Simultaneous experimentation as an entrepreneurial strategy for emergent markets: Transcending the trade-off between flexibility and funding?.

The unpredictable nature of emergent markets implies that ventures entering such markets are confronted with technological and commercial uncertainty. Defining a viable business model under such circumstances is a complex and precarious endeavour. Previous research has either advanced the idea of focus – in order to attract resources and realize first mover advantages – or sequential experimentation financed through bootstrapping, implying limited resources during initial phases of the venture. As such, a trade-off between flexibility and resource acquisition has been introduced. Within this contribution we explore how ventures starting up in emergent industries can balance the attainment of financial resources with flexibility and business model adaptation. Based on a sequence analysis of six case studies, we identify two distinctive approaches to business development in emergent industries: focused commitment versus simultaneous experimentation. Our findings reveal that focused commitment is instrumental for acquiring resources but at the same time impedes flexibility, while simultaneous experimentation allows to attract resources while maintaining manoeuvring space for business model adaptation. An analytical comparison of both approaches suggests that simultaneous experimentation is indeed a more viable strategy when entering emergent industries.entrepreneurial opportunities; business model; uncertainty; commitment; experimentation;

Dealing with Disruption: Emerging Approaches to Fintech Regulation

“Fintech” refers to a variety of digital assets, technologies, and infrastructure that deal with the operation of today’s financial markets. The regulation of this presents both legal and regulatory challenges. This article examines the regulatory responses to fintech disruption; specifically, the “experimentation” approach, the “incorporation” approach, and the “accommodation” approach. These approaches provide a baseline for further discussion and policy analysis in response to “Fintech.

Dealing with Disruption: Emerging Approaches to Fintech Regulation

“Fintech” refers to a variety of digital assets, technologies, and infrastructure that deal with the operation of today’s financial markets. The regulation of this presents both legal and regulatory challenges. This article examines the regulatory responses to fintech disruption; specifically, the “experimentation” approach, the “incorporation” approach, and the “accommodation” approach. These approaches provide a baseline for further discussion and policy analysis in response to “Fintech.

Dealing with Disruption: Emerging Approaches to Fintech Regulation

“Fintech” refers to a variety of digital assets, technologies, and infrastructure that deal with the operation of today’s financial markets. The regulation of this presents both legal and regulatory challenges. This article examines the regulatory responses to fintech disruption; specifically, the “experimentation” approach, the “incorporation” approach, and the “accommodation” approach. These approaches provide a baseline for further discussion and policy analysis in response to “Fintech.

Virtual Reality as a Problem of the Electronic Economy.

Two concepts of virtual reality are competing in the cyber world, virtual reality as total adaptability and virtual reality as the simulation of possible worlds. Virtuality as adaptability in industrial production leads to a closer consideration of individual con-sumer demand and to de-massified production. It implies a stronger reference of pro-duction to the reality of consumer needs. The aesthetic concept of virtual reality as pos-sible words and fictional realities can imply a loss of reality. Both concepts of virtuality interact, however. Adaptive production needs the experimentation of imagined and simulated possible worlds. Virtual reality leads to a disembodiment of experience and to the danger of the loss of the validation of perception by experience. The concept of the virtual is originally a concept of theological origin, signifying invisible but real potenti-ality or a reality that is real only as potentiality. One of the most important innovations of the virtual reality of the internet has taken place in financial markets in online trading and online brokerage. The virtual reality of the internet financial markets enables large strata of the population to participate in stock market speculation, leading to a kind of people’s capitalism. Problems caused by the virtual character of the transactions in online trading are the churning of traders and the over-trading of shares by investors.

The global financial crisis and development thinking

The global financial crisis has not only dealt a major blow to the global economy, but also shaken confidence in economic management in the developed world and the economic models that guide it. The crisis has revealed major market failures, especially in the housing bubble and its transmission to the financial system, but also glaring state failures that propagated and exacerbated the crisis. Will the events of the past two years lead to major shifts in thinking about development economics, and should they? This paper assesses that question for several key domains of development thinking, including the market-state balance, macroeconomic management, globalization, development financing, and public spending. On the one hand, changed global circumstances and new awareness of vulnerability should lead to some policy changes, as developing countries take steps to reduce and buffer risks, including risks generated in developed countries. At the same time, the crisis should largely reinforce the Post-Washington Consensus on development that has emerged over the past decade -- a world view that aims to achieve private sector-driven growth but sees a facilitating role for the state, promotes engaging with the global economy in ways that advance development, and values pragmatism, experimentation, and evidence-based policymaking over ideology.Debt Markets,Economic Theory&Research,Banks&Banking Reform,Climate Change Economics,Emerging Markets

Experimentation in securities market structure and regulation in China: from state to market

A key feature of the socialist market economy in China is the development of securities markets so as to facilitate entrepreneurship. With the national securities market now well established attention has shifted to the development of lower tier markets that may be able to meet the financing needs of smaller scale enterprises. In this article we examine how the concept of experimentation has been applied to the process of developing such markets and the regulatory framework in which they operate. We begin with a survey and critique of the policy and regulatory framework within which lower-tier markets have evolved. We argue that experimentation has been important in China but that it operates in a unique way as a result of the institutional structure in which securities markets are located. We then focus more specifically on the regulatory framework for lower tier markets and present two case studies focused on the establishment and operation of two local equity exchanges in a single province (LiaoNing). While this evidence supports our view on the significance of experimentation it also highlights the problems associated with developing lower-tier securities markets within the current policy framework

Building an experimentation process model for financial institutions developing personal finance products for the bottom of the pyramid

Traditional financial institutions in South Africa have experienced difficulty in trying to bring the benefits of the formal, first world economy to the unbanked and underbanked markets that constitute the bottom of the pyramid for the country. South African formal financial institutions - as a result of governmental pressure and recognising business opportunities at the bottom of the pyramid – have through innovation been exploring and expanding their personal finance product and service ranges to meet the requirements of the unbanked and underbanked markets. Innovative products and services developed through a process of experimentation can help financial institutions meet the needs of this lower end of the pyramid. Research conducted through ethnographic interviews was directed towards furthering understanding of the process, forms and strategic context of experimentation that South African financial institutions (both large and niche) undertake and operate within, when developing and implementing products for the bottom of the pyramid and the impact it has on the organisation. A model was developed, which is an enhancement of Stefan Thomke’s four step experimentation process, outlining an experimentation process that can be used by institutions innovating and experimenting within a developing economy and market such as South Africa’s.Dissertation (MBA)--University of Pretoria, 2010.Gordon Institute of Business Science (GIBS)unrestricte

Formalize the informal: market segmentation and integration in the formal and informal credit markets in Wenzhou.

In 2012, the Chinese government designated Wenzhou city as a testbed for policy experimentation aimed at institutionalizing informal lending practices. This study investigates how interest rates in the formal and informal credit markets interacted before and after this policy experimentation. Hence, we use the vector autoregression models and ordinary multiple regression method, which is based on the financial repression theory. We document large yield spreads between the formal and informal credit markets in Wenzhou before (2003–2011) and after (2013–2018) the reforms. We find an increase in the responsiveness of the informal sector to the formal sector, after the reforms. We argue that the informal financial system serves as a one-way substitute for the formal financial sector in Wenzhou. An analysis of the transaction-level data suggests thatmaturity, availability of collateralization, loan purpose, and the amount of loans determine informal lending rates. Thus, this study provides important policy implications for reforming China’s financial syste