Struggle for Survival in the Deregulated Market: Re-commodification and Informalisation of the Taxi Sector in Stockholm

This paper investigates the process of the informalization of the Swedish taxi industry, focusing on how this process has been manifested in Stockholm’s taxi market. This process has been analysed partly in its particular, local and sector-specific context, as it has been affected by the deregulation of the taxi sector, and partly in its relationship to the broader context of economic and political changes to which all contemporary capitalistic (welfare) states are exposed. This study raises questions about actual common sense discourses on the issue of irregularities in the taxi industry, and offers an alternative perspective both on the ongoing process of informalization, and on the role of various economic actors in that process, including the state.     

What drives mortgage fees in Australia?

We investigate the factors that affect total, ongoing and origination fees of mortgages in Australia during the period 1996 to 2011. We find that banks charge significantly higher total and ongoing fees than mortgage corporations although they require lower origination fees. We also find that fee levels are dependent on loan size, loan‐to‐value ratio and loan features like term of the loan and presence of an offset account. Further, we confirm that lenders trade‐off higher (lower) interest rates with lower (higher) fee levels. Finally, our results show that mortgage fees are significantly affected by market conditions.     

Walking a slippery line: Investments in social values and product longevity

Corporate sponsorship of events that support social values (e.g., human rights) help firms infuse their products with symbolic meaning, prolonging their life cycle. Yet, higher product prices might spark perceptions that the firm invests in social values for calculative or opportunistic motives, in which case event sponsorship is unlikely to deliver the expected benefits in the form of product longevity. This study explores this potential tension empirically, using data related to sponsored social events, entry prices, and product longevity for a U.S. cosmetics producer. Copyright © 2014 John Wiley & Sons, Ltd.     

The Global Compact: an analysis of the motivations of adoption in the Spanish context

In the 10 years after the launch of the United Nations Global Compact (GC), there have been very few empirical assessments of the initiative in the academic literature. In this study, drawing from institutional theory and the resource-based view of the firm, we examine motivations of business participants to adopt the GC principles in the Spanish context. Using survey data from Spain – the country reporting the highest volume of business participants in the GC – we find that external institutional forces as well as internal organisational resources shape motivations for adopting GC principles. In particular, we find that early and late adopters are motivated similarly by the perceived opportunity of achieving image gains, while late adopters are motivated more by economic gains than early adopters. We further find that regardless of the extent of internal intangible resources possessed, firms are similarly motivated by economic gains. The results also show that companies with more intangible resources are motivated more by image gains than those with fewer resources. Our findings indicate that contrary to its earlier days, economic gains have emerged as an important motivator for the adopters of the GC principles with image gains still being an important motivator.     

Agricultural commodity futures trading based on cross-country rolling quantile return signals

This paper formulates and examines a new type of bivariate time series trading strategy based on signals generated from cross-country quantiles of return distributions. We conduct rolling quantile trading strategies separately in the U.S. and Chinese futures markets for soybeans, wheat, corn and sugar over very short (daily, intraday and overnight) holding periods. Overall, we find that these practical strategies outperform various benchmarks and there is a large profit potential when trades follow quantile-based signals rather than focusing on the median only. The results highlight the value of cross-country trading strategies and the harnessing of information from different parts of the return distributions which have so far been neglected.     

Management Behaviour in Vietnamese Commercial Banks

This study identifies managerial behaviour in Vietnamese banks between the years 2000 and 2014, based on the managerial framework of banks, as identified by Rossi et al. ( 2009 ). This framework is built on the interrelationships between efficiency, risk, capital and diversification. This study uses the Z‐score to measure insolvency risk, the SFA to estimate cost efficiency, the ratio of total equity to total assets to capture bank capital and the HHI index to measure the diversification of revenue and earning assets. The results from the 3SLS estimator indicate that revenue diversification has an insignificant impact on insolvency risk, capital ratio and cost efficiency, but earning assets diversification has a negative effect on these three variables, supporting ‘classical diversification’, ‘economic capital’ and ‘monitoring’ behaviours. Moreover, a decline in cost efficiency leads to a rise in insolvency risk, implying ‘bad management’ behaviour; an increase in risk results in a reduction in cost efficiency, indicating ‘bad luck’ behaviour; and a reduction in capital ratio in the poorly capitalised banks leads to a growth in risk, suggesting ‘moral hazard’ behaviour. The results remain strongly robust when using an alternative risk measurement (the loan loss provision ratio) and an alternative SFA model.     

River-sea shipping - competitiveness of various transport technologies

This paper evaluates two existing and one new river-sea transport technology. As existing technologies, we are dealing with river-sea transport with transhipment of cargos from sea to river ships and vice versa at ports located in the river mouths and technology with river-sea vessels and the river-sea push barge system. The new cost based models are developed for each of these technologies and illustrated through various examples. The proposed models consider the dependence between minimal total costs and relations of sea transport distance to total transport distance, on one side, and a level of cargo handling rates in ports, on the other side. An analysis of the results provides us with the possibility of drawing useful guidelines for further improvement and development of river-sea transport and its technologies.     

Which way does water flow? An econometric analysis of the global price integration of water stocks

Around US$600 billion of investment is desperately needed to address forecasted huge shortages in water supply globally. A number of worldwide investors – so-called water funds – have started to take up this challenge. For these global water investors, knowledge about the extent of integration between the water sectors of financial markets is highly important. According to international portfolio diversification theory, the less (more) integrated markets are, the more (less) benefits there are from international diversification. In this study, we investigate the extent and manner of interdependence among the US, European and Asian water sector of the equity markets based on Vector Autoregression (VAR), Granger causality and impulse response analyses. We find that world water stock market prices are indeed significantly interdependent although this interdependence varies across time periods. Each market quickly responds to shocks from each other and completes its response within 3 days. Hence, for water investors, international diversification that is undertaken just within the water sector will not be beneficial. The result also implies that there is the risk of crossmarket contagion – that is, price volatility spill over across water sectors of different financial markets, and therefore, water authorities in one market should take cognisance of events in other markets.     

It Is Time to Reexamine the Role of Stock Markets in Developing Economies

Although the many perceived benefits of a stock market may have led to their rapid formation and development aspirations across economies, emerging findings that stock markets may not be as useful as previously thought, even a detraction in the case of some developing economies, raises the question of how practical stock markets may be in different situations. In light of the foregoing and using Fiji as an example, this study argues that it is indeed time to reexamine the role of stock markets in developing economies with a view to restructuring the financial system for improved efficiency and effectiveness.     

Discretionary accruals: signalling or earnings management in Australia?

We investigate the signalling effect of discretionary accruals (DAC). Although we find that discretionary accruals are insignificantly related to contemporaneous stock returns, we uncover that income‐increasing discretionary accruals of GAAP‐complying growth firms are significantly and positively related to contemporaneous stock returns. Furthermore, we find that this positive effect is stronger among firms with better corporate governance mechanisms, such as Board of Directors Independence, Audit Committee Independence and Large Shareholders’ Ownership. In addition to contemporaneous stock returns, we also find similar results with the future increase in dividends. Our findings are consistent with the argument that corporate governance can enhance the signalling effect of reported earnings of GAAP‐complying growth firms.