Francesca Carnevali
- Published in print:
- 2005
- Published Online:
- September 2006
- ISBN:
- 9780199257393
- eISBN:
- 9780191603846
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0199257396.003.0001
- Subject:
- Economics and Finance, Economic History
This chapter explores the literature on the economic importance of small firms in terms of employment and technological change. It considers why small firms are reliant on commercial banks for ...
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This chapter explores the literature on the economic importance of small firms in terms of employment and technological change. It considers why small firms are reliant on commercial banks for finance, and why information asymmetries can make a difference in the nature of this relationship.Less
This chapter explores the literature on the economic importance of small firms in terms of employment and technological change. It considers why small firms are reliant on commercial banks for finance, and why information asymmetries can make a difference in the nature of this relationship.
Milada Anna Vachudova
- Published in print:
- 2005
- Published Online:
- April 2005
- ISBN:
- 9780199241194
- eISBN:
- 9780191602382
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0199241198.003.0002
- Subject:
- Political Science, European Union
The quality of political competition at the moment of regime change determined whether East European states embarked on a liberal or an illiberal pattern of political change after 1989. It was ...
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The quality of political competition at the moment of regime change determined whether East European states embarked on a liberal or an illiberal pattern of political change after 1989. It was initially determined by the presence or absence of an opposition to communism strong enough to take power in 1989, and secondarily by the presence or absence of a reforming communist party. This chapter makes the theoretical case for why political competition is central to understanding variation in the domestic trajectories of post-communist states. It also presents a model of the causal mechanisms that translate different levels of political competition into liberal and illiberal political outcomes.Less
The quality of political competition at the moment of regime change determined whether East European states embarked on a liberal or an illiberal pattern of political change after 1989. It was initially determined by the presence or absence of an opposition to communism strong enough to take power in 1989, and secondarily by the presence or absence of a reforming communist party. This chapter makes the theoretical case for why political competition is central to understanding variation in the domestic trajectories of post-communist states. It also presents a model of the causal mechanisms that translate different levels of political competition into liberal and illiberal political outcomes.
Max H. Boisot, Ian C. MacMillan, and Kyeong Seok Han
- Published in print:
- 2007
- Published Online:
- January 2008
- ISBN:
- 9780199250875
- eISBN:
- 9780191719509
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199250875.003.0004
- Subject:
- Business and Management, Knowledge Management
The resource-based view shares with population ecology, organizational systematics, organizational cladistics, and institutional theory a concern with why firms differ and with what keeps them ...
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The resource-based view shares with population ecology, organizational systematics, organizational cladistics, and institutional theory a concern with why firms differ and with what keeps them different. These two questions only have meaning if — as has been the case in the neoclassical theory of the firm — similarities between firms are taken as the default assumption. This chapter distinguishes between ontological heterogeneity — differences in the world — and epistemic heterogeneity — differences in the way that the world is construed. Focusing on the latter, it puts forward an argument for taking epistemic heterogeneity between firms as the default assumption. It starts with a general analysis of how living systems make sense of the world. It then goes on to identify the cognitive activities of codification and abstraction as key sources of epistemic heterogeneity. The findings are applied to those systems called firms where a dominant logic allows epistemic heterogeneity to persist. In some case, this leads to competitive advantage, in others to a debilitating inertia. The implications for a knowledge-based theory of the firm are briefly explored.Less
The resource-based view shares with population ecology, organizational systematics, organizational cladistics, and institutional theory a concern with why firms differ and with what keeps them different. These two questions only have meaning if — as has been the case in the neoclassical theory of the firm — similarities between firms are taken as the default assumption. This chapter distinguishes between ontological heterogeneity — differences in the world — and epistemic heterogeneity — differences in the way that the world is construed. Focusing on the latter, it puts forward an argument for taking epistemic heterogeneity between firms as the default assumption. It starts with a general analysis of how living systems make sense of the world. It then goes on to identify the cognitive activities of codification and abstraction as key sources of epistemic heterogeneity. The findings are applied to those systems called firms where a dominant logic allows epistemic heterogeneity to persist. In some case, this leads to competitive advantage, in others to a debilitating inertia. The implications for a knowledge-based theory of the firm are briefly explored.
