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Article
Publication date: 29 June 2012

Walter Dolde, Carmelo Giaccotto, Dev R. Mishra and Thomas O'Brien

The purpose of this paper is to assess how much difference it makes for US firms to use the two‐factor ICAPM to estimate their cost of equity instead of a single‐factor CAPM.

Abstract

Purpose

The purpose of this paper is to assess how much difference it makes for US firms to use the two‐factor ICAPM to estimate their cost of equity instead of a single‐factor CAPM.

Design/methodology/approach

For a large sample of US companies, the authors compare the empirical cost of equity estimates of a two‐factor international CAPM with those of the single‐factor domestic CAPM and the single‐factor global CAPM.

Findings

The authors find that the cost of equity estimates of the two‐factor ICAPM are reasonably close to those of either single‐factor model for US firms with low‐to‐moderate foreign exchange exposure; and second, perhaps surprisingly, for US firms with extreme foreign exchange exposure, that the cost of equity estimates of the two‐factor ICAPM tend to be very close to those of the domestic CAPM, and even closer than to those of the single‐factor global CAPM.

Research limitations/implications

The paper's findings might prove useful to academic researchers wanting to resolve the seemingly contradictory empirical results on the pricing of FX risk.

Practical implications

The findings will hopefully help managers decide whether they should go to the trouble of estimating a US firm's cost of equity with the two‐factor international CAPM instead of a traditional single‐factor CAPM.

Originality/value

The paper extends the existing literature by focusing on the two‐factor ICAPM, and finds some new and surprising empirical results.

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Article
Publication date: 20 June 2008

Alex Faseruk and Dev R. Mishra

The purpose of this paper is to examine the impact of US dollar exchange rate risk on the value of Canadian non‐financial firms.

Abstract

Purpose

The purpose of this paper is to examine the impact of US dollar exchange rate risk on the value of Canadian non‐financial firms.

Design/methodology/approach

The sample, from the Compustat database, includes all non‐financial Canadian firms with sales over $100 million. The study segregates firms into hedging and non‐hedging groups and applies statistical techniques to test if hedging enhances value.

Findings

The results demonstrate that Canadian firms that have higher levels of US$ sales tend to use derivatives more frequently through higher levels of US$ exposure. Firms that have both US sales and assets appear less likely to use hedging. Firms with an American subsidiary and use financial instruments to hedge have higher values. When operational hedging is used with financial hedging, it is a value enhancing activity increasing their market‐to‐book by 14 per cent and market value‐to‐sales by 40 per cent. Incremental impact of these two hedging strategies is to enhance value by 7 per cent.

Research limitations/implications

The sample from Compustat captures large capitalization Canadian firms but ignores about 75 per cent of Canadian firms. There is a bias towards larger firms. Some hedging items are not disclosed on financial statements. A survey would enhance and complement these results.

Practical implications

The paper finds that it is important for Canadian firms that have exports denominated in US dollars to hedge their exposure. The full value of hedging is reaped by using both operational and financial hedges.

Originality/value

This study is the first that examines US dollar risk management by Canadian firms.

Details

Management Research News, vol. 31 no. 8
Type: Research Article
ISSN: 0140-9174

Keywords

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Book part
Publication date: 30 March 2017

Narjess Boubakri, Jean-Claude Cosset and Dev Mishra

We examine the market valuation of targets with multiple large shareholders (MLS) and single large shareholder (SLS) structures, in an international sample of M&A…

Abstract

We examine the market valuation of targets with multiple large shareholders (MLS) and single large shareholder (SLS) structures, in an international sample of M&A announcement in 19 countries outside North America. We find that the presence and power of MLS in these firms are negatively associated with abnormal returns and first-bid-to-merger-completion returns, suggesting that MLS mitigate agency problems in the target, and hence their acquisition is perceived as “a loss of good governance.” The negative association between MLS targets and returns is stronger in widely held firms suggesting that MLS indeed curb expropriation of minority shareholders. By contrast, when the second largest shareholder in the MLS structure of the target is a family, we find positive cumulative abnormal returns at the merger announcement, suggesting exacerbated agency problems in these firms that should benefit from the “acquisition of good governance.” Our evidence is robust to a battery of tests and to addressing potential endogeneity.

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Article
Publication date: 1 August 2006

Budong Yang, Yue Jiao and Shuting Lei

To use distinct element simulation (PFC2D) to investigate the relationships between microparameters and macroproperties of the specimens that are modeled by bonded…

Abstract

Purpose

To use distinct element simulation (PFC2D) to investigate the relationships between microparameters and macroproperties of the specimens that are modeled by bonded particles. To determine quantitative relationships between particle level parameters and mechanical properties of the specimens.

Design/methodology/approach

A combined theoretical and numerical