When rules and principles are not enough: insiders’ views and narratives on the global financial crisis

Much has been written about Wall Street and the global financial crisis (GFC). From a fraudulent derivatives market to a contestable culture of banking bonuses, culpability has been examined within the frames of American praxis, namely that of American exceptionalism. This study begins with an exploratory analysis of non-US voices concerning the nature of the causes of the GFC. The analysis provides glimpses of the globalized extent of assumptions shared, but not debated within the globalization convergence of financial markets as the neo-liberal project. Practical and paradigmatic tensions are revealed in the capture of a London-based set of views articulated by senior financial executives of financial service organizations, the outcomes of which are not overly optimistic for any significant change in praxis within the immediate future.

Leader characteristics and styles in the SMEs of the People's Republic of China during the global financial crisis

This empirical study explores successful views and characteristics of leaders and employees in the SMEs of the People's Republic of China during the global financial crisis.

The global financial crisis and after: a new capitalism?

The 2008 global financial crisis was the consequence of the process of financialization, or the creation of massive fictitious financial wealth, that began in the 1980s, and of the hegemony of a reactionary ideology, namely, neoliberalism, based on selfregulated and efficient markets. Although capitalism is intrinsically unstable, the lessons from the stock-market crash of 1929 and the Great Depression of the 1930s were transformed into theories and institutions or regulations that led to the “30 glorious years of capitalism” (1948–77) and that could have avoided a financial crisis as profound as the present one. It did not because a coalition of rentiers and “financists” achieved hegemony and, while deregulating the existing financial operations, refused to regulate the financial innovations that made these markets even more risky. Neoclassical economics played the role of a meta-ideology as it legitimized, mathematically and “scientifically”, neoliberal ideology and deregulation. From this crisis a new capitalism will emerge, though its character is difficult to predict. It will not be financialized but the tendencies present in the 30 glorious years toward global and knowledge-based capitalism, where professionals will have more say than rentier capitalists, as well as the tendency to improve democracy by making it more social and participative, will be resumed.

Antidumping and the global financial crisis: the impact on Latin America and the Caribbean

Includes bibliography

Macroeconomic challenges of fiscal decentralization in Latin America in the aftermath of the global financial crisis

Incluye Bibliografía

The impact of the global financial crisis on Latin America

Includes bibliography

The global financial crisis: what happened and what’s next

Global economic conditions have been deteriorating sharply since mid- September 2008. Lending has dropped abruptly, credit spreads have widened sharply, stock markets have plunged and economies everywhere are stumbling. Governments around the world have undertaken unprecedented measures, including some coordinated intervention. However, global economic prospects remain troubled, and further policy action is required. In order to better understand the task before policy makers as they chart a new direction, this paper examines how the global economy arrived at its current predicament, looking back at the sequence of events that contributed to create havoc in financial markets, as well as the policy response they produced. In light of these events, we examine the impact on Latin American financial markets in particular. The global nature of the current crisis underscores the need for coordinating the policy response at the global level, as well as advancing towards a new international financial architecture that will make possible a more effective response to the build-up of systemic pressures.

The influence of corporate governance characteristics on changes in risk following the global financial crisis evidence from companies listed in the portuguese stock market

Apesar da crescente regulação da atividade empresarial e do estabelecimento de normas e recomendações relativamente ao governo das sociedades verificados desde o início da década passada, as empresas de grande parte dos sectores de atividade económica foram seriamente afetadas durante a crise financeira global. Este estudo permite concluir que houve aumentos significativos no risco total e idiossincrático das empresas não financeiras cotadas na Euronext Lisboa após a falência do banco Lehman Bothers, a 15 de Setembro de 2008. Estes resultados são coerentes com o aumento da incerteza dos investidores verificado durante o período de crise, resultante do colapso de alguns dos maiores bancos do último século, que se traduziu numa falta de confiança generalizada nas instituições financeiras que resultou em maiores dificuldades na obtenção de créditos bancários e num aumentos dos custos de capital, durante este período. Os resultados sugerem que as alterações verificadas nas medidas do risco variaram de acordo com as características de governação e características específicas das empresas, quer num horizonte temporal mais curto, quer num horizonte temporal mais alargado. O mercado de capitais premiou as empresas com um número relativamente maior de administradores não-executivos e com administradores que exercem (em média) cargos de gestão num maior número de empresas ou instituições. Por outro lado, o mercado de capitais penalizou as empresas com um número relativamente maior de administradores independentes, maior concentração de capital, maiores oportunidades de crescimento, maior alavancagem financeira e maior liquidez corrente.

