Sharan Jagpal
- Published in print:
- 2008
- Published Online:
- September 2008
- ISBN:
- 9780195371055
- eISBN:
- 9780199870745
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195371055.003.0022
- Subject:
- Business and Management, Marketing
This chapter shows how the firm can use marketing-finance fusion to evaluate mergers and acquisition strategies. It examines the potential gains from mergers, the history of mergers and acquisitions, ...
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This chapter shows how the firm can use marketing-finance fusion to evaluate mergers and acquisition strategies. It examines the potential gains from mergers, the history of mergers and acquisitions, the effect of private equity firms and hedge funds on merger activity and merger performance, and the special problems posed by international mergers. In particular, it shows how buying and selling firms can objectively value brands by combining game theory and data from choice-based experiments.Less
This chapter shows how the firm can use marketing-finance fusion to evaluate mergers and acquisition strategies. It examines the potential gains from mergers, the history of mergers and acquisitions, the effect of private equity firms and hedge funds on merger activity and merger performance, and the special problems posed by international mergers. In particular, it shows how buying and selling firms can objectively value brands by combining game theory and data from choice-based experiments.
Masahiro Okuno‐Fujiwara
- Published in print:
- 1998
- Published Online:
- January 2007
- ISBN:
- 9780198294917
- eISBN:
- 9780191715501
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780198294917.003.0013
- Subject:
- Economics and Finance, South and East Asia
This chapter presents an abstract model of the government-business relationship and identifies institutional structures that determine the nature and outcome of this relationship in different ...
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This chapter presents an abstract model of the government-business relationship and identifies institutional structures that determine the nature and outcome of this relationship in different societies. The importance ofex antepolicy rules versusex postnegotiation is discussed. The relative merits and demerits of different types of government are assessed, and the results are used to evaluate the development performance of the relation-based Japanese system contrasted with the rule-based United States system.Less
This chapter presents an abstract model of the government-business relationship and identifies institutional structures that determine the nature and outcome of this relationship in different societies. The importance ofex antepolicy rules versusex postnegotiation is discussed. The relative merits and demerits of different types of government are assessed, and the results are used to evaluate the development performance of the relation-based Japanese system contrasted with the rule-based United States system.
Federico Varese
- Published in print:
- 2001
- Published Online:
- November 2003
- ISBN:
- 9780198297369
- eISBN:
- 9780191600272
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/019829736X.003.0004
- Subject:
- Political Science, Russian Politics
Chapters 1 and 2 point to the fact that the demand for protection that accompanies the spread of market transactions is met by the Russian state only in part: a significant sector of the business ...
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Chapters 1 and 2 point to the fact that the demand for protection that accompanies the spread of market transactions is met by the Russian state only in part: a significant sector of the business world does not use state-supplied protection services. A demand for alternative sources of protection is then expected to arise. Some authors, especially economists, have been quick to conclude that, since the state does not provide a service, the market inevitably will. It cannot, however, be argued that demand will inevitably be met; a supply of people trained in the use of violence and easily available weapons must also be present. This chapter focuses on the availability of people trained in the use of violence and of weapons, and the varieties of private protectors available in Russia at the time of the transition to the market, ranging from segments of the state apparatus (privately sold state protection), to private security (protection) firms, the internalized protection systems of major economic conglomerates, and criminal groups (banditskaya krysha: krysha, literally ‘roof’, is Russian slang for protection).Less
Chapters 1 and 2 point to the fact that the demand for protection that accompanies the spread of market transactions is met by the Russian state only in part: a significant sector of the business world does not use state-supplied protection services. A demand for alternative sources of protection is then expected to arise. Some authors, especially economists, have been quick to conclude that, since the state does not provide a service, the market inevitably will. It cannot, however, be argued that demand will inevitably be met; a supply of people trained in the use of violence and easily available weapons must also be present. This chapter focuses on the availability of people trained in the use of violence and of weapons, and the varieties of private protectors available in Russia at the time of the transition to the market, ranging from segments of the state apparatus (privately sold state protection), to private security (protection) firms, the internalized protection systems of major economic conglomerates, and criminal groups (banditskaya krysha: krysha, literally ‘roof’, is Russian slang for protection).
