Further Evidence on PPP Adjustment Speeds: the Case of Effective Real Exchange Rates and the EMS*

Two different approaches intend to resolve the ‘puzzling’ slow convergence to purchasing power parity (PPP) reported in the literature [see Rogoff (1996) , Journal of Economic Literature, Vol. 34.] On the one hand, there are models that consider a non‐linear adjustment of real exchange rate to PPP induced by transaction costs. Such costs imply the presence of a certain transaction band where adjustment is too costly to be undertaken. On the other hand, there are models that relax the ‘classical’ PPP assumption of constant equilibrium real exchange rates. A prominent theory put together by Balassa (1964, Journal of Political Economy, Vol. 72) and Samuelson (1964 Review of Economics and Statistics, Vol. 46) , the BS effect, suggests that a non‐constant real exchange rate equilibrium is induced by different productivity growth rates between countries. This paper reconciles those two approaches by considering an exponential smooth transition‐in‐deviation non‐linear adjustment mechanism towards non‐constant equilibrium real exchange rates within the EMS (European Monetary System) and effective rates. The equilibrium is proxied, in a theoretically appealing manner, using deterministic trends and the relative price of non‐tradables to proxy for BS effects. The empirical results provide further support for the hypothesis that real exchange rates are well described by symmetric, nonlinear processes. Furthermore, the half‐life of shocks in such models is found to be dramatically shorter than that obtained in linear models.     

The effect of mergers and acquisitions on environmental,social and governance performance and market value: Evidence from EU acquirers

This study explores the effect of environmental, social, and governance (ESG) performance on market value and performance in the context of mergers and acquisitions. We examine whether acquisition of targets with better ESG performance can help acquirers to increase their own ESG performance and whether the market values the increased ESG performance positively. Moreover, we explore whether the acquisition of targets with better ESG performance affects the market value of acquirers. For this study, we utilize a sample of 100 European mergers and acquisitions between 2003 and 2017, for which matching data on the ESG performance of both the target and acquiring firms are available. Our results show that the postmerger ESG performance of the acquirer increases following the acquisition of a target that has higher ESG performance than that of the acquirer in the premerger stage, whereas the postmerger market value of the acquirer increases following an increase in the acquirer's postmerger ESG performance in relation to its premerger ESG performance. Finally, we provide partial evidence of a positive relationship between the postmerger market value of the acquirer and the acquisition of a target with higher ESG performance than itself in the premerger stage.     

Technology gaps in European banking: Put the blame on inputs or outputs?

This paper investigates the production efficiency of 12 European banking systems over the period 1997–2004, taking into account possible technology heterogeneity. Using a non-parametric metafrontier framework, efficiency and metatechnology ratio measures are computed and decomposed into input- and output-invariant components. Empirical findings indicate the existence of significant and rather increasing technology heterogeneity within European banking. A typology of the national banking systems is also developed, based on the overall productive performance with respect to the European technological edge, the absorptive capacity and the role of knowledge spillover effects. Decomposition results draw attention to catching up policies focusing on input and/or output scale adjustments.     

The determinants of investment in Greek manufacturing

An attempt is made to provide some insight into the determinants of manufaturing investment in Greece. For this purpose an accelerator-relative costs-profits model is used and both the putty-putty and putty-clay versions are examined. Estimates reveal that demand and profits factors play an important role in investment decision while the impact of relative inputs cost is significant mainly in the short run. Window regression experiments show that there is a dramatic fall in profits elasticity of investment and a corresponding increase in the significance of demend factor in the later periods.     

PUBLIC ENTERPRISE IN THE EUROPEAN UNION: prospects and constraints

ABSTRACT * : The author highlights the problems and prospects of public enterprises within the European Union, as well as the major adjustments considered necessary for these enterprises to fulfil their role. He argues that general criteria determining whether the production of goods and services should be in the public sector cannot be readily established in the European Union, since public supply does not solely depend on the specific economic characteristics of the particular good or service, but also on the prevailing social, cultural and economic conditions in each country, on the economic policy pursued, and on the structural characteristics of its private and public sectors, including entrepreneurial and trade union behaviour.     

International law as a negotiation tool in Banking Union; the case of the Single Resolution Fund

EU’s response to the recent Euro-crisis has involved a mixture of EU and international law, with the latter being linked to all the arrangements that may have fiscal implications for national Member States. The SRF embodies all the controversial characteristics of Banking Union. This article illustrates the legal implications that this political choice creates, and how the interrelation between the SRM, the SRF and the ESM, allows leading economies, including Germany, to control the resolution framework both before and after crisis. This raises questions as to the direction that European Integration is taking and its highly nationalised character.     

高速维特比译码器的设计

本文实现了高速(2，1，7)卷积码的维特比译码器。该译码器针对加比选(ACS)模块采用并行化结构设计，并且在解码器的各个部分，在不影响译码性能的前提下，采用了一系列的简化设计，从而使译码器输出数据的速率达到160Mbps。     

The Integration of Commercial Real Estate Markets and Stock Markets

This paper tests whether commercial real estate markets (both exchange-traded and non-exchange-traded) are integrated with stock markets using multifactor asset pricing models. The results support the hypothesis that the market for exchange-traded real estate companies, including REITs, is integrated with the market for exchange-traded (non-real-estate) stocks. Moreover, the degree of integration has significantly increased during the 1990s. However, when appraisal-based returns (adjusted for smoothing) are used to construct real estate portfolio returns, the results fail to support the integration hypothesis, although this may reflect the inability of these estimated private market returns to accurately proxy for commercial real estate returns. Interestingly, the growth rate in real per capita consumption is consistently priced in both commercial real estate markets and stock markets, whereas previous studies have found mixed evidence on the role of consumption in explaining ex ante stock returns.     

Sustaining brand loyalty: The moderating role of green consumption values

Environmental issues are massively emerging in the current agendas of governments, businesses and consumers all over the globe. Consumers increasingly adopt a more energetic role in the environmental discussion and employ product consumption to manifest their contribution to the debate. Equally, a growing number of businesses try to affect positive social change, whereas others strategically approach green opportunities; at the same time, they persistently intensify their branding offerings to sustain loyalty. This article brings into discussion green consumption values as the authors aim to shed light into the way the latter moderate the effect of brand related factors, namely, brand experiences and brand personality, on brand loyalty. Based on data received from 413 participants and using the wearable technologies industry as the focal context, the study underscores the significance of green consumption values. Findings are discussed, and implications for managers are provided.     

A Non-parametric Estimation of Productivity with Idiosyncratic and Aggregate Shocks: The Role of Research and Development (R&D) and Corporate Tax

We develop a non-parametric technique framework for estimating firm-level Total Factor Productivity (TFP). Our paper has two major novelties: first, we propose a modelling of productivity with both firm-idiosyncratic factors and aggregate shocks. Second, we apply the Bayesian Markov Chain Monte Carlo (MCMC) technique that offers a numerical integration of productivity outside the posterior overcoming the restrictive assumptions about the relationship between productivity and variable production inputs. We implement our methodology in a group of 4,286 manufacturing firms from France, Germany, Italy, and the UK (2001–14). The results show that: (i) aggregate shocks matter for firm TFP evolution. The global financial crisis of 2008 caused severe, albeit short, adverse effects on TFP; (ii) there is substantial heterogeneity across countries in the way firms react to changes in R&D and taxation. German and UK firms are more sensitive to fiscal changes than R&D, while the opposite is true for Italian firms. R&D and taxation effects are symmetrical for French firms; (iii) the UK productivity handicap continues for years after the financial crisis; and (iv) there are substantial knowledge spillovers among German and Italian firms.