Vaccination Gap,Vaccination Fraud and Inefficient Testing

Intereconomics - A number of shortcomings in Germany’s efforts to contain the spread of the coronavirus, including fraudulent testing, vaccination fraud and insufficient testing capacity have...     

Horizontal mergers with synergies: Cash vs. profit-share auctions

We consider takeover bidding in a Cournot oligopoly when firms have private information concerning the synergy effect of merging with a takeover target and bidders can influence rivals' beliefs through their bids. We compare cash and profit-share auctions, first- and second-price, supplemented by entry fees. Since non-merged firms benefit from a merger if synergies are low, bidders are subject to a positive externality with positive probability; nevertheless, pooling does not occur. Unlike cash auctions, profit-share auctions are not revenue equivalent, and the second-price profit-share auction is more profitable than the other auctions.     

Relating the Zone of Tolerance to Service Failure in the Hospitality Industry

The purpose of this study was to explore the zone of tolerance concept in relation to perceptions of service encounters, specifically when service failures are likely to occur. A simulated restaurant experience consisting of a series of dining service encounters was conducted with a sample of academic staff and research students. Results showed that individuals have different perceptions with different variability in their zone of tolerance; individuals appear to have a larger zone of tolerance when dealing with negative encounters and a narrower zone of tolerance for positive encounters. In addition, an initial negative encounter predisposes customers to future negative encounters. Failure is seen as a difficult concept to judge as individuals have diverse perceptions of what constitutes a failure and when it starts. Further research directions are proposed.     

„Die Methoden des Controllings werden in China akzeptiert und wissbegierig aufgenommen.“

Praxis / ArtikelInterview Titelthema

„Die Methoden des Controllings werden in China akzeptiert und wissbegierig aufgenommen.“ Interview mit Bernd Pichler, Dipl.-Kfm., MBA (GSBA Z), Managing Director Commercialder Volkswagen (China) Import Co., Ltd.     

Dynamic market entry and the value of flexibility in transitional international joint ventures

The purpose of this study is to formalize the optimal choice of market entry strategy for an individual multinational enterprise (MNE) from a dynamic perspective. It is argued that incorporating a suitable treatment of irreversibility, uncertainty and flexibility related to an MNE's investment decision gives further insights into the expansion, dissolvement, and optimal timing of international joint ventures (IJVs). In most cases, the initial entry strategy serves as a platform allowing the firm to make subsequent investments to exploit host-country advantages and capabilities. We allow for this by taking a three-step expansion strategy explicitly into account. The evolutionary process of the value of the foreign direct investment can be interpreted as a compound complex chooser option. The results suggest that uncertainty, size of equity share and future investment/divestment opportunities play an important role when it comes to transit from export to the first phase of the foreign direct investment commitment. The paper underscores the importance of modeling the dynamics of market entry and helps to refine the application of real options in the alliance context by providing a closed-form solution in continuous time to value the overall strategic flexibility.     

Exchange Rates and Monetary Policy in Central Europe - A Survey of Some Issues

MOCT-MOST: Economic Policy in Transitional Economies -     

Public subsidies and new ventures’ use of bank loans

Access to financial resources is crucial for young firms to strive. To foster innovation and growth in these firms, governments address financing constraints by initiating public support programs. For such financial support to be effective, it is, however, important that firms are able to augment publicly provided resources with additional means. This study examines the relationship between new ventures’ subsidy receipt and long-term bank loans. Studying new ventures founded between 2005 and 2009 in Germany, we test whether the subsidy itself facilitates use to bank financing. Applying econometric techniques that account for the endogenous nature of a subsidy receipt, we find that subsidized young firms are more likely to use bank loans and to have obtained a larger share of their financing mix from banks. We further show that this effect is stronger in highly information-opaque sectors. These results suggest that the effect may be attributed to an information value carried by the grant that is relevant to banks’ loan assessment procedures, especially when new venture value is difficult to judge.     

Sektorale und gesamtwirtschaftliche Beurteilung des „Carbon-Leakage”-Problems für die Bundesrepublik Deutschland

In order to mitigate the global warming issue, the European Commission decided To reduce carbon dioxide emissions in Europe by 2020 by 20% (compared to 1990). This translates into an overall reduction of 1.1 billion tons. The most important Reduction tool in its policy arsenal is the Emission-Trading System (ETS). All ETS industries together are supposed to reduce their CO₂ emissions by 421 million tons or 21 % (compared to 2005). With a planned reduction of 421 million tons of CO₂, Germany’s ETS industries bear almost a quarter of the Overall reduction burden. The associated carbon leakage problem is only to some extent attributed to the climate protection targets. The planned adjustment of the major allocation mechanism in the third trading phase weights considerably more. In the third trading phase the free provision of benchmark-related emission permits will be replaced with a market-price auction system. A current study of the EEFA-Research Institute examines the effects of auctioning on compatibility, production and employment in Germany.     

Research on extended external reporting assurance: Trends,themes, and opportunities

The assurance of non‐financial information (NFI) included in extended external reports (EERs) is a global activity that has far‐reaching consequences for business, investors, other stakeholders, and society. EERs remain largely unregulated with few standards. Along with our companion paper (Krasodomska, Simnett, & Street, 2021, Journal of International Financial Management and Accounting, 25, 209), we contribute to the current discussion on EER assurance by providing an overview of the academic literature to inform the standard setting initiatives of the International Auditing and Assurance Standard Setting Board (IAASB), as well as the practice of assurance of EERs. We identify 121 articles on extended external reporting (EER) assurance published between 2009 and 2020 across 35 journals ranked A*, A, and B on the Australian Business Deans Council (ABDC) 2019 Journal Quality List. These articles cover archival, experimental, interviews, case studies, surveys, and content analysis research methods and serve as a possible input for standard setting activities. We document a rapid increase in this literature with almost half of the articles published in the last 3 years, 2018 to 2020. Finally, we offer ideas for future research directly linked to the proposed Guidance of the IAASB on EER assurance. We encourage researchers to engage in these and other issues of the IAASB’s Guidance to assist them with valuable input for their standard setting activities.