Federico Varese
- Published in print:
- 2001
- Published Online:
- November 2003
- ISBN:
- 9780198297369
- eISBN:
- 9780191600272
- Item type:
- book
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/019829736X.001.0001
- Subject:
- Political Science, Russian Politics
This book researches the question of what the Russian Mafia is, and challenges widely held views of its nature. It charts the emergence of the Russian Mafia in the context of the transition to the ...
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This book researches the question of what the Russian Mafia is, and challenges widely held views of its nature. It charts the emergence of the Russian Mafia in the context of the transition to the market, the privatization of protection, and pervasive corruption. The ability of the Russian State to define property rights and protect contracts is compared with the services offered by fragments of the state apparatus, private security firms, ethnic crime groups, the Cossacks and the Russian Mafia. Past criminal traditions, rituals, and norms have been resuscitated by the modern Russian Mafia to forge a powerful new identity and compete in a crowded market for protection. The book draws on and reports from undercover police operations, in-depth interviews conducted over several years with the victims of the Mafia, criminals, and officials, and documents from the Gulag archives. It also provides a comparative study, making references to other mafia in other countries (the Japanese Yakuza, the Sicilian Cosa Nostra, American–Italian Mafia and the Hong Kong Triads). The book has an introduction and conclusion and between these is arranged in three parts: I. The Transition to the Market and Protection in Russia (three chapters); II. Private protection in Perm (two chapters investigating the emergence and operation of the mafia in the city of Perm); and III. The Russian Mafia (three chapters).Less
This book researches the question of what the Russian Mafia is, and challenges widely held views of its nature. It charts the emergence of the Russian Mafia in the context of the transition to the market, the privatization of protection, and pervasive corruption. The ability of the Russian State to define property rights and protect contracts is compared with the services offered by fragments of the state apparatus, private security firms, ethnic crime groups, the Cossacks and the Russian Mafia. Past criminal traditions, rituals, and norms have been resuscitated by the modern Russian Mafia to forge a powerful new identity and compete in a crowded market for protection. The book draws on and reports from undercover police operations, in-depth interviews conducted over several years with the victims of the Mafia, criminals, and officials, and documents from the Gulag archives. It also provides a comparative study, making references to other mafia in other countries (the Japanese Yakuza, the Sicilian Cosa Nostra, American–Italian Mafia and the Hong Kong Triads). The book has an introduction and conclusion and between these is arranged in three parts: I. The Transition to the Market and Protection in Russia (three chapters); II. Private protection in Perm (two chapters investigating the emergence and operation of the mafia in the city of Perm); and III. The Russian Mafia (three chapters).
Krishnendu Ghosh Dastidar and Uday Bhanu Sinha
- Published in print:
- 2011
- Published Online:
- September 2012
- ISBN:
- 9780198073970
- eISBN:
- 9780199081615
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780198073970.003.0016
- Subject:
- Economics and Finance, Microeconomics
Recent studies have addressed mixed oligopoly models where state-owned welfare-maximizing public firms and profit-maximizing private firms coexist. Some studies have addressed the consequences of ...
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Recent studies have addressed mixed oligopoly models where state-owned welfare-maximizing public firms and profit-maximizing private firms coexist. Some studies have addressed the consequences of privatization in quantity setting models, while others have extended the analysis of mixed oligopoly to include foreign firms. There is evidence that welfare is unchanged by privatization if output subsidies can be used as an instrument both before and after privatization. This chapter explores the entire set of pure strategy Bertrand equilibrium in a mixed duopoly with convex costs and shows that the set of equilibria is exactly the same as in the case where both firms are private. When both firms are public, the set of equilibrium prices is larger than that in a mixed duopoly. By analysing sequential move price games, the chapter proves that the best possible outcome (in terms of welfare) is achieved when the public firm is the leader.Less
Recent studies have addressed mixed oligopoly models where state-owned welfare-maximizing public firms and profit-maximizing private firms coexist. Some studies have addressed the consequences of privatization in quantity setting models, while others have extended the analysis of mixed oligopoly to include foreign firms. There is evidence that welfare is unchanged by privatization if output subsidies can be used as an instrument both before and after privatization. This chapter explores the entire set of pure strategy Bertrand equilibrium in a mixed duopoly with convex costs and shows that the set of equilibria is exactly the same as in the case where both firms are private. When both firms are public, the set of equilibrium prices is larger than that in a mixed duopoly. By analysing sequential move price games, the chapter proves that the best possible outcome (in terms of welfare) is achieved when the public firm is the leader.
