The impact of digital transformation on the retailing value chain

Consumers have traditionally made purchase decisions at the store shelf, giving institutional brick-and-mortar retailers great power to learn about and influence behaviors and preferences. With the rise of e-commerce, mobile shopping, and most recently smart technologies, new competitors threaten this long-standing supremacy. Adopting a value-creation perspective, we analyze how digitization started the erosion of institutional retailing as the primary interface to the customer. We develop a framework that identifies five new sources of value creation and propose how these advance and transform competition for this interface. Depending on the importance of the new sources of value creation (in different purchase situations), stationary retailing may prevail as an important interaction point in a multichannel decision journey. However, increasing diffusion of branded-product platforms including connected devices and online retail platforms is shifting this authority to new players. For the parties involved in this multilayered competition, acknowledging the changes and actively managing their position in the evolving eco-systems is crucial.     

The role of corporate governance in shaping accruals manipulation prior to acquisitions

Based on stock swap transactions involving public acquirers originating from the UK between 1998 and 2011, this paper investigates the role of corporate governance in shaping accruals manipulation prior to stock swap deals. In contrast to common claims that strong corporate governance constrains accruals manipulation, my results show that well-governed acquirers engage more aggressively in income-increasing accruals manipulation than those with weak governance. This finding is consistent with a role of corporate governance that incentivises managerial actions in the interests of firms’ shareholders. Overall, this finding highlights the setting-specific nature of the earnings management and corporate governance relation. My results are robust to different discretionary accrual models, differences in the firm's growth structure, merger and acquisition control variables, a control group of 100% cash acquirers, an analysis of buy-and-hold abnormal returns, and potential sample selection problems.     

After the "Bubble": Valuation of Telecommunications Companies by Financial Analysts

In this article, we present the results of a series of interviews given by financial analysts specializing in the European telecommunications industry. Our objective is to gain an insight into their approaches to analysis and valuation (information sources, valuation methods, determinants of recommendations, etc.). We also consider whether analysts' approaches have changed since the “high‐tech bubble”. We find that today they rely much more on the discounted cash flow analysis method than at the end of the 1990s, when valuation was largely based on multiples. In line with this, analysts have changed their focus from revenue‐oriented measures towards an assessment of profitability and cash flow generation. Further, analysts claim to have become more diligent and more critical in their analysis.     

The role of off-farm employment in the rural energy consumption transition — A village-level analysis in Jiangxi Province, China

Energy consumption in rural areas in China is characterized by high consumption of fuelwood, straw and other biomass. Off-farm employment can play an important role in the transition towards more sustainable sources of energy by increasing rural household incomes and reducing the amount of labor available for biomass collection. The purpose of this paper is to examine the impact of off-farm employment on rural household energy consumption choices, and to disentangle the various causal relationships that play a role in this respect. To this end, a hybrid farm household/village computable general equilibrium (CGE) model is used that has been calibrated for a remote village in Northeast Jiangxi Province where fuelwood is the main source of energy. The model takes into account nonseparability of farm household production and consumption decisions as well as linkages within the village between households involved in off-farm employment and households with no members working off-farm. Contrary to previous research for a richer region in rural China, we find that fuelwood is not an inferior good. The positive impact of more food consumption on fuelwood collection more than compensates the higher leisure demand associated with higher incomes. Shifts in production activities and in prices on village factor markets caused by increased labour scarcity (the lost-labour effect of off-farm employment), on the other hand, cause a reduction in fuelwood collection and consumption. This lost-labour effect is much stronger for migration than for local off-farm employment, because the latter can more easily be combined with on-farm work and fuelwood collection. For local off-farm employment the income effect dominates the lost-labour effect, resulting in a positive overall impact of higher off-farm participation on fuelwood consumption. For migration, on the other hand, the income effect and the lost-labour effect are almost equal in size. Hence, the amount of fuelwood collected and consumed does not change much when households participate in migration. The final conclusion is therefore that increased off-farm employment opportunities do not promote the transition of rural energy use in the poorer regions of rural China.     

Combining results of different models: the case of a levy on the Dutch nitrogen surplus

Economic instruments, such as levies are considered by the Dutch government for reducing the harmful effects of the production and application of manure. To analyse these levies a framework which makes it possible to combine and to choose among different types of research is developed. The results are integrated along the line of the marginal abatement cost curve. The problems related to integrating different types of research are taken into account. The method developed allows every farmer to react to a levy differently. A levy turns out to be more effective to reduce the nitrogen surplus on farm level in the pig fattening sector when compared to the pig breeding sector. But even a levy of 2 guilderd/kg of nitrogen does not remove the total manure surplus in the pig sector and results in large profit losses. Further research is needed to underpin the empirical input required by the model.     

