The Politics of Pulp Investment and the Brazilian Landless Movement (MST)

The Politics of Pulp Investment and the Brazilian Landless Movement (MST) The paper industry has been moving more heavily to the global South at the beginning of the 21st century. In a number of cases the rural populations of the global South have engaged in increasingly important resistance in their scuffle with the large-scale tree plantation-relying pulp investment model. The resistance had generally not yet managed to slow down Southern industrial tree plantation expansion until 2004. After all, even the MST, perhaps the strongest of the Southern movements, has limited power in comparison to the corporations pushing for plantation expansion. This thesis shows how, even against these odds, depending on the mechanisms of contention and case-specific conflict dynamics, in some cases the movements have managed to slow and even reverse plantation expansion. The thesis is based on extensive field research in the Brazilian countryside. It outlines a new theory of contentious agency promotion, emphasizing its importance in the shaping of corporate resource exploitation. The thesis includes a Qualitative Comparative Analysis of resistance influence on the economic outcomes of all (14) Brazilian large-scale pulp projects between 2004-2008. The central hypothesis of the thesis is that corporate resource exploitation can be slowed down more effectively and likely when the resistance is based on contentious agency. Contentious agency is created by the concatenation of five mutually supporting mechanisms of contention: organizing and politicizing a social movement; heterodox framing of pulp projects; protesting; networking; and embedding whilst maintaining autonomy. The findings suggest that contentious agency can slow or even reverse the expansion of industrial plantations, whereas when contentious agency promotion was inactive, fast or even unchecked plantation expansion was always the outcome. The rule applied to all the assessed 14 pulp conflict cases. The hypothesis gained strong support even in situations where corporate agency promotion was simultaneously active. In previous studies on social movements, there has been a lack of contributions that help us understand the causal mechanisms of contention influencing economic outcomes. The thesis answers to the call by merging a Polanyian analysis of the political economy with the Dynamics of Contention research program and making a case for the impact of contentious agency on capital accumulation. The research concludes that an efficient social movement can utilize mechanisms of contention to promote the potential of activism among its members and influence investment outcomes. Protesting, for example via pioneering land occupations, seemed to be particularly important. Until now, there has been no comprehensive theory on when and how contentious agency can slow down or reverse the expansion of corporate resource exploitation. The original contribution of this research is to provide such a theory, and utilize it to offer an extensive explanation on the conflicts over pulp investment in Brazil, the globalization of the paper industry, and slowing of industrial plantation expansion in the global South.

In the Shadow of Freedom : Life on board the oil tanker

The aim of this study was to look at the freedom of ordinary people as they construct it. The scope, however, was limited to contemporary Finnish sailors and their freedom discourses. The study belongs to the field of the anthropology of religions, which is part of comparative religion. Worldview, which is one of the key concepts in comparative religion, provided the broader theoretical basis of the study. The data consisted of 92 interviews with Finnish professional seafarers conducted in 1996, 1999, 2000 and 2005, field journals that were written during two periods of fieldwork in 1996 and 1999-2000, and correspondence with some of the seafarers during 1999-2005. The analysis process incorporated new rhetoric and metaphor theory. The thesis is in three parts. The first part discusses the methodological challenges of this type of ethnography, the second an ethnography of modern Finnish shipworld focuses on work, organization, hierarchy and gender, and the third part discusses the freedom concepts of seafarers. It was found that seafarers use two kinds of freedom discourse. The first is in line with the stereotypical Jack Tar, a free-roving sailor who is not bound to land and its mundane routines, and the second views shipworld as freedom from freedom, meaning one is not responsible for one s own actions because one is not free to make a choice. It was also found that seafarers are well aware of the stereotypical images that are attached to their profession: they not only deny them, but also utilize, reflect on and construct them.