Michael S. Long and Thomas A. Bryant
- Published in print:
- 2007
- Published Online:
- January 2008
- ISBN:
- 9780195301465
- eISBN:
- 9780199867288
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195301465.003.0002
- Subject:
- Economics and Finance, Financial Economics
This chapter briefly discusses valuing a closely held firm and publicly held firm. It then considers the existence of a going concern, the lack of separation of manager and owner in closely held ...
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This chapter briefly discusses valuing a closely held firm and publicly held firm. It then considers the existence of a going concern, the lack of separation of manager and owner in closely held firms, adjustments for taxes and insider compensation, and valuing “excess” returns. An adjustments example is presented.Less
This chapter briefly discusses valuing a closely held firm and publicly held firm. It then considers the existence of a going concern, the lack of separation of manager and owner in closely held firms, adjustments for taxes and insider compensation, and valuing “excess” returns. An adjustments example is presented.
Michael S. Long and Thomas A. Bryant
- Published in print:
- 2007
- Published Online:
- January 2008
- ISBN:
- 9780195301465
- eISBN:
- 9780199867288
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195301465.003.0007
- Subject:
- Economics and Finance, Financial Economics
This chapter shows how to estimate the required return for a closely held firm. It begins by reviewing the required return for a public firm. It then focuses on additional adjustments required to ...
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This chapter shows how to estimate the required return for a closely held firm. It begins by reviewing the required return for a public firm. It then focuses on additional adjustments required to adapt the method for use on a closely held firm. This approach deals specifically with the lack of liquidity and diversification of the owner and the lack of market information for small firms. Finally, the chapter shows how the discount rate should be estimated for a closely held firm.Less
This chapter shows how to estimate the required return for a closely held firm. It begins by reviewing the required return for a public firm. It then focuses on additional adjustments required to adapt the method for use on a closely held firm. This approach deals specifically with the lack of liquidity and diversification of the owner and the lack of market information for small firms. Finally, the chapter shows how the discount rate should be estimated for a closely held firm.
Michael S. Long and Thomas A. Bryant
- Published in print:
- 2007
- Published Online:
- January 2008
- ISBN:
- 9780195301465
- eISBN:
- 9780199867288
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195301465.003.0008
- Subject:
- Economics and Finance, Financial Economics
This chapter focuses mainly on the process of buying an existing firm. The first and foremost principle in buying any business is to know what is actually being bought, including both tangible and ...
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This chapter focuses mainly on the process of buying an existing firm. The first and foremost principle in buying any business is to know what is actually being bought, including both tangible and intangible assets. In addition to the positive assets, the transaction must also address present liabilities that would be assumed and possible future ones inherent in the deal. Both assets and liabilities should be valued in terms of what it would cost the proposed buyer to replace them. The valuation of assets and liabilities, knowing what you can pay, reorganizing the business; and the “put” option to close the business if it is not successful, and the transaction costs that will be incurred when exiting the business in the future, are discussed.Less
This chapter focuses mainly on the process of buying an existing firm. The first and foremost principle in buying any business is to know what is actually being bought, including both tangible and intangible assets. In addition to the positive assets, the transaction must also address present liabilities that would be assumed and possible future ones inherent in the deal. Both assets and liabilities should be valued in terms of what it would cost the proposed buyer to replace them. The valuation of assets and liabilities, knowing what you can pay, reorganizing the business; and the “put” option to close the business if it is not successful, and the transaction costs that will be incurred when exiting the business in the future, are discussed.
