Credit information sharing and banking crises: An empirical investigation

We study the effect of credit information sharing on the likelihood of banking crises using a comprehensive cross-country dataset for the period from 1975 to 2006. The empirical analysis shows that credit information sharing reduces the likelihood of banking crises and it does more so in low income countries. The effect is statistically and economically significant, and applies to both public registries and private bureaus. Furthermore, we show that credit information sharing reduces the impact of rapid credit growth on banking crises. Specifically, rapid credit growth is less likely to lead to a banking crisis in countries with credit information sharing.     

The Impact on UK Acquirers of Domestic, Cross‐border, Public and Private Acquisitions

Abstract:   We examine the announcement and post‐acquisition share returns of UK acquirers in over 4,000 acquisitions of domestic, cross‐border, public and private targets. Domestic public acquisitions result in negative announcement and post‐acquisition returns, whilst cross‐border public acquisitions result in zero announcement returns and negative post‐acquisition returns. In contrast, both domestic and cross‐border private acquisitions result in positive announcement returns and zero post‐acquisition returns. The main differences between private and public acquisitions are that glamour acquirers underperform in public acquisitions but not in private acquisitions, and that acquirers using noncash methods of payment underperform in domestic public acquisitions but not in domestic private acquisitions. Overall, cross‐border acquisitions result in lower announcement and long run returns than domestic acquisitions. In cross‐border acquisitions, those involving high‐tech firms perform relatively well, as do those with low national cultural differences.     

Combining Data from Surveys and Administrative Record Systems. The Norwegian Experience

At Statistics Norway administrative data have been extensively used in order to improve the quality of survey data. Various techniques have been used to reduce sampling variance and/or to reduce the effects of non-response. In the present article some of the most commonly used methods are being presented, and based on empirical rather than theoretical evaluations, we give our conclusions concerning their potentials and limitations.     

Estimating Returns on Commercial Real Estate: A New Methodology Using Latent-Variable Models

Despite their widespreao use as benchmarks of U.S. commercial real estate returns, indexes produced by the National Council of Real Estate Investment Fiduciaries (NCREIF) are subject to measurement problems that severely impair their ability to capture the true risk–return characteristics–especially volatility–of privately held commercial real estate. We utilize latent-variable statistical methods to estimate an alternative index of privately held (unsecuritized) commercial real estate returns. Latent-variable methods have been extensively applied in the behavioral sciences and, more recently, in finance and economics. Unlike factor analysis or other unconditional statistical approaches, latent variable models allow us to extract interpretable common information about unobserved private real estate returns using the information contained in various competing measures of returns that are measured with error. We find that our latent-variable real estate return series is approximately twice as volatile as the aggregate NCREIF total return index, but less than half as volatile as the NAREIT equity index. Overall, our results strongly support the use of latent-variable statistical models in the construction of return series for commercial real estate.     

Branding without Unique Brands: Managing similarity and difference in a public sector context

Abstract

Corporate branding requires organizations to focus on uniqueness and differentiation. At the same time, public institutions must provide equal services in order to gain legitimacy. Hence, corporate branding in the public sector organizations has to handle two concerns simultaneously – securing legitimacy and building reputation. We examine this tension through interviews with communication managers in Norwegian hospitals. Despite large investments in techniques borrowed from corporate branding, the informants were reluctant to talk about branding. Instead, they were more oriented towards the universal character of their hospitals. Four explanations are put forward for why branding has an ambiguous position in Norwegian hospitals.     

Strangers on the board: The impact of board internationalization on earnings management of Nordic firms

The internationalization of firms has led to boards becoming more international as well. In this study, we investigate the consequences of board internationalization. In particular, by drawing on research on language and board dynamics, we identify theory-based reasons why board internationalization could increase, or decrease, earnings management practices. We use agency theory, stressing how board internationalization may positively or negatively affect monitoring quality of boards. Next to agency theory, we use theories explaining how language differences in the boardroom complicates communication and how differences in language structures (referred to as linguistic relativity in the literature) affect directors’ perception and detection of earnings management practices. Using a sample of 3249 firm-year observations representing 586 non-financial listed Nordic firms during 2001–2008, we find that the presence of non-Nordic foreign directors on the board is associated with significantly higher levels of earnings management. Our analysis indicates that this effect is driven by language-related factors, as well as by the level of foreign board members’ accounting knowledge.     

Interlocks and firm performance: The role of uncertainty in the directorate interlock‐performance relationship

We examine how uncertainty influences the performance effects of directorate interlocks. Our study offers a new perspective of directorate interlocks as mechanisms that enable firms to improve performance when confronted with greater uncertainty, suggesting that uncertainty positively moderates the interlock‐performance relationship. This contrasts with the view based on resource dependence theory suggesting networks reduce uncertainty and enhance firm performance, implying that uncertainty mediates the interlock effect upon performance. Using a sample of 3,745 firms across manufacturing industries in the United States during the period 2001–2009, we find support for the moderation argument and less convincing support for mediation, suggesting that firms may not form interlocks necessarily to reduce uncertainty. Instead, firms may create interlocks to enable adaptation and enhance performance when confronted by uncertainty. Copyright © 2013 John Wiley & Sons, Ltd.     

Founding family leadership and industry profitability

In this article, we argue that firms in high-margin industries can benefit from founding family influence. Specifically, in more profitable markets, the influence of the founding family provides an additional corporate governance-monitoring function. The sample consists of 294 firm-year observations from 98 publicly traded companies headquartered in Sweden, representing approximately half of all non-financial traded firms. Our support that the effect of family leadership in publicly held firms should be assessed in relation to the intensity of industry competition.

Business Cycle Correspondence in the European Union

This paper examines whether there exists a close correspondence in the business cycles of the EU economies. We focus on the timing and magnitude of business cycles and propose criteria for defining close correspondence. We suggest that any correspondence that does exist is confined to the EU core and that, contrary to some of the existing literature, there exists a clear core-periphery distinction. This makes us less optimistic about the prospects for EMU if it is not accompanied by institutional arrangements that take into account the differences between EU economies.     

Resistance to Change in the Corporate Elite: Female Directors’ Appointments onto Nordic Boards

In this empirical study, we investigate the variation in firms’ response to institutional pressure for gender-balanced boards, focusing specifically on the preservation of prevailing practices of director selection and its impact on the representation of women on the board of directors. Using 8 years of data from publicly listed Nordic corporations, we show societal pressure to be one of the determinants of female directorship. Moreover, in some corporations, the director selection process may work to maintain “a traditional type of board”. In such boards, demographic diversity among male members appears to be associated with a lower share of female directors, although we cannot establish wether this reflects discrimination or a desire to maintain critical competencies. With this paper we add to the theoretical understanding of the factors underlying female board appointments by adopting an institutional theory lens to study female board representation. Viewing the demands for gender-balanced boards in terms of societal pressure for the de-institutionalization of the prevailing norms and practices, we highlight preferences for maintaining established practices as a potentially important barrier to institutional change. On these grounds, we conjecture on the relationship between the gender diversity of boards and other diversity dimensions. We suggest that a board room gender quota (if implemented) is supplemented by policies to ensure the transparency of board changes, in order to prevent the crowding out of other diversity dimensions.