21 years of international M&As and joint ventures by Italian medium-sized listed firms: Value creation or value destruction?

This study provides evidence of the value creation of different equity entry modes in a sample of international investments performed by all Italian medium-sized listed firms in the period 1986-2006. Our research shows a positive and significant market reaction to announcements of internationalization strategies. The results are largely affected by high-equity entry modes carried out in advanced economies. Low-equity entry modes and international operations performed in emerging countries show no significant market reaction. We also find that the relative size of the deal, the firm age, the country risk, and the evolution of information disclosure regulation, matter in explaining the outcomes.     

Monetary Policy,Taylor’s Rule and Instability

We analyse the dynamic behaviour of an economy where the central bank (CB) sets interest rates according to a Taylor‐type policy rule. A simple model for a closed and instability‐prone economy is constructed and subjected to formal dynamical analysis and numerical simulation. It is shown that a requirement for local stability is that the two response coefficients in the policy rule be positive. Similarly, it is shown that raising the response coefficient of the output gap increases the likeliness of the economy being stable, whereas raising the response coefficient of the inflation gap has an uncertain and probably negligible effect on local stability. Self‐sustained oscillations may arise for certain parameter values. Policy mistakes in the estimation of the long‐run equilibrium real interest rate or potential real GDP may prevent the CB from achieving its inflation target. A suggestion for enhancing the stabilization capacity of Taylor‐type policy rules in the context of the model presented is made.     

Economic Growth and Transboundary Pollution in Europe: An Empirical Analysis

The existing empirical evidence suggests that environmental Kuznets curvesonly exist for pollutants with semi-local and medium term impacts.Ansuategi and Perrings (2000) have considered the behavioral basis for thecorrelation observed between different spatial incidence of environmentaldegradation and the relation between economic growth and environmentalquality. They show that self-interested planners following a Nash-typestrategy tend to address environmental effects sequentially: addressingthose with the most immediate costs first, and those whose costs aredisplaced in space later. This paper tests such behavioral basis in thecontext of sulphur dioxide emissions in Europe.