The global financial crisis, working people and sustainable development

Although they had nothing to do with the actual causes of the 2008 Global Financial crisis, it is ordinary workers and their families who have arguably suffered the most from its effects. While governments and international agencies seem most concerned to protect the returns to Capital in the name of financial austerity and economic good sense, little has been done to protect the well-being of working people or the global environment. Both trade unionists and environmentalists oppose the destruction wrought by neoliberal market economics; the challenge is for them to work more closely together in the future to promote truly sustainable development.

Market orientation, innovation capability and business performance:insights from the global financial crisis

Purpose - The paper aims to examine the role of market orientation (MO) and innovation capability in determining business performance during an economic upturn and downturn. Design/methodology/approach - The data comprise two national-level surveys conducted in Finland in 2008, representing an economic boom, and in 2010 when the global economic crisis had hit the Finnish market. Partial least square path analysis is used to test the potential mediating effect of innovation capability on the relationship between MO and business performance during economic boom and bust. Findings - The results show that innovation capability fully mediates the performance effects of a MO during an economic upturn, whereas the mediation is only partial during a downturn. Innovation capability also mediates the relationship between a customer orientation and business performance during an upturn, whereas the mediating effect culminates in a competitor orientation during a downturn. Thus, the role of innovation capability as a mediator between the individual market-orientation components varies along the business cycle. Originality/value - This paper is one of the first studies that empirically examine the impact of the economic cycle on the relationship between strategic marketing concepts, such as MO or innovation capability, and the firm's business performance.

Anatomy and lessons of the global financial crisis. Is US consumption financed by Chinese savings?

Savings and investments in the American money market by emerging countries, primarily China, financed the excessive consumption of the United States in the early 2000s, which indirectly led to a global financial crisis. The crisis started from the real estate mortgage market. Such balance disrupting processes began on the American financial market which contradicted all previously known equilibrium theories of every school of economics. Economics has yet to come up with models or empirical theories for this new disequilibrium. This is why the outbreak of the crisis could not be prevented or at least predicted. The question is, to what extent can existing market theories, calculation methods and the latest financial products be held responsible for the new situation. This paper studies the influence of the efficient market and modern portfolio theory, as well as Li’s copula function on the American investment market. Naturally, the issues of moral risks and greed, credit ratings and shareholder control, limited liability and market regulations are aspects, which cannot be ignored. In summary, the author outlines the potential alternative measures that could be applied to prevent a new crisis, defines the new directions of economic research and draws the conclusion for the Hungarian economic policy.

Shining a Light on the Dark Side: How the Global Financial Crisis Exposed the Dark Side of Leadership