Poverty and the Environment : Investment Poverty and the Role of Assets in Generating Welfare for Farmer Households in the Province of Herrera, Panama

Köyhiä maanviljelijöitä on usein syytetty kehitysmaiden ympäristöongelmista. On väitetty, että eloonjäämistaistelu pakottaa heidät käyttämään maata ja muita luonnonvaroja lyhytnäköisesti. Harva asiaa koskeva tutkimus on kuitenkaan tukenut tätä väitettä; perheiden köyhyyden astetta ja heidän aiheuttamaansa ympäristövaikutusta ei ole kyetty kytkemään toisiinsa. Selkeyttääkseen köyhyys-ympäristö –keskustelua, Thomas Reardon ja Steven Vosti kehittivät investointiköyhyyden käsitteen. Se tunnistaa sen kenties suuren joukon maanviljelijäperheitä, jotka eivät ole köyhiä perinteisten köyhyysmittareiden mukaan, mutta joiden hyvinvointi ei ole riittävästi köyhyysrajojen yläpuolella salliakseen perheen investoida kestävämpään maankäyttöön. Reardon ja Vosti korostivat myös omaisuuden vaikutusta perheiden hyvinvointiin, ja uskoivat sen vaikuttavan tuotanto- ja investointipäätöksiin. Tässä tutkimuksessa pyritään vastaamaan kahteen kysymykseen: Miten investointiköyhyyttä voidaan ymmärtää ja mitata? Ja, mikä on viljelijäperheiden omaisuuden hyvinvointia lisäävä vaikutus? Tätä tutkimusta varten haastateltiin 402 maanviljelijäperhettä Väli-Amerikassa, Panaman tasavallan Herreran läänissä. Näiden perheiden hyvinvointia mitattiin heidän kulutuksensa mukaan, ja paikalliset köyhyysrajat laskettiin paikallisen ruoan hinnan mukaan. Herrerassa ihminen tarvitsee keskimäärin 494 dollaria vuodessa saadakseen riittävän ravinnon, tai 876 dollaria vuodessa voidakseen ravinnon lisäksi kattaa muitakin välttämättömiä menoja. Ruoka- eli äärimmäisen köyhyyden rajan alle jäi 15,4% tutkituista perheistä, ja 33,6% oli jokseenkin köyhiä, eli saavutti kyllä riittävän ravitsemuksen, muttei kyennyt kustantamaan muita perustarpeitaan. Molempien köyhyysrajojen yläpuolelle ylsi siis 51% tutkituista perheistä. Näiden köyhyysryhmien välillä on merkittäviä eroavaisuuksia ei vain perheiden varallisuuden, tulojen ja investointistrategioiden välillä, mutta myös perheiden rakenteessa, elinympäristössä ja mahdollisuuksissa saada palveluja. Investointiköyhyyden mittaaminen osoittautui haastavaksi. Herrerassa viljelijät eivät tee investointeja puhtaasti ympäristönsuojeluun, eikä maankäytön kestävyyttä muutenkaan pystytty yhdistämään perheiden hyvinvoinnin tasoon. Siksi investointiköyhyyttä etsittiin sellaisena hyvinvoinnin tasona, jonka alapuolella elävien perheiden parissa tuottavat maanparannusinvestoinnit eivät enää ole suorassa suhteessa hyvinvointiin. Tällaisia investointeja ovat mm. istutetut aidat, lannoitus ja paranneltujen laiduntyyppien viljely. Havaittiin, että jos perheen hyvinvointi putoaa alle 1000 dollarin/henkilö/vuosi, tällaiset tuottavat maanparannusinvestoinnit muuttuvat erittäin harvinaisiksi. Investointiköyhyyden raja on siis noin kaksi kertaa riittävän ravitsemuksen hinta, ja sen ylitti 42,3% tutkituista perheistä. Heille on tyypillistä, että molemmat puolisot käyvät työssä, ovat korkeasti koulutettuja ja yhteisössään aktiivisia, maatila tuottaa paremmin, tilalla kasvatetaan vaativampia kasveja, ja että he ovat kerryttäneet enemmän omaisuutta kuin investointi-köyhyyden rajan alla elävät perheet. Tässä tutkimuksessa kyseenalaistettiin yleinen oletus, että omaisuudesta olisi poikkeuksetta hyötyä viljelijäperheelle. Niinpä omaisuuden vaikutusta perheiden hyvinvointiin tutkittiin selvittämällä, mitä reittejä pitkin perheiden omistama maa, karja, koulutus ja työikäiset perheenjäsenet voisivat lisätä perheen hyvinvointia. Näiden hyvinvointi-mekanismien ajateltiin myös riippuvan monista väliin tulevista tekijöistä. Esimerkiksi koulutus voisi lisätä hyvinvointia, jos sen avulla saataisiin paremmin palkattuja töitä tai perustettaisiin yritys; mutta näihin mekanismeihin saattaa vaikuttaa vaikkapa etäisyys kaupungeista tai se, omistaako perhe ajoneuvon. Köyhimpien perheiden parissa nimenomaan koulutus olikin ainoa tutkittu omaisuuden muoto, joka edisti perheen hyvinvointia, kun taas maasta, karjasta tai työvoimasta ei ollut apua köyhyydestä nousemiseen. Varakkaampien perheiden parissa sen sijaan korkeampaa hyvinvointia tuottivat koulutuksen lisäksi myös maa ja työvoima, joskin monesta väliin tulevasta muuttujasta, kuten tuotantopanoksista riippuen. Ei siis ole automaatiota, jolla omaisuus parantaisi perheiden hyvinvointia. Vaikka rikkailla onkin yleensä enemmän karjaa kuin köyhemmillä, ei tässä aineistossa löydetty yhtään mekanismia, jota kautta karjan määrä tuottaisi korkeampaa hyvinvointia viljelijäperheille. Omaisuuden keräämisen ja hyödyntämisen strategiat myös muuttuvat hyvinvoinnin kasvaessa ja niihin vaikuttavat monet ulkoiset tekijät. Ympäristön ja köyhyyden suhde on siis edelleen epäselvä. Köyhyyden voittaminen vaatii pitkällä tähtäimellä sitä, että viljelijäperheet nousisivat investointiköyhyyden rajan yläpuolelle. Näin heillä olisi varaa alkaa kartuttaa omaisuutta ja investoida kestävämpään maankäyttöön. Tällä hetkellä kuitenkin isolle osalle herreralaisia perheitä tuo raja on kaukana tavoittamattomissa. Miten päästä yli tuhannen dollarin kulutukseen perheenjäsentä kohden, mikäli elintaso ei yllä edes riittävään ravitsemukseen? Ja sittenkin, vaikka hyvinvointi kohenisi, ei ympäristön kannalta parannuksia ole välttämättä odotettavissa, mikäli karjalaumat kasvavat ja eroosioalttiit laitumet leviävät.

