Objectivity, Proximity and Adaptability in Corporate Governance

Countries appear to differ considerably in the basic orientations of their corporate governance structures. We postulate the trade-off between objectivity and proximity as fundamental to the corporate governance debate. We stress the value of objectivity that comes with distance (e.g. the market oriented U.S. system), and the value of better information that comes with proximity (e.g. the more intrusive Continental European model). Our key result is that the optimal distance between management and monitor (board or shareholders) has a bang-bang solution: either one should capitalize on the better information that comes with proximity or one should seek to benefit optimally from the objectivity that comes with distance. We argue that this result points at an important link between the optimal corporate governance arrangement and industry structure. In this context, we also discuss the ways in which investors have "contracted around" the flaws in their own corporate governance systems, pointing at the adaptability of different arrangements.http://deepblue.lib.umich.edu/bitstream/2027.42/39651/3/wp266.pd

Objectivity, Proximity and Adaptability in Corporate Governance

Countries appear to differ considerably in the basic orientations of their corporate governance structures. We postulate the trade-off between objectivity and proximity as fundamental to the corporate governance debate. We stress the value of objectivity that comes with distance (e.g. the market oriented U.S. system), and the value of better information that comes with proximity (e.g. the more intrusive Continental European model). Our key result is that the optimal distance between management and monitor (board or shareholders) has a bang-bang solution: either one should capitalize on the better information that comes with proximity or one should seek to benefit optimally from the objectivity that comes with distance. We argue that this result points at an important link between the optimal corporate governance arrangement and industry structure. In this context, we also discuss the ways in which investors have "contracted around" the flaws in their own corporate governance systems, pointing at the adaptability of different arrangements.corporate governance, comperitive systems, corporate finance, economic reform, convergence

A Pasteurella pneumotropica Strain of Mouse Origin Colonizes Rats but is Out Competed by a P. pneumotropica Strain of Rat Origin

Mouse and rat Pasteurellaceae have been found to differ in phenotypic characteristics but both animal species  may be infected by each other’s bacterial strains. We explored the possibility that a mouse Pasteurella  strain colonizing rats would be out competed by a subsequent infection of a rat Pasteurella strain. Rats were dosed intranasally and orally with the mouse P. pneumotropica biotype Jawetz strain NCTC  8141T and exposed to pen-mates infected with the rat P. pneumotropica biotype Heyl strain SSI P331 by  co-housing. Rats were tested by PCR using primer sets developed for the specific detection of each biotype respectively. The co-housing and exposure of rats initially infected by the mouse P. pneumotropica with pen-mates harbouring  the rat P. pneumotropica led to disappearance of the mouse bacterium from the rats.  Our results question the suitability of Pasteurellaceae from contemporary laboratory animals to elucidate  associations between bacterial properties and host species.

Guinea Pig and Rat as Carriers of Host-unique and Shared Haemophilus Phenotypes

Infections by V- factor dependent Pasteurellaceae (commonly called Haemophilus spp) frequently occur in  colonies of guinea pig and rat. We evaluated possible differences between 185 Haemophilus strains from  guinea pig (n=97) and rat (n=88) by API NH biotyping and by cell wall lipid profiling (FAME-analysis). By  combining results of both methods we found 28 Haemophilus API-FAME types. Seven API-FAME types  were shared and comprised 66% and 76% of the guinea pig and rat Haemophilus strains respectively. The  remaining 21 Haemophilus phenotypes were unique to either guinea pig (12 types) or rat (9 types).

Monitoring of Rat Colonies for Antibodies to CAR Bacillus

The cilia associated respiratory (CAR) bacillus is a respiratory pathogenic bacterium of rats and other species of animal. We determined by enzymelinked immunosorbent assay (ELISA) antibudies t0 CAR bacillus antigen in sera from 20 colonies of rats. Six out of 10 Mycoplasma pulmoms ELISA positive experimental colonies contained CAR bacillus seropositive rats, comprising 26 out of 45 (58 %) samples. CAR bacillus infection was not diagnosed by ELISA in 183 samples from 10 M. pulmonis free SPF-rat breeding colonies

Market liquidity, investor participation and managerial autonomy: why do firms go private?

We analyze a publicly-traded firm's decision to stay public or go private when managerial autonomy from shareholder intervention affects the supply of productive inputs by management. We show that both the advantage and the disadvantage of public ownership relative to private ownership lie in the liquidity of public ownership. While the liquidity of public ownership lets shareholders trade easily and supply capital at a lower cost, the liquidity-engendered trading also results in stochastic shocks to a firm's shareholder base. This exposes management to uncertainty regarding the identity of future shareholders and their extent of intervention in management decisions and in turn curtails managerial incentives. By contrast, because of its illiquidity, private ownership provides a stable shareholder base and improves these inputprovision incentives but results in a higher cost of capital. Thus, capital market liquidity, while being a principal advantage of public ownership, also has a surprising 'dark side' that discourages public ownership. Our model takes seriously a key difference between private and public equity markets in that, unlike the private market, the firm's shareholder base, namely the extent of investor participation, is stochastic in the public market. This allows us to extract predictions about the effects of investor participation on the stock price level and volatility and on the public firm's incentives to go private, thereby providing a link between investor participation and firm participation in public markets. Lesser investor participation induces lower and more volatile stock prices, encouraging public firms to go private, whereas greater investor participation encourages younger firms to go public. Moreover, IPO underpricing is optimal because it is shown to lead to a higher and less volatile post-IPO stock price, greater autonomy for the manager and a higher supply of privately-costly managerial inputs