What Drives the Commodity-Sovereign-Risk-Dependence in Emerging Market Economies?
Hannes Böhm, Stefan Eichler, Stefan Gießler
Abstract
Using daily data for 34 emerging markets in the period 1994-2016, we find robust evidence that higher export commodity prices are associated with higher sovereign bond returns (indicating lower sovereign risk). The economic effect is especially pronounced for heavy commodity exporters. Examining the drivers, we find, first, that commodity-dependence is higher for countries that export large volumes of volatile commodities and that the effect increases in times of recessions, high inflation, and expansionary U.S. monetary policy. Second, the importance of raw material prices for sovereign financing can likely be mitigated if a country improves institutions and tax systems, attracts FDI inflows, invests in manufacturing, machinery and infrastructure, builds up reserve assets and opens capital and trade accounts. Third, the concentration of commodities within a country’s portfolio, its government indebtedness or amount of received development assistance appear to be only of secondary importance for commodity-dependence.
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Zweites Forum Menschenwürdige Wirtschaftsordnung. Liberalismus, Sozialismus, Sozialstaat: Überlegungen anläßlich des 200. Geburtstages von John Stuart Mill
Ulrich Blum, Heinrich Oberreuter, Wolfgang Quaisser
IWH-Sonderhefte,
Nr. 1,
2007
Abstract
Wirtschafts- und sozialethische Grundlagen unseres Wirtschaftssystems sind gerade in einer Zeit essentiell, in der wirtschafts- und sozialpolitische Reformen – oder das, was dafür gehalten wird – nahezu ständig auf der Tagesordnung stehen. Vielfach verfestigt sich der Eindruck, daß Reformlösungen durch angeblich alternativlose Sachzwänge begründet werden. Plakative begriffliche Polarisierungen – wie beispielsweise „Neoliberalismus“ versus „Soziale Marktwirtschaft“ – kennzeichnen die politische Debatte, ohne sie ordnungspolitisch und sozialphilosophisch zu fundieren. Die Gefahr einer solchen gedanklichen und begrifflichen (gewollten?) Unschärfe liegt in der mangelhaften Kohärenz und Tragfähigkeit von Reformansätzen.
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(Since When) Are East and West German Business Cycles Synchronised?
Stefan Gießler, Katja Heinisch, Oliver Holtemöller
Abstract
This paper analyses whether and since when East and West German business cycles are synchronised. We investigate real GDP, unemployment rates and survey data as business cycle indicators and employ several empirical methods. Overall, we find that the regional business cycles have synchronised over time. GDP-based indicators and survey data show a higher degree of synchronisation than the indicators based on unemployment rates. However, recently synchronisation among East and West German business cycles seems to become weaker, in line with international evidence.
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Unethical Employee Behavior Against Coworkers Following Unkind Management Treatment: An Experimental Analysis
Sabrina Jeworrek, Joschka Waibel
Managerial and Decision Economics,
Nr. 5,
2021
Abstract
We study unethical behavior toward unrelated coworkers as a response to managerial unkindness with two experiments. In our lab experiment, we do not find that subjects who experienced unkindness are more likely to cheat in a subsequent competition against another coworker who simultaneously experienced mistreatment. A subsequent survey experiment suggests that behavior in the lab can be explained by individuals' preferences for norm adherence, because unkind management behavior does not alter the perceived moral appropriateness of cheating. However, having no shared experience of managerial unkindness opens up some moral wiggle room for employees to misbehave at the costs of others.
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Who Benefits from Mandatory CSR? Evidence from the Indian Companies Act 2013
Jitendra Aswani, N. K. Chidambaran, Iftekhar Hasan
Emerging Markets Review,
March
2021
Abstract
We examine the value impact of mandatory Corporate Social Responsibility (CSR) spending required by the Indian Companies Act of 2013 for large and profitable Indian firms. We find that the external mandate is value decreasing, even after controlling for prior voluntary CSR activity by firms affected by the mandate. We also find that there is systematic crosssectional variation across firms. Firms that are profitable and firms in the Fast Moving Consumer Goods sector that voluntarily engaged in CSR, benefit from CSR. Industrial firms and firms with high capital expenditures are negatively impacted by the mandate. We conclude that a one-size-fits-all approach to CSR is sub-optimal and value decreasing.
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Is Social Capital Associated with Corporate Innovation? Evidence from Publicly Listed Firms in the U.S.
