New Venture Performance in Transition Economies from Different Institutional Perspectives

Building on institutional theory, this study examines the effects of dysfunctional competition and government ties on new venture performance in transition economies. And, it goes deeper to investigate how these effects are contingent on a new venture's entrepreneurial orientation (EO). It finds that EO weakens the negative relationship between dysfunctional competition and new venture performance but exacerbates the negative linkage of government ties to new venture performance. The findings not only illustrate how government impacts new venture performance in transition economies, but also indicate that new ventures can leverage entrepreneurship to cope with the effects of government‐related factors.     

SCREENING AS A UNIFIED THEORY OF DELINQUENCY,RENEGOTIATION, AND BANKRUPTCY

We propose a parsimonious model with adverse selection where delinquency, renegotiation, and bankruptcy all occur in equilibrium as a result of a simple screening mechanism. A borrower has private information about her endowment, and a lender uses random contracts to screen different types of borrowers. In equilibrium, some borrowers choose not to repay and thus become delinquent. The lender renegotiates with some delinquent borrowers. In the absence of renegotiation, delinquency leads to bankruptcy. Applied to mortgage restructuring, our mechanism generates amplification of house‐price shocks through foreclosure spillovers. We also show that government intervention aimed at limiting foreclosures may have unintended consequences.     

Organizational patterns of economies: an ecological perspective

A complex adaptive systems paradigm can be used to abridge theorizing in ecological and economic sciences. The paper discusses economic flows, connectivity and stability from the perspective of theoretical ecology. The global economy, by analogy with ecosystems, appears to self-organize as an ascendent system: most of the world trade is done among the tiny fraction of technologically advanced countries and trade interaction strength exhibits a power law with exponential decay. Small world behavior and preferential attachment characterizes interactions among economic agents. Industrial economies and the world economic system as a whole appear to evolve towards the ‘maximum power’ efficiency. Development that fosters efficiency in the maximum power sense (all the world becomes industrialized) implies a trade-off in socio-economic diversity, and may be antithetical to the stability of the global economy. If we take an ecological perspective, then the problem of global development does not reside in the realm of technology or global governance. It boils down to the question of required natural balance in living systems, the balance between organized complexity and overhead, the harmony between efficiency and adaptability.     

Board composition,share ownership,and ‘underpricing’ of U.K. IPO firms

Using a sample of 251 IPOs in the United Kingdom, this paper examines interlinks between executive and nonexecutive characteristics, share ownership, and short‐term performance measured in terms of share offer ‘underpricing.’ It argues that executives' power and previous experience directly affect ex ante choice of nonexecutive directors and their ownership interests in the firm. These endogenously developed governance factors may be used by IPO teams strategically to reduce the extent of underpricing. However, there is a selective response of investors to different board characteristics and share ownership structure. Copyright © 2002 John Wiley & Sons, Ltd.     

Corporate Governance and Performance in Publicly Listed,Family-Controlled Firms: Evidence from Taiwan

Using a multi-industry dataset of 228 firms listed on the Taiwan Stock Exchange (TSE) this paper analyses the effects of ownership structure and board characteristics on performance in large, publicly traded firms that are controlled by founding families. After taking account of possible endogeneity problems, we do not find that family control is associated with performance measured in terms of accounting ratios, sales per issued capital, earnings per share and market-to-book value. However, share ownership by institutional investors, and foreign financial institutions in particular, is associated with better performance. Our results indicate that board independence from founding family and board members’ financial interests have a positive impact on performance.     

What drives intermediation costs? A case of tennis betting market

We demonstrate that there is a considerable variation in bookmaker margins across matches, time and bookmakers. Our results imply that using match, tournament and players’ characteristics explains the variations in margins hence, they can be helpful in managing intermediation cost in a market of state-contingent assets: fixed-odds betting markets. We also provide evidence that bookmakers protect themselves by increasing odds on the favourite player, thus attracting more bettors to the favourite player, while deterring bettors from betting on the underdog by reducing the odds. By that process, bookmakers are possibly sacrificing a portion of their margin.     

RETRACTED ARTICLE: Prediction of economic growth by extreme learning approach based on science and technology transfer

The purpose of this research is to develop and apply the extreme learning machine (ELM) to forecast gross domestic product (GDP) growth rate. Economic growth may be developed on the basis on combination of different factors. In this investigation was analyzed the economic growth prediction based on the science and technology transfer. The main goal was to analyze the influence of number of granted European patents on the economic growth by field of technology. GDP was used as economic growth indicator. The ELM results are compared with genetic programming (GP) and artificial neural network (ANN). The reliability of the computational models were accessed based on simulation results and using several statistical indicators. Coefficient of determination for ELM method is 0.9841, for ANN method it is 0.7956 and for the GP method it is 0.7561. Based upon simulation results, it is demonstrated that ELM can be utilized effectively in applications of GDP forecasting.

     

Shadow short rate and monetary policy in the Euro area

Empirical modelling of the monetary policy effects using conventional linear econometric models is put to a great test when interest rates approach the zero-lower bound. A possible remedy recently proposed in the literature is to introduce a shadow short rate (SSR) obtained from the yield curve model as an alternative monetary policy measure. This paper examines the usefulness of shadow rates as a policy stance measure for the Euro area. Moreover, the SSR can be used to study the country-specific monetary policy stance. We incorporate the shadow short rate in a standard vector autoregressive analysis to study the effects of monetary policy shocks both at the level of the Euro area and for two periphery EA countries, Italy and Spain, that endured significant financial stress during the crisis. Our analysis shows that monetary policy shocks identified form the SSR produce similar macro responses as shocks identified from the standard policy rate. The Euro area shocks can directly translate to a corresponding change in the country-specific financing conditions in the periphery, whereas the reverse effect is limited. The historical decomposition of the stochastic component of the SSR series shows that the unconventional policy measures were effective in stabilising the sovereign crisis in 2011, however, their relatively limited quantity provided only a weak stimulus to the economy.