Michael S. Long and Thomas A. Bryant
- Published in print:
- 2007
- Published Online:
- January 2008
- ISBN:
- 9780195301465
- eISBN:
- 9780199867288
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195301465.003.0009
- Subject:
- Economics and Finance, Financial Economics
This chapter discusses the importance of maintaining an exit strategy for the owner(s) of a closely held firm. Except for the smallest of businesses, a major component of a good exit plan is ...
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This chapter discusses the importance of maintaining an exit strategy for the owner(s) of a closely held firm. Except for the smallest of businesses, a major component of a good exit plan is knowledge about the value of the business. An exit strategy can take one of three broad approaches. First, the owners can consider going public, or selling the firm to widely dispersed third-party investors. Assuming the firm will remain closely held, two broad exit strategies exist. The firm can be sold to outsiders in an arm's-length transaction, or it can be sold or given to insiders, including the original owners' heirs, partners, or employees.Less
This chapter discusses the importance of maintaining an exit strategy for the owner(s) of a closely held firm. Except for the smallest of businesses, a major component of a good exit plan is knowledge about the value of the business. An exit strategy can take one of three broad approaches. First, the owners can consider going public, or selling the firm to widely dispersed third-party investors. Assuming the firm will remain closely held, two broad exit strategies exist. The firm can be sold to outsiders in an arm's-length transaction, or it can be sold or given to insiders, including the original owners' heirs, partners, or employees.
Michael S. Long and Thomas A. Bryant
- Published in print:
- 2007
- Published Online:
- January 2008
- ISBN:
- 9780195301465
- eISBN:
- 9780199867288
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195301465.003.0001
- Subject:
- Economics and Finance, Financial Economics
This chapter — and the ones that follow — opens and closes with a conversation between two business owners, discussing the kinds of practical questions to be addressed in the middle part of each ...
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This chapter — and the ones that follow — opens and closes with a conversation between two business owners, discussing the kinds of practical questions to be addressed in the middle part of each chapter. Although all the characters are fictional, these conversations reflect those of many business owners, their families, and their advisors. The chapter discusses the importance of knowing a firm's value, specific times that require valuation, and ways to estimate value.Less
This chapter — and the ones that follow — opens and closes with a conversation between two business owners, discussing the kinds of practical questions to be addressed in the middle part of each chapter. Although all the characters are fictional, these conversations reflect those of many business owners, their families, and their advisors. The chapter discusses the importance of knowing a firm's value, specific times that require valuation, and ways to estimate value.
W. Mark Fruin
- Published in print:
- 1994
- Published Online:
- November 2003
- ISBN:
- 9780198288985
- eISBN:
- 9780191596285
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0198288980.003.0003
- Subject:
- Economics and Finance, South and East Asia
This chapter examines the institutional environment of late nineteenth and early twentieth‐century Japan, highlighting the role of government and emerging private firms in shaping the business and ...
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This chapter examines the institutional environment of late nineteenth and early twentieth‐century Japan, highlighting the role of government and emerging private firms in shaping the business and economic environment of early modern Japan. It argues that the government tried to foster cooperation among Japan's nascent firms while the firms themselves more often adopted a competitive stance. The different sections of the chapter discuss the distinctiveness of the early Japanese enterprise system, the institutional context of the corporation, the emergence of the modern enterprise system, the evolution of business traditions, comparative perspectives on organizational forms and attributes, the modern corporate system, and the role of entrepreneurs and new methods and motivation within this.Less
This chapter examines the institutional environment of late nineteenth and early twentieth‐century Japan, highlighting the role of government and emerging private firms in shaping the business and economic environment of early modern Japan. It argues that the government tried to foster cooperation among Japan's nascent firms while the firms themselves more often adopted a competitive stance. The different sections of the chapter discuss the distinctiveness of the early Japanese enterprise system, the institutional context of the corporation, the emergence of the modern enterprise system, the evolution of business traditions, comparative perspectives on organizational forms and attributes, the modern corporate system, and the role of entrepreneurs and new methods and motivation within this.
