Developing marketing capabilities for customer value creation through Marketing-Sales integration

The capacity to create superior customer value stems from the marketing capabilities a company possesses. A considerable body of research has indicated that market oriented companies have distinctive marketing capabilities which lead to superior organizational performance. Although it has been widely recognized that the development of marketing capabilities requires the joint effort of Marketing and Sales departments, almost no attention has been devoted to investigating the integration of these two functions. This study reports on an exploratory effort to use the means-end theory in explaining Marketing-Sales integration. Findings show that Marketing-Sales integration is a multi-faceted construct made up of different components that impact different marketing capabilities and highlight its antecedents and consequences.     

Does bank capital affect lending behavior?

This paper investigates the existence of cross-sectional differences in the response of lending to monetary policy and GDP shocks owing to differences in bank capitalization. It adds to the literature by using the excess capital-to-asset ratio, which can better control the riskiness of banks' portfolios, and by disentangling the effects of the “bank lending channel” from those of the “bank capital channel.” The results, based on a sample of Italian banks, indicate that bank capital matters in the propagation of different types of shocks to lending, owing to the existence of regulatory capital constraints and imperfections in the market for bank fund-raising.     

Optimal Decision-Making with Time Diversification

One of the most enduring topics in financial theory is thepersistence of investment risk across time. Traditional financelacks methods for considering and hedging non-diversifiablerisks. This paper is based on the general equilibrium model ofAllen and Gale (1997). We extend their model in variousdirections: the intermediary is a firm and not a planner,financial markets are assumed to be incomplete, and the mechanismof intergenerational risk-sharing is endogenously determined. Ourmodel allows for the analysis of optimal behavior of individualsand the intermediary together with the respective feedbackprocesses.     

Monetary policy and financial stability: What role for the futures market?

This paper examines interactions between monetary policy and financial stability. There is a general view that central banks smooth interest rate changes to enhance the stability of financial markets. But might this induce a moral hazard problem, and induce financial institutions to maintain riskier portfolios, the presence of which would further inhibit active monetary policy? Hedging activities of financial institutions, such as the use of interest rate futures and swap markets to reduce risk, should further protect markets against consequences of unforeseen interest rate changes. Thus, smoothing may be both unnecessary and undesirable. The paper shows by a theoretical argument that smoothing interest rates may lead to indeterminacy of the economy's rational expectations equilibrium. Nevertheless, our empirical analysis supports the view that the Federal Reserve smoothes interest rates and reacts to interest rate futures. We add new evidence on the importance for policy of alternative indicators of financial markets stress.     

Entrepreneurial finance and economic growth

This paper develops a theory of the centralization of firms engaged in multi-market collusive agreements. A centralized organization (called the unitary or U-form) allows price coordination across several markets, whereas with decentralized (the multidivisional or M-form) firms the probability that the antitrust authority will find evidence of collusion on one market while investigating the other is lower. We show that the firm’s choice of internal structure depends to a large extent on product substitutability and the instruments used by the antitrust authority.     

A transaction level study of the effects of central bank intervention on exchange rates

We study the effects of sterilised intervention operations executed on behalf of the Swiss National Bank (SNB) using tick-by-tick transactions data between 1986 and 1995. We extend the preliminary analysis of [Economic Journal 109 (1999) 662] by matching these data with indicative intra-day exchange rate quotes and news-wire reports of central bank activity. Using an event study approach we find that intervention has important short-run effects on exchange rate returns. In particular, among various results, we find that i) intervention has a stronger impact when the SNB moves with-the-market and when its activity is concerted with that of other central banks and ii) exchange rate returns move in the 15 min interval prior to interventions.     

Do Some Forms of Financial Flows Help Protect Against "Sudden Stops"?

There is a debate on whether some forms of financial flows offerbetter protection against crises than others. Using a largepanel data set that includes advanced, emerging, and developingeconomies during 1970–2003, this article analyzes thebehavior of several types of flows: foreign direct investment(FDI), portfolio equity investment, portfolio debt investment,other flows to the official sector, other flows to banks, andother flows to the nonbank private sector. Differences acrosstypes of flows are limited with respect to volatility, persistence,cross-country comovement, and correlation with growth at homeor in the world economy. However, consistent with conventionalwisdom, FDI is the least volatile form of financial flow, whenthe average size of net or gross flows is taken into account.The differences are striking during "sudden stops" in financialflows (defined as drops in total net financial inflows of morethan percentage points of GDP compared with the previous year).In such episodes, FDI is remarkably stable, and portfolio equityseems to play a limited role. Portfolio debt experiences a reversal,though it recovers relatively quickly, and other flows (includingbank loans and trade credit) experience severe drops and oftenremain depressed for a few years.