The Impact of FDI on International Portfolio Investments

Some empirical research has argued that part of the reason for the observed "home bias" is that investors are able to indirectly achieve internationally diversified portfolios via domestically listed multinational firms. Another branch of this research attributes the "home bias" and country allocations to more deeply rooted informational causes. Using a four-year annual panel of Finnish international portfolios and Foreign Direct Investments in twenty-five countries, I provide evidence consistent with an information asymmetry explanation

Corporate Governance Mechanisms and Firm Performance:Evidence from Finland

This paper examines the association between corporate governance attributes and firm performance of Finnish firms during 1990 – 2000. The empirical results suggest that corporate governance matters for firm performance. First, univariate test results indicate that firms characterized by a high (efficient) level of corporate governance have delivered greater stock returns, are higher valued based on the measure of Tobin’s Q, and exhibit higher ratios of cash flow to assets, on average, in comparison to their counterparts characterized by a low (inefficient) level of corporate governance. Second, controlling for a number of well-known determinants of stock returns, we find evidence that firms categorized by inefficient corporate governance have delivered inferior returns to shareholders during the investigation period. Finally, after controlling for several common determinants of firm value, we find that firms characterized by efficient corporate governance have been valued higher during the investigation period, measured by Tobin’s Q.

Stock Option Compensation in Finland: An Analysis of Economic Determinants, Contracting Frequency, and Design

This paper addresses several questions in the compensation literature by examining stock option compensation practices of Finnish firms. First, the results indicate that principal-agent theory succeeds quite well in predicting the use of stock options. Proxies for monitoring costs, growth opportunities, ownership structure, and risk are found to determine the use of incentives consistent with theory. Furthermore, the paper examines whether determinants of stock options targeted to top management differ from determinants of broad-based stock option plans. Some evidence is found that factors driving these two types of incentives differ. Second, the results reveal that systematic risk significantly increases the likelihood that firms adopt stock option plans, whereas total firm risk and unsystematic risk do not seem to affect this decision. Third, the results show that growth opportunities are related to time-dimensional contracting frequency, consistent with the argument that incentive levels deviate more rapidly from optimum in firms with high growth opportunities. Finally, the results suggest that vesting schedules are decreasing in financial leverage, and that contract maturity is decreasing in firm focus. In addition, both vesting schedules and contract maturity tend to be longer in firms involving state ownership.

Improving outcome of childhood bacterial meningitis by simplified treatment : Experience from Angola

Background Acute bacterial meningitis (BM) continues to be an important cause of childhood mortality and morbidity, especially in developing countries. Prognostic scales and the identification of risk factors for adverse outcome both aid in assessing disease severity. New antimicrobial agents or adjunctive treatments - except for oral glycerol - have essentially failed to improve BM prognosis. A retrospective observational analysis found paracetamol beneficial in adult bacteraemic patients, and some experts recommend slow β-lactam infusion. We examined these treatments in a prospective, double-blind, placebo-controlled clinical trial. Patients and methods A retrospective analysis included 555 children treated for BM in 2004 in the infectious disease ward of the Paediatric Hospital of Luanda, Angola. Our prospective study randomised 723 children into four groups, to receive a combination of cefotaxime infusion or boluses every 6 hours for the first 24 hours and oral paracetamol or placebo for 48 hours. The primary endpoints were 1) death or severe neurological sequelae (SeNeSe), and 2) deafness. Results In the retrospective study, the mortality of children with blood transfusion was 23% (30 of 128) vs. without blood transfusion 39% (109 of 282; p=0.004). In the prospective study, 272 (38%) of the children died. Of those 451 surviving, 68 (15%) showed SeNeSe, and 12% (45 of 374) were deaf. Whereas no difference between treatment groups was observable in primary endpoints, the early mortality in the infusion-paracetamol group was lower, with the difference (Fisher s exact test) from the other groups at 24, 48, and 72 hours being significant (p=0.041, 0.0005, and 0.005, respectively). Prognostic factors for adverse outcomes were impaired consciousness, dyspnoea, seizures, delayed presentation, and absence of electricity at home (Simple Luanda Scale, SLS); the Bayesian Luanda Scale (BLS) also included abnormally low or high blood glucose. Conclusions New studies concerning the possible beneficial effect of blood transfusion, and concerning longer treatment with cefotaxime infusion and oral paracetamol, and a study to validate our simple prognostic scales are warranted.

Practical Proposals for Specifying k-Nearest Neighbours Weights Matrices

In this article we introduce and evaluate testing procedures for specifying the number k of nearest neighbours in the weights matrix of spatial econometric models. The spatial J-test is used for specification search. Two testing procedures are suggested: an increasing neighbours testing procedure and a decreasing neighbours testing procedure. Simulations show that the increasing neighbours testing procedures can be used in large samples to determine k. The decreasing neighbours testing procedure is found to have low power, and is not recommended for use in practice. An empirical example involving house price data is provided to show how to use the testing procedures with real data.

Molecular methods for the epidemiological analysis of methicillin-resistant Staphylococcus aureus (MRSA) and Streptococcus pneumoniae

Methicillin-resistant Staphylococcus aureus (MRSA) and Streptococcus pneumoniae are major health problems worldwide, both found in symptomless carriage but also causing even life-threatening infections. The aim of this thesis was to characterise MRSA and S. pneumoniae in detail by using several molecular typing methods for various epidemiological purposes: clonality analysis, epidemiological surveillance, outbreak investigation, and virulence factor analysis. The characteristics of MRSA isolates from the strain collection of the Finnish National Infectious Disease Register (NIDR) and pneumococcal isolates collected from military recruits and children with acute otitis media (AOM) were analysed using various typing techniques. Antimicrobial susceptibility testing, pulsed-field gel electrophoresis (PFGE), multilocus sequence typing (MLST), spa typing, staphylococcal cassette chromosome mec (SCCmec) typing, and the detection of Panton-Valentine leukocidin (PVL) genes were performed for MRSA isolates. Pneumococcal isolates were analysed using antimicrobial susceptibility testing, serotyping, MLST, and by detecting pilus islet 1 (PI-1) and 2 (PI-2) genes. Several international community- and hospital-associated MRSA clones were recognised in Finland. The genetic diversity among MRSA FIN-4 isolates and among FIN-16 isolates was low. Overall, MRSA blood isolates from 1997 to 2006 were genetically diverse. spa typing was found to be a highly discriminatory, rapid and accurate typing method and it also qualifies as the primary typing method in countries with a long history of PFGE-based MRSA strain nomenclature. However, additional typing by another method, e.g. PFGE, is needed in certain situations to be able to provide adequate discrimination for epidemiological surveillance and outbreak investigation. An outbreak of pneumonia was associated with one pneumococcal strain among military recruits, previously healthy young men living in a crowded setting. The pneumococcal carriage rate after the outbreak was found to be exceptionally high. PI-1 genes were detected at a rather low prevalence among pneumococcal isolates from children with AOM. However, the study demonstrated that PI-1 has existed among pneumococcal isolates prior to pneumococcal conjugate vaccine and the increased antimicrobial resistance era. Moreover, PI-1 was found to associate with the serotype rather than the genotype. This study adds to our understanding of the molecular epidemiology of MRSA strains in Finland and the importance of an appropriate genotyping method to be able to perform high-level laboratory-based surveillance of MRSA. Epidemiological and molecular analyses of S. pneumoniae add to our knowledge of the characteristics of pneumococcal strains in Finland.