Margaret Jane Radin
- Published in print:
- 2012
- Published Online:
- October 2017
- ISBN:
- 9780691155333
- eISBN:
- 9781400844838
- Item type:
- chapter
- Publisher:
- Princeton University Press
- DOI:
- 10.23943/princeton/9780691155333.003.0006
- Subject:
- Law, Company and Commercial Law
This chapter examines whether boilerplate rights deletion schemes can be justified by the “contract-as-product” theory. The contract-as-product theory attempts to sidestep the issue of consent by ...
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This chapter examines whether boilerplate rights deletion schemes can be justified by the “contract-as-product” theory. The contract-as-product theory attempts to sidestep the issue of consent by denying that a particular set of contracted terms is an individual transaction requiring consent in the traditional sense. According to this view, whatever adhesion terms accompany the purchase of a product should actually be conceived of as part of the product. The chapter considers how choice or consent by the recipient enters into the contract-as-product view, and how information asymmetry and heuristic biases render erroneous the assumption of economic rationality. It argues that contract-as-product theory cannot suffice to validate boilerplate in general, or even presumptively.Less
This chapter examines whether boilerplate rights deletion schemes can be justified by the “contract-as-product” theory. The contract-as-product theory attempts to sidestep the issue of consent by denying that a particular set of contracted terms is an individual transaction requiring consent in the traditional sense. According to this view, whatever adhesion terms accompany the purchase of a product should actually be conceived of as part of the product. The chapter considers how choice or consent by the recipient enters into the contract-as-product view, and how information asymmetry and heuristic biases render erroneous the assumption of economic rationality. It argues that contract-as-product theory cannot suffice to validate boilerplate in general, or even presumptively.
Sheilagh Ogilvie
- Published in print:
- 2019
- Published Online:
- May 2019
- ISBN:
- 9780691137544
- eISBN:
- 9780691185101
- Item type:
- chapter
- Publisher:
- Princeton University Press
- DOI:
- 10.23943/princeton/9780691137544.003.0006
- Subject:
- Economics and Finance, Economic History
This chapter examines one major market failure that guilds might have helped solve: the potential for information asymmetries between producers and consumers about the quality of goods and services. ...
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This chapter examines one major market failure that guilds might have helped solve: the potential for information asymmetries between producers and consumers about the quality of goods and services. Many guilds erected market regulations. To address such concerns, guilds required producers and products to be guild-certified, inspected workshops or wares, and penalized quality violations. Guilds also engaged in many unrelated activities which affected quality unintentionally. The chapter then assesses the evidence on information asymmetries about quality, the institutional mechanisms available to solve them, and the outcomes in different sectors of the European economy. It argues that guilds shed light on the balance between market failures, state failures, and the failure of particularized institutions in intermediating between producers and consumers.Less
This chapter examines one major market failure that guilds might have helped solve: the potential for information asymmetries between producers and consumers about the quality of goods and services. Many guilds erected market regulations. To address such concerns, guilds required producers and products to be guild-certified, inspected workshops or wares, and penalized quality violations. Guilds also engaged in many unrelated activities which affected quality unintentionally. The chapter then assesses the evidence on information asymmetries about quality, the institutional mechanisms available to solve them, and the outcomes in different sectors of the European economy. It argues that guilds shed light on the balance between market failures, state failures, and the failure of particularized institutions in intermediating between producers and consumers.
B. Greenwald and J. E. Stiglitz
- Published in print:
- 2004
- Published Online:
- September 2007
- ISBN:
- 9780199269426
- eISBN:
- 9780191710179
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199269426.003.0006
- Subject:
- Business and Management, Organization Studies
This chapter provides a formal model for incorporating finance within the theory of the firm and for a more nuanced reading of the evolution of capitalistic economies. Financial markets emerged as ...
