Intellectual property rights,product complexity and the organization of multinational firms

This paper studies how the intellectual property right (IPR) regime in destination countries influences the decision of firms between procurement from related parties and from independent suppliers while the latter may involve technology sharing or not. Using firm‐level data on the mode choice for each transaction and a new product complexity measure, results confirm that firms are generally reluctant to source complex goods from outside firm boundaries. However, when technology is shared, IPRs promote outsourcing of more complex goods whereas without technology sharing, IPRs promote outsourcing of less complex products that are prone to reverse engineering and simpler to imitate.     

Statistical Approaches to Forecasting Domestic Energy Consumption and Assessing Determinants: The Case of Nordic Countries

The residential sector accounts for large share of total annual energy use in the Nordic countries due to the extremely cold climates and high household heating demand. Most domestic energy consumption in the Nordic countries is for space heating and providing hot water. The purpose of our study was to forecast the annual energy consumption of the Nordic residential sectors by 2020 as a function of socio-economic and environmental factors, and to offer a framework for the predictors in each country.

Our research models the domestic energy use in Nordic countries based on social, economic and environmental factors. Applying the multiple linear regression (MLR), multivariate adaptive regression splines (MARS), and the artificial neural network (ANN) analysis methodologies, three models have been generated for each country in the Nordic region. Using these models, we forecasted the Nordic countries domestic energy use by 2020 and assessed the causal links between energy consumption and the investigated predictors. The results showed that the ANN models have a superior capability of forecasting the domestic energy use and specifying the importance of predictors compared to the regression models. The models revealed that changes in population, unemployment rate, work force, urban population, and the amount of CO₂ emissions from the residential sectors can cause significant variations in Nordic domestic sector energy use.     

Learning by supplying and competition threat

Review of World Economics - This study proposes a model of learning by supplying in an international outsourcing framework, where the supplier of a relationship-specific input can reverse engineer...     

Political crises and the stock market integration of emerging markets

This paper investigates the role of political crises in explaining the degree of stock market integration in emerging markets over the period 1991-2006. Using the International Crisis Behavior database, which contains detailed information on political crises around the world, and employing data on more than 15,500 firms, we assess whether political crises affect stock market integration in 19 emerging markets in South and East Asia, Latin America, and Central and Eastern Europe. We conclude that crises with certain characteristics generally reduce the level of stock market integration in these regions. In particular, the beginning of a political crisis, its severity, the involvement of the US in the conflict, and the number of parties involved in a crisis all have impacts on the level of stock market integration in these markets.     

Properties and the predictive power of implied volatility in the New Zealand dairy market

This study develops a dairy implied volatility index (DVIX), derived from New Zealand Exchange traded options on whole milk powder (WMP) futures. We document an inverse return–volatility relation which is asymmetric, where increases in WMP futures prices are associated with larger absolute changes in the DVIX than decreases. In sample, the results strongly suggest that the DVIX has a high information content regarding conditional variance and that the inclusion of historical information further improves the predictive power. Out of sample, we find that the DVIX provides substantial information about future realized volatility. We also document that a combination of historical volatility and the DVIX provides the best out-of-sample forecasts.     

Contemporaneous Spillover Effects between the U.S. and the U.K. Equity Markets

We use high frequency data and the “identification through heteroskedasticity” approach of Rigobon (2003) to capture the contemporaneous volatility spillover effects between the U.S. and U.K. equity markets. We demonstrate the relevance of taking into account the information present during simultaneous trading hours by comparing the results generated by our structural vector autoregression with those of a traditional reduced-form vector autoregression. Our findings clearly demonstrate that contemporaneous relations matter and that ignoring them leads to inappropriate conclusions regarding the magnitude and direction of volatility spillover.     

Main Determinations of Female Entrepreneurs in the Construction Industry in Malaysia

This paper explores the determination of female entrepreneurs in the construction industry based on masculine and feminine characteristics in the Malaysian construction industry, using the Bem Sex‐Role Inventory (BSRI). The median split method determined that female construction entrepreneurs have masculine traits. The results are not robust because of the limited number of responses; nonetheless, the findings can be used as a platform for future research on female construction entrepreneurs in the construction industry in Malaysia. To enhance the findings’ contributions, this paper also discusses the industry characteristics, which are considered to have significantly contributed to the masculinity of female construction entrepreneurs.     

Transfer price and equilibrium in multidivisional firms: an examination of divisional autonomy and central control

The problem faced by a firm that oversees two divisions, one of which produces and one of which uses an intermediate good, is considered. Since divisions have information that is not available to the centre, it is useful to allow the divisions some autonomy in their sales and procurement decisions. The analysis allows the centre to specify the transfer price that must be used in trades between divisions as well as placing restraints on their ability to trade with outside firms. In most of the models presented in this paper, the centre cannot observe the market price of the intermediate product, and in some models it cannot observe divisional costs. It is shown how the centre can obtain the full information solution in the simplest case by using a penalty factor that encourages internal trade. However, when divisional costs are not observable, the full information outcome is not obtainable. In this case, the optimal value of the penalty factor implies a tradeoff between the benefits of allowing divisions to act to take advantage of price opportunities in outside markets and savings in transactions costs of trades between divisions.     

New Zealand mutual funds: measuring performance and persistence in performance

The present study investigates the performance of New Zealand mutual funds using a survivorship‐bias controlled sample of 143 funds for the period of 1990–2003. Our overall results suggest that New Zealand mutual funds have not been able to provide out‐performance. Alphas for equity funds, both domestic and international, are insignificantly different from zero, whereas balanced funds underperform significantly. There is no evidence of timing abilities by the fund managers. In the short term, significant evidence of return persistence for all funds is observed. This persistence, however, is driven by ‘icy hands’ rather than ‘hot hands’. Finally, we find the risk‐adjusted performance for equity funds to be positively related to fund size and expense ratio and negatively related to load charges.     

Do Criminal Sanctions Deter Insider Trading?

Many developed markets have taken what appears to be a tough stance on illegal insider trading through the use of criminal sanctions. Although criminal sanctions represent a much greater penalty than civil sanctions, the higher burden of proof required makes their enforceability weaker. This trade off between severity and enforceability makes the impact of criminal sanctions ambiguous. We empirically examine this issue by studying the deterrence of insider trading following the introduction of criminal sanctions in a developed market. Significant changes in sanction regimes are rare, especially when criminal sanctions are introduced without other changes. In February 2008, New Zealand introduced criminal sanctions for insider trading. This change of law offers a unique setting in which to examine the deterrence effect of criminalization. Using measures for the cost of trading, degree of information asymmetry, and probability of informed trading, we find that the enactment of this law led to a worsening in these measures. These findings suggest that the weaker enforceability of criminalization outweighs the associated increased severity of the penalties in New Zealand.