A strategic perspective of cross-listing by emerging market firms : evidence from Indonesia, Mexico, Poland and South Africa

This paper develops an approach to the analysis of cross-listing that brings together the financial and non-financial benefits of the phenomenon. We employ the real options framework, which offers a detailed characterisation of the strategic issues associated with cross-listing, in context of internationalisation of emerging market firms. The associated hypotheses are tested using firm-level data from four large emerging market economies with different profiles in terms of institutional quality and financial development. This allows us to extend the existing literature by isolating the relative importance of institutional quality and financial development for benefits of cross-listing

Institutional reforms, productivity and profitability:from rents to competition?

This paper explores the divergent effects of institutional reforms on firm's productivity and profits. To assess this empirically, we investigate the impact of various components of economic liberalisation on the performance of firms from Central and Eastern European countries from 1998 to 2006. The impact of reforms on profitability vis-à-vis productivity differs, which we interpret as an indication that profitability is an ambiguous measure of performance: one needs to distinguish between unproductive rents and productivity-based quasi-rents. We find that competition-enhancing liberalisation measures have more impact on state owned firms as compared with domestic and foreign owned firms

The future of offshoring FDI in high-tech sectors

This paper examines what is still a relatively new phenomenon in the literature, the outsourcing/offshoring of high-technology manufacturing and services. This has become a concern for both policy makers and academics for two reasons. Firstly, policy makers have become concerned that the offshoring of high-technology sectors in the West will follow the more labour intensive sectors, and move to lower cost locations. Secondly, international business theory has tended to view low costs, and high levels of indigenous technological development as being the two main drivers of location advantage in the attraction of FDI. We show that this may not be the case for offshored high-technology manufacturing or services

Co-Administration of Iron and Bioavailable Curcumin Reduces Levels of Systemic Markers of Inflammation and Oxidative Stress in a Placebo-Controlled Randomised Study

Ferrous sulphate (FS) is widely used as an iron supplement to treat iron deficiency (ID), but is known to induce inflammation causing gastric side-effects resulting in poor adherence to supplement regimens. Curcumin, a potent antioxidant, has been reported to suppress inflammation via down regulation of NF-κB. The aim of the present double blind, placebo-controlled randomised trial was to assess whether co-administration of FS with a formulated, bioavailable form of curcumin (HydroCurc™) could reduce systemic inflammation and/or gastrointestinal side-effects. This study recruited 155 healthy participants (79 males; 26.42 years ± 0.55 and 76 females; 25.82 years ± 0.54), randomly allocated to one of five different treatment groups: iron and curcumin placebo (FS0_Plac), low dose (18 mg) iron and curcumin placebo (FS18_Plac), low dose iron and curcumin (FS18_Curc), high dose (65 mg) iron and curcumin placebo (FS65_Plac), and high dose iron and curcumin (FS65_Curc). Completed questionnaires and blood samples were collected from all participants at baseline (day 1), mid-point (day 21), and at end-point (day 42). Results showed a significant reduction in IL-6 in the FS65_Curc group (0.06 pg/mL ± 0.02, p = 0.0073) between the mid-point and end-point. There was also a significant reduction in mean plasma TNF levels in the FS65_Curc (0.65 pg/mL ± 0.17, p = 0.0018), FS65_Plac (0.39 pg/mL ± 0.15, p = 0.0363), and FS18_Curc (0.35 pg/mL ± 0.13, p = 0.0288) groups from mid-point to end-point. A significant increase was observed in mean plasma TBARS levels (0.10 µM ± 0.04, p = 0.0283) in the F18_Plac group from baseline to end-point. There was a significant association with darker stools between FS0_Plac vs. FS65_Plac (p = 0.002, Fisher’s exact test) suggesting that high iron dose in the absence of curcumin leads to darker stools. A reduction in inflammation-related markers in response to co-administering supplemental iron alongside formulated curcumin suggests a reduction in systemic inflammation. This supplementation approach may therefore be a more cost effective and convenient alternative to current oral iron-related treatments, with further research to be conducted

