The Financing of Research and Development

Evidence on the ‘funding gap’ for R&D is surveyed.The focus is on financial-market reasons for under-investmentin R&D that persist even in the absence of externality inducedunder-investment. The conclusions are that (i) small and newinnovative firms experience high costs of capital that are onlypartly mitigated by the presence of venture capital; (ii) evidencefor high costs of R&D capital for large firms is mixed,although these firms do prefer internal funds for financingthese investments; (iii) there are limits to venture capitalas a solution to the funding gap, especially in countries wherepublic equity markets are not highly developed; and (iv) furtherstudy of governmental seed capital and subsidy programmes usingquasi-experimental methods is warranted.     

The Internet and Christianity in Asia: Cultural Trends,Structures and Transformations

The internet has not as yet transformed the majority of Asian nations into open, liberal and democratic societies. Although it has had a significant impact, particularly on business, advertising expenditures, gaming, ICQs and other such aspects of consumption and entertainment, and in some parts of Asia (particularly in well‐networked nations like Singapore, Japan, South Korea, Hong Kong, Malaysia, Taiwan and others), its development and impact have been uneven, predictably tending to follow the existing patterns of socio‐economic development. One area which has not received much scholarly attention is the internet and religion, which is significant in that structural characteristics and trends appear to be privileging the phenomenon of global Christianity, at the cost of the traditional religions such as Hinduism, Islam and Buddhism which have dominated Asian societies. The tendency for internet and evangelical Christian cultures to converge in a number of key Asian nations (and predictably, for both to be absent in other nations at the opposite end of the techno‐cultural spectrum) results in an alternative mapping and conceptualization of Asia in which communicatively and culturally ‘open’ societies are contrasted with ‘closed’ ones, a distinction which is the more pronounced because it is corroborated by several cultural parameters (the history of the nation's interaction with foreign powers in the age of European imperialism, economic development, communications policies and infrastructures, ethnicity, religious tolerance, and so on). This mapping re‐writes many received groupings and associations of Asian nations in terms of ethnicity, religion and political affiliations. Internet n’a pas encore changé la majorité des nations asiatiques en sociétés démocratiques, libérales et ouvertes. Il a eu une forte incidence, notamment au plan affaires, dépenses publicitaires, jeux, messageries instantanées (ICQ) et autres aspects liés à la consommation et aux loisirs, ainsi que dans certaines régions d’Asie (en particulier dans les nations dotées de réseaux: Singapour, Japon, Corée du Sud, Hong‐Kong, Malaisie, Taiwan, etc.). Pourtant, son développement a été irrégulier suivant, comme on pouvait s’y attendre, les schémas existants d’expansion socio‐économique. Les intellectuels se sont peu attachés à un domaine, à savoir internet et la religion, alors qu’il est significatif puisque tendances et caractéristiques culturelles semblent privilégier le Christianisme mondialisé, aux dépens des religions traditionnelles tels l’Hindouisme, l’Islam et le Bouddhisme qui ont dominé les sociétés asiatiques. La tendance à la convergence d’internet et des cultures chrétiennes évangéliques vers plusieurs nations asiatiques cruciales (et, de manière prévisible, à leur absence d’autres nations situées à l’autre extrémité du spectre techno‐culturel) produit une cartographie et une conceptualisation alternatives de l’asie où des sociétés ‘ouvertes’ au plan communications et culture sont mises en opposition avec des sociétés ‘fermées’, distinction particulièrement prononcée car elle correspond à plusieurs paramètres culturels (histoire nationale de l’interaction avec des puissances étrangères à l’époque de l’impérialisme européen, développement économique, politiques et infrastructures de communications, ethnicité, tolérance religieuse, entre autres). Cette cartographie récrit nombre des regroupements et associations établis de nations asiatiques en termes d’ethnicité, de religion et d’affiliations politiques.     

