Does the Basle Capital Accord reduce bank fragility? An assessment of the value-at-risk approach

We examine the economic implications arising from a bank using a VaR-constrained mean-variance model for the selection of its trading portfolio as a consequence of the Basle Capital Accord. Surprisingly, we show that when a VaR constraint is imposed, it is plausible that certain banks will end up selecting ‘riskier’ portfolios than they would have chosen in the absence of the constraint. Accordingly, regulators such as the Basle Committee on Banking Supervision should be aware that allowing a bank to use VaR to determine its minimum regulatory capital may increase its fragility. Alternatives to VaR-based bank capital regulation that mitigate or even preclude its perverse implications are presented.     

The Value of Chinese Online game industry

The online games didn＇t enter China for a long time, but its development speed surprised a lot of people. The data in the IDC＇s report shows that the market size of online game will reach 8.34 million RMB in 2006. Alone with the increase of market competition and the growth of original creation, the Chinese online game industry will suffer an intensive shock. At present, the online game operation is facing the problem of product life circle＇s reduction and revenue＇s drop. To solve these problems, online game companies has to find out the new game＇s increasing point of profit.     

Telecommunications policy and individuals with disabilities: Issues of accessibility and social inclusion in the policy and research agenda

Information and communications technologies have become an integral part of life in an information society, affecting employment, education and many other daily activities. For individuals with disabilities, equal access to telecommunications remains a concern, as many technologies that are developed do not allow for equal access. Law and policy have made significant progress in some nations, but sizeable barriers remain to the social inclusion of individuals with disabilities in telecommunications technologies and services. This paper examines the importance of equal access to telecommunications for individuals with disabilities in both the formulation and the implementation of policy. Analyzing issues of policy and implementation, this paper discusses policy questions and potential areas of research to better understand the relationship of telecommunications policy to access for persons with disabilities.     

Networks and innovation: sustainable technologies in Scottish social housing

The process of innovation often involves the participation of several firms and organisations in a network. This paper improves our understanding of the role of inter-organisational relations in such networks. It assesses how sustainable technologies in the Scottish social housing sector are introduced and diffused. Drawing on detailed interviews, the paper shows that despite policy initiatives by the National Housing Agency to encourage sustainable technologies and processes, a number of factors related to the organisational structure of the construction industry militate against the achievement of this objective. The different aims of the parties involved in the construction chain may not be easily reconciled and traditional approaches to construction may reinforce these differences, hindering efforts to introduce innovation.     

The challenge of the future and the institutionalization of interdisciplinarity: notes on Herman Kahn’s legacy

This article is an attempt to explore Herman Kahn’s foundational contribution to the development of what he called “broad studies”, a combination of futures research and public policy analysis. In Kahn’s view, decision making and policy processes pose two crucial problems that the scholarly research is rarely forced to face: (1) the need to have and operate with a broad, multifaceted vision of phenomena and (2) the issue of coping imaginatively and realistically with future circumstances and conditions that can only vaguely be distinguished in the present. Implied in these two is the need to develop new methods and approaches fitted to the charges imposed by them. The paper discusses Kahn’s work as an integrated solution to these problems: The definition and advocacy of broad and future-oriented studies, his concept on how these studies should be institutionalized in interdisciplinary organizational systems, and the crucial position scenarios and propaedeutic and heuristic methodologies have in this context. A special attention is given to two methodological approaches he developed to cope with these challenges: Scenario Building and the Method of Classes of Variables.When twenty years ago, on July 7, 1983, Herman Kahn died suddenly at age 61, both friends and intellectual adversaries recognized that “the world lost one of its most creative and best minds” [1] and [2]. By that time Herman Kahn was one of the preeminent and best known Futures Studies scholars, a founding father of the field, with extensive and vital contributions in Strategic Studies, an area where he was also considered a founding figure and a leader [3] and [4]. His work was followed all over the world and the directions he traced in the public debate on very sensitive issues of crucial public concern have continued to be unaltered today, twenty years after his unexpected and premature death. Yet in spite of the incessant influence of his arguments and ideas, today his intellectual legacy is still to be accounted for and the breath and depth of his contributions are still to be reviewed and analyzed in a systematic way. This paper is an attempt to explore only one dimensions of this legacy: Kahn’s foundational contribution to the development of what he liked to call “broad studies”, a combination of futures research and public policy analysis.The two decades that have passed since his death allow us today to approach his work undisturbed by the “sound and fury” of the many public debates and controversies he participated in and to focus on some of the deepest and most enduring dimensions of his intellectual contributions. However while doing that, we should keep in mind that for Kahn the public policy process shaping the future and the public debate associated to it were always the focal points and the ultimate ends of his efforts. Indeed, probably the best approach to Kahn’s work is to see it in the light of his continuous concern for the practical relevance of the social research. For him the research process was always action-oriented and its ultimate test was its relevance for policy and social action. As a result, the most promising starting point for any overview of Kahn’s thought and work should be a set of crucial conclusions he reached about the policy making process and decision makers early in his career.     