The global financial crisis has had innumerate outcomes around the globe. Whilst most of these are generally perceived to be negative, there are outcomes which could be considered positive for society. One such outcome is the spotlight that the financial crisis has shone on corruption within organisations and in particular, the role that destructive leaders play in the promotion of negative behaviours within organisations. This interest in identifying so-called ‘dark-side’ traits in leaders is a positive step both academically and practically. Academically, there is a limited research examining individuals with ‘dark-traits’ within organisations (Mahmut, Homewood & Stevenson, 2008). Practically, most leader derailment can be attributed to ‘dark-side’ traits and leaders with such traits are implicated in a host of issues for organisations including poor staff morale and satisfaction, bullying, poor levels of productivity, high staff turnover, unethical behaviour and even white collar crime (e.g. Boddy,2010; 2011; Lesha & Lesha, 2012; O’Boyle, Forsyth, Banks & McDaniel, 2012; Sanecka, 2013). This paper focuses on one of the ‘dark-side’ traits; psychopathy. Psychopathy is a personality disorder characterised by guiltlessness, incapacity to experience love, impulsivity, shallow emotions, superficial charm and an inability to learn from experience (Cleckley, 1941, 1982). Research has found that individuals with high levels of psychopathy can be found working within organisations and experiencing some degree of career success (e.g. Babiak, Neumann & Hare, 2010; Board & Fritzon, 2005; Boddy, 2010; Lilienfeld, Latzman, Watts, Smith & Dutton, 2014). These individuals are theoretically thought to be attracted to careers which offer power, status and monetary rewards. In particular, the finance industry has been suggested as an ideal work place for the organisational psychopath. Some authors go as far as attribute organisational psychopaths a key role in the financial crisis (Boddy, 2011). However, little research has been conducted to explore whether levels of psychopathy in employees differ across industries and what careers might be most attractive to individuals with high levels of psychopathy. This paper presents the results of a large scale survey of 265 alumni of universities in the Central England region of the UK. The survey was conducted to assess the link between levels of three factors of psychopathy (Egotism, Callousness and Antisocialism) with occupation as defined by Holland’s RIASEC model. Participants completed Brinkley, Diamond, Magaletta & Heigel’s (2008) revision of Levenson’s Self-Report Psychopathy Scale and responded to questions regarding their current occupation. Logistic regression analyses were conducted to assess whether levels of Egotism, Callousness and Antisocialism were predictive of occupation. The results showed that when compared to individuals who occupy job roles within the Social sector of Holland’s model, individuals with higher levels of psychopathy were more likely to be employed within Realistic, Investigative, Enterprising and Conventional roles. When comparing Social and Realistic roles, more Egotistical individuals were likely to be employed within Realistic roles. When comparing those employed in Social roles to Investigative, Enterprising and Conventional roles, individuals with higher levels of Antisocialism were more likely to be employed within the latter three occupations than within Social roles. This suggests that individuals with psychopathy do gravitate towards certain career paths. Social roles where job incumbents are required to be caring and interact with others to a large extent appear to be unattractive to individuals with high levels of psychopathy. Social roles are also associated with lower monetary rewards and are generally less prestigious (Henley, 2001). These individuals instead seek out occupations where there are higher levels of risk, power and reward. Roles in the Realistic category include those which include high levels of risk e.g. fighter pilot, fireman etc., (Cohen, Meir, Segal & Amar, 2003). Investigative careers hold the highest level of prestige and ranking. Enterprising roles include management positions where power is wielded over subordinates and sales roles, where customers can be manipulated (ACT, 2009). Conventional roles include those within the finance industry, which include some of the most financially lucrative positive available (Babiak & Hare, 2006). The above suggests that individuals with higher levels of psychopathy may be seeking to satisfy their self-centred natures by selecting careers which provide them with high levels of reward in one way or another. Alternatively, these individuals may select roles where their traits can be accepted. The importance of Antisocialism in predicting occupation may be testament to the importance of finding a career which ‘fits’ such traits. Antisocialism is generally associated with negative outcomes in the workplace (Ettner, MacLean & French, 2010). Therefore, finding environments tolerant of antisocial tendencies may be a priority for individuals with high levels of these traits. The results suggest that Enterprising, Investigative and Conventional work environments may be tolerant of Antisocialism in employees and Realistic environments tolerant of Egotism. Academically, the results show that there is value in studying ‘dark-side’ characteristics in organisations. Individuals with higher levels of psychopathic traits, do not appear to randomly enter employment. Instead, they appear to gravitate to careers which meet their needs and/or tolerate their traits. It is important to further explore what industries and positions are particularly attractive to individuals with higher levels of psychopathy and what makes them attractive to these individuals. Such knowledge is important for practitioners to be able to advise organisations as to the likely level of risk they face of employing organisational psychopaths and to enable organisations which are particularly attractive to highly psychopathic employees to design selection systems which detect undesirable traits in candidates. Furthermore, organisations can examine their culture to assess whether traits such as antisocialism are tolerated (or even rewarded) and what the implications of this are.