sounds in words). Further, we introduce sublexical priming as a means to enhance phonetic symbolism effects. Across four experiments, we demonstrate that product evaluations, consistent with phonetic symbolism theory, are more (less) likely when a child is older (younger). Specifically, older children who can recognize sounds in words perceive back vowel brand names (e.g., Vopoz) as slower, heavier, larger, smoother, creamier, chewier, and thicker than brand names with front vowel sounds (e.g., Vipiz). In addition, we show that phonetic symbolism effects manifest when younger children (low in phonological awareness) are primed to focus on parts of a word/s, which we term sublexical priming. We present embedded tasks and chunking of brand names as strategic communication techniques that can be implemented as sublexical primes to enhance phonetic symbolism effects in younger children.     

Gefährdet TTIP die ökonomische Zukunftsfähigkeit?

This article contributes to the discussion on the economic effects of TTIP by focusing on the opportunities for the participating economies of enhancing their innovative capacities. Referring to the insights of Neo-Schumpeterian evolutionary innovation economics the article concludes that according to the currently published documents the legal properties of TTIP can harm the ability of states to adapt their regulatory standards — a main instrument for a dynamic and technology-specific innovation policy. The missing flexibility for the new supranational standards can be a major reason for difficulties in the reform of standards aiming at a “creative disturbance” of market processes by the state in order to stimulate innovative activities and to induce additional growth.