Pay More, Earn Less, Work Harder - New Evidence on Foreign Subsidiary Performance and Market Efficiency in Emerging Markets

Foreign subsidiary performance and market efficiency effects are estimated and confronted in this paper using a rich firm-level panel for Polish manufacturing. Besides estimating total factor productivity, other performance measures are calculated and contrasted such as labor productivity, employment growth, markup levels and profitability. The findings show that foreign subsidiaries in Poland pay more (in wages and capital), earn less (in terms of profitability or ROA) and work harder (in terms of TFP and labor productivity) relative to their domestic counterparts. Foreign subsidiaries contribute with higher employment growth than other domestic and new firms. There is no evidence that foreign subsidiaries have significantly reduced market efficiency within the period of study and across the industries and entry modes investigated on average. Controlling for competition (which is found to have a negative effect on efficiency) the paper documents significant intra-industry spillovers. The effect is estimated to be twice as high within the foreign owned industrial communities as compared to the cross effect to domestic firms.multinational firms, economic growth, firm performance, spillovers

Mergers and Acquisitions - The Standing of theory in the Quest for Better Institutions and Policy

The paper shows that the standing of theory in the field of mergers and acquisitions is weak for at least three reasons. Research is best described as a battlefield of ad hoc theory testing leaving behind a fragmented field. Research has focused traditionally on high intensity markets under the Anglo-Saxon variant of capitalism. Empirical evaluation is prone to be inexact and suffers among other from significant aggregation problems between the micro (firm performance) and macro level (economic growth). The deficiencies in the standing of theory will be reflected in weak institutions to handle the political processes concerning value, liquidity, efficiency and fairness aspects that affect the market for corporate assets within and across different variants of capitalism.Economic Growth, Institutions, Mergers and Acquisitions, the Resource Based View, Variants of Capitalism

Comparative Advantage in Tourism - A Supply-Side Analysis of Tourism Flows

The purpose of the paper is to relate the tourism demand model with the traditional theories that explain international trade flows. In the existing tourism literature, tourism flows and tourism demand forecasts are typically explained by the demand-side variables. But in the traditional trade theories, international trade flows are explained from the supply-side variables, i.e. the comparative advantage of the exporting countries. A model is proposed in the paper, trying to explain in a modern and global economy, the factors that from a supply-side perspective can decide the comparative advantage of countries in a certain type of service activity. The preliminary results render a strong support for the relevance of certain supply-side factors in explaining international tourism flows such as both natural endowments and created assets associated with foreign investments, hotel capacity and level of development.

Mergers and acquisitions - the standing of theory in the quest for better institutions and policy

The paper shows that the standing of theory in the field of mergers and acquisitions is weak for at least three reasons. Research is best described as a battlefield of ad hoc theory testing leaving behind a fragmented field. Research has focused traditionally on high intensity markets under the Anglo-Saxon variant of capitalism. Empirical evaluation is prone to be inexact and suffers among other from significant aggregation problems between the micro (firm performance) and macro level (economic growth). The deficiencies in the standing of theory will be reflected in weak institutions to handle the political processes concerning value, liquidity, efficiency and fairness aspects that affect the market for corporate assets within and across different variants of capitalism. - -Economic Growth, Institutions, Mergers and Acquisitions, the Resource Based View, Variants of Capitalis

Hormone strategies as a key for understanding life history trade-offs in fish

Animal behaviour has fascinated humans for millennia. For studying animal behaviour, evolutionary biologists have focused primarily on their ultimate fitness causes mainly using a top-down approach. In contrast, physiologists have concentrated on the proximate causes of behaviour adopting primarily a bottom-up approach. This difference in focus and methodology has caused a conceptual rift between the fields. To take part in narrowing this rift, this thesis has aimed to unite proximate mechanisms with ultimate evolutionary explanations. To reach this goal, we developed a digital modelling tool that describes the relationship between a simplified endocrine system and the behaviour of a generalised juvenile fish. The model shows that the optimal growth hormones levels in juvenile fish decrease with size together with size-dependent mortality risk, while hormones that affect appetite and metabolism are kept relatively stable throughout the growth period. When comparing stable environments, we also found that optimal hormone levels increase with food availability. In variable environments with partly predictable food availability, hormone levels increase when food availability is temporarily high, while they decrease when food availability is temporarily poor. In this way, we found that it is optimal for fish to: move their mortality costs over time by primarily foraging and growing when food availability is rich, build their energy reserves when food availability is at an intermediate level, and wait for the environment to improve when it is poor. When a fish, in addition to living in a variable environment, is exposed to a parasite that only has an energetic cost to the host, its optimal compensation strategy is to increase its hormone levels and thus its growth, foraging and metabolism. As a result, fish also show increased predation mortality with increasing parasite costs. These are signs often associated with parasite manipulation, but the parasites in our model only take energy from the host and is devoid of any strategy. In conclusion, we thus find that dynamic hormone levels have the potential to evolve as a unified strategy that affects survival and growth during the growth phase of juvenile fish. The model also indicates that such a hormone strategy can be adaptive to prepare the phenotype of a juvenile fish for the food availability and parasite costs that are likely to come in its environments. In addition we find that behavioural and physiological changes following an infection might in some cases be the result of a co-evolved mixed phenotype of both the host and parasite, where both behave according to their own adaptive strategies. Using an approach including both proximate mechanisms and ultimate evolutionary explanations thus have the potential to increase our understanding of animal behaviour

Comparative Advantage in Tourism - A Supply-Side Analysis of Tourism Flows

The purpose of the paper is to relate the tourism demand model with the traditional theories that explain international trade flows. In the existing tourism literature, tourism flows and tourism demand forecasts are typically explained by the demand-side variables. But in the traditional trade theories, international trade flows are explained from the supply-side variables, i.e. the comparative advantage of the exporting countries. A model is proposed in the paper, trying to explain in a modern and global economy, the factors that from a supply-side perspective can decide the comparative advantage of countries in a certain type of service activity. The preliminary results render a strong support for the relevance of certain supply-side factors in explaining international tourism flows such as both natural endowments and created assets associated with foreign investments, hotel capacity and level of development

Scale in Technology and Learning-by-Doing in the Windmill Industry

This paper examines the remarkable development of technology and the fast learning-by-doing in the windmill industry since it emerged in the beginning of the 1980s. Based on time series of prices of windmills a dynamic cost function for producing windmills is tested. The estimations verified that learning-by-doing in the Danish windmill industry has contributed significantly to improve the cost efficiency of the producers. The technological development has been stimulated both by process and product innovations as the capacity of the individual mills has increased. The learning effect created by early subsidies from the government has consolidated the competitive advantages of the windmill cluster in Denmark and preserved the first mover advantages at the world market. The article concludes that the industry probably will enter into a matured phase in the future with more modest technological growth.Learning-by-doing; scale in technology; process and product innovations