This paper analyses the labour market transitions of unemployed individuals. We are particularly interested in why some individuals become self-employed instead of wage or salary earners upon returning to employment. Using Finnish microdata and a multinomial logit model we find that when we compare unemployed individuals ́ probability of moving into a wage or salary work with the probability of ...

We explore how general economic conditions impact defaults and major credit rating changes by fitting reduced-form Cox intensity models with a broad range of macroeconomic and firm-specific ratings-related variables. For all corporate issuers in the period 1981 2002 we find both types of factors strongly influenced the risk of a credit event. However, while the effects of ratings-related factor...

We examine what are common factors that determine systematic credit risk and estimate and interpret the common risk factors. We also compare the contributions of common factors in explaining the changes of credit default swap (CDS) spreads during the pre-crisis, crisis and post-crisis period. Based on the testing result from the common principal components model, this study finds that the eigen...

Focusing on the electronics industry, this paper verifies and compares how bipolar R&D policy contributed to growth in productivity in Korea and Taiwan. Two implications are derived from the empirical results. First, in Korea, government’s business group-centered R&D policy encouraged private R&D expenditure rather than public R&D infrastructure. Second, and in contrast, publicly funded R&D inf...

The purpose of this paper is to empirically investigate the interaction between hedging, financing, and investment decisions. This work is relevant in that theoretical predictions are not necessarily identical to those in the case where only two decisions are being made. We argue that the way in which hedging affects the firms’ financing and investing decisions differs for firms with different ...

We show that firms with chief executive officers (CEOs) who gain general managerial skills over their lifetime work experience invest more in R&D and produce more patents. We address the potential endogenous CEO-firm matching bias using firmand CEOfixed effects and variation in the enforceability of non-compete agreements across states and over time during the CEO’s career. Our findings suggest...

This paper examines the relationship between ownership structure, analyst coverage, and forecast error for the entire population of non-financial companies listed on the Swiss Exchange for the period 2003-2013. The results show a negative association between concentrated ownership and analyst coverage for both family firms and firms held by a nonfamily blockholder. Furthermore, forecasts of ana...

The relative constancy of nonfinancial corporate tax revenues as a share of U.S. GDP masks offsetting trends in the ratio of corporate profits to GDP (declining) and the average tax rate (increasing). The average tax rate rose steadily between 1996 and 2003, an increase largely attributable to the importance of tax losses. This rise casts some doubt on the role of tax planning activities in red...

We examine the interaction between risk (uncertainty) and production efficiency in determining pay-performance sensitivity in optimal executive compensation. Particularly, we show that the risk-incentive trade-off is exacerbated (attenuated) as production efficiency increases when the efficiency level is greater (less) than the level of compensation risk. This result suggests that the optimalit...

Is market-based or bank-based financial system better for fostering technological innovation as an engine of growth? I present evidence that bank-based systems promote rapid technological progress in those industrial sectors that depend heavily on external finance for funding innovation by facilitating credit access to younger firms. On the other hand, I also find evidence of a general positive...