Judo Strategy: 10 Techniques For Beating A Stronger Opponent

The idea of judo economics, building on analogies with the sport of judo, has been around for at least 20 years. But taking these ideas further to judo strategy means that a framework of strategic principles can be developed to help companies put stronger opponents on the mat.     

Cognitive processing models in performance appraisal: evidence from the Malaysian education system

The effectiveness of the decision‐making process in appraisal has been of long‐standing interest. This paper reports the results of research exploring the extent to which those undertaking appraisals apply systematic processes to their decision‐making, represented in terms of the cognitive processing models applied by appraisers. Results of 22 cognitive mapping interviews exploring appraisal practice, undertaken with appraisers in the Malaysian education system, are described. The resultant cognitive maps have been explored for what they tell us about the cognitive processing models underlying appraisers' decision‐making. Results suggest that the practice of appraisal evidenced in interviews demonstrates the presence of cognitive processing that reflects theoretical cognitive processing models, although some differences are observed between less experienced and experienced appraisers' models. Implications from the interview findings for the practice of appraisal are identified.     

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.     

The New Growth Theory and Coasean economics: Institutions to capture externalities

The New Growth Theory and Coasean Economics: Institutions to Capture Externalities. — This paper presents the main theoretical arguments which lead many adherents of the New Growth Theory to the conclusion that externalities in research and development are important for economic growth and warrant government subsidies. In contrast, the authors point to private institutions like associations, company structures and industry clusters which can capture such externalities. An international comparison of private R&;D investment and special features of institutions in Switzerland and Japan are in line with this hypothesis. Thus, the argument for R&;D subsidies made by the New Growth Theory is considerably reduced.     

Syndicated Loan Announcements and Borrower Value

Announcements of syndication loans increase borrowers' shareholder wealth if they are revolving credit agreements but not if they are term loans. Share price responses to revolving credit announcements are positive and significant, whereas the wealth effect for term loans is negative and significant. The results show that announcements from both the financial press and commercial information providers can affect borrower share price reaction. Overall, single syndication announcements appear to be more newsworthy than multiple announcements reported in the financial press, and we find evidence of information leakage, post‐announcement drift, or both.     

HOW TO CLEAR UP THE PENSIONS MESS

All three pillars of the British pensions system are crumbling. The basic state pension is unsustainable in its present form. Defined benefit occupational pension schemes are fast disappearing, and with them the retirement hopes of millions of workers. A further 3 million low-income earners are not saving enough for their retirement. And uncertainty about pensions choices is widespread. In each case the primary cause of the problem is governmental or regulatory failure. The paper makes eight general and four specific proposals for restoring the system.