The evolution of world trade from 1995 to 2014: A network approach

This paper employs network analysis to study world trade from 1995 to 2014. We focus on the main connective features of the world trade network (WTN) and their dynamics. Results suggest that countries’ efforts to attain the benefits of trade have resulted in an intertwined network that is increasingly dense, reciprocal, and clustered. However, these features do not correspond to a linear aggregation of the characteristics of its constituents (trade sectors). Trade linkages are distributed homogeneously among countries, but their intensity (i.e. their value) is highly concentrated in a small set of countries. The main connective features of the WTN were not affected by the 2007–2008 international financial crisis. However, we find that the crisis marks a turning point in the evolution of the WTN from a two-group (led by the US and Germany) to a three-group (led by the US, Germany, and China) hierarchical structure.     

Bank market power and the intensity of borrower discouragement: analysis of SMEs across developed and developing European countries

Small Business Economics - This paper analyzes the effect of bank market power on the financial constraints of small and medium-sized enterprises (SMEs) through the study of borrower...     

Environmental Innovations and Internationalization: Theory and Practices

Based on original data on Italian firms specializing in medium‐ and low‐tech industries, we study the relationship between firms’ upstream and downstream internationalization and their propensity to introduce products or processes that reduce environmental impact. Preliminary evidence suggests that geography plays an important role in green firms’ activities and supply chains. More precisely, results suggest that firms that outsource to and rely on non‐local suppliers are less likely to engage in environmental innovations. Moreover, we verify that firms engaged in export activities play a similar and negative role, regardless of the export intensity and typology of foreign markets (i.e. developed versus emerging). Tapping global flows of knowledge by being a part of a multinational group positively spurs the development of green innovations, as for FDIs. Copyright © 2014 John Wiley & Sons, Ltd and ERP Environment     

Tests of Normality of Functional Data

The paper is concerned with testing normality in samples of curves and error curves estimated from functional regression models. We propose a general paradigm based on the application of multivariate normality tests to vectors of functional principal components scores. We examine finite sample performance of a number of such tests and select the best performing tests. We apply them to several extensively used functional data sets and determine which can be treated as normal, possibly after a suitable transformation. We also offer practical guidance on software implementations of all tests we study and develop large sample justification for tests based on sample skewness and kurtosis of functional principal component scores.     

A Geometrical Interpretation of Collinearity: A Natural Way to Justify Ridge Regression and Its Anomalies

Justifying ridge regression from a geometrical perspective is one of the main contributions of this paper. To the best of our knowledge, this question has not been treated previously. This paper shows that ridge regression is a particular case of raising procedures that provide greater flexibility by transforming the matrix X associated with the model. Thus, raising procedures, based on a geometrical idea of the vectorial space associated with the columns of matrix X , lead naturally to ridge regression and justify the presence of the well-known constant k on the main diagonal of matrix X ^′ X . This paper also analyses and compares different alternatives to raising with respect to collinearity mitigation. The results are illustrated with an empirical application.     

How an international ambidexterity strategy can address the paradox perspective on corporate sustainability: Evidence from Chinese emerging market multinationals

Corporate sustainability (CS) is receiving considerable attention from emerging market multinational enterprises (EMNEs), playing an important role in the globalized market. However, theoretical and empirical knowledge about how EMNEs address CS is still scant, and the relationship between internationalization and CS has not been widely explored. This study aims to fill this gap, evaluating the relationship between an international ambidexterity strategy and CS in EMNEs, which highlighted the paradox perspective. Then we develop three hypotheses in which we argue how the dynamic capabilities underpinning international ambidexterity could be considered a driver of CS in EMNEs. We test the developed hypotheses against data from 300 Chinese EMNEs obtained by a survey. Our results contribute to shape ambidextrous international strategies and to consider CS as a springboard for the strategic intent to systematically and recursively outperform global competition. Testing a measurement scale of international ambidexterity, we suggest structural ambidexterity as a strategic option of internationalization that allows the achievement of economic, social, and environmental sustainability objectives.     

On the Relationship between Audit Tenure and Fees Paid to the Audit Firm and Audit Quality

Abstract

We investigate the impact of audit firm tenure, partner tenure, audit fees, fees for non-audit services and total fees on audit quality, as measured by discretionary accruals. Our sample consists of Spanish non-financial public companies for the years between 2006 and 2013. Results indicate that audit quality increases with audit firm tenure but decreases with partner tenure. Moreover, the level of fees paid to the audit firm seems to have a negative impact on audit quality, which is mainly driven by fees for audit services. In this regard, we do not observe any significant relationship between fees for non-audit services and audit quality. Our results also show that the negative relationship between either long partner tenures or high fees and audit quality does not occur when the tenure with the audit firm is long. Therefore, long audit firm tenures do not only seem to involve higher audit quality ‘per se’, but also moderate the negative effects of partner tenure and audit fees on audit quality. The results of this study, which are robust to several sensitivity checks, may be relevant for the current debate on auditor rotation and the joint provision of audit and non-audit services.     

A unified framework for robust modelling of financial markets in discrete time

Finance and Stochastics - We unify and establish equivalence between the pathwise and the quasi-sure approaches to robust modelling of financial markets in finite discrete time. In particular, we...     

Trade shocks,product mix adjustment and productivity growth in Italian manufacturing

In this paper, we use firm-level data on the universe of Italian manufacturing multi-product exporters to test whether demand shocks in export markets lead multi-product exporters to increase their productivity. The main mechanism behind the documented productivity gains is the reallocation of resources across products within firms (American Economic Review, 104, 2014 and 495; National Bureau of Economic Research Working Paper Series No. 22433, 2016). Intuitively, the increased demand stemming from foreign markets will induce firms to adjust their product mix by moving inputs from low to high productive/profitable uses. We find that these productivity gains are significant and can explain between 1/10 and 1/2 of aggregate productivity growth in the manufacturing sector.