The gender wage gap among China’s rural–urban migrants

In this study, we present new empirical evidence on gender wage differences among rural–urban migrants in China. We use a data set that includes migrants residing in urban communities and those living at their workplaces—the latter were not included in the previous studies. We find that the gender wage gap among migrants is 16%–18% and does not differ between migrants living at workplaces and those living in urban communities. However, gender differences in industry sorting play a more important role for migrants living at their workplaces, whereas differences in education and experience are of importance for those living in urban communities. Overall, differences in the returns to characteristics are the main driver of the gender wage gap, especially for migrants living in urban communities.     

Short- and long-term participation tax rates and their impact on labor supply

Generous income support programs as provided by European welfare states have often been blamed to hamper employment. This paper investigates the importance of incentives inherent in the tax-benefit system for the individual decision to take up work. Using German microdata over the period 1993–2010, we find that recent reforms in Germany increased work incentives at the extensive margin measured by the participation tax rate (PTR), particularly for low-income individuals. Work incentives are even higher if the time horizon is extended to more than one year, pointing at an overestimation of the disincentives by standard measures. Regression analysis reveals that a decrease in the PTR increases the probability of taking up work significantly.     

The effect of land tenure governance on technical efficiency: evidence from three provinces in eastern China

This study aims to identify the mechanisms through which land tenure governance affects the technical efficiency of grain production in an integrated framework and to examine the impacts of the public governance, village self-governance, and relational governance of land tenure on the technical efficiency of contracted land and rented-in land. Farm-level survey data collected from Liaoning, Jiangxi, and Jiangsu provinces covering the years of 2014 and 2015 is used for the empirical analysis. The findings indicate that (i) public governance associated with land certification significantly increases the technical efficiency of grain production; (ii) village self-governance and administrative land reallocations can serve as substitutes for the land rental market in optimizing the distribution of land resources and improving technical efficiency; and (iii) compared to multi-year transfer contracts, both annual and open-ended transfer contracts have negative impacts on technical efficiency.     

Internal Capital Markets and Capital Structure: Bank Versus Internal Debt

We argue that domestic business groups are able to actively optimise the internal/external debt mix across their subsidiaries. Novel to the literature, we use bi‐level data (i.e. data from both individual subsidiary financial statements and consolidated group level financial statements) to model the bank and internal debt concentration of non‐financial Belgian private business group affiliates. As a benchmark, we construct a size and industry matched sample of non‐group affiliated (stand‐alone) companies. We find support for a pecking order of internal debt over bank debt at the subsidiary level which leads to a substantially lower bank debt concentration for group affiliates as compared to stand‐alone companies. The internal debt concentration of a subsidiary is mainly driven by the characteristics of the group's internal capital market. The larger its available resources, the more intra‐group debt is used while bank debt financing at the subsidiary level decreases. However, as the group's overall debt level mounts, groups increasingly locate bank borrowing in subsidiaries with low costs of external financing (i.e. large subsidiaries with important collateral assets) to limit moral hazard and dissipative costs. Overall, our results are consistent with the existence of a complex group wide optimisation process of financing costs.     

Sustainable natural resource use in rural China: Recent trends and policies

In this paper we provide an overview of recent trends in the availability and quality of land and water resources in rural China, and examine the common presumption that rural resources are rapidly degrading in China. Data based on consistent definitions and measurement methods that have recently become available are used to that end. In addition, we analyse the impact of new policy initiatives to introduce market-based instruments and new institutions to address land degradation and water scarcity problems.We find that the decline in cultivated area has accelerated in the beginning of the new century. Ecological recovery programs, not urbanization and industrialization, are the major factors causing this decline. Ecological recovery programs are also a major force behind the increase in forest land area and the reduction of water erosion. Modest successes can be observed in the protection of wetlands and (until the mid-1980s) for the average quality of cultivated land. On the other hand, degradation of natural grassland and wind erosion have become much more severe in recent decades.In northern China, particularly in the 3-H (Hai and Luan, Huai and Huang) river basins, the availability of water has tightened. Groundwater tables have fallen considerably in the Hai river basin, because farmers increasingly rely on groundwater for irrigation. Evidence on other parts of northern China is mixed. Pollution of surface water is getting worse since the beginning of the 1990s in two major lakes in southern China and until recently in the rivers in northern China. Water quality problems in the larger rivers in southern China are less severe and getting less. These problems are to a large extent caused by agriculture-based non-point source pollution, especially in the major lakes and reservoirs.The sloping land conversion program, water pricing, and the establishment of water user associations and payments for environmental service projects are used as cases to examine the introduction of market-based instruments and new institutions. We argue that less government interference in the implementation of these instruments and institutions is likely to enhance ecological as well the economic benefits. Moreover, supportive measures to improve the functioning of land and labor markets are usually needed to ensure the sustainability of the impact of interventions.