Iftekhar Hasan, Chun-Keung (Stan) Hoi, Qiang Wu, Hao Zhang
Journal of Corporate Finance,
June
2020
Abstract
We find that social capital in U.S. counties, as captured by strength of social norms and density of social networks, is positively associated with innovation of firms headquartered in the county, as captured by patents and citations. This relation is robust in fixed-effect regressions, instrumental variable regressions with a Bartik instrument, propensity score matching regressions, and a difference-in-differences design that isolates the effects of over time variations in social capital due to corporate headquarter relocations. Strength of social norms plays a more dominant role than density of social networks in producing these empirical regularities. Cross-sectional evidence indicates the prominence of the contracting channel through which social capital relates to innovation. Additionally, we find that social capital is also positively associated with trademarks and effectiveness of corporate R&D expenditures.
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Financial Analysts' Career Concerns and the Cost of Private Debt
Bill Francis, Iftekhar Hasan, Liuling Liu, Qiang Wu, Yijiang Zhao
Journal of Corporate Finance,
April
2021
Abstract
Career-concerned analysts are averse to firm risk. Not only does higher firm risk require more effort to analyze the firm, thus constraining analysts' ability to earn more remuneration through covering more firms, but it also jeopardizes their research quality and career advancement. As such, career concerns incentivize analysts to pressure firms to undertake risk-management activities, thus leading to a lower cost of debt. Consistent with our hypothesis, we find a negative association between analyst career concerns and bank loan spreads. In addition, our mediation analysis suggests that this association is achieved through the channel of reducing firm risk. Additional tests suggest that the effect of analyst career concerns on loan spreads is more pronounced for firms with higher analyst coverage. Our study is the first to identify the demand for risk management as a key channel through which analysts help reduce the cost of debt.
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A Comparison of Monthly Global Indicators for Forecasting Growth
Christiane Baumeister, Pierre Guérin
International Journal of Forecasting,
Nr. 3,
2021
Abstract
This paper evaluates the predictive content of a set of alternative monthly indicators of global economic activity for nowcasting and forecasting quarterly world real GDP growth using mixed-frequency models. It shows that a recently proposed indicator that covers multiple dimensions of the global economy consistently produces substantial improvements in forecasting accuracy, while other monthly measures have more mixed success. Specifically, the best-performing model yields impressive gains with MSPE reductions of up to 34% at short horizons and up to 13% at long horizons relative to an autoregressive benchmark. The global economic conditions indicator also contains valuable information for assessing the current and future state of the economy for a set of individual countries and groups of countries. This indicator is used to track the evolution of the nowcasts for the U.S., the OECD area, and the world economy during the COVID-19 pandemic and the main factors that drive the nowcasts are quantified.
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Finance-Growth Nexus and Banking Efficiency: The Impact of Microfinance Institutions
Afsheen Abrar, Iftekhar Hasan, Rezaul Kabir
Journal of Economics and Business,
March-April
2021
Abstract
This paper investigates the relative importance of microfinance institutions (MFIs) at both the macro (financial development, economic growth, income inequality, and poverty) and micro levels (efficiency of traditional commercial banks). We observe a significant impact on most of the fronts. MFIs’ participation increases overall savings (total bank deposits) and credit allocation (loans to private sector) in the economy. Their involvement enhances economic welfare by reducing income inequality and poverty. Additionally, their active presence helps to discipline the traditional commercial banks by subjecting them to more competition triggering higher efficiency.
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Do Activist Hedge Funds Target Female CEOs? The Role of CEO Gender in Hedge Fund Activism
Bill Francis, Iftekhar Hasan, Yinjie (Victor) Shen, Qiang Wu
Journal of Financial Economics,
Nr. 1,
2021
Abstract
Using a comprehensive US hedge fund activism dataset from 2003 to 2018, we find that activist hedge funds are about 52% more likely to target firms with female CEOs compared to firms with male CEOs. We find that firm fundamentals, the existence of a “glass cliff,” gender discrimination bias, and hedge fund activists’ inherent characteristics do not explain the observed gender effect. We also find that the transformational leadership style of female CEOs is a plausible explanation for this gender effect: instead of being self-defensive, female CEOs are more likely to communicate and cooperate with hedge fund activists to achieve intervention goals. Finally, we find that female-led targets experience greater increases in market and operational performance subsequent to hedge fund targeting.
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