Multinational enterprises and the welfare state

This paper presents an empirical analysis on the extent to which a country’s welfare spending influences foreign direct investment (FDI) decisions, particularly as they relate to relocations. We argue, and subsequently empirically test, that higher welfare spending by governments attracts foreign investment. Moreover, multinational enterprises (MNEs) located in high welfare spending countries have a lower likelihood of relocating to foreign markets compared with MNEs in countries with lower levels of welfare spending. Using data for MNEs in 27 OECD countries, our results show that MNE location decisions are positively related to welfare spending. These findings appear to be more pronounced for MNEs operating in high-tech rather than in low-tech manufacturing industries. Our results suggest that high welfare spending does deter FDI in the case of host developing economies, but that these effects are small. We suggest that this is a result of firms being more hesitant to invest in developing countries where they will be expected to contribute to welfare. This suggests that a degree of trust between firms and host country governments is required on institution building and the delivery of welfare. Our results suggest that the conventional wisdom of firms avoiding or relocating away from locations due to the associated additional costs of high welfare spending is questionable, but that firms need to be confident on the efficacy of this welfare expenditure

High-growth firms and productivity:evidence from the United Kingdom

Abstract There is considerable evidence that high-growth firms (HGFs) contribute significantly to employment and economic growth. However, the literature so far does not adequately explore the link between HGFs and productivity. This paper investigates the empirical link between total factor productivity (TFP) growth and HGFs, defined in terms of sales growth, in the United Kingdom over the period 2001-2010, by examining two related research questions. Firstly, does higher TFP growth lead to HGF status and secondly, does HGF experience help firms achieve faster TFP growth? Our findings reveal that firms in both the manufacturing and services sectors are more likely to become HGFs when they exhibit higher TFP growth. In addition, firms that have had HGF experience tend to enjoy faster TFP growth following the high-growth episodes. Policy implications are drawn based on the self-reinforcing process of the high-growth phenomenon that is revealed by our results

FDI in hot labour markets: The implications of the war for talent

This paper highlights an inherent contradiction that exists within investment promotion activities in rich countries. Since the financial crisis, many inward investment agencies have shifted their activities from job creation per se to seeking to attract investment in high-tech activities. Such knowledge-intensive sectors are engaged in what has become referred to as “the war for talent”, so locations need to understand their value proposition to firms, especially where labour is tight. This paper explores the implications of this, in terms of the impact on employment and earnings of high skilled labour. We show that, because skill shortages already exist in many of these sectors, seeking to attract inward investment in these sectors simply causes the earnings of such workers to be bid up, and employment in the incumbent sector to fall. We highlight the over-riding importance that firms place on the availability of skilled labour when determining locations, and how policies which promote labour market flexibility, particularly through investment in skills to address skill shortages, can significantly mitigate the adverse effects, which tend to be more keenly felt in poorer regions of Europe where skilled labour is in even shorter supply

Should I Stay or Should I Go? Firm Heterogeneity in the Post-crisis Period

Existing microeconomic research on exporting firms is dominated by empirical findings across time and countries based on two theories of why firms choose to export. One requires firms to be better performers before entry, the other requires there to be improvements in performance as a result of entry. In this paper, we disentangle entry to, and exit from, the overseas market for UK manufacturing firms to better understand the motivations and characteristics underlying both decisions. We explore the extent to which changes in the macroeconomic environment may influence behaviour, following a time of global financial turbulence

Does German Foreign Direct Investment Lead to Job Losses at Home?

This paper provides firm-level evidence on the labour demand effects of outward investments using a panel of multinationals (MNEs) based in Germany. Distinguishing the type of investments and the location of subsidiaries around the world between 1997 and 2008, our evidence shows that for both the manufacturing and services sector the expansion of employment abroad does not occur at the detriment of employment at home. The analysis is extended to see whether outward FDI causes average wage cuts for workers employed in the German parent firm. Our findings indicate no clear average wage effects due to outward FDI. Given that domestic MNEs are seen to play an important role in the growth potential for an economy, these findings are somewhat re-assuring from a policy point of view. JEL Classifications: F23, J2