Business cycle and aggregate industry mergers

This paper tests the relationship between industry-level mergers and business cycle using panel tests that allow us to control for macro-economic and industry-level determinants of merger activity. We find robust evidence that both related and unrelated industry-level mergers are pro-cyclical. However, the evidence is asymmetric between related and unrelated mergers. We also find strong evidence in support of two major theories of merger activity that have been proposed and tested in the existing literature, namely, neoclassical theory and behavioral theory. The proxies of both neoclassical and behavioral theories explain merger activity in general; however, the pro-cyclicality of mergers is not fully captured by any of these proxies, individually or collectively.     

Of poisoners, tanners and the British Raj: redefining Chamar identity in colonial North India, 1850–90

This article explores colonial representations of the crime of cattle poisoning and uses it as a starting point to investigate questions related to the formation of Chamar identity. Starting from the 1850s, it looks at the process whereby the caste group was imbued with certain undesirable traits of character. Simultaneously, it also explores the larger trend towards fixing the caste with certain occupational traits, so that it began to be identified completely with leather work by late nineteenth century. The role of new specialisms such as ethnography, toxicology and medical jurisprudence in the formation of new definitions about Chamars is also highlighted. The overall aim of the article is to reveal the complexities involved in the formation of colonial discourse about caste and caste groups.     

Managing knowledge: changing ways of wealth creation

R&D will have to be at the core of enterprises which expect to prosper in the new economy. Investors now realise there is a link between R&D investment and long-term growth, so share prices are boosted for companies which know how to extract value from R&D spending. The IT and pharmaceutical industries are probably the leaders in new ways of managing knowledge more effectively.     

MULTIVARIATE COINTEGRATION APPROACH TO THE DETERMINATION OF RESERVES AND BANK CREDIT: A CASE STUDY OF TURKEY*

The paper estimates both long-run reserves and long-run money demand equations using the multivariate cointegration approach. An economic model is constructed, based on the monetary approach to balance of payments in which the monetary authorities can control money supply through changes in bank credit. The vector auto-regressive methodology is used to derive latent equilibrium relationships, and the short-run error correction equations are estimated for both nominal money stock and reserves. A response function for the short-run changes in bank credit is developed. Given the institutional system and slow adjustments, a response function of changes in bank credit to lagged changes in reserves performs well for the period 1960–88.     

Wealth Effects of Acquiring Financially Distressed Firms

The purpose of the present research is to study target and acquirer shareholder wealth effects of acquisition announcements in which the target is financially distressed. The abnormal returns and the dollar abnormal gains to both the target and acquiring firms are examined according to whether the mode of acquisition is a merger or a tender offer. A regression analysis is also undertaken to examine the importance of the mode of acquisition, an industry effect, and tax variables in determining the abnormal dollar gains in acquisitions of financially distressed targets.     

Deposit insurance subsidies,moral hazard,and bank regulation

The model developed in the paper separates deposit insurance subsidies into two components: a premium-linked subsidy which arises from an ex-ante mispricing of the deposit insurance premium, and an asset-linked subsidy which arises from a lack of ex-post monitoring of the bank's actions. The identification of these two subsidies provides important insight into the relation between deposit-insurance subsidies and bank risk. The asset-linked subsidy is higher for banks of average risk and lower for very-high and very-low risk banks. The premiumlinked subsidy behaves differently under risk-adjusted and fixed-rate premiums. The model also indicates that the implementation of a riskadjusted insurance-rate schedule alone would not be sufficient to eliminate the bank's excessive risk-taking behavior. Thus, some combination of risk-sensitive deposit-insurance pricing and regulatory control is necessary to reduce the moral hazard problem.     

The curse of globalised culture: the fall of Indian cinema foretold

Indian popular cinema, at the present juncture, is caught in a fix marked by two opposite trends—the overall decline in quality of the modern film resulting in rejection by audiences (as seen in endless commercial failures) and the nostalgic reverence among people about the classic films of earlier years, which had entertained and mesmerised them in a discourse that was beautiful, exciting and emotionally satisfying. This paper argues that the current decline in quality is part and outcome of the wider globalisation processes, consequently delinking cinema from the earlier creative roots. In this context, it makes some projections about the future of this cinema (and television) and suggests a set of future options to resurrect it from its present decline and to help the medium reinvent its past glory and social relevance.