Globalisation and the environment: the long-term effects of technology on the international division of labour and energy demand

This paper examines the effect of the structural changes arising from the globalisation of production and innovation and from technological changes on the environment. Drawing on theories of international production from international business and innovation, we assess the impact of long-term technological change and changes in international production on the international division of labour and energy demand. We select two industrial sectors with different technological characteristics (the textile, clothing and footwear sector and the chemical sector). We examine the effects of the globalisation of production and of technological change on these two sectors on the level of industrial production and resource intensity in different regions and countries over the last 30 years. We speculate on the impact of globalisation of production and innovation in future pervasive technologies—information technology, biotechnology and nano-technology. The implications of these developments on industrial greenhouse gases emissions are assessed.     

Accounting for decarbonisation and reducing capital at risk in the S&P500

This article accounts for carbon emissions in the S&P 500 and explores the extent to which capital is at risk from decarbonising value chains. At a global level it is proving difficult to decouple carbon emissions from GDP growth. Top-down legal and regulatory arrangements envisaged by the Kyoto Protocol are practically redundant given inconsistent political commitment to mitigating global climate change and promoting sustainability. The United Nations Environment Programme (UNEP) and European Commission (EC) are promoting the role of financial markets and financial institutions as drivers of behavioural change mobilising capital allocations to decarbonise corporate activity.     

An international study of internal audit function quality

We investigate organisational and environmental factors that influence firms’ incentives to develop high-quality internal audit functions (IAFs) by using a unique international sample formed by matching proprietary data from a global internal auditor survey with public data obtained from Worldscope. Concerning organisational factors, we find that a positive relationship exists between IAF quality and firm complexity and confirm that complex firms have a higher demand for monitoring and advising and, therefore, a greater need for formal controls. In addition, IAF quality is positively related to board monitoring and audit committee diligence but negatively associated with CEO power, which suggests that IAF quality is influenced by other key players in corporate governance. Regarding environmental factors, we document that IAF quality is positively associated with industry competition, which implies that a firm’s incentive for a high-quality IAF is enhanced when confronted with greater environmental uncertainty. Furthermore, IAF quality has a significantly positive relationship with our self-constructed index of IAF requirements included in national corporate governance codes, which indicates that strong home-country corporate governance codes play a role in fostering IAF development.     

Sharing my way to success: A case study on developing entrepreneurial ventures using social capital in an OSS community

While Open Source Software (OSS) communities provide opportunities for knowledge creation, we have a limited understanding of how entrepreneurs leverage OSS communities for their entrepreneurial ventures. Using social capital theory in a mixed methods case study, we compare entrepreneur and non-entrepreneur behaviors to investigate how entrepreneurs build social capital within an OSS community. This study shows that entrepreneurs differentiate themselves from non-entrepreneurs by focusing on cognitive and relational capital building activities, which in return makes it possible for them to leverage their social capital to influence and shape the environment in which they are operating. Our findings suggest that entrepreneurs strategically select which activities within the community to expend their limited resources on (e.g., developing code over participating in email conversations) and build their social capital more through their actions than through their words (e.g., showing their commitment to the community through code commits, bug fixes, and documentation). Given the liabilities of newness and smallness as well as other challenges faced by entrepreneurs, applying an open innovation strategy in OSS communities could be one approach where entrepreneurs, by developing and freely revealing their intellectual property to the community, share their way to success via OSS-infused entrepreneurial business ventures.     

Are there major differences in the attitudes and service quality of standard and seasonal employees? An empirical examination and implications for practice

Despite the increased use of seasonal employees by organizations, few studies have been completed on the attitudes and service quality of seasonal office workers. Using Lautsch's classification model, we analyzed the organizational context in which the standard and seasonal workers in this study were employed. Hypotheses were developed based upon the organizational analysis and social exchange theory. Results from archival data obtained from a web‐based organizational survey of 205 clerical and professional workers indicated contrary to expectations, standard and seasonal employees did not significantly differ in terms of perceptions of overall job conditions, perceived organizational support (POS), or job engagement. However, seasonal employees did report significantly fewer opportunities to work on challenging tasks, less comfortable physical working conditions, and less job security than the standard workers. As predicted, standard employees reported significantly higher levels of service quality performance than seasonal employees. Additionally, job engagement mediated the relationship between POS and service quality for both the standard and seasonal employees. Implications for managing seasonal employees are discussed.