The Distribution of Information among Institutional and Retail Investors in IPOs

This study examines investor performance in IPOs using a unique database comprising 85,384 investors and 29 offerings from Finland. The evidence indicates that on average institutional investors do not obtain larger initial returns than retail investors, as the incentive to acquire information is limited by allocation rules which favour small orders. This result is in contrast to findings by Aggarwal et al . (2002), who show that institutional investors perform better in a bookbuilding environment. Within each investor category, however, large orders are associated with the best performance, suggesting that information differences figure more importantly within rather than between categories.     

Analyst information production and the timing of annual earnings forecasts

We investigate whether the reputation-herding theory or the tradeoff theory explains variation in the timing of individual analysts’ forecasts. Using forecast accuracy improvements, forecast boldness, and the price impact of forecasts as measures of forecast quality, we find that in the information discovery phase that precedes an earnings announcement, earlier forecasts have higher quality than later forecasts. We also find a similar pattern in the information analysis phase that begins with the earnings announcement date. Our findings suggest that consistent with the herding theory, analysts who are more capable participate early in discovering and analyzing information, and therefore earlier forecasts in the information discovery and analysis phases are of higher quality than later forecasts in that phase.     

Central bank interventions and implied exchange rate correlations

This paper examines the effects of the foreign exchange market interventions by the Bank of Japan on the ex ante correlations between the JPY/USD, EUR/USD, and GBP/USD exchange rates. The correlation estimates used in the analysis are derived from the market prices of OTC currency options. The results show that central bank interventions significantly affect the market expectations about future exchange rate co-movements. In particular, we find that interventions tend to temporarily increase the ex ante correlations among the major exchange rates. However, our results also suggest that intervention episodes are associated with lower-than-average levels of exchange rate correlations.     

Credit rationing, interest rates and capital accumulation

A simple endogenous growth model is developed to characterize credit rationing through the capital accumulation process. The model shows that credit rationing on investment loans decreases as capital accumulates and the enforcement cost decreases. We find that the evolution of the interest rate factor (lending interest rate/depositing interest rate) has a similar pattern to the credit rationing probability. However, simulations show that the evolution of the interest rate spread through the capital accumulation process depends on the degree of the enforcement cost. In the empirical part of the paper, we consider fifty-two countries, at different stages of development, over the period 1995–2005. We confirm the theoretical findings relative to the evolution of the interest rate spread and interest rate factor with capital accumulation. These results suggest that, for economies endowed with costly contract enforcement, the interest rate factor could be a better proxy of credit rationing than the interest rate spread.     

RETHINKING THE RESEARCH FUNDING PROCESS: An Indian Perspective

In this paper I focus on the substantial research funding cuts announced by UK Research and Innovation (UKRI) in March 2021 to examine the process of funding for and participation in global research projects for researchers based in Southern institutions. I focus here on three key aspects of participating in global research projects: first, the structures through which these grants are created—the programmatic frameworks or other imperatives that confine and limit this work to Northern/Western-centric frames; secondly, the precarity of these grants and the work that they generate; and, thirdly, the increasingly output-related and time-bound nature of work in light of limited support. I argue that the effects of these are felt disproportionately by those located in the global South and are therefore worth considering as part of larger debates centred on democratizing and decolonizing knowledge networks.     

Public external debt,informality and production efficiency in developing countries

This paper proposes an alternative approach to investigate the non-linear effect of external debt on growth. In the theoretical part, we develop an endogenous growth model with formal and informal sectors to analyse the effect of the public external debt on the production efficiency. We show that an increase of the public external debt share increases the production efficiency through a positive externality effect. However, it generates an opposite effect via the reduction of the formal sector’s size in favour of a less efficient informal sector. The resultant effect becomes negative beyond an optimal level. Besides, we show that a large stock of public external debt reduces the production efficiency when it leads to a tight fiscal policy which reduces the formal sector size. Empirically, using a stochastic frontier technique with unobserved heterogeneity, for a panel of 27 developing countries for the period of 1970–2005, we confirm that the turning point associated to the effect of the share external public debt is apparent at 84%.     

Oil crisis,energy-saving technological change and the stock market crash of 1973–74

The market value of U.S. corporations was nearly halved during the oil crisis of 1973–74. In this paper, we investigate the hypothesis that the sharp rise in energy costs during this period resulted in the obsolescence of firms' existing capital and reduced their market value. To quantify this obsolescence channel of the energy crisis, we simulate a calibrated dynamic general equilibrium model, where firms adopt energy-saving technologies along with the rise in energy prices, and the value of their installed capital falls due to investment irreversibility. We find that this channel can account for a third of the decline in Tobin's q observed in the data. Separately, we consider the role of investment subsidies extended by the government during this period to expedite the adoption of energy-saving technologies. This extension of the model can account for more than half of the decline in q. We also find empirical support for the capital obsolescence channel in cross-sectional regressions, where we show that the sectoral variation in the decline of energy use following the crisis is significant in explaining the sectoral variation in the drop of market values.     

How retail entrepreneurs perceive the link between surveillance,feeling of security,and competitiveness of the retail store? A structural model approach

This study seeks to create a comprehensive understanding of the ways in which retail entrepreneurs perceive the link between surveillance and customers’ and employees’ sense of security at the store level. This study also analyzes the link between customers’ and employees’ sense of the security and store's competitiveness from the viewpoint of retail entrepreneurs. The present study utilizes elements of Crime Prevention through Environmental Design (CPTED) in its theoretical approach. The population for the study consisted of 946 grocery store K-retail entrepreneurs. The data collection was carried out through an Internet survey in February and March 2009. A total of 161 grocery store retailers filled in the questionnaire, yielding a response rate of 17%. Data were analyzed using structural equation modeling (SEM). The study revealed that formal surveillance has a negative impact on customers’ feelings of security from the retailers’ point of view. In contrast to formal surveillance, informal surveillance had positive impacts on customers’ and employees’ feelings of security. Retail entrepreneurs perceived that both customers’ and employees’ feeling of security had a positive impact on the store's competitiveness.