Impression Management in Letters to Shareholders: Evidence from Poland

We study impression management in an emerging market setting with high ownership concentration. Using content analysis, we identify impression management techniques in a sample of letters to shareholders written in the Polish language by the 60 largest companies listed at the Warsaw Stock Exchange in 2008 and 2013. We find patterns in the occurrence of these techniques with the use of k-means clustering: the largest cluster includes letters that praise the management, while the rest include defensive arguments, discussions of negative outcomes and short, formal letters. The more concentrated ownership is, the shorter the letters are, which indicates that management invest less effort in communicating with investors. This is particularly visible in companies held by insiders, which tend to produce short, formal letters, devoid of impression management. In contrast, companies controlled by foreign shareholders prepare letters that are longer and which are more likely to present defensive arguments, while institutional non-controlling shareholders favour extensive disclosure. The results shed light upon communication practices in Central and Eastern Europe, and offer implications for regulators and managers that may help strengthen the information environment in regional stock markets.     

Centralisation of Collective Bargaining in a Decade of Decentralisation: The Case of the Engineering Construction Industry

This article examines the sole recent case of the comprehensive centralisation of bargaining. This ‘exceptional’ case allows new light to be cast on existing trends in multi-employer bargaining. The analysis suggests the importance of the state and unions as interlocutors in the political process of the determination of employer ‘interests’.     

Value of a Statistical Life—the Case of Poland

This study investigates the relationship between wages and the risk of work-related death for male blue-collar workers. The size of the premium for risk and its statistical significance depend heavily on the inclusion of industry dummy variables into the regression. Irrespective of the type of risk variable used, controlling for industry at a finer breakdown lowers the price of risk and its statistical significance. Estimates of the value of a statistical life (VSL) proved to be more robust when an aggregated risk measure at three-digit occupational level was used. In this case, the VSL varied from 0.79 million USD (for the model with industry dummy variables at the three-digit level) to 2.41 million USD (for the model without industry dummy variables). To the best of the author’s knowledge, this is the first study estimating VSL using the compensating wage differential approach for countries in Central-Eastern Europe.     

A BSDE approach to fair bilateral pricing under endogenous collateralization

Nie and Rutkowski (Int. J. Theor. Appl. Finance 18:1550048, 2015; Math. Finance, 2016, to appear) examined fair bilateral pricing in models with funding costs and an exogenously given collateral. The main goal of this work is to extend results from Nie and Rutkowski (Int. J. Theor. Appl. Finance 18:1550048, 2015; Math. Finance, 2016, to appear) to the case of an endogenous margin account depending on the contract’s value for the hedger and/or the counterparty. Comparison theorems for BSDEs from Nie and Rutkowski (Theory Probab. Appl., 2016, forthcoming) are used to derive bounds for unilateral prices and to study the range for fair bilateral prices in a general semimartingale model. The backward stochastic viability property, introduced by Buckdahn et al. (Probab. Theory Relat. Fields 116:485–504, 2000), is employed to examine the bounds for fair bilateral prices for European claims with a negotiated collateral in a diffusion-type model. We also generalize in several respects the option pricing results from Bergman (Rev. Financ. Stud. 8:475–500, 1995), Mercurio (Actuarial Sciences and Quantitative Finance, pp. 65–95, 2015) and Piterbarg (Risk 23(2):97–102, 2010) by considering contracts with cash-flow streams and allowing for idiosyncratic funding costs for risky assets.     

Long-term unemployment, unemployment benefits and social assistance: The Polish experience

This paper provides a comprehensive account of the regulations governing the systems of unemployment support and social assistance in post-communist Poland. To provide a solid foundation for a further discussion of these issues, the paper extensively characterizes the Polish labor force in terms of the prevalence and duration of unemployment. A final aspect of our empirical analysis concerned the question of what are the main sources of personal income for labor force participants, unemployed workers and long-term unemployed workers. In conclusion, we argue for a reform of the Polish systems of income support that separates the objectives of employment growth and poverty alleviation, and that improves upon the implementation of support schemes.     

