Spin-offs in an Environment of Bank Debt

Abstract:  An assessment of the wealth impact of spin-offs involving UK firms is of interest, as they tend to access debt through banks rather than capital markets. Banks will have a different relationship with shareholders, so the distribution of returns may differ from that previously observed. The short and long-term impact on both parent and spin-off shareholders is investigated. Possible reasons for a positive returns response, including an anticipated acquisition premium, and management focus related gains, are considered. Annual financial ratios offer a further evaluation of operating performance and assess the impact on levels of leverage in parents and spin-offs.     

On the sharing of trade gains by resource-poor and resource-rich countries

A model of an asymmetric world composed of resource-poor and resource-rich countries. The scopes of ‘economic imperialism’ and ‘resource nationalism’ are then examined. It is shown that self-seeking resource-poor countries will completely exploit their resource-rich trading partners but that the latter will exploit the former only partially.     

The gain from free trade under conditions of uncertainty

It is argued that recent attempts to demonstrate that free trade may be harmful under some kinds of uncertainty are based on implausible assumptions. It is shown also that standard proofs of the gainfulness of free trade can be adapted to accommodate uncertainty.     

Universal Dumping of Homogeneous Products

Contrary to predictions from traditional comparative advantage analysis, a class of models with imperfect competition predicts intra-industry trade in homogeneous goods. Brander and Krugman offer a model with two countries and one firm in each country which generates the outcome that both firms dump into the export market (reciprocal dumping). The present paper determines the extent to which higher dimensionality alters this outcome by introducing a model with several firms in each of several countries. It is shown that dumping is universal. Thus, whenever trade occurs dumping occurs.     

Extracting Resource Deposits of Unknown Size: Optimal Order

Abstract. The optimal order of extracting resource deposits of unknown size depends on the informational characteristics of the extraction process. This paper fills the gap between two strands of literature. The first strand is about the optimal extraction of single reserve under stock-size uncertainty. The second strand is about the optimal order of extraction of deposits of known sizes. Our emphasis on the premium for resolution of uncertainty complements Solow and Wan's shadow surcharge when extraction moves from a low-cost deposit to a high-cost one.     

How do Small and Medium Enterprises Go “Green”? A Study of Environmental Management Programs in the U.S. Wine Industry

In industries populated by small and medium enterprises, managers’ good intentions frequently incur barriers to superior environmental performance (Tilley, Bus Strategy Environ 8:238–248, 1999). During the period when the U.S. wine industry was beginning to promote voluntary adoption of sound environmental practices, we examined managers’ attitudes, norms, and perceptions of stakeholder pressures to assess their intentions to implement environmental management programs (EMP). We found that managers within the simple structures of these small and medium firms are responsive to attitudes, norms, and pressures from internal stakeholders and that voluntarily established EMP increased the success of firms’ implementation of energy conservation and recycling practices. Applications of our findings to future research on small and medium enterprises as well as direct practical applications of our results are discussed.