Marilyn Carroll, Steven Vincent, John Hassard, and Fang Lee Cooke
- Published in print:
- 2004
- Published Online:
- October 2011
- ISBN:
- 9780199262236
- eISBN:
- 9780191698859
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780199262236.003.0004
- Subject:
- Business and Management, HRM / IR, Organization Studies
This chapter focuses on structures and outcomes in contractual relationships between private sector firms in Britain. The chapter is divided into five sections. Section 4.2 briefly reviews the ...
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This chapter focuses on structures and outcomes in contractual relationships between private sector firms in Britain. The chapter is divided into five sections. Section 4.2 briefly reviews the existing literature on contractual relations. Section 4.3 introduces the three private-private contracting case studies. Section 4.4 highlights those institutional factors which strongly influence the contracting and outsourcing strategies of the case study firms. Section 4.5 examines more closely the reasons behind the firms' decisions to outsource or retain activities in-house, whether these have resulted in performance gains or costs, and the nature of risk, trust, and power relationships between the firms involved in the contractual arrangements. Finally, Section 4.6 summarizes and contrasts the findings from our three case studies.Less
This chapter focuses on structures and outcomes in contractual relationships between private sector firms in Britain. The chapter is divided into five sections. Section 4.2 briefly reviews the existing literature on contractual relations. Section 4.3 introduces the three private-private contracting case studies. Section 4.4 highlights those institutional factors which strongly influence the contracting and outsourcing strategies of the case study firms. Section 4.5 examines more closely the reasons behind the firms' decisions to outsource or retain activities in-house, whether these have resulted in performance gains or costs, and the nature of risk, trust, and power relationships between the firms involved in the contractual arrangements. Finally, Section 4.6 summarizes and contrasts the findings from our three case studies.
Michael S. Long and Thomas A. Bryant
- Published in print:
- 2007
- Published Online:
- January 2008
- ISBN:
- 9780195301465
- eISBN:
- 9780199867288
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195301465.003.0004
- Subject:
- Economics and Finance, Financial Economics
This chapter begins with a discussion of what is meant by a going concern valuation. Once that is done, an estimate of the value of the firm's current operations is developed. The key result is the ...
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This chapter begins with a discussion of what is meant by a going concern valuation. Once that is done, an estimate of the value of the firm's current operations is developed. The key result is the assessment that the reinvestment rate has no affect on value — as long as future investments earn just the required rate of return. That is the situation for most mature firms. The firm's value is the present value of its expected excess cash, without regard to whether that cash is paid out or reinvested. The chapter ends with a discussion on how to measure “excess cash”values correctly.Less
This chapter begins with a discussion of what is meant by a going concern valuation. Once that is done, an estimate of the value of the firm's current operations is developed. The key result is the assessment that the reinvestment rate has no affect on value — as long as future investments earn just the required rate of return. That is the situation for most mature firms. The firm's value is the present value of its expected excess cash, without regard to whether that cash is paid out or reinvested. The chapter ends with a discussion on how to measure “excess cash”values correctly.
Michael S. Long and Thomas A. Bryant
- Published in print:
- 2007
- Published Online:
- January 2008
- ISBN:
- 9780195301465
- eISBN:
- 9780199867288
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195301465.003.0010
- Subject:
- Economics and Finance, Financial Economics
This chapter presents a summary of the ideas discussed in the preceding chapters. These include ideas that should be incorporated when estimating value in general; ideas that should be considered in ...
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This chapter presents a summary of the ideas discussed in the preceding chapters. These include ideas that should be incorporated when estimating value in general; ideas that should be considered in valuing a closely held firm; choices that have to be resolved in the valuation process; and changes in the way we manage and invest in closely held firms.Less
This chapter presents a summary of the ideas discussed in the preceding chapters. These include ideas that should be incorporated when estimating value in general; ideas that should be considered in valuing a closely held firm; choices that have to be resolved in the valuation process; and changes in the way we manage and invest in closely held firms.
Maria Misra
- Published in print:
- 1999
- Published Online:
- October 2011
- ISBN:
- 9780198207115
- eISBN:
- 9780191677502
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780198207115.003.0002
- Subject:
- History, Asian History
This chapter explores the origins of the managing agency houses. It describes the emergence of the colonial economy, business and society in ...