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This chapter provides a formal model for incorporating finance within the theory of the firm and for a more nuanced reading of the evolution of capitalistic economies. Financial markets emerged as mechanisms for ensuring the fulfilment of promises made for a return in the future in exchange for money today. The ensuing difficulties were met in part by legal changes, such as the development of limited liability and enforceable fraud standards, along with pragmatic advances in such areas of accountability as accountancy and auditing. Nonetheless, tensions remain due largely to information asymmetry problems and enforcement of difficulties. Given differing rates of return across sectors, the firm takes on the role of an important financial institution. An evolutionary process results in which deficiencies in the market give rise to new contract forms and their exploitation by some participants in the market, thus producing still newer arrangements. The evolution of financial instruments necessarily remains intertwined with the evolution of the firm.Less
This chapter provides a formal model for incorporating finance within the theory of the firm and for a more nuanced reading of the evolution of capitalistic economies. Financial markets emerged as mechanisms for ensuring the fulfilment of promises made for a return in the future in exchange for money today. The ensuing difficulties were met in part by legal changes, such as the development of limited liability and enforceable fraud standards, along with pragmatic advances in such areas of accountability as accountancy and auditing. Nonetheless, tensions remain due largely to information asymmetry problems and enforcement of difficulties. Given differing rates of return across sectors, the firm takes on the role of an important financial institution. An evolutionary process results in which deficiencies in the market give rise to new contract forms and their exploitation by some participants in the market, thus producing still newer arrangements. The evolution of financial instruments necessarily remains intertwined with the evolution of the firm.
Joseph E. Stiglitz, José Antonio Ocampo, Shari Spiegel, Ricardo Ffrench-Davis, and Deepak Nayyar
- Published in print:
- 2006
- Published Online:
- September 2006
- ISBN:
- 9780199288144
- eISBN:
- 9780191603884
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0199288143.003.0003
- Subject:
- Economics and Finance, Development, Growth, and Environmental
Despite progress in economic science, important disagreements remain about the conduct of macroeconomic policy. This chapter identifies three broad policy positions (‘conservative’ or ‘neoclassical’, ...
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Despite progress in economic science, important disagreements remain about the conduct of macroeconomic policy. This chapter identifies three broad policy positions (‘conservative’ or ‘neoclassical’, ‘standard Keynesian’, and ‘heterodox’) and looks at the theory and evidence behind each. The approaches differ not only on what they focus, but also in their assumptions concerning the structure and behavior of the economy and the behavior of government. The conservative approach focuses on inflation and deficits, which it attempts to address through tight monetary and restrictive fiscal policy. The standard Keynesian approach is more concerned with unemployment and stagnation, which it attempts to address through expansionary monetary and fiscal policy. The heterodox approach looks for non-standard ways (including the use of microeconomic interventions) to stabilize the economy, stimulate growth and employment, and contain inflation.Less
Despite progress in economic science, important disagreements remain about the conduct of macroeconomic policy. This chapter identifies three broad policy positions (‘conservative’ or ‘neoclassical’, ‘standard Keynesian’, and ‘heterodox’) and looks at the theory and evidence behind each. The approaches differ not only on what they focus, but also in their assumptions concerning the structure and behavior of the economy and the behavior of government. The conservative approach focuses on inflation and deficits, which it attempts to address through tight monetary and restrictive fiscal policy. The standard Keynesian approach is more concerned with unemployment and stagnation, which it attempts to address through expansionary monetary and fiscal policy. The heterodox approach looks for non-standard ways (including the use of microeconomic interventions) to stabilize the economy, stimulate growth and employment, and contain inflation.
Margaret Jane Radin
- Published in print:
- 2012
- Published Online:
- October 2017
- ISBN:
- 9780691155333
- eISBN:
- 9781400844838
- Item type:
- chapter
- Publisher:
- Princeton University Press
- DOI:
- 10.23943/princeton/9780691155333.003.0002
- Subject:
- Law, Company and Commercial Law
This chapter examines the normative degradation caused by the apparent lack of consent to boilerplate. It first considers the varieties of nonconsent to which consent is contrasted, including ...
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This chapter examines the normative degradation caused by the apparent lack of consent to boilerplate. It first considers the varieties of nonconsent to which consent is contrasted, including coercion and its related conceptions of force and duress; fraud, with its allied notions of misrepresentation and deception; and sheer ignorance. It then discusses problematic consent, focusing on situations involving “information asymmetry” and heuristic biases. It also explores strategies of assimilating World B to consent, with particular emphasis on the devolution of voluntary agreement. The chapter shows that consent is problematic even when recipients click a box that says “I agree,” because it remains unclear what they could actually be agreeing to.Less
This chapter examines the normative degradation caused by the apparent lack of consent to boilerplate. It first considers the varieties of nonconsent to which consent is contrasted, including coercion and its related conceptions of force and duress; fraud, with its allied notions of misrepresentation and deception; and sheer ignorance. It then discusses problematic consent, focusing on situations involving “information asymmetry” and heuristic biases. It also explores strategies of assimilating World B to consent, with particular emphasis on the devolution of voluntary agreement. The chapter shows that consent is problematic even when recipients click a box that says “I agree,” because it remains unclear what they could actually be agreeing to.