The global financial crisis: Lessons for European integration

The EU's limited fiscal capacity has proven to be the most critical constraint in responding to the global financial crisis in a coordinated manner. The EU does not have enough resources to rescue the troubled financial institutions and member states. This leads to a nationalization of rescue operations, which undermines the Single European Market and requires IMF involvement with respect to member states in distress. The EU must also complete the lacking elements of the Single European Market architecture (such as European financial supervision) and help in strengthening global policy and regulatory coordination.     

The components of landline telephone survey coverage bias. The relative importance of no-phone and mobile-only populations

The continuously growing mobile-only population raises concerns regarding the representativeness of traditional landline telephone surveys. At this time, the mobile-only population differs significantly from general population, which leads to coverage bias when using fixed-line samples only for telephone surveys. However, in many European countries the mobile-only population is not the only source of coverage bias in telephone surveys. In addition, we have to consider coverage biases caused by considerable proportions of citizens without any telephone service. Since these two groups differ from the general population with respect to differential socio-demographic categories, in our view, the negative effects of mobile-only coverage error in traditional landline telephone surveys might in fact compensate—in part—for coverage bias caused by the no-phone population. To test this hypothesis of compensating coverage biases we calculated relative coverage biases caused by the mobile-only population and relative coverage biases caused by the no-phone population in 30 European countries for two socio-demographic variables in two points in time. Results are presented for four groups of countries that differ with respect to no-phone and mobile-only rates. Results suggest that—in general—mobile-only biases and no-phone biases do not compensate to a great extent, and thus the alarming mobile-only biases cannot be neglected when using telephone surveys in the estimation of population parameters. Nevertheless, there are several countries where the bias caused by the mobile-only population is far bigger than the joint bias caused by the mobile-only population and the no-phone population. This finding suggests that biases caused by the recent mobile-only population would be even more severe if the no-phone population did not exist.     

Making cross-border retail finance a reality case study: Deutsche Bank PBC S.A. in Poland

Until recently, the retail banking industry was widely recognised as being predominantly a local activity. Now retail banking is increasingly affected by globalisation. Cross-border activity offers opportunities for financial institutions to boost their sales through unified marketing and client acquisition techniques. Deutsche Bank quickly recognised the advantages of a regional versus a local approach to its retail activities in Europe. This paper outlines and discusses Deutsche Bank's cross-border activity in the Polish market. Poland, which joined the European Union in May 2004, is an interesting area of study. The case study presents the Deutsche Bank approach to retail banking in Poland. The case concludes that it is not the behaviour of the customer which is the most important obstacle to cross-border retail banking, but rather the legislative environment of the individual countries. With the harmonisation of European policies in this respect, these hurdles should be eliminated gradually.     

A note on Kaleckian lags in the Solow model

Building on a contribution by Paul Zak, we consider the modified Solow model with a time lag introduced in the Kaleckian spirit. This model produces endogenous cycles that can be interpreted as economic fluctuations. For reasonable parameter values it can generate empirically relevant cyclic variations in output. We prove the existence of a Hopf bifurcation and a limit cycle solution in the model. We find that there is only one solution with a period longer than the production lag. Additionally we calculate the period of this cycle.     

BOARD GOVERNANCE: DOES OWNERSHIP MATTER?

Good governance is crucial to achieving an organization's mission. Nevertheless, little is known about how the structure of governance is influenced by the nonprofit (NPO) or for‐profit ownership (FPO) structure of an organization, partly because they tend to be active in different sectors. In this paper we overcome this challenge by using data from a global sample of 392 microfinance institutions. The results show that the average NPO has a larger board, more female directors, and a higher number of board meetings than the average FPO. Moreover, where there are larger boards and more frequent board meetings, this has a positive effect on the financial performance of NPOs. It is thus confirmed that ownership structures influence boards’ characteristics and that some board mechanisms are more efficient in some ownership structures than in others. An effective board design should thus be based on a firm's ownership structure.