The burden of the family company: Leopoldo Pirelli and his times

Leopoldo Pirelli was the third generation to run the family firm and a key character of Italian capitalism. He played a major role in Italy’s biggest merger and served as Head of the Committee for Reforms of the Italian Confederation of Industrialists. As head of Pirelli, he was appreciated by shareholders and by management. Though intent on internationalisation, he failed twice (the ‘Union’ with Dunlop and later with Continental). After this second failure he resigned. A respected leader of the international business community, Pirelli failed at his most important task – transforming a family firm into a public company.     

Segmentation and motivation of foreign tourists in world heritage sites. A case study,Quito (Ecuador)

This paper presents an analysis of the current relationships between three fundamental constructs in the decision-making process of the visitor – motivation, satisfaction and loyalty – of a tourist destination World Heritage Site like the city of Quito, Ecuador. The results demonstrate the existence of three motivational dimensions among foreign visitors to visit the city: firstly cultural, secondly circumstantial and finally hedonic-gastronomic. Additionally, and tending to the motivational schemes, four types of foreign visitors have been identified: a hedonic-gastronomic cultural tourist, a hedonic-gastronomic tourist, a circumstantial hedonic-gastronomic cultural tourist and an alternative tourist. The reasons or motives of the visit reveal that only the hedonic-gastronomic dimension discriminates significantly as far as the degree of perceived satisfaction and loyalty declared by the visitors are concerned.     

Back to Basics: Forecasting the Revenues of Internet Firms

This paper examines the roles played by past revenues, web usage data, and analysts in forecasting the future revenues of internet firms during the years 1998 to 2000. For this time period our analysis shows that estimates of web traffic growth have significant incremental value in the prediction of revenues above time-series forecasts. Furthermore, analysts almost always underestimate the revenues of internet firms. Historical revenue growth has incremental predictive power over analysts' forecasts for portal and content/community firms, but not for our e-tailer sample. Moreover, the stocks of the portal and content/community firms with high historical revenue growth earn higher abnormal returns during our sample period than do those with low historical growth. Estimates of web usage growth generally do not have incremental value over analysts' forecasts for predicting the revenues of either set of firms. However, perfect foreknowledge of actual web usage growth would provide incremental predictive power. Collectively, our findings point to the potential value for forecasting purposes of both improving upon the web usage estimates and obtaining more timely reports of actual web traffic.     

Peer choice in CEO compensation

Current research shows that firms are more likely to benchmark against peers that pay their Chief Executive Officers (CEOs) higher compensation, reflecting self serving behavior. We propose an alternative explanation: the choice of highly paid peers represents a reward for unobserved CEO talent. We test this hypothesis by decomposing the effect of peer selection into talent and self serving components. Consistent with our prediction, we find that the association between a firm's selection of highly paid peers and CEO pay mostly represents compensation for CEO talent.     

How farmers benefit from plant clinics: an impact study in Bolivia

Between 2000 and 2009, nine plant clinics in three agro-ecological areas of Bolivia (Andes, lowlands and valleys) served about 800 communities in an area roughly 300 × 100km. Over 6000 farmers consulted these clinics with 9000 queries. Many found the advice so useful that they visited the clinics repeatedly. A survey of 238 clinic users found that most adopted the clinics' recommendations. Fruit and vegetable growers who followed the clinic recommendations tended to spend less on pesticides. As for certain crops like potato, citrus and peach palm, a modest increase in pesticides helped improve the quality and quantity of the harvest. Farmers improved their incomes by following the clinics' advice. The poorest farmers enjoyed the greatest increase in income per hectare. This was the first study to explore the impact of plant clinics; future studies need to be improved, for example by obtaining baseline data and by comparing clinic users to their peers who have not used clinics.     

Do multinational banks create or destroy shareholder value? A cross‐country analysis

We question whether the international diversification of multinational banks creates or destroys shareholder value. Based on a sample of 384 listed banks from 56 countries we provide new and robust evidence that bank cross‐border activities create shareholder value, as shown by an economically and statistically significant premium for international diversification. Our results are confirmed controlling for bank fixed effects, time‐varying bank characteristics, reverse causality, functional diversification, and instrumenting for the choice to expand abroad. The increase in shareholder value is slightly larger for banks in the middle range of international diversification and in the case of expansion towards less developed countries.     

Efficiency and risk in European banking

We assess the inter-temporal relationship between bank efficiency, capital and risk in a sample of European commercial banks employing several definitions of efficiency, risk and capital and using the Granger-causality methodology in a panel data framework. Our results suggest that lower bank efficiency with respect to costs and revenues Granger-causes higher bank risk and that increases in bank capital precede cost efficiency improvements. We also find that more efficient banks eventually become better capitalized and that higher capital levels tend to have a positive effect on efficiency levels. These results are generally confirmed by a series of robustness tests. The results have potentially important implications for bank prudential supervision and underline the importance of attaining long-term efficiency gains to support financial stability objectives.     

Post-merger Price Dynamics Matters,So Why Do Merger Retrospectives Ignore It?

Review of Industrial Organization - The overwhelming majority of retrospective merger studies pool the post-merger data to estimate the average price effect of the merger. Pooled post-merger...     

Cystadenoma of the seminal vesicle: US and CT findings

Ultrasonographic (US) and computed tomographic (CT) features of a cystadenoma of the seminal vesicle are presented.     

Is bank default risk systematic?

We evaluate the impact of commonly used indicators of bank distress on broad (i.e. sector and country) risks. This issue deserves special attention in the banking industry where there is a strong degree of interconnectedness among institutions and the default of a single bank may cause a cascading failure, which could potentially bankrupt the entire system. Using several measures of individual bank risk our results show that these measures have a direct impact on European banking (i.e. systemic) stock market risk. We also provide strong evidence suggesting that, for listed banks, default risk tends to be systematic (i.e. non-diversifiable).