Das europäische Verfahren zur Vermeidung und Korrektur von Leistungsbilanzungleichgewichten

The Macroeconomic Imbalance Procedure (MIP) is part of a institutional framework known as the so-called “sixpack“, which has come into effect on December 13th 2011 in response to the European financial and debt crisis. The crisis has shown that internal and external imbalances (in particular current account deficits) are strongly intertwined. The MIP should identify external imbalances at an early stage and thus compel countries to correct these imbalances to forestall potential crises. Methodological questions are discussed, which are to be resolved to ensure the effectiveness of the MIP.     

What Do We Know about Success and Failure of Mergers?

Collecting the most important results of about 80 empirical merger studies, this study condenses the bewildering spectrum of results to 18 stylized facts. Most important, no more than a quarter of the mergers increase consumer welfare; another quarter increase profits at the cost of consumers; half of the mergers reduce the value of the firm. Targets' shareholders win, while bidders' shareholders break even upon the announcement of a merger, but lose significantly in the long run. Seen relatively, horizontal mergers fare best, especially if they are focus-increasing. Cash-financed mergers fare better than stock-financed and strategic mergers fare better than financial ones. Confronting the stylized facts with existing merger theory reveals some major paradoxes; confronting them with existing competition policy reveals the need for a modification and intensification, as mergers increase concentration, and corporate policy strives towards still higher concentration. As a summary ten lessons are extracted on what we may have learnt, and on what is still open.     

A structural break in the effects of Japanese foreign exchange intervention on yen/dollar exchange rate volatility

We study the impact of Japanese foreign exchange intervention on the volatility of the yen/dollar exchange rate since the early 1990’s in a GARCH framework with interventions as exogenous variables. Using daily intervention data provided by the Japanese Ministry of Finance, we show that the effect of interventions varies over time. From 1991 up to the late 1990’s, Japanese foreign exchange intervention is associated with an increase in volatility of the yen/dollar exchange rate. After the year 1997, Japanese foreign exchange intervention correlates with reductions in exchange rate volatility. This can be explained by the fact that Japanese foreign exchange intervention remained quasi unsterilized in the liquidity trap.

Learning to live with complexity

Business life has always featured the unpredictable, the surprising, and the unexpected. But in today's hyperconnected world, complexity is the norm. Systems that used to be separate are now intertwined and interdependent, and knowing the starting conditions is no guide to predicting outcomes; too many continuously changing interactive elements are in play. Managers looking to navigate these difficulties need to adopt new approaches. They should drop outmoded forecasting tools-for example, ones that rely on averages, which are often less important than outliers. Instead, they should use models that simulate the behavior of the system. They should also make sure that their data include a good amount of future-oriented information. Risk mitigation is crucial as well. Managers should minimize the need to rely on predictions-for instance, they can give users a say in product design. They can decouple elements in a system and build in redundancy to minimize the consequences of a partial system failure, and turn to outside partners to extend their own company's capabilities. They can complement hard analysis with "soft" methods such as storytelling to make potentially important future possibilities more real. And they can make trade-offs that keep early failures small and provide the diversity of thought needed in a nimble organization faced with complexity on virtually every front.