The choice between joint ventures and acquisitions in foreign direct investments: The role of partial acquisitions and accrued experience

In order to avoid the liability of foreignness, firms invest in foreign countries pooling their own resources with those of local firms. This combination of assets may take place through joint ventures or acquisitions. When facing the need to choose between these two entry modes, managers find that there are two critical factors that have received little attention in previous research: the existence of different types of acquisitions—full acquisitions, pure partial acquisitions, and shared partial acquisitions—and the role of the experience accrued by the investing firm in carrying out investments through a particular entry mode. Both factors, as well as their managerial implications, are analyzed in this article. © 2004 Wiley Periodicals, Inc.     

Consumption structure and atmospheric pollution in Spain: towards a higher sustainability

The aim of this paper is to analyse the responsibility of Spanish demand composition (particularly private and public consumption) in the actual levels of atmospheric pollution in Spain. To that end, and on the basis of an input–output model, we set out to identify the environmental pollution generated both directly and indirectly by the economic sectors in order to obtain a determined final demand. We focus on three atmospheric pollutants, namely SOx, NOx and CO₂. After identifying the key sectors in the generation of these types of pollution, we estimate the effect that a change in final consumption will have on the global level of pollution. As a consequence, we can evaluate the effectiveness of different demand policies when seeking to control this global pollution. These policies, directed mainly towards a change in private and public consumption, can hopefully contribute towards the objective of achieving sustainable development.     

Franchisee-based brand equity and performance

This study focuses on the perceptions of franchisees and analyzes the influence of brand equity on franchisee performance. The factors that constitute brand equity are also assessed. Factor analysis was used to generate valid and reliable scales based on a sample of 205 Portuguese franchisee firms, and structural equation modeling methodology was then employed in the analysis. The results show franchisee-based brand equity (FBBE) to be a multivariate factor with strong influence on performance. This study contributes significantly to the literature by showing the perspective of franchisees toward franchising. It also has implications on the adequacy of corporate strategy in achieving performance.     

Structural change and female participation in recent economic growth: a multisectoral analysis for the Spanish economy

ABSTRACT

Economic growth has different impacts on gender gaps. In recent decades the growing participation of women in the labour market has reduced the gender employment gap, however a notable gender pay gap still persists standing at around 15% on average in the European Union. In this context, this paper evaluates the impact of economic growth patterns on the evolution of gender employment and pay gaps. First, sectorial feminization, direct discrimination, and structural change factors are identified and evaluated as ways to explain changes observed in the gender pay gap. Second, we explore the influence of demand, technology, and intensity factors on the evolution of employment combining gender, skill, sectorial, and temporal perspectives. As a case study, we examine Spanish economic growth from 1980 to 2007 and the influences on the size, composition (by skill), and distribution (by sector) of female and male employment, as well as the consequences for gender gaps. Our results show that structural change contributed to reduce the gender employment gap in Spain; while the evolution of the gender pay gap is less conclusive, following a sort of inverted U-shape. This paper shows the suitability and potential of the multisectorial input–output framework to analyse structural and technological changes and their impacts on the gender employment and pay gaps.     

Determinants shaping the international currency system: Where do currencies stand relative to their equilibria?

Using a sample of 27 currencies, we empirically test the role of a large set of determinants potentially underlying currencies' share in the international currency system, providing, to the best of our knowledge, the most comprehensive study of this kind so far. We propose a new global indicator that quantifies the international use of currencies on the basis of three dimensions—medium of exchange, unit of account and store of value. From a range of indicators including openness, financial development and institutional development indicators, we uncover several variables that are significant in explaining the international status of currencies, hence contributing to understanding the role of the determinants shaping the international currency system. We also investigate the long-run equilibrium values for currency shares, allowing us to score currencies on the basis of the potential stemming from the determinants. We contribute to the debate on international currencies' prospects, not only by looking at much discussed currencies such as the US dollar, the euro and the Chinese renminbi, but also by uncovering potential of emerging currencies. This knowledge is of the utmost importance for the debate on the reform of the international monetary system—from the point of view of academics, policymakers and market practitioners.     