Essays on corporate governance, stakeholders, and restructuring

This dissertation consists of an introductory section and three theoretical essays analyzing the interaction of corporate governance and restructuring. The essays adopt an incomplete contracts approach and analyze the role of different institutional designs to facilitate the alignment of the objectives of shareholders and management (or employees) over the magnitude of corporate restructuring. The first essay analyzes how a firm's choice of production technology affects the employees' human capital investment. In the essay, the owners of the firm can choose between a specific and a general technology that both require a costly human capital investment by the employees. The specific technology is initially superior in using the human capital of employees but, in contrast to the general technology, it is not compatible with future innovations. As a result, anticipated changes in the specific technology diminish the ex ante incentives of the employees to invest in human capital unless the shareholders grant the employees specific governance mechanisms (a right of veto, severance pay) so as to protect their investments. The results of the first essay indicate that the level of protection that the shareholders are willing to offer falls short of the socially desirable one. Furthermore, when restructuring opportunities become more abundant, it becomes more attractive both socially and from the viewpoint of the shareholders to initially adopt the general technology. The second essay analyzes how the allocation of authority within the firm interacts with the owners' choice of business strategy when the ability of the owners to monitor the project proposals of the management is biased in favor of the status quo strategy. The essay shows that a bias in the monitoring ability will affect not only the allocation of authority within the firm but also the choice of business strategy. Especially, when delegation has positive managerial incentive effects, delegation turns out to be more attractive under the new business strategy because the improved managerial incentives are a way for the owners to compensate their own reduced information gathering ability. This effect, however, simultaneously makes the owners hesitant to switch the strategy since it would involve a more frequent loss of control over the project choice. Consequently, the owners' lack of knowledge of the new business strategy may lead to a suboptimal choice of strategy. The third essay analyzes the implications of CEO succession process for the ideal board structure. In this essay, the presence of the departing CEO on the board facilitates the ability of the board to find a matching successor and to counsel him. However, the ex-CEO's presence may simultaneously also weaken the ability of the board to restructure since the predecessor may use the opportunity to distort the successor's project choice. The results of the essay suggest that the extent of restructuring gains, the firm's ability to hire good outside directors and the importance of board's advisory role affect at which point and for how long the shareholders may want to nominate the predecessor to the board.

