Staging of Venture Financing, Investor Opportunism and Patent Law

Stage financing provides a real option that is valuable when facing external uncertainty. However, it may also induce investor hold-up, if the property rights on an invention are not sufficiently protected. As a consequence, the entrepreneur may not work hard. Investor opportunism is less likely to occur, if investors' residual cash-flow-rights are contingent on verifiable 'milestones' in the previous stage. Equity-linked financing also provides high-powered incentives to the investor not to 'steal the idea' because his payoff becomes sensitive to the project value. The paper provides a new explanation for both types of contractual provisions. Copyright 2006 The Author Journal compilation (c) 2006 Blackwell Publishing Ltd.

Organizational Form and Industry Emergence: Nonprofit and Mutual Firms in the Development of the U.S. Personal Finance Industry

Economic theories of commercial nonprofits and mutuals usually emphasise the advantages of such organisational forms in reducing agency and monitoring costs in markets that suffer from information asymmetries in exchanges between firms and their customers. This article examines the ability of such transaction cost theories to account for historical variations in the ownership and governance of firms in the US personal finance industry between the early nineteenth century and the Great Depression. It focuses, in particular, on mutual savings banks and their role in the development of the intermediated market for savings accounts. While I find some evidence in support of transaction cost theories of organisational form, I also find that entrepreneurial and socio-political factors played crucial roles in the choice of ownership and governance structures; mutual savings banks predominated in the early years of the industry because the form offered entrepreneurial advantages over investor-owned corporations and because in some states they benefited from regulatory and political advantages that joint-stock companies lacked. Their relative decline by the early twentieth century was the result of increasing competition in the market for savings deposits, the loosening of regulatory barriers to entry, and changes in public policy that reduced the transaction, innovation, and regulatory advantages that the mutual savings bank form had once held. The article draws out the theoretical implications for our understanding of the historical role of nonprofit and mutual firms

Factors of Employees’ Effective Voice in Corporate Goverance*

Traditionally, corporate governance has focused on the problem of crafting mechanisms to align the interests of owners and managers. The key characteristic has been to minimize the potential for managers to act in their own self-interest at the expense of shareholders. The purpose of this paper is to focus on employees as stakeholders in the governance process. We argue that creating an environment where employees have help in behaving ethically, in the course of their work, is the first step in encouraging them to voice observations of wrongdoing. Seven groups of professionals in the accounting and insurance fields were surveyed during a 10-year period and asked to indicate the extent to which 14 items were helpful in dealing with ethical challenges. Over 2700 responses were analyzed. The findings indicate that professionals think that their organizational culture and policy for voice was more helpful in dealing with ethical dilemmas than was their professional association. Copyright Springer 2005boards of directors, corporate governance, ethics, employee voice, stakeholders,

The role of micro-organisms in the ecological connectivity of running waters

Pusch M, Fiebig D, Brettar I, et al. The role of micro-organisms in the ecological connectivity of running waters. Freshwater Biology. 1998;40(3):453-495