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This chapter explores the origins of the managing agency houses. It describes the emergence of the colonial economy, business and society in British India, and the formation of colonial society in Calcutta. The agency houses can be divided into two groups. The first, of which Gillanders, Arbuthnot and Co., and Jardine Skinner are typical, had mercantile roots. A second type of agency house began to appear in the 1860s, which unlike the first, had its origins in a variety of non-mercantile concerns. By the 1890s, the two types of agencies were all private partnership firms with senior partners resident in Britain and the junior partners in India. One of the most important advantages of the managing agency was the structure of the firm, which allowed partners to maintain control of several different limited liability companies without having to invest a large amount of capital.Less
This chapter explores the origins of the managing agency houses. It describes the emergence of the colonial economy, business and society in British India, and the formation of colonial society in Calcutta. The agency houses can be divided into two groups. The first, of which Gillanders, Arbuthnot and Co., and Jardine Skinner are typical, had mercantile roots. A second type of agency house began to appear in the 1860s, which unlike the first, had its origins in a variety of non-mercantile concerns. By the 1890s, the two types of agencies were all private partnership firms with senior partners resident in Britain and the junior partners in India. One of the most important advantages of the managing agency was the structure of the firm, which allowed partners to maintain control of several different limited liability companies without having to invest a large amount of capital.
Michael S. Long and Thomas A. Bryant
- Published in print:
- 2007
- Published Online:
- January 2008
- ISBN:
- 9780195301465
- eISBN:
- 9780199867288
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195301465.003.0005
- Subject:
- Economics and Finance, Financial Economics
This chapter develops the valuation methods for firms with growth opportunities. It begins by distinguishing excess returns on current investments from those associated with those future investments ...
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This chapter develops the valuation methods for firms with growth opportunities. It begins by distinguishing excess returns on current investments from those associated with those future investments that are necessary to create growth. It then shows how a firm's current value is actually the sum of the current operation's value and the value of the growth opportunities. This revised approach is followed by a discussion on how to estimate these growth options and how to value them. A related issue is the negative affect on value of future competition, because firms earning excess returns tend to attract competitors, who then drive down the margins earned by the earlier entrants. The chapter concludes by estimating the likely effect those competitive invaders will have on the value of a firm.Less
This chapter develops the valuation methods for firms with growth opportunities. It begins by distinguishing excess returns on current investments from those associated with those future investments that are necessary to create growth. It then shows how a firm's current value is actually the sum of the current operation's value and the value of the growth opportunities. This revised approach is followed by a discussion on how to estimate these growth options and how to value them. A related issue is the negative affect on value of future competition, because firms earning excess returns tend to attract competitors, who then drive down the margins earned by the earlier entrants. The chapter concludes by estimating the likely effect those competitive invaders will have on the value of a firm.
Michael S. Long and Thomas A. Bryant
- Published in print:
- 2007
- Published Online:
- January 2008
- ISBN:
- 9780195301465
- eISBN:
- 9780199867288
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195301465.003.0003
- Subject:
- Economics and Finance, Financial Economics
This chapter discusses situations where a firm cannot be valued as a going concern. In such cases, value of all assets, both tangible and intangible, are viewed as being put to their most productive ...
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This chapter discusses situations where a firm cannot be valued as a going concern. In such cases, value of all assets, both tangible and intangible, are viewed as being put to their most productive alternative uses. In this context, their earning power is assumed to be higher in some applications other than the current business where they are employed, so their effects on the modified income statement are disregarded. The chapter focuses on an extended Balance Sheet that includes all intangibles.Less
This chapter discusses situations where a firm cannot be valued as a going concern. In such cases, value of all assets, both tangible and intangible, are viewed as being put to their most productive alternative uses. In this context, their earning power is assumed to be higher in some applications other than the current business where they are employed, so their effects on the modified income statement are disregarded. The chapter focuses on an extended Balance Sheet that includes all intangibles.