The watershed simulation and forecasting system in the National Board of and the Environment

Yhteenveto: Vesistömalleihin perustuva vesistöjen seuranta- ja ennustejärjestelmä vesi- ja ympäristöhallinnossa

Discursive (de)legitimation of a contested Finnish greenfield investment project in Latin America

Despite the central role of legitimacy in corporate social responsibility debate, little is known of subtle meaning-making processes through which social actors attempt to establish or de-establish legitimacy for socially contested corporate undertakings, and through which they, at the same time, struggle to define the proper social role and responsibility of corporations. We investigated these processes in the context of the intense socio-political conflict around the Finnish forest industry company Metsa¨-Botnia’s world-scale pulp mill in Uruguay. A critical discursive analysis of Finnish media texts highlights three types of struggle that characterized the media coverage: legalistic argumentation, truth fights, and political battles. Interestingly, this case illustrates how the corporate representatives — with the help of the national media — tend to frame the issue in legalistic terms, emphasize their expert knowledge in technical and environmental evaluations, and distance themselves from political disputes. We argue that similar tendencies are likely to characterize corporate social responsibility debates more generally.

Essays on the Costs and Benefits of Large Shareholders in Corporate Governance (summary section only)

“Corporate governance deals with the ways in which suppliers of finance to firms assure themselves of getting a return on their investment” (Shleifer and Vishny (1997, p. 737). According to La Porta et al. (1999), research in corporate finance relevant for most countries should focus on the incentives and capabilities of controlling shareholders to treat themselves preferentially at the expense of minority shareholders. Accordingly, this thesis sets out to answer a number of research questions regarding the role of large shareholders in public firms that have received little attention in the literature so far. A common theme in the essays stems from the costs and benefits of individual large-block owners and the role of control contestability from the perspective of outside minority shareholders. The first essay empirically examines whether there are systematic performance differences between family controlled and nonfamily controlled firms in Western Europe. In contrast to the widely held view that family control penalizes firm value, the essay shows that publicly traded family firms have higher performance than comparable firms. In the second essay, we present both theoretical and empirical analysis on the effects of control contestability on firm valuation. Consistent with the theoretical model, the empirical results show that minority shareholders benefit from a more contestable control structure. The third essay explores the effects of individual large-block owners on top management turnover and board appointments in Finnish listed firms. The results indicate that firm performance is an important determinant for management and board restructurings. For certain types of turnover decisions the corporate governance structure influences the performance / turnover sensitivity. In the fourth essay, we investigate the relation between the governance structure and dividend policy in Finnish listed firms. We find evidence in support of the outcome agency model of dividends stating that lower agency conflicts should be associated with higher dividend payouts.

Essays on the Linkages Between Financial Markets, and Risk Asymmetries (summary section only)

During the last few decades there have been far going financial market deregulation, technical development, advances in information technology, and standardization of legislation between countries. As a result, one can expect that financial markets have grown more interlinked. The proper understanding of the cross-market linkages has implications for investment and risk management, diversification, asset pricing, and regulation. The purpose of this research is to assess the degree of price, return, and volatility linkages between both geographic markets and asset categories within one country, Finland. Another purpose is to analyze risk asymmetries, i.e., the tendency of equity risk to be higher after negative events than after positive events of equal magnitude. The analysis is conducted both with respect to total risk (volatility), and systematic risk (beta). The thesis consists of an introductory part and four essays. The first essay studies to which extent international stock prices comove. The degree of comovements is low, indicating benefits from international diversification. The second essay examines the degree to which the Finnish market is linked to the “world market”. The total risk is divided into two parts, one relating to world factors, and one relating to domestic factors. The impact of world factors has increased over time. After 1993, when foreign investors were allowed to freely invest in Finnish assets, the risk level has been higher than previously. This was also the case during the economic recession in the beginning of the 1990’s. The third essay focuses on the stock, bond, and money markets in Finland. According to a trading model, the degree of volatility linkages should be strong. However, the results contradict this. The linkages are surprisingly weak, even negative. The stock market is the most independent, while the money market is affected by events on the two other markets. The fourth essay concentrates on volatility and beta asymmetries. Contrary to many international studies there are only few cases of risk asymmetries. When they occur, they tend to be driven by the market-wide component rather than the portfolio specific element.

