The relationship between governance structure and risk management approaches in Japanese venture capital firms

This paper attempts to understand what drives Japanese venture capital (JVC) fund managers to select either active managerial monitoring or portfolio diversification to manage their firms' investment risks [J. Bus. Venturing 4 (1989) 231]. Unlike U.S. venture capitalists that use active managerial monitoring to gain private information in order to maximize returns [J. Finance 50 (1995) 301], JVCs have traditionally used portfolio diversification to attenuate investment risks [Hamada, Y., 2001. Nihon no Bencha Kyapitaru no Genkyo (Current State of Japanese Venture Capital), Nihon Bencha Gakkai VC Seminar, May 7]. We found that performance pay is positively related to active monitoring and that management ownership is positively related to active monitoring and negatively related to portfolio diversification. The managerial implication of our study is that venture capitalists should be as concerned about the structure of their incentive systems for their fund managers as they are for their investee-firm entrepreneurs. Agency theory says that contingent compensation is a self-governing mechanism for individual effort that is difficult to measure and verify. When properly applied, equity ownership and performance-based pay can have powerful influencing effects on the strategic choices of managers.     

The New Economy is dead,long live the information economy

The arrival of the 2001–2003 recession caused many to suppose that the so-called “New Economy” was now defunct. This article addresses a number of related issues, including the question of the durability and viability of business cycles in the face of the technological developments of the information age. It asks what went wrong with the New Economy and examines its characteristics as well as its remaining possibilities and prospects for the future. Finally, it considers the spread of the Information Economy to Europe, especially to Germany, the country that one might expect to be the leading European player, but which is not at present actually a strong competitor for that role.     

The effects of ownership concentration and corporate debt on corporate divestitures in Chinese listed firms

This study examines how ownership concentration and corporate debt impact corporate divestitures in China. Corporate divestitures reduce the asset base of a company and the opportunity for expropriation by majority shareholders. In emerging economies, weak legal institutions, combined with equity ownership concentration and high corporate debt, allow majority shareholders to avoid such disciplines. Consequently, the relationship between these governance mechanisms and divestiture activity exhibits a pattern that is different from that in developed economies. Using archival data collected from 1,210 Chinese listed companies during 1999–2003, we found that ownership concentration by the largest shareholder depressed corporate divestitures both in state-controlled and in non-state-controlled firms. The negative effect of corporate debt on divestitures only existed for state-controlled firms. Our finding provides corroborating evidence for principal–principal conflicts in emerging economies. It suggests that corporate strategy in these countries can be better explained by taking into account the unique agency problems that are prevalent in these economies.     

A typology for defining agritourism

Agritourism has been studied in various ways and contexts. It can be argued, however, that studies have yet to provide a clear and basic understanding of the characteristics that underpin and define agritourism. This paper proposes an original typology for defining agritourism by identifying the key characteristics currently used to define agritourism in the literature and organising them into a transparent and structured framework. For the first time, the agritourism typology clarifies and classifies definitions of agritourism that currently exist in the literature. It therefore offers a comprehensive framework that can be used as a basis for more informed debate and discussion and for future empirical research.     

Why Organizations Struggle to Implement a Market Orientation: Insights Into Beliefs of Top Management

The role of management as an antecedent and barrier to market orientation is well documented. However, the often deeply held beliefs of top management that influence the degree to which their firms are market oriented has been largely overlooked. This study sought to understand these beliefs using a qualitative research method. Case study research employing in-depth semistructured interviews of four Australian vertically integrated horticultural enterprises was undertaken. A total of 28 beliefs of senior management team members were identified. These beliefs, which appeared to have become part of organizational culture, influenced the way market intelligence was gathered and shared and the degree to which the organizations planned, coordinated, and timed their responses to market opportunities and threats. The results suggest that changing management beliefs about marketing and market orientation may be an important component of enhancing the degree to which firms are market oriented.     

Survival and Decline of the Apprenticeship System in the Australian and UK Construction Industries

The preservation of the apprenticeship system in the Australian construction industry contrasts with its decline in Britain over the last three decades. This decline is conventionally ascribed to changes in industrial structure, specifically a decline in the role of the public sector, intensification of subcontracting and growth of self‐employment. Given that the Australian construction industry has undergone similar structural changes to those in the United Kingdom, this difference in outcome requires explanation. This article suggests that the contrasting outcomes are the result of institutional differences in the organization of the training system, employers and labour between the two countries. These institutional differences are, however, diminishing as arrangements for training and industrial relations in Australia are increasingly fashioned in the likeness of the United Kingdom.     

A note on endogenous growth and scale effects

This paper reconciles the recent vs. very long-run evidence on scale effects in endogenous growth models by extending Howitt's (1999) model to include a subsistence constraint in consumption. Scale effects will be present only when this constraint is binding.     

Labour unions,globalization and deregulation in Thailand

This contribution traces the evolution of work systems and labour-management relationships in Thailand, with emphasis on the nature and role of unions in the Thai economy. We focus on issues that have emerged as a consequence of globalization and privatization (currently the most significant form of deregulation in Thailand). Labour unions are quite weak in Thailand, even in comparison to other rapidly developing countries in the region. Furthermore, unions have been weakened further in recent years as the consequence of government action, prompted both by globalization pressures and extensive privatization of state enterprises. The emergence of a democratic political system in Thailand has not served to reverse this trend. Indeed, a reversal of this trend does not seem likely in the foreseeable future.