Optimal liquidation strategies regularize portfolio selection

We consider the problem of portfolio optimization in the presence of market impact, and derive optimal liquidation strategies. We discuss in detail the problem of finding the optimal portfolio under expected shortfall (ES) in the case of linear market impact. We show that, once market impact is taken into account, a regularized version of the usual optimization problem naturally emerges. We characterize the typical behavior of the optimal liquidation strategies, in the limit of large portfolio sizes, and show how the market impact removes the instability of ES in this context.     

The relationship between job dissatisfaction and training transfer

The high rates of training transfer failure that prevail still puzzle practitioners as well as researchers. The central aim of the present study is to analyze the relatively under‐researched role of job dissatisfaction in the training transfer process. Specifically, we expect that job dissatisfaction would have a negative effect on transfer but that this effect would be buffered by the expectation of positive transfer consequences and motivation to transfer. To test these hypotheses, 220 participants in different training programs completed an online questionnaire 1 year after training. The results support our assumptions. They reveal that job dissatisfaction has a detrimental effect on training transfer, but that motivation to transfer and the expectation of positive transfer consequences have a buffering effect. The more motivated a person is towards transfer, the less negative is the effect of job dissatisfaction on actual transfer, but only if a person expects positive outcomes from transfer, such as acknowledgment or rewards. The findings are discussed in relation to existing training transfer models, as well as models of job (dis)satisfaction.     

The impact of firm entry regulation on long-living entrants

What is the impact of firm entry regulation on sustained entry into self-employment? How does firm entry regulation influence the performance of long-living entrants? In this paper, I address these questions, exploiting a natural experiment in firm entry regulation. After German reunification, East and West Germany faced different economic conditions, but fell under the same law that imposes a substantial mandatory standard on entrepreneurs who want to start a legally independent firm in one of the regulated occupations. The empirical results suggest that the entry regulation suppresses long-living entrants, not only entrants in general or transient, short-lived entrants. This effect on the number of long-living entrants is not accompanied by a counteracting effect on the performance of long-living entrants, as measured by firm size several years after entry.     

An investigation into the roles of open innovation collaboration managers

The concept of open innovation has gained traction among practitioners and academics. Many different aspects of open innovation have been researched, but the question of how to manage open innovation collaboration in order to achieve the desired knowledge flow across organizational boundaries remains only partly answered. Consequently, this article argues for the need to complement prior firm-centric perspectives by investigating the roles of senior management in the postmodern form of organizing that characterizes open innovation collaboration. A more in-depth understanding of managerial roles in this context can increase the chances of fruitful collaboration. Thus, the article uses an inductive, interview-based approach to explore senior management roles in two institutionalized open innovation collaborations, thereby creating an initial conceptualization of the role of managers in open innovation and forming a basis for further studies on open innovation management. In this respect, the article identifies and discusses additional managerial roles that appear to be crucial for open innovation collaborations. These roles are those of a facilitator, tactician, and sensegiver.     

Bank capital regulation, asset risk, and subordinated uninsured debt

Whether more stringent capital requirements lead to reduced or to increased bank risk-taking has been discussed intensively in the academic literature. In this paper we drop the common but unrealistic assumptions that banks only issue deposits whose returns are guaranteed by a subsidised deposit insurance and that deposit insurance is free. We prove that with uninsured debt and a flat-rate deposit insurance premium the reaction of a bank to a higher capital requirement may change substantially. In some scenarios banks increase asset risk due to the enforcement of a more stringent capital requirement.     

Monroe Friedman: Consumer Boycotts: Effecting Change Through the Marketplace and the Media

Journal of Consumer Policy -     

Institutional checks and balances and the political control of the money supply

The Nordhaus hypothesis about the political business cycle assertsthat elected politicians have incentives to expand the moneysupply prior to elections to stimulate the economy and therebyengineer their re-election. Central bank independence is widelyregarded as an institutional solution to this problem. However,this solution works only if central bankers are not perfectagents of their political principals, perhaps because they areconservative (more inflation-averse). This artide proposes analternative solution: political business cycles may be obstructedby institutional checks and balances. The analysis applies tothe Deutsche Bundesbank and has implications for the institutionalstructure of the future European Central Bank.