Tsuneo Ishikawa
- Published in print:
- 2002
- Published Online:
- November 2003
- ISBN:
- 9780198288626
- eISBN:
- 9780191596469
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/019828862X.003.0003
- Subject:
- Economics and Finance, Public and Welfare
This chapter addresses the question of how the resources of labour power are supplied to alternative uses from the neoclassical viewpoint of individual rational choice, and further explains various ...
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This chapter addresses the question of how the resources of labour power are supplied to alternative uses from the neoclassical viewpoint of individual rational choice, and further explains various modifications made to the framework of analysis, which are designed to cope with circumstances peculiar to the labour market that cannot be handled well in a standard framework of market clearing. Section 3.1 formulates the theory of general equilibrium for an economy with heterogeneous abilities and heterogeneous jobs, and derives some fundamental properties governing the distribution of income; in particular, it answers the supply‐side questions of how people's diverse abilities are allocated to different job types and how people's preferences for types of job affect such a process; and discusses implications of these on the size distribution of income. Section 3.2 discusses the possibility that each person's ability might change over time, in particular that it might be modified into a more valuable one at the expense of economic resources. Section 3.3 discusses the types of labour market equilibrium that obtain when each person's ability is imperfectly revealed––more specifically, asymmetry of information exists between the workers and the employer in that every worker knows his or her ability perfectly well while the employer cannot observe it directly. Section 3.4 again discusses the implications of informational imperfection, but this time imperfection falls equally (or symmetrically) on workers and employers.Less
This chapter addresses the question of how the resources of labour power are supplied to alternative uses from the neoclassical viewpoint of individual rational choice, and further explains various modifications made to the framework of analysis, which are designed to cope with circumstances peculiar to the labour market that cannot be handled well in a standard framework of market clearing. Section 3.1 formulates the theory of general equilibrium for an economy with heterogeneous abilities and heterogeneous jobs, and derives some fundamental properties governing the distribution of income; in particular, it answers the supply‐side questions of how people's diverse abilities are allocated to different job types and how people's preferences for types of job affect such a process; and discusses implications of these on the size distribution of income. Section 3.2 discusses the possibility that each person's ability might change over time, in particular that it might be modified into a more valuable one at the expense of economic resources. Section 3.3 discusses the types of labour market equilibrium that obtain when each person's ability is imperfectly revealed––more specifically, asymmetry of information exists between the workers and the employer in that every worker knows his or her ability perfectly well while the employer cannot observe it directly. Section 3.4 again discusses the implications of informational imperfection, but this time imperfection falls equally (or symmetrically) on workers and employers.
G. Anandalingam and Henry C. Lucas
- Published in print:
- 2004
- Published Online:
- September 2007
- ISBN:
- 9780195177404
- eISBN:
- 9780199789559
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195177404.003.0001
- Subject:
- Business and Management, Strategy
The winner’s curse, at its core, is driven by information asymmetry because the buyer does not know the true value of the acquisition. Overpayment occurs beyond auctions; in fact, the possibility of ...
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The winner’s curse, at its core, is driven by information asymmetry because the buyer does not know the true value of the acquisition. Overpayment occurs beyond auctions; in fact, the possibility of overpaying arises in a large number of business decisions. The problem is further exacerbated in competitive bidding situations when there are other potential buyers and time to make decisions is compressed. Overvaluing an acquisition has led to reductions in gains, high debt loads, and decreases in the stock price of the firm involved. All of these situations are examined with a combination of accessible theory and very current examples.Less
The winner’s curse, at its core, is driven by information asymmetry because the buyer does not know the true value of the acquisition. Overpayment occurs beyond auctions; in fact, the possibility of overpaying arises in a large number of business decisions. The problem is further exacerbated in competitive bidding situations when there are other potential buyers and time to make decisions is compressed. Overvaluing an acquisition has led to reductions in gains, high debt loads, and decreases in the stock price of the firm involved. All of these situations are examined with a combination of accessible theory and very current examples.
