PRIVATE EQUITY: SOURCES AND USES

Private equity capital is playing a large and growing role in the funding of small to medium-sized, high-growth businesses. Today's private equity investment typically takes the form of purchase of a minority interest in a post-start-up, high-technology company followed by an IPO a few years later. A large number of such investors are scouring the markets for new investment possibilities and the competitive pressures are growing.
Although private equity investors can and often do add significant value to a company, private equity is potentially expensive, in terms of both loss of ownership and loss of control over long-term strategic decisions of the company. Owner-managers who want to retain as much of both as possible are advised to install more formalized business procedures, expand the company's outside relationships, and become more familiar with the company's financial needs and options. These changes should reduce capital needs, reduce the costs of private equity funding, and increase negotiating leverage when dealing with large, sophisticated private capital investors.     

Forward to Basics in Economics

For nearly half a century since Keynes's supposed rebuttal of classical economics, economists and politicians have been pre-occupied with 'demand side' efforts to maintain full employment and output by spending more than they can raise in taxes. The evident failure of 'demand side' economics has at last reached the Keynesian economists. Some are beginning to reject 'demand side' economics as inadequate and to argue for the return of 'supply and demand'.     

Professional HRM Practices in Family Owned‐Managed Enterprises*

This study examines determinants of professional human resource management (HRM) practices within a sample of approximately 700 small to medium‐sized firms. Predictions from the agency theory and the resource‐based view of organizations lead to alternate hypotheses regarding the direct and indirect negative effects of family ownership and management on the usage of professional HRM practices. Results support predictions for both direct and indirect effects. These indirect effects occur through intermediary variables that reflect organizational complexity, such as firm size, (the presence of a) formal business plan, and HRM specialization. The findings lend partial support to both theories.     

Test procedures and test problems for least squares algorithms

Numerous test problems have been introduced in the past twenty years for the purpose of studying and comparing least squares algorithms and computer programs. This paper discusses and classifies some of the useful test problems which have appeared in the literature. A recent large scale test procedure is briefly summarized. Several neat, mathematical examples are displayed. One of these, first introduced by Läuchli, is modified so that it can be solved by the method of inverting a matrix of correlation coefficients. Comparative results from running two types of problems on several different algorithms are given which illustrate some of the factors affecting computational accuracy: choice of algorithm, scaling of the data, tolerance parameters, and iterative refinement.     

The Monetary Services Index

Professor Roy Batchelor of the City University Business School claims that conventional measures of the money supply are unsatisfactory. He proposes instead a Monetary Services Index, but concludes that the new index would be unsatisfactory as a target.