Adjusting for risk in comparing the performances of male- and female-controlled SMEs

Small and medium enterprise (SME) research has typically found that female-owned SMEs underperform male-owned SMEs. Further, this underperformance usually persists after controlling for variables such as industry, age of business, and size of business. However, previous studies have normally limited their assessment of performance to sales or profit (or growth in sales or profit) without controlling for differences in risk. Our results indicate that although profits are significantly higher for male-controlled SMEs, so is the variation in profits (risk). After adjusting for risk, we find no significant difference between the performances of male- and female-controlled SMEs.     

Failure Rates for Female‐Controlled Businesses: Are They Any Different?

Previous research has found that female-owned businesses generally underperform male-owned businesses on a variety of measures such as revenue, profit, growth, and discontinuance (failure) rates. It has been suggested that this finding might be the result of systematic differences between male- and female-owned businesses, particularly industry differences. This paper analyzes data from a representative sample of 8,375 small and medium-sized Australian enterprises that originally were surveyed in 1994–95, with follow-up surveys in each of the subsequent three years for a subsample of businesses. The aim was to determine whether female-owned businesses exhibit higher failure rates than male-owned businesses and, if so, whether this finding persists after controlling for industry differences. The results suggest that while female-owned businesses do have higher failure rates compared to male-owned businesses, the difference is not significant after controlling for the effects of industry.     

Clawbacks,Holdbacks, and CEO Contracting

“Clawbacks” are much discussed in the context of senior executive compensation, yet the discussion has largely ignored the presence of holdbacks that are already in place in many firms. Holdbacks are deferred compensation that is potentially foregone in the event that the CEO leaves the firm without good reason or they are dismissed for wrong‐doing. They are explicit or written features of a CEOs employment contract. Holdbacks are already in use at 70% of S&P 500 firms and average $18.4 million each. Firms with higher CEO replacement costs, greater information asymmetry, a recent bad experience (fraud, lawsuit, or restatement), or in more certain environments are more likely to have a holdback. In contrast, clawback adoptions are mainly driven by firms' bad experiences and external pressure from shareholders. Holdbacks and incentive‐based compensation are substitutes, as termination incentives can reduce the need for incentive compensation. As managers reasonably demand a premium for accepting risky compensation, a measure of abnormal compensation is positively associated with holdbacks, but there is no significant association between clawbacks and holdbacks. These findings suggest that the holdbacks many firms already have in place could help an “ex‐post settling up” in the event of financial misconduct, or even simply misstated financials. As companies have more control over the amounts held back ex‐ante, holdbacks are potentially more efficient.     

A synthesis of homelessness in South Africa: A rapid critical appraisal

Homelessness in South Africa requires collaborative research. Social, political, cultural and economic factors that cause homelessness must be considered to develop a common definition and understanding of homelessness. South Africa’s social complexity and diversity make it challenging to construct available results into one conceptual framework, and this in turn complicates national policy implementation and role allocation. By means of a rapid critical appraisal of literature on homelessness in South Africa, researchers provide evidence to direct and structure contextual research pertaining to homelessness. Four themes transpire: conceptualisation; demography; roles and responsibilities of key stakeholders; and strategic policy and research issues. Researchers caution that the findings are not generalisable, because of the rapid nature of the appraisal and possible selection bias of the literature. Measures of validity were used to ensure that the study accomplished its purpose through the key results and to ensure that the results are a true reflection of available evidence.     

On the determinants of yield spreads between mortgage pass-through and Treasury securities

Yield spreads between mortgage pass-through and U.S. Treasury securities may reflect differences in taxation, phenomena affecting relative supply and demand, and compensation for default, call, and marketability risks on mortgage instruments. Our research empirically models differences in yields between pass-throughs and comparable-maturity Treasuries. We find that interest-rate volatility and the term structure of rates, factors often cited in the mortgage pricing literature as affecting the mortgage call premium, are the primary determinants of movements in these spreads. Moreover, these effects have grown in importance in recent years as exercise of the prepayment option has increased. We also find evidence that liquidity and credit concerns affect the pricing of pass-through securities.     

Testing assumptions underlying economic research on transgenic food crops for Third World farmers: Evidence from Cuba, Guatemala and Mexico

Transgenic crop varieties (TGVs) are being promoted as essential for improving small-scale Third World (SSTW) agriculture. Most economic research on this topic makes critical, untested assumptions, including that farmers will choose TGVs over other varieties because TGVs are economically optimal and because farmers are risk neutral profit maximizers. We tested these assumptions using data from a survey of 334 farmers in 6 communities in Cuba, Guatemala and Mexico in which farmers ranked 4 real and hypothetical maize varieties for eating and sowing. Our results did not support these assumptions. Most farmers preferred farmer varieties for sowing and especially for eating, avoiding TGVs, a preference associated with being risk averse and with non-monetary preferences. Farmers more integrated into modern agriculture were more likely to choose TGVs. These results suggest that farmers most in need of support and most important for conserving genetic diversity are least favorable toward TGVs, and that alternative ways of improving SSTW agriculture should receive more attention.     

The seasonal unit root structure in New Zealand Macroeconomic variables

ADF unit root tests are generally applied to macroeconomic data prior to testing theoritical models to ensure that all relevant variables are integrated of the same order. Not only is it important to test that these variables are integrated of the same order but also that a cointegrating relationship exists; failure to do so raise the specture of false inference associated with the spurious regression problem. The seasonal nature of quarterly data adds a further proplem which has generally been overcome by seasonally adjusting the data using procedure such as the census X-11 rather than suppressing it, have attempted to determine whether the seasonal component in each variable exhibits stochastic non-stationary. This paper analysisunit roots in a seasonal setting and compares the recently developed tests for seasonal unit roots as well as the standard augmented Dickey-Fuller zerop frequency unit root tests. Of the variables tested relatively few paper to be integrated at the seasonal frequenciues and, as other studies suggest,determinstic seasonal effects are typically more important than stochastic ones.     

Regime Change and the Role of International Markets on the Stock Returns of Small Open Economies

We examine the influence of US, UK and German macroeconomic and financial variables on the stock returns of two relatively small, open European economies, Ireland and Denmark. Within a nonlinear framework, we allow for time variation via regime switching using a smooth transition regression (STR) model. We find that US (global) and UK and German (regional) stock returns are significant determinants of returns in both markets. Further, global information represented by oil and US asset price movements drive changes between states in each market. Significantly, the role of country‐specific domestic variables is typically confined to a single state while global and regional variables pervade all states.