Raaj K. Sah and Joseph E. Stiglitz
- Published in print:
- 2002
- Published Online:
- January 2005
- ISBN:
- 9780199253579
- eISBN:
- 9780191601682
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/0199253579.003.0011
- Subject:
- Economics and Finance, Development, Growth, and Environmental
A treatment of the wage–productivity hypothesis, which states that the wage a firm pays or the prices its workers face may have an important effect on the productivity of its workforce is presented. ...
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A treatment of the wage–productivity hypothesis, which states that the wage a firm pays or the prices its workers face may have an important effect on the productivity of its workforce is presented. The hypothesis is first discussed at the level of the firm, and then analysed using a subclass of models to study how private firms might determine urban wages and unemployment, and how these decisions might be affected by tax and price policy.Less
A treatment of the wage–productivity hypothesis, which states that the wage a firm pays or the prices its workers face may have an important effect on the productivity of its workforce is presented. The hypothesis is first discussed at the level of the firm, and then analysed using a subclass of models to study how private firms might determine urban wages and unemployment, and how these decisions might be affected by tax and price policy.
Patrick L. Anderson
- Published in print:
- 2013
- Published Online:
- September 2013
- ISBN:
- 9780804758307
- eISBN:
- 9780804783224
- Item type:
- chapter
- Publisher:
- Stanford University Press
- DOI:
- 10.11126/stanford/9780804758307.003.0005
- Subject:
- Economics and Finance, Financial Economics
This chapter presents the available information on the number of businesses in the United States, and the number by size class, the share that fulfill a common definition of “small” business, and the ...
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This chapter presents the available information on the number of businesses in the United States, and the number by size class, the share that fulfill a common definition of “small” business, and the data on survivorship rates for newly-established businesses in multiple countries. It critically examines the stylized facts about such businesses in the United States. Finally, it provides updated data on the value of privately-held businesses in the U.S., following the methodology of Anderson (2009). Those data suggest that equity in privately held firms form a larger share of household assets than stocks in publicly-traded firms among U.S. households.Less
This chapter presents the available information on the number of businesses in the United States, and the number by size class, the share that fulfill a common definition of “small” business, and the data on survivorship rates for newly-established businesses in multiple countries. It critically examines the stylized facts about such businesses in the United States. Finally, it provides updated data on the value of privately-held businesses in the U.S., following the methodology of Anderson (2009). Those data suggest that equity in privately held firms form a larger share of household assets than stocks in publicly-traded firms among U.S. households.
Michael S. Long and Thomas A. Bryant
- Published in print:
- 2007
- Published Online:
- January 2008
- ISBN:
- 9780195301465
- eISBN:
- 9780199867288
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195301465.003.0006
- Subject:
- Economics and Finance, Financial Economics
This chapter discusses the problems caused in valuation measurement due to inflation. It begins with a review of the ways inflation measurement problems can be handled. It then considers the effect ...
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This chapter discusses the problems caused in valuation measurement due to inflation. It begins with a review of the ways inflation measurement problems can be handled. It then considers the effect of using nominal depreciation values. The common practice of assuming depreciation expense is equal to the normal reinvestment required to maintain the current profit position is shown to overestimate value significantly. Another real issue related to inflation is addressed: the decreased value of the depreciation expense that can be claimed against the taxes payable on future income. The depreciation expenses that can be used to shield future income against taxes are based on historical costs. If there is no inflation, those expenses are likely to be approximately the same as the actual costs business owners need to invest to maintain their productivity (i.e., income-earning potential). If inflation occurs, those replacement costs will increase, but the depreciation expenses will not keep up.Less
This chapter discusses the problems caused in valuation measurement due to inflation. It begins with a review of the ways inflation measurement problems can be handled. It then considers the effect of using nominal depreciation values. The common practice of assuming depreciation expense is equal to the normal reinvestment required to maintain the current profit position is shown to overestimate value significantly. Another real issue related to inflation is addressed: the decreased value of the depreciation expense that can be claimed against the taxes payable on future income. The depreciation expenses that can be used to shield future income against taxes are based on historical costs. If there is no inflation, those expenses are likely to be approximately the same as the actual costs business owners need to invest to maintain their productivity (i.e., income-earning potential). If inflation occurs, those replacement costs will increase, but the depreciation expenses will not keep up.
