Failure Prediction: Evidence from Korea

This study is an attempt to construct and test a distress classification model for Korean companies. Utilizing a sample of 34 distressed firms from the recent 1990-1993 period and a matched (by industry and year) sample of non-failed firms, we observe the classification accuracy of two models. Both models utilize measures of firm size, asset turnover, solvency and leverage with one model available for testing only on publicly traded companies and one model applicable to all public and private entities. We observe excellent classification accuracy based on data from the first two years prior to distress. And, although the accuracy drops off after t -2, the models still provide effective early warnings of distress in many cases. The results of this study are of particular relevance in the current financial market scenario of increased deregulation and greater individual financial institution decision making. It is somewhat ironic for us to be proposing the use of a financial distress early-warning model given the current robust economic growth and low bankruptcy rate in Korea. But, the financial problems in Japan are a sobering reminder that high growth can be followed by financial excesses, increased business failures and large loan losses.     

Keynesian models of deflation and depression revisited

This paper extends Tobin's [Tobin, J., 1975. Keynesian models of recession and depression. American Economic Review 65, 195–202] Keynesian analysis of deflation to include a range of additional channels through which deflation exacerbates Keynesian unemployment. The paper provides further theoretical reasons why downward price level adjustment may not solve the Keynesian problem. These arguments challenge the received wisdom that Keynes’ General Theory is a special case resting on downwardly rigid prices and nominal wages. This conventional wisdom has led many economists to recommend policies promoting downward flexibility. These policies have created an environment in which deflation is more likely, giving new relevance to Keynesian analysis of deflation.     

HEROES FOR PRESENT PURPOSES?— A LOOK AT THE CHANGING IDEA OF COMMUNAL LAND OWNERSHIP IN BRITAIN: PRESIDENTIAL ADDRESS

The suggestion that land should be owned communally (usually nationally) has often been put forward in Britain during the last three hundred years. The paper reviews the arguments as they have been developed by Utopians, Economists, Popularisers and Politicians. It argues that, though current problems are different from those addressed in the past, the history of the idea of communal ownership still offers insights that have current relevance. As far as rural land is concerned, the problems associated with ownership rights are those that relate either to non-market effects or to the ‘unearned increment’ or to landlord/tenant relationships. Suggestions are made as to the part that changes in property rights might play in handling these problems today. ‘To whomsoever the soil at any time belongs, to him belong the fruits of it. White parasols and elephants mad with pride are the flowers of a grant of land.’     

Einzelbesprechungen

Ohne ZusammenfassungAus dem Englischen übersetzt von Karl BodeAus dem Russischen übersetzt von A. GerschenkronAus dem Italienischen übersetzt von M. St. Braun, WienAus dem Italienischen übersetzt von Erich Allina, Wien     

Employee attitudes,customer satisfaction,and sales performance: assessing the linkages in US grocery stores

Using store‐level panel data for a major supermarket company, we investigate the linkages between employee attitudes, customer satisfaction, and sales performance, while controlling for observed and unobserved differences across stores. We find that employee attitudes positively affect customer satisfaction with service but do not affect customer satisfaction with quality or value. Additionally, we find that customer satisfaction with service positively affects sales performance. Our results suggest that employee attitudes affect sales performance through their impact on customer service. Copyright © 2008 John Wiley & Sons, Ltd.     

Quality Labelling for Re-used ICT Equipment to Support Consumer Choice in the Circular Economy

Journal of Consumer Policy - The ever-increasing consumption of natural resources required for the production of consumer electronics, and the growing amount of electronic waste, underline the...     

The Role of Sovereign Funds in Stabilizing the World’s Financial Architecture

This article discusses the activities of the largest sovereign wealth funds and analyzes their functions. The issues of the motivation of such funds, their influence on the main participants of the financial market, and in particular, questions of economic security are touched upon.