Post-Bretton Woods evidence on PPP under different exchange rate regimes

This article investigates the behaviour of exchange rates across different regimes for a post-Bretton Woods period. The exchange rate regime classification is based on the classification of Frankel et al. (2004) who condensed the 10 categories of exchange rate regimes reported by the International Monetary Fund (IMF) into three categories. Panel unitroot tests and panel cointegration are used to examine the Purchasing Power Parity (PPP) hypothesis. The latter test is used to check for both the weak and strong forms of PPP. The panel unit-root tests show no evidence of PPP and suggest there is no difference in the behaviour of exchange rates across different regimes. However, failure to detect PPP across any of the regimes could be due to structural breaks. This assumption is reinforced by the results of cointegration tests, which suggest that there exists at least a weak form of PPP for the different regimes. The evidence for strong PPP decreases as the exchange rate regime moves away from a flexible exchange rate regime.

Executive remuneration, financial performance and corporate governance in UK and Spanish listed firms

This study examines the relationship between executive directors’ remuneration and the financial performance and corporate governance arrangements of the UK and Spanish listed firms. These countries’ corporate governance framework has been shaped by differences in legal origin, culture and backgrounds. For example, the UK legal arrangements can be defined as to be constituted in common-law, whereas for Spanish firms, the legal arrangement is based on civil law. We estimate both static and dynamic regression models to test our hypotheses and we estimate our regression using Ordinary Least Squares (OLS) and the Generalised Method of Moments (GMM). Estimated results for both countries show that directors’ remuneration levels are positively related with measures of firm value and financial performance. This means that remuneration levels do not lead to a point whereby firm value is reduced due to excessive remuneration. These results hold for our long-run estimates. That is, estimates based on panel cointegration and panel error correction. Measures of corporate governance also impacts on the level of executive pay. Our results have important implications for existing corporate governance arrangements and how the interests of stakeholders are protected. For example, long-run results suggest that directors’ remuneration adjusts in a way to capture variation in financial performance

Stock market efficiency, the small firm effect and cointegration

The cointegration methodology commonly used for testing the efficiency of the foreign exchange market is applied to a sample of UK share prices. Specifically we test for static market efficiency in the share prices of small and large firms, using monthly data from January 1975 to December 1989. The empirical findings provide evidence of market efficiency for portfolios of large firms but of inefficiency for small firm portfolios. These results are indicative of a small firm effect in the UK stock market.

The appraisal and management of multi-storey dwelling blocks using large concrete panel systems

This exploratory study is concerned with the integrated appraisal of multi-storey dwelling blocks which incorporate large concrete panel systems (LPS). The first step was to look at U.K. multi-storey dwelling stock in general, and under the management of Birmingham City Council in particular. The information has been taken from the databases of three departments in the City of Birmingham, and rearranged in a new database using a suite of PC software called `PROXIMA' for clarity and analysis. One hundred of their stock were built large concrete panel system. Thirteen LPS blocks were chosen for the purpose of this study as case-studies depending mainly on the height and age factors of the block. A new integrated appraisal technique has been created for the LPS dwelling blocks, which takes into account the most physical and social factors affecting the condition and acceptability of these blocks. This appraisal technique is built up in a hierarchical form moving from the general approach to particular elements (a tree model). It comprises two main approaches; physical and social. In the physical approach, the building is viewed as a series of manageable elements and sub-elements to cover every single physical or environmental factor of the block, in which the condition of the block is analysed. A quality score system has been developed which depends mainly on the qualitative and quantitative conditions of each category in the appraisal tree model, and leads to physical ranking order of the study blocks. In the social appraisal approach, the residents' satisfaction and attitude toward their multi-storey dwelling block was analysed in relation to: a. biographical and housing related characteristics; and b. social, physical and environmental factors associated with this sort of dwelling, block and estate in general.The random sample consisted of 268 residents living in the 13 case study blocks. Data collected was analysed using frequency counts, percentages, means, standard deviations, Kendall's tue, r-correlation coefficients, t-test, analysis of variance (ANOVA) and multiple regression analysis. The analysis showed a marginally positive satisfaction and attitude towards living in the block. The five most significant factors associated with the residents' satisfaction and attitude in descending order were: the estate, in general; the service categories in the block, including heating system and lift services; vandalism; the neighbours; and the security system of the block. An important attribute of this method, is that it is relatively inexpensive to implement, especially when compared to alternatives adopted by some local authorities and the BRE. It is designed to save time, money and effort, to aid decision making, and to provide ranked priority to the multi-storey dwelling stock, in addition to many other advantages. A series of solution options to the problems of the block was sought for selection and testing before implementation. The traditional solutions have usually resulted in either demolition or costly physical maintenance and social improvement of the blocks. However, a new solution has now emerged, which is particularly suited to structurally sound units. The solution of `re-cycling' might incorporate the reuse of an entire block or part of it, by removing panels, slabs and so forth from the upper floors in order to reconstruct them as low-rise accommodations.

Can psychometric testing be used to explain, predict and measure behavioural competences and the funding resource orchestration of the entrepreneur?

Financing is a critical entrepreneurial activity (Shane et al. 2003) and within the study of entrepreneurship, behaviour has been identified as an area requiring further exploration (Bird et al. 2012). Since 2008 supply side conditions for SMEs have been severe and increasingly entrepreneurs have to bundle or ‘orchestrate’ funding from a variety of sources in order to successfully finance the firm (Wright and Stigliani 2013: p.15). This longitudinal study uses psychometric testing to measure the behavioural competences of a panel of sixty entrepreneurs in the Creative Industries sector. Interviews were conducted over a 3 year period to identify finance finding behaviour. The research takes a pragmatic realism perspective to examine process and the different behavioural competences of entrepreneurs. The predictive qualities of this behaviour are explored in a funding context. The research confirmed a strong behavioural characteristic as validated through interviews and psychometric testing, was an orientation towards engagement and working with other organisations. In a funding context, this manifested itself in entrepreneurs using networks, seeking advice and sharing equity to fund growth. These co-operative, collaborative characteristics are different to the classic image of the entrepreneur as a risk-taker or extrovert. Leadership and achievement orientation were amongst the lowest scores. Three distinctive groups were identified and also shown by subsequent analysis to be a positive contribution to how entrepreneurial behavioural competences can be considered. Belonging to one of these three clusters is a strong predictive indicator of entrepreneurial behaviour – in this context, how entrepreneurs access finance. These Clusters were also proven to have different characteristics in relation to funding outcomes. The study seeks to make a contribution through the development of a methodology for entrepreneurs, policy makers and financial institutions to identify competencies in finding finance and overcome problems in information asymmetry.

Do R&D strategies in high-tech sectors differ from those in low-tech sectors? An alternative approach to testing the pooling assumption

Most studies investigating the determinants of R&D investment consider pooled estimates. However, if the parameters are heterogeneous, pooled coefficients may not provide reliable estimates of individual industry effects. Hence pooled parameters may conceal valuable information that may help target government tools more efficiently across heterogeneous industries. There is little evidence to date on the decomposition of the determinants of R&D investment by industry. Moreover, the existing work does not distinguish between those R&D determinants for which pooling may be valid and those for which it is not. In this paper, we test the pooling assumption for a panel of manufacturing industries and find that pooling is valid only for output fluctuations, adjustment costs and interest rates. Implementing the test results into our model, we find government funding is significant only for low-tech R&D. Foreign R&D and skilled labour matter only in high-tech sectors. These results suggest important implications for R&D policy.