Sticky cost behaviour: evidence from small and medium sized companies

This paper investigates whether cost stickiness occurs in small and medium sized companies using a sample of Italian nonlisted and listed firms during the period 1999–2008. Our findings show that cost stickiness emerges only for the total cost of labour and not for selling, general and administrative (SG&A) costs, cost of goods sold and operating costs. Stickiness of operating costs is only detected in a sample of listed companies. We further contribute to the literature on sticky cost behaviour by discussing critical issues associated with the extant approach of empirical analysis and interpretation of sticky cost behaviour.     

Reversing the Logic: The Path to Profitability through Relationship Marketing

Many firms have experienced greater success through implementing relationship marketing strategies. This is achieved by gaining knowledge about their own customers through database marketing and about the general marketplace through marketing research. Over time, this has led firms to adopt a general framework which we call the conventional path to profitability. This conventional framework suggests that new product innovation leads to acquisition, acquisition combined with a rich experience leads to satisfaction, satisfaction leads to loyalty and customer retention, and loyalty/retention leads to profitability. However, we show that some of the links in the framework are weak based on both academic research and marketplace realities. Consequently, we reverse the logic of the conventional path to profitability. We introduce a new approach that starts the customer relationship management strategy with customer profitability and the notion that different customers should be rewarded and satisfied differently. In addition, we outline a strategy that relationship marketing firms can implement, leading to higher levels of customer profitability and offer directions for future research.     

The impact of education on fertility in Italy. Changes across cohorts and south–north differences

Quality & Quantity - Several studies suggest that over the last decades in Italy the negative effects of women’s education on fertility have attenuated. However, recent analyses developed...     

Does ICT adoption improve access to credit for small enterprises?

Using data at the bank–firm level collected through the 9th UniCredit Survey conducted in 2012 on a large sample of small businesses, we investigate the extent to which a large international bank offers better credit conditions to enterprises that use ICT more extensively. The results, which are robust to selection and endogeneity issues, show that banks tend to grant increasing volumes of credit to such enterprises. We interpret this evidence as the ceteris paribus effect of ICT adoption by small businesses on the quality of information transmitted to banks. Another possible interpretation is that banks consider ICT adoption as a signal of firms’ willingness to innovate. We also discuss implications concerning the key role that technology plays in changing the ‘arm’s length’ versus ‘relationship’ lending paradigms.     

Securities class actions in the US banking sector: Between investor protection and bank stability

This paper investigates whether securities class actions (SCAs) can play a role in banking supervision, both as a warning signal of insolvency and as an instrument of market discipline to encourage bank managers to carefully evaluate risk. Two groups of US banks are compared over the 2000–2008 period. One includes banks that have faced at least one SCA, while the other is composed of non-targeted banks (control group). Results indicate that collective private litigation procedures are more frequently directed at financially fragile intermediaries exhibiting inadequate governance standards. Furthermore, banks which have been subjected to SCAs are likely to reduce their excessive risk positions. This supports the idea that SCAs could be efficiently employed as a complement to public supervisory activity in the banking sector.     

Analysing Household and Intra-urban Variants in the Consumption of Financial Services: Uncovering “Exclusion” in an English City

This study provides an empirical assessment of the socioeconomic factors that determine household exclusion from consumer financial services. A unique microeconomic data set, of interview data, collected from a representative cross-sectional sample of 1005 households is analysed using logistic regression techniques. In investigating exclusion from consumer financial services, both financial self-exclusion and institutional-led financial exclusion are examined. Indicators of financial self-exclusion include the absence of a savings account or home contents insurance, whilst indicators of institutional-led financial exclusion include the use of “doorstep lenders.” Findings show that both measures of financial self-exclusion are determined by income, education, age, housing tenure, and social participation, whilst financial exclusion is generally associated with socioeconomic characteristics such as age, gender, housing tenure, working status, income, disability, and the presence of young people in household but not with respondents’ residential area, education level, internet use, and social participation. These results offer useful insights to policy makers and financial services providers in terms of the range and mix of policies and instruments that local and central Government can deploy to address exclusion.     

Forecasting accuracy of wind power technology diffusion models across countries

Wind power technology is analyzed in terms of diffusion, with incentive effects introduced as exogenous dynamics in the Generalized Bass Model (GBM) framework. Estimates and short-term forecasts of the life-cycles of wind power are provided for the US and Europe, as they have similar geographic areas, as well as for some leading European countries. GBMs have the best performance in model selection, and are ranked first in terms of forecast accuracy over a set of different accuracy measures and forecasting horizons, relative to the Standard Bass, Logistic, and Gompertz models.