Secured Creditor Recovery Rates from Management Buy‐outs in Distress

Buy‐out literature suggests that secured creditors will recoup substantial proportions of the funds they extend to finance the initial buy‐out. This paper uses a unique dataset of 42 failed MBOs to examine the extent of credit recovery by secured lenders under UK insolvency procedures and the factors that influence the extent of this recovery. On average, secured creditors recover 62 per cent of the amount owed. The percentage of secured credit recovered is increased where the distressed buy‐out is sold as a going concern and where the principal reason for failure concerns managerial factors. The presence of a going concern qualification in the audit report and the size of the buy‐out reduce the recovery rate by secured creditors.     

Fundamentals and devaluation expectations in target zones: Some new evidence from the ERM

The credibility of exchange rate target zones for four EMS countries for the period March 1979-September 1992 is examined. Existing methods by Svensson, Edin and Vredin, typically applied to data from the Nordic countries, are considered. On balance, the method suggested by Edin and Vredin provides somewhat better estimates of devaluation probabilities than either of Svensson's methods. While all methods produce reasonably good estimates of the expected size of devaluations, they did not predict the September 1992 EMS crisis. However, we find that electoral and other institutional variables improve estimates of devaluation expectations.     

British central government and “the mercantile system of double entry” bookkeeping: a study of ideological conflict

The study examines the contest between rival interests following the Treasury's decision to explore the potential of “the mercantile system of double entry” bookkeeping as the basis for recording and reporting the financial affairs of British central government. At the heart of the ensuing dispute was an ideological conflict between individuals representing the competing interests of the aristocracy and those of the new capitalist classes. The battleground was whether the mercantile system of double entry should be designed to reflect the “old society” priorities of stewardship, patronage and personal accountability or “new society” pressure for a business framework judged capable of achieving “cheap and efficient government”.     

Population Pessimism and Economic Optimism in the Asian Giants

The timing of China’s and India’s demographic transitions and the implications of alternative fertility scenarios are explored here using a global economic model incorporating full demographic behaviour and measures of dependency that accurately reflect the changing proportion of workers, rather than working‐aged, in the total population. The baseline scenario confirms that demographic change in India may yield significant gains to future real per capita income, resulting from a continuing sharp decline in its total dependency ratio. For China, these gains are largely in the past, although the positive contribution of declining youth and working‐aged dependency to future per capita income will continue to offset the negative impact of rising aged dependency through to 2030. Whilst a policy change to foster higher fertility rates and hence more rapid population growth in China might ultimately ease its dependency burden, in the short run it will increase it. In any case, such a course is contradictory to the goal of delivering improvements in real per capita income. For India, we confirm that the benefits of further fertility reductions, in the form of increased real per capita income, are substantial.     

From the Digital Internet to the Physical Internet: A Conceptual Framework With a Stylized Network Model

Despite the increasing academic interest and financial support for the Physical Internet (PI), surprisingly little is known about its operationalization and implementation. In this paper, we suggest studying the PI on the basis of the Digital Internet (DI), which is a well‐established entity. We propose a conceptual framework for the PI network using the DI as a starting point, and find that the PI network not only needs to solve the reachability problem, that is, how to route an item from A to B, but also must confront a more complicated optimality problem, that is, how to dynamically optimize a set of additional logistics‐related metrics such as cost, emissions and time for a shipment. These last issues are less critical for the DI and handled using relatively simpler procedures. Based on our conceptual framework, we then propose a simple network model using graph theory to support the operationalization of the PI. The model covers the characteristics of the PI raised in the current literature and suggests future directions for further quantitative analyses.     

Developing Country Interests in Agricultural Trade Reform

This paper examines whether developing countries, as a group, would be better off in the absence of agricultural protection in the industrial North and, if so, whether they should support reforms negotiated between the major players in the Uruguay Round. Results from the Tyers-Anderson GLS model of world food markets suggest that the net effect of industrial country agricultural protection is beneficial to developing countries, though by only a small margin, even if its removal were to stimulate accelerated technical change in developing countries. The same is found to be true of partial reforms which are more palatable politically, such as quotas to reduce oversupply in the EC. Of course, many developing countries, including those which are members of the Cairns Group, are badly hurt by protection in the North. Unfortunately, however, they and the other members of that group stand to gain comparatively little from the reduction of oversupply in the EC through quotas.     

Towards an Integrative Model of Small Firm Internationalisation

Firm internationalisation has long been regarded as an incremental process, wherein firms gravitate towards psychologically close markets and increase commitment to international markets in a gradual, step-wise, manner through a series of evolutionary stages. However, much of the recent literature provides clear evidence of rapid and dedicated internationalisation by born global firms. Typically, these are smaller entrepreneurial firms that internationalise from inception, or start to shortly thereafter. Their main source of competitive advantage is often related to a more sophisticated knowledge base. In addition, the authors have found evidence of firms supporting this born global pattern of behaviour but also evidence of firms that suddenly internationalise after a long period of focusing on the domestic market. These born-again globals appear to be influenced by critical events that provide them with additional human or financial resources, such as changes in ownership/management, being taken over by another company with international networks, or themselves acquiring such a firm. Based upon the extant literature and our own research, we propose an integrative model that recognises the existence of different internationalisation pathways. We then explore differences in behaviour due to the firm's internationalisation trajectory and discuss the strategic and public policy implications.