Short-term Price Behavior and the Effect of Foreign Investors in Finnish Equity Markets (summary section only)

As globalization and capital free movement has increased, so has interest in the effects of that global money flow, especially during financial crises. The concern has been that large global money flows will affect the pricing of small local markets by causing, in particular, overreaction. The purpose of this thesis is to contribute to the body of work concerning short-term under- and overreaction and the short-term effects of foreign investment flow in the small Finnish equity markets. This thesis also compares foreign execution return to domestic execution return. This study’s results indicate that short-term under- and overreaction occurs in domestic-buy portfolios (domestic net buying) rather than in foreign-buy portfolios. This under- and overreaction, however, is not economically meaningful after controlling for the bid-ask bounce effect. Based on this finding, one can conclude that foreign investors do not have a destabilizing effect in the short-term in the Finnish markets. Foreign activity affects short-term returns. When foreign investors are net buyers (sellers) there are positive (negative) market adjusted returns. Literature related to nationality and institutional effect leads us to expect these kind of results. These foreign flows are persistent at a 5 % to 21 % level and the persistence of foreign buy flow is higher than the foreign sell flow. Foreign daily trading execution is worse than domestic execution. Literature which quantifies foreign investors as liquidity demanders and literature related to front-running leads us to expect poorer foreign execution than domestic execution.

Angel Investing in Finland: An Analysis Based on Agency Theory and the Incomplete Contracting Theory

Wealthy individuals - business angels who invest a share of their net worth in entrepreneurial ventures - form an essential part of an informal venture capital market that can secure funding for entrepreneurial ventures. In Finland, business angels represent an untapped pool of capital that can contribute to fostering entrepreneurial development. In addition, business angels can bridge knowledge gaps in new business ventures by means of making their human capital available. This study has two objectives. The first is to gain an understanding of the characteristics and investment behaviour of Finnish business angels. The strongest focus here is on the due diligence procedures and their involvement post investment. The second objective is to assess whether agency theory and the incomplete contacting theory are useful theoretical lenses in the arena of business angels. To achieve the second objective, this study investigates i) how risk is mitigated in the investment process, ii) how uncertainty influences the comprehensiveness of due diligence as well as iii) how control is allocated post investment. Research hypotheses are derived from assumptions underlying agency theory and the incomplete contacting theory. The data for this study comprise interviews with 53 business angels. In terms of sample size this is the largest on Finnish business angels. The research hypotheses in this study are tested using regression analysis. This study suggests that the Finnish informal venture capital market appears to be comprised of a limited number of business angels whose style of investing much resembles their formal counterparts’. Much focus is placed on managing risks prior to making the investment by strong selectiveness and by a relatively comprehensive due diligence. The involvement is rarely on a day-to-day basis and many business angels seem to see board membership as a more suitable alternative than involvement in the operations of an entrepreneurial venture. The uncertainty involved does not seem to drive an increase in due diligence. On the contrary, it would appear that due diligence is more rigorous in safer later stage investments and when the business angels have considerable previous experience as investors. Finnish business angels’ involvement post investment is best explained by their degree of ownership in the entrepreneurial venture. It seems that when investors feel they are sufficiently rewarded, in terms of an adequate equity stake, they are willing to involve themselves actively in their investments. The lack of support for a relationship between increased uncertainty and the comprehensiveness of due diligence may partly be explained by an increasing trend towards portfolio diversification. This is triggered by a taxation system that favours investments through investment companies rather than direct investments. Many business angels appear to have substituted a specialization strategy that builds on reducing uncertainty for a diversification strategy that builds on reducing firm specific (idiosyncratic) risk by holding shares in ventures whose returns are not expected to exhibit a strong positive correlation.

Real Estate Investment and Uncertainty: Econometric Modelling using Finnish Data

The purpose of this paper is to test for the effect of uncertainty in a model of real estate investment in Finland during the hihhly cyclical period of 1975 to 1998. We use two alternative measures of uncertainty. The first measure is the volatility of stock market returns and the second measure is the heterogeneity in the answers of the quarterly business survey of the Confederation of Finnish Industry and Employers. The econometric analysis is based on the autoregressive distributed lag (ADL) model and the paper applies a 'general-to-specific' modelling approach. We find that the measure of heterogeneity is significant in the model, but the volatility of stock market returns is not. The empirical results give some evidence of an uncertainty-induced threshold slowing down real estate investment in Finland.