The Economics of State Aid for the Rescue and Restructuring of Firms in Difficulty: Theoretical Considerations, Empirical Analysis and Proposals for Reform. Bruges European Economic Research (BEER) Papers 27/September 2013

State aid for rescue and restructuring (R&R) of companies in difficulty causes a significant distortion of competition. It prevents the market from eliminating inefficient companies. Because of this, the European Commission has to be specially strict when it assesses rescue or restructuring aid. This paper examines recent cases of corporate restructuring partly funded with public money. It explains the main aspects of the current guidelines which are applicable to R&R State Aid and establishes a theoretical framework for the economic assessment of R&R aid. It then analyses decisions adopted by the European Commission concerning R&R state aid during the period 2000-2013. It finds that there is little economic rationale in the granting of R&R aid. The paper concludes by applying the lessons drawn from the empirical analysis to the anticipated revision of the R&R guidelines in the context of the State Aid Modernisation process.

Strategic knowledge serendipity and arbitrage & intellectual venture capitalists: An emerging breed of knowledge entrepreneurs; and Part II: Global and Local (GloCal) knowledge logistics for innovation and competitiveness. ACES Working Papers, August 2009

Strategic Knowledge: While entrepreneurship may occur as a natural result of personal drive, it occurs most often, most robustly and is most sustainable in an environment designed to encourage it. Potential entrepreneurs become active entrepreneurs when the conditions are most supportive of their commercial opportunities and their business thus helping channel the two key qualities they exhibit as individuals obsessed maniacs and clairvoyant oracles (Carayannis, GWU Lectures, 2000-2005) and (Carayannis et at, 2003a) towards the generation of sustainable wealth. So far, entrepreneurial scholars who turn into intellectual venture capitalists by founding knowledge-driven companies remain one of the least explored specie in the territory of entrepreneurship. GloCal: The increasing engagement of firms within global knowledge and production networks and their ability to source knowledge globally as well as locally (GloCally), for the development of innovation capacities will shape the future of UK's knowledge resources and its role in the global economy. Practices such as off-shoring R&D activities are widely adopted, creating challenging, and not very well understood, issues related to cross-country and inter-firm knowledge and technology flows. We seek to address the internationalisation and networking of research and innovation activities, including the roles and strategies of enterprises, universities, research centres, governments in a cross-country and inter-sectoral way, to assess the impact and the implications for sustaining and enhancing the competitiveness of UK firms and other British knowledge producers and users.

An international study on the impact of cultural factors on the prevalence of family-owned firms. ACES Working Papers, August 2010

A key question in international corporate governance is why certain in ownership types are prevalent in different countries around the world (La Prota et al., 1999). In this study, we provide an answer for the prevalence of the family-owned firms in 42 countries by examining key characteristics of culture. We show that family-ownership is positively correlated with power distance (PD), in-group collectivism (CI) and, insignificantly, with uncertainty avoidance (UA). Our study makes a contribution to the field since previous research used religion and language as umbrella constructs for culture, while we pinpoint specific cultural dimensions.

How did Targeted Government Trade Policies Impact the Productivity of Manufacturing Firms in Eastern Europe and Central Asia between 1995 and 2009? ACES Working Papers, 28 August 2012

This study investigates whether trade-related, targeted, government policies had an impact on the total factor productivity (TFP) of manufacturing firms in Eastern Europe and Central Asia (ECA region) between 1995 and 2009. It does so by looking at how different types of primarily industry-specific trade policies (or their combinations) impacted firm productivity. The dependent variable is firm total factor productivity (TFP), calculated using the Levinsohn-Petrin approach. As an alternative measure of firm productivity, this study uses labor productivity. This study finds that, in most instances (10 out of 14 times), targeted policies do not show a significant impact on manufacturing firms’ TFP. Based on the analysis of 588 manufacturing firms in the ECA region, this study finds that, contrary to proponents of targeted policies, targeted trade-related government policies have a limited impact on the total factor productivity (TFP) in developing countries.

The Political Response of Firms to the 1992 Single Market Program: The Case of the German Automobile Industry Pamela Camer. CES Germany & Europe Working Papers, No. 03.1, 1994

This paper examines the political responses of German automobile firms to the 1992 Single Market initiative. I argue that the decision by firms to try to influence EC policies depends on the perceived economic impact of the single market and ,the market alternative open to firms, while the decision on how to lobby depends on the size of the finn and the institutional and strategic environment in which a firm operates. I use this framework to explain why German automobile firms were slow in responding the single market initiative and why, when they did choose to lobby, the firms pursued different political strategies. The research suggests that we should not limit our studies to the political activity of trade associations and sectors, but should also examine the political strategies and activities of individual firms. It also suggests that, as integration efforts in Europe proceed, there is likely to be increased activity by individual firms and national associations because European trade associations may not be able to agree on specific EC policy proposals.

The globalization of angel investments. Bruegel Working Paper 2015/09, 1 September 2015

The last decade has seen a rapid expansion and deepening of the types of vehicles that fund start-up firms in the U.S. and worldwide. In particular, we have seen a growing role of angel groups and other more “individualistic” funding options for start-ups, such as super angels or crowd sourcing platforms. Authors seek to understand the nature and consequences of angel investments across a variety of geographies with varying levels of venture capital markets and other forms of risk capital. They ask whether angel investors improve the outcomes and performance of the start-ups they invest in. Furthermore we want to understand whether and how the types of firms that seek angel funding vary with the overall entrepreneurial ecosystem in a country. Authors examine the records of 13 angel investment groups based in 12 nations and with applicants for financing transactions from 21 nations, examining both the applicants that were considered and rejected and those that were funded. Key findings from the analysis are two-fold. First, angel investors have a positive impact on the growth of the firms they fund, their performance, and survival. Second, they find that the selection of firms that apply for angel funding is different across countries.