Testing for horizontal and vertical foreign investment spillovers in China, 1998–2007

As with many developing countries, the Chinese government hopes that knowledge brought by multinationals will spill over to domestic industries and increase their productivity. In this paper, we show that foreign investment originating outside of Hong Kong, Macau, and Taiwan has positive effects on individual firm level productivity, while foreign investment from HKMT firms does not. We also test for both horizontal (within the same industry) and vertical (upstream or downstream) linkages from foreign investment. Using a manufacturing firm-level panel for 1998 through 2007, we find zero or weak positive horizontal externalities. However, our results show that foreign direct investment (FDI) has generated positive productivity spillovers to domestic firms via backward linkages (the contacts between foreign affiliates and their local suppliers in downstream sectors) as well as forward linkages (between foreign suppliers and their local buyers in the upstream sectors).     

Alternative Monetary Targets,Instruments and Future Monetary Policy Frameworks

ABSTRACT

This article expands on the debate of whether merely controlling inflation can be considered a good outcome in terms of monetary policy, discussing proposals for adopting alternative monetary targets (e.g., price level, nominal GDP), alternative instruments (e.g., monetary finance, central bank digital currencies), for enlarging central banks' mandates (e.g., incorporating employment, wages, inequality, environmental objectives) and for the design of future monetary policy frameworks.

We argue that in the coming years, central banks should not simply maintain their pre-2008 standards by de-implementing unconventional monetary policies. Instead, they must take advantage of their past and recent experiences in order to improve, under an evolutionary perspective, future monetary policy and financial stability frameworks. Based on this, measures implemented since the 2008 crisis would have three possible treatments in new frameworks: i) be discarded, due to their predominantly adverse effects; ii) not be regularly implemented, but be used as backstop mechanisms if needed; iii) be incorporated as regular measures of monetary policy/financial stability frameworks. Accordingly, monetary and financial stability authorities will increasingly need to evolve and engage in a continuously adaptive and innovative process in order to face challenges posed by financial markets that are becoming more dynamic, innovative, complex, interconnected and globalised.     

Crossing the Great Divide: Ostrom’s Coproduction and the Economics of Aged Care

As the first woman to win the Nobel Prize in economics, Elinor Ostrom has attracted the interest of many feminist economists. Best known for her work on common pool resources, Ostrom made numerous theoretical and methodological contributions to economics, many of which are useful for feminist economists. This paper explores Ostrom’s work on coproduction: the active participation of individuals who receive a good or service in the production process. A particular focus is on how Ostrom’s model of coproduction might be applied and extended to capture the characteristics and circumstances of aged care. Data from interviews with women employed in Australia’s aged-care sector are used to inform a discussion of coproduction in aged care and the institutional supports necessary for successful outcomes. Key issues include the skills and resourcing of aged-care workers, and their authority to negotiate care practice with care recipients under current governance arrangements.     

Inflation expectations in the euro area: are consumers rational?

In this paper, we propose a quantitative measure for inflation expectations based on consumer survey data. Thereafter, we proceed to testing the rationality assumption. This issue is of noteworthy interest in its own as it is commonly assumed in the theoretical modelling literature that the rational expectations hypothesis holds. This analysis is conducted for the euro area as a whole, as well as for several member countries, using a sample covering the last two decades. Moreover, we also assess if the conclusions hold when one focuses on the post-euro introduction period.     

Supporting the Endogenous Relationship Between Well-Being and Employment for US Individuals

We test the existence of an endogenous relationship between well-being and employment for US individuals. To that end, we use a simultaneous equation generalized Probit model applied to four recent waves of the National Health Interview Survey (1997–2000). Our results do not enable us to accept the hypothesis that there is a significant effect from employment status to subjective well-being. In contrast, we provide evidence that suggest that well-being is positively correlated to the probability of having a job.