Improved estimation of portfolio value‐at‐risk under copula models with mixed marginals

Portfolio value‐at‐risk (PVAR) is widely used in practice, but recent criticisms have focused on risks arising from biased PVAR estimates due to model specification errors and other problems. The PVAR estimation method proposed in this article combines generalized Pareto distribution tails with the empirical density function to model the marginal distributions for each asset in the portfolio, and a copula model is used to form a joint distribution from the fitted marginals. The copula–mixed distribution (CMX) approach converges in probability to the true marginal return distribution but is based on weaker assumptions that may be appropriate for the returns data found in practice. CMX is used to estimate the joint distribution of log returns for the Taiwan Stock Exchange (TSE) index and the associated futures contracts on SGX and TAIFEX. The PVAR estimates for various hedge portfolios are computed from the fitted CMX model, and backtesting diagnostics indicate that CMX outperforms the alternative PVAR estimators. © 2006 Wiley Periodicals, Inc. Jrl Fut Mark 26:997–1018, 2006     

PLANNING MULTIPLE LOCATION INVENTORIES

Supplying customer demand from comparable alternate inventory locations when an item is out of stock at its primary stocking point creates a virtual inventory for that item. The expectation is that if more inventories can be drawn upon, the inventory for an item would be lower, the fill rate would be higher, or both. While generally true that safety stocks will be lower, regular stocks, on the other hand, may rise with such cross filling of demand. In this study, a methodology is developed that balances the cross filling effects on both regular and safety stocks for determining whether an inventoried item should be cross‐filled. An example and guidelines are given to show how the methodology can be simplified and applied in practice.     

RELATIONSHIP MAGNITUDE AND ITS ROLE IN INTERORGANIZATIONAL RELATIONSHIP STRUCTURE

Close relationships between and among supply chain members are becoming more prevalent. However, there is lack of agreement in the literature and in practice concerning the characteristics of different interorganizational relationships. The resultant confusion is an obstacle to the progression of research and could cause problems among firms in a supply chain. Based on previous research and an exploratory study conducted with company executives responsible for supply chain management activities, this article seeks to introduce the concept of relationship magnitude (i.e., the extent or degree of closeness or strength of the relationship) and differentiate it from relationship type (i.e., classes of relationships that share common traits). Implications for managers and opportunities for future research are provided.     

Actual experience,potential experience or age,and labor force participation by married women

In this paper, the limitations of potential experience and age as proxies for market experience are discussed. Results from a conditional logit model estimating the probability of participation by married women are sensitive to the measure of experience used in the empirical specification. Married women usually have noncontinuous labor market histories so age and potential experience will fall short of actual experience. Direct information about a woman's labor market history is necessary in empirical studies of the market behavior of married women.     

Partial Privatization,Foreign Competition,and Optimum Tariff*

Using a simple international mixed oligopoly model with one public and one or more foreign firms, this paper examines the effect of partial privatization or foreign competition on optimum tariffs and finds that foreign competition lowers the optimal tariff rate but partial privatization raises it. This result implies that trade liberalization is welfare improving if a country opens up its economy by allowing foreign competition. However, the liberalization policy is not desirable when the country only partially or completely privatizes its publicly‐owned enterprises.     

A MULTINOMIAL APPROXIMATION FOR AMERICAN OPTION PRICES IN LÉVY PROCESS MODELS

This paper gives a tree-based method for pricing American options in models where the stock price follows a general exponential Lévy process. A multinomial model for approximating the stock price process, which can be viewed as generalizing the binomial model of Cox, Ross, and Rubinstein (1979) for geometric Brownian motion, is developed. Under mild conditions, it is proved that the stock price process and the prices of American-type options on the stock, calculated from the multinomial model, converge to the corresponding prices under the continuous time Lévy process model. Explicit illustrations are given for the variance gamma model and the normal inverse Gaussian process when the option is an American put, but the procedure is applicable to a much wider class of derivatives including some path-dependent options. Our approach overcomes some practical difficulties that have previously been encountered when the Lévy process has infinite activity.     

Industrial Targeting and Non‐shiftable Capital in the Harris–Todaro Model*

This paper shows that, in the 2 × 3 sector‐specific capital Harris–Todaro model, capital growth owing to either domestic or foreign investment always enhances the welfare of the country (i.e. non‐immiserizing), and this result of non‐immiserizing foreign investment holds regardless of initial holdings of foreign capital; the policy of industrial targeting via capital investment is more effective vis‐à‐vis the (neoclassical) 2 × 2 mobile‐capital Harris–Todaro model or the Heckscher–Ohlin model; in contrast to the recent generalization by Marjit and Beladi (2003 ), capital growth cannot be immiserizing in the present model, even if it destroys the “envelope theorem.”