Akos Rona-Tas and Alya Guseva
- Published in print:
- 2014
- Published Online:
- September 2014
- ISBN:
- 9780804768573
- eISBN:
- 9780804789592
- Item type:
- chapter
- Publisher:
- Stanford University Press
- DOI:
- 10.11126/stanford/9780804768573.003.0004
- Subject:
- Sociology, Economic Sociology
This chapter continues the discussion in the previous chapter focusing on the puzzles related to the consumer loan side of the credit card--information asymmetry, information sharing and market ...
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This chapter continues the discussion in the previous chapter focusing on the puzzles related to the consumer loan side of the credit card--information asymmetry, information sharing and market origination and expansion. It concludes with a short account of how each was solved in the American payment card market and presents a brief preview of solutions used in the postcommunist countries.Less
This chapter continues the discussion in the previous chapter focusing on the puzzles related to the consumer loan side of the credit card--information asymmetry, information sharing and market origination and expansion. It concludes with a short account of how each was solved in the American payment card market and presents a brief preview of solutions used in the postcommunist countries.
PENGCHENG ZHU
- Published in print:
- 2012
- Published Online:
- May 2013
- ISBN:
- 9780199754656
- eISBN:
- 9780199979462
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199754656.003.0020
- Subject:
- Economics and Finance, Financial Economics, International
Multinational corporations use cross-border mergers and acquisitions (M&As) as an important restructuring strategy. Multiple motivations exist for cross-border M&As. Most studies focus on returns ...
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Multinational corporations use cross-border mergers and acquisitions (M&As) as an important restructuring strategy. Multiple motivations exist for cross-border M&As. Most studies focus on returns related to short-term announcements of acquiring and target firms in cross-border M&As and find significant variations in the performance outcomes. The results are mainly driven by market segmentation, the competitiveness of the corporate control market, and advantages associated with intangible assets. Long-term studies on cross-border M&As are limited and show mixed impact on acquiring and targeting firm performance. Information asymmetry, cultural barriers, and cross-country corporate governance all contribute to the complexity of the cross-border M&A activities. This chapter reviews the impact of these factors on acquisition performance.Less
Multinational corporations use cross-border mergers and acquisitions (M&As) as an important restructuring strategy. Multiple motivations exist for cross-border M&As. Most studies focus on returns related to short-term announcements of acquiring and target firms in cross-border M&As and find significant variations in the performance outcomes. The results are mainly driven by market segmentation, the competitiveness of the corporate control market, and advantages associated with intangible assets. Long-term studies on cross-border M&As are limited and show mixed impact on acquiring and targeting firm performance. Information asymmetry, cultural barriers, and cross-country corporate governance all contribute to the complexity of the cross-border M&A activities. This chapter reviews the impact of these factors on acquisition performance.
Joseph E. Stiglitz
- Published in print:
- 2010
- Published Online:
- February 2010
- ISBN:
- 9780199578801
- eISBN:
- 9780191723285
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199578801.003.0002
- Subject:
- Economics and Finance, Macro- and Monetary Economics, Financial Economics
The global financial crisis is distinctive in its origins, its magnitude, and its consequences. This chapter examines the failures that led to the crisis and, in particular, the important role played ...
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The global financial crisis is distinctive in its origins, its magnitude, and its consequences. This chapter examines the failures that led to the crisis and, in particular, the important role played by information and incentives problems. On the basis of this diagnosis, the author provides recommendations on how to reform financial regulation to prevent future crises. The crisis provides an excellent case study in the economics of information. Stiglitz illustrates how the models—those used explicitly by or implicit in the mind of both regulators and market participants—ignored the imperfections and asymmetries of information. Since incentives mattered, distorted incentives at both the individual and organizational level led to distorted behavior. These distorted incentives included executive compensation systems in banks and conflict of interest in rating agencies. Additional problems were caused by the repeal of Glass‐Steagall, moral hazard, the use of complexity to reduce competition and increase profit margins, as well as moral hazard problems created by securitization.Less
The global financial crisis is distinctive in its origins, its magnitude, and its consequences. This chapter examines the failures that led to the crisis and, in particular, the important role played by information and incentives problems. On the basis of this diagnosis, the author provides recommendations on how to reform financial regulation to prevent future crises. The crisis provides an excellent case study in the economics of information. Stiglitz illustrates how the models—those used explicitly by or implicit in the mind of both regulators and market participants—ignored the imperfections and asymmetries of information. Since incentives mattered, distorted incentives at both the individual and organizational level led to distorted behavior. These distorted incentives included executive compensation systems in banks and conflict of interest in rating agencies. Additional problems were caused by the repeal of Glass‐Steagall, moral hazard, the use of complexity to reduce competition and increase profit margins, as well as moral hazard problems created by securitization.
Peter d. Spencer
- Published in print:
- 2000
- Published Online:
- October 2011
- ISBN:
- 9780198776093
- eISBN:
- 9780191695384
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780198776093.003.0003
- Subject:
- Economics and Finance, Financial Economics
Insurance markets are different and special in many ways compared to other financial markets. From their informational structure, the purchaser or prospective insured or applicant is more likely to ...
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Insurance markets are different and special in many ways compared to other financial markets. From their informational structure, the purchaser or prospective insured or applicant is more likely to know more about their own risk characteristics than the insurer. Unlike other markets, information advantage is held by suppliers, who have more idea regarding the product quality than the buyer does. This chapter focuses on insurance products, and in this type of market there is usually a two-way information asymmetry. The insurer knows more about the insurance products, while the client/applicant knows more about the risk of the thing insured than the insurer. The chapter also discusses different types of insurance models. Regulation of insurance markets is also provided, so as to solve the information problem affecting the insurance services. The chapter concludes with the market structure of insurance markets and the prudential regulation required by the governments of countries with such a type of market.Less
Insurance markets are different and special in many ways compared to other financial markets. From their informational structure, the purchaser or prospective insured or applicant is more likely to know more about their own risk characteristics than the insurer. Unlike other markets, information advantage is held by suppliers, who have more idea regarding the product quality than the buyer does. This chapter focuses on insurance products, and in this type of market there is usually a two-way information asymmetry. The insurer knows more about the insurance products, while the client/applicant knows more about the risk of the thing insured than the insurer. The chapter also discusses different types of insurance models. Regulation of insurance markets is also provided, so as to solve the information problem affecting the insurance services. The chapter concludes with the market structure of insurance markets and the prudential regulation required by the governments of countries with such a type of market.
Takeo Hoshi
- Published in print:
- 1994
- Published Online:
- October 2011
- ISBN:
- 9780198288152
- eISBN:
- 9780191684579
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780198288152.003.0012
- Subject:
- Economics and Finance, South and East Asia
This chapter opens by describing several stylized facts of corporate grouping in general and the firm's relationship with its main bank in particular. It then goes on to summarize the main results of ...
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This chapter opens by describing several stylized facts of corporate grouping in general and the firm's relationship with its main bank in particular. It then goes on to summarize the main results of a series of econometric studies that were carried out on the role of the main bank system. These studies are among the first attempts to subject theoretical propositions regarding the main bank system to serious econometric testing and have been widely quoted among financial specialists. The studies tested the proposition that the corporate grouping and the main bank system reduce incentives and cause information problems arising from information asymmetries normally existing between investors and borrowers.Less
This chapter opens by describing several stylized facts of corporate grouping in general and the firm's relationship with its main bank in particular. It then goes on to summarize the main results of a series of econometric studies that were carried out on the role of the main bank system. These studies are among the first attempts to subject theoretical propositions regarding the main bank system to serious econometric testing and have been widely quoted among financial specialists. The studies tested the proposition that the corporate grouping and the main bank system reduce incentives and cause information problems arising from information asymmetries normally existing between investors and borrowers.
Alya Guseva and Akos Rona-Tas
- Published in print:
- 2014
- Published Online:
- September 2014
- ISBN:
- 9780804768573
- eISBN:
- 9780804789592
- Item type:
- book
- Publisher:
- Stanford University Press
- DOI:
- 10.11126/stanford/9780804768573.001.0001
- Subject:
- Sociology, Economic Sociology
This book draws on original fieldwork to provide a comparative analysis of emerging credit card markets in eight countries--the Czech Republic, Hungary, Poland, Bulgaria, Russia, Ukraine, China and ...
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This book draws on original fieldwork to provide a comparative analysis of emerging credit card markets in eight countries--the Czech Republic, Hungary, Poland, Bulgaria, Russia, Ukraine, China and Vietnam. The problem of market emergence is posed as analytically distinct from market functioning. Card markets are viewed as being actively constructed, rather than emerging spontaneously and following the US blueprint. The process of market construction involves solving a set of puzzles related to the credit card as a product that is both a means of payment and an instrument of credit. These puzzles are: standardization, information asymmetry, information sharing, market origination and expansion. They were solved differently in each of the countries, and the resulting markets are neither identical to the “Western” blueprint, nor to each other. The book focuses on the trajectories of market development in the eight countries from the moment the first cards were issued to the present time, underscoring both similarities and differences between countries.Less
This book draws on original fieldwork to provide a comparative analysis of emerging credit card markets in eight countries--the Czech Republic, Hungary, Poland, Bulgaria, Russia, Ukraine, China and Vietnam. The problem of market emergence is posed as analytically distinct from market functioning. Card markets are viewed as being actively constructed, rather than emerging spontaneously and following the US blueprint. The process of market construction involves solving a set of puzzles related to the credit card as a product that is both a means of payment and an instrument of credit. These puzzles are: standardization, information asymmetry, information sharing, market origination and expansion. They were solved differently in each of the countries, and the resulting markets are neither identical to the “Western” blueprint, nor to each other. The book focuses on the trajectories of market development in the eight countries from the moment the first cards were issued to the present time, underscoring both similarities and differences between countries.
Sheilagh Ogilvie
- Published in print:
- 2019
- Published Online:
- May 2019
- ISBN:
- 9780691137544
- eISBN:
- 9780691185101
- Item type:
- chapter
- Publisher:
- Princeton University Press
- DOI:
- 10.23943/princeton/9780691137544.003.0007
- Subject:
- Economics and Finance, Economic History
This chapter explores how guilds dealt with human capital investment, a second sphere in which markets are often thought to fail. Many guilds imposed comprehensive training requirements, as in the ...
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This chapter explores how guilds dealt with human capital investment, a second sphere in which markets are often thought to fail. Many guilds imposed comprehensive training requirements, as in the case of the seventeenth-century Toledo silk-twisters who justified their exclusive legal privileges on the grounds that “the art of silk is useful and has many secrets; because of the quality and secrets of the said art, no matter how deft a man may be, he cannot master them except through long practice and the passage of time.” The chapter then looks at the externalities and information asymmetries which could cause markets in human capital investment to fail, and the ways in which guilds regulated training in pre-industrial crafts and services.Less
This chapter explores how guilds dealt with human capital investment, a second sphere in which markets are often thought to fail. Many guilds imposed comprehensive training requirements, as in the case of the seventeenth-century Toledo silk-twisters who justified their exclusive legal privileges on the grounds that “the art of silk is useful and has many secrets; because of the quality and secrets of the said art, no matter how deft a man may be, he cannot master them except through long practice and the passage of time.” The chapter then looks at the externalities and information asymmetries which could cause markets in human capital investment to fail, and the ways in which guilds regulated training in pre-industrial crafts and services.
Gavin Mooney
- Published in print:
- 2009
- Published Online:
- May 2009
- ISBN:
- 9780199235971
- eISBN:
- 9780191717086
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199235971.003.0003
- Subject:
- Economics and Finance, Public and Welfare
This chapter examines how health economists have dealt with the recognition that the market for health care fails. It examines the reasons for such failure and suggests that too little attention has ...
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This chapter examines how health economists have dealt with the recognition that the market for health care fails. It examines the reasons for such failure and suggests that too little attention has been given to the formulation of values, with issues around asymmetry of information overly dominating the thinking on market failure. It considers two other key issues around market failure: externalities and public goods. The chapter highlights the problems in conventional health economics in restricting itself to using the values of individuals qua individuals and in being consequentialist; both of these restrictions being true of welfarism as well as of extra-welfarism. It argues that there has been no real attempt to date to provide a comprehensive alternative health economics paradigm in the wake of market failure.Less
This chapter examines how health economists have dealt with the recognition that the market for health care fails. It examines the reasons for such failure and suggests that too little attention has been given to the formulation of values, with issues around asymmetry of information overly dominating the thinking on market failure. It considers two other key issues around market failure: externalities and public goods. The chapter highlights the problems in conventional health economics in restricting itself to using the values of individuals qua individuals and in being consequentialist; both of these restrictions being true of welfarism as well as of extra-welfarism. It argues that there has been no real attempt to date to provide a comprehensive alternative health economics paradigm in the wake of market failure.
Pierre Salmon
- Published in print:
- 2019
- Published Online:
- May 2019
- ISBN:
- 9780190499167
- eISBN:
- 9780190499198
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/oso/9780190499167.003.0003
- Subject:
- Economics and Finance, Public and Welfare
The chapter follows the logic of the relation between downward accountability, the information asymmetry faced by voters or citizens, and yardstick competition. Assuming that the accountability ...
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The chapter follows the logic of the relation between downward accountability, the information asymmetry faced by voters or citizens, and yardstick competition. Assuming that the accountability perspective is adopted, the main question is the information available to citizens. In important policy domains it is difficult to mitigate the information asymmetry faced by citizens in the absence of yardstick comparisons. This offers a role for these comparisons and with them yardstick competition to come to the rescue of accountability. A similar logic inspired the way tournaments and yardstick competition were introduced, in the 1980s, in the fields of labor and industrial economics. The last part of the chapter recalls some characteristics of that work and discusses the way they must be adapted, with some discarded (namely the contractual dimension), when the analysis is transposed from its original habitat to the agency relation between citizens and incumbents.Less
The chapter follows the logic of the relation between downward accountability, the information asymmetry faced by voters or citizens, and yardstick competition. Assuming that the accountability perspective is adopted, the main question is the information available to citizens. In important policy domains it is difficult to mitigate the information asymmetry faced by citizens in the absence of yardstick comparisons. This offers a role for these comparisons and with them yardstick competition to come to the rescue of accountability. A similar logic inspired the way tournaments and yardstick competition were introduced, in the 1980s, in the fields of labor and industrial economics. The last part of the chapter recalls some characteristics of that work and discusses the way they must be adapted, with some discarded (namely the contractual dimension), when the analysis is transposed from its original habitat to the agency relation between citizens and incumbents.
Didier Folus and Emmanuel Boutron
- Published in print:
- 2015
- Published Online:
- August 2015
- ISBN:
- 9780199375875
- eISBN:
- 9780199375899
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199375875.003.0013
- Subject:
- Economics and Finance, Financial Economics
The main goal of a PE fund manager is to receive a return in excess of the price paid for the companies in the portfolio at the time of exit. Various exit strategies are available to fund managers ...
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The main goal of a PE fund manager is to receive a return in excess of the price paid for the companies in the portfolio at the time of exit. Various exit strategies are available to fund managers including a trade sale, which is the sale of the company to another PE firm or a secondary buyout for a medium or large portfolio company. Another way to exit is an initial public offering (IPO). A more recent exit strategy is for the portfolio company to pay a preferred dividend to the PE fund in order to repay the initial invested amount. This strategy is also known as a dividend recapitalization, which is sometimes financed with additional debt. Financial economics can help inform the PE fund’s GPs about the different exit routes. Pecking order theory, agency costs, and information asymmetry each offer relevant scientific arguments explaining the observed behaviors.Less
The main goal of a PE fund manager is to receive a return in excess of the price paid for the companies in the portfolio at the time of exit. Various exit strategies are available to fund managers including a trade sale, which is the sale of the company to another PE firm or a secondary buyout for a medium or large portfolio company. Another way to exit is an initial public offering (IPO). A more recent exit strategy is for the portfolio company to pay a preferred dividend to the PE fund in order to repay the initial invested amount. This strategy is also known as a dividend recapitalization, which is sometimes financed with additional debt. Financial economics can help inform the PE fund’s GPs about the different exit routes. Pecking order theory, agency costs, and information asymmetry each offer relevant scientific arguments explaining the observed behaviors.
