Marktkonzentration und Marktmachtanalyse für den deutschen Regelenergiemarkt

We analyze the German market for tertiary electricity reserves in 2008. The cost of tertiary reserves of about €200 million accounted for 15% of the total cost of system services. The aim of the paper is to analyze the market structure to reveal possible opportunities for the execution of market power. To do so, we apply various concentration measures for the total market, as well as for all submarkets (i.e., different time frames, positive and negative reserves). We analyze: market shares, Herfindahl-Hirschman-Index, Pivotal Supplier Index (PSI) and the Residual Supply Index (RSI). Based on all concentration indicators, we find that all submarkets are best characterized as tight oligopolies with a (competitive) fringe. The four largest companies always qualify as being jointly dominant according to German competition law. The role of the fringe firms is, however, not negligible, in particular not for positive reserves. Strongest indication for market power is found for negative reserves from 0–8 a.m. Our analysis highlights that relying on single concentration indicators (e.g., market shares) can be misleading. It is sensible and often necessary to consider the full set of indicators.     

Societal risks as seen by Chinese students living in Macao

The present study reports on mean risk magnitude judgements expressed by Chinese students living in Macao on 87 hazardous activities, substances and technologies. These judgements were compared with findings on African, American and European samples. Despite high similarity in mean results, standard deviations, and linear correlation with the other countries, Macao appears to be the country in which the level of risk perception was clearly the highest, and this seems largely due to five items connected with violence and crime. These results are explained by the exceptionally high level of crime in Macao and its crude display by the local media.     

The Anatomy of Public and Private Real Estate Return Premia

Market-wide, stock market specific, and real estate market specific risk – what kind of risk and to which extent drives the returns of listed real estate? Based on a structural asset pricing model calibrated to the empirical data in the U.S., we show that at least two thirds of the risk premium of listed real estate are driven by the same factors as direct real estate. Our results shed new light on the risk-characteristics of listed real estate returns and are of high interest for academics, regulators, and portfolio managers alike.     

Why Do Banks Provide Leasing?

Banks are engaging in leasing activities at an increasing rate, which is demonstrated by aggregated data for both European and U.S. banking companies. However, little is known about leasing activities at the bank level. The contribution of this paper is the introduction of the nexus of leasing in banking. Beginning from an institutional basis, this paper describes the key features of banks’ leasing activities using the example of German regional banks. The banks in this sample can choose from different types of leasing contracts, providing the banks with a degree of leeway in conducting business with their clients. We find a robust and significant positive impact of banks’ leasing activities on their profitability. Specifically, the beneficial effect of leasing stems from commission business in which the bank acts as a middleman and is not affected by the potential defaults of customers.     

A Maturity Model for Management Control Systems

Corporate management in today’s international companies has become increasingly complex. To cope with the growing challenges, information technology (IT)-based management control systems (MCSs) covering reporting, planning, and consolidation have been deployed. Despite their tradition in management research, the ‘right’ setup of MCSs is still challenging. Maturity models (MMs) are an established instrument to identify strengths and weaknesses of certain domains. As existing MMs rather focus on single MCS domains, neglect an IT perspective and miss a sound methodical foundation, this paper outlines an empirically and algorithmically constructed MCS MM. The model consists of three partial MMs for reporting, planning, and consolidation, which are integrated into one holistic MCS MM. The five levels of the MCS MM guide MCS evolution from a basic, mandatory/external-driven MCS (level 1) to a balanced MCS (level 2), and a comprehensive MCS (level 3). Ultimately, MCSs show a strong strategic focus (level 4) and leverage the potentials of modern IT (level 5).     

The effect of the financial crisis on systemic trust

Policymakers throughout Europe are faced with the challenge of re-establishing trust, and especially systemic or institutional trust, that has been lost in the wake of the financial crisis. This paper looks at recent empirical evidence concerning the reaction to the crisis in terms of citizens’ diminished levels of systemic trust. Special attention is paid to the confidence invested in political institutions at the European and the national level, on the one hand, and in the free market economy, on the other.