Why Do Foreign Firms Leave U.S. Equity Markets?

Foreign firms terminate their Securities and Exchange Commission registration in the aftermath of the Sarbanes–Oxley Act (SOX) because they no longer require outside funds to finance growth opportunities. Deregistering firms’ insiders benefit from greater discretion to consume private benefits without having to raise higher cost funds. Foreign firms with more agency problems have worse stock‐price reactions to the adoption of Rule 12h‐6 in 2007, which made deregistration easier, than those firms more adversely affected by the compliance costs of SOX. Stock‐price reactions to deregistration announcements are negative, but less so under Rule 12h‐6, and more so for firms that raise fewer funds externally.     

Negative Monetary Policy Rates and Systemic Banks' Risk-Taking: Evidence from the Euro Area Securities Register

We show that negative monetary policy rates induce systemic banks to reach-for-yield. For identification, we exploit the introduction of negative deposit rates by the European Central Bank in June 2014 and a novel securities register for the 26 largest euro area banking groups. Banks with more customer deposits are negatively affected by negative rates, as they do not pass negative rates to retail customers, in turn investing more in securities, especially in those yielding higher returns. Effects are stronger for less capitalized banks, private-sector (financial and nonfinancial) securities and dollar-denominated securities. Affected banks also take higher risk in loans.     

Do CEOs Matter? Evidence from Hospitalization Events

Using variation in firms’ exposure to their CEOs resulting from hospitalization, we estimate the effect of chief executive officers (CEOs) on firm policies, holding firm-CEO matches constant. We document three main findings. First, CEOs have a significant effect on profitability and investment. Second, CEO effects are larger for younger CEOs, in growing and family-controlled firms, and in human-capital-intensive industries. Third, CEOs are unique: the hospitalization of other senior executives does not have similar effects on the performance. Overall, our findings demonstrate that CEOs are a key driver of firm performance, which suggests that CEO contingency plans are valuable.     

Industrial segmentation,the ethnic economy,and job mobility: the case of Cuban exiles in Florida

We examine mobility between core, periphery, and the ethnic economy in a sample of Cuban exiles. We analyze, first, hypotheses involving the relative magnitude of exit rates from given origins, and, second, hypotheses positing effects of independent variables on exit rates. Regarding the first type of hypotheses, we argue that the presence of an ethnic economy requires modification of predictions in the segmented economy perspective. Data support our argument. Concerning the second type of predictions, regression analysis shows that movement into the periphery is negatively associated with number of relatives in the U.S., movement into ethnic economy employment is positively related to number of relatives living in same city as respondent, and movement into self-employment is positively related to education, intention to return to Cuba if communism were overthrown, and taking a university-level course, and negatively associated with living in a Cuban neighborhood. As a whole, regression results indicate that, with the exception of movement into the periphery, individuals with more resources are more prone to mobility.     

Employment and education discrimination against disabled people in Cape Verde

This article assesses the employment and school enrolment gaps between disabled and nondisabled persons using the last Cape Verdean census. The unexplained part of these gaps accounts for most of them, whatever the age group considered. Furthermore, differences in age structures between disabled and nondisabled persons have almost no effect on these gaps. Taking into account potential misclassification errors in the disability variable seems to change only marginally these results. These findings thus suggest that there is scope for programs to better target and promote employment and education of the disabled in Cape Verde.     

INFLATION STABILIZATION AND NOMINAL ANCHORS

This paper analyzes the choice of a nominal anchor in disinflation programs in chronic inflation countries. Both theory and evidence suggest several conclusions. (i) The recessionary effects associated with disinflation appear in the early stages of money-based programs but only in the late stages of exchange rate-based programs. (ii) Lack of credibility is more disruptive under fixed exchange rates than under floating exchange rates. (iii) Attempting to pursue a disinflationary policy while maintaining a given level of the real exchange rate is likely to be self-defeating. (iv) A high degree of currency substitution favors the exchange rate as the nominal anchor.     

Stradin: A Strategic Dynamic and Interactive Decision-Making Process

This article proposes a new strategic decision-making process: Stradin. Stradin uses recent developments in computerized network systems and user-friendly interfaces in order to address management challenges of corporations of the 1990s. Five strategic challenges are addressed: (1) finding the right balance in the centralization-decentralization dilemma; (2) conciliating strategic decisions and their operational implementation; (3) finding a balance between role differentiation and integration; (4) using conflict constructively in order to improve decision making; (5) conciliating emerging strategies and continuity. The article below discusses each of these challenges and shows how Stradin can help in meeting them.     

The Franco‐German trade puzzle: an analysis of the economic consequences of the Franco‐Prussian war1

When the Franco‐German trade relationship is viewed from a long‐term perspective, the conventional view that trade ties were rather good before 1914 becomes doubtful. In fact, trade statistics point to the absolute and relative decline in trade flows between the two countries after the Franco‐Prussian war of 1870–1. This postwar episode of Franco‐German trade history is far from incidental. On the basis of a comprehensive study of Franco‐German trade by product, this article reveals a complete restructuring of French trade with Germany after the conflict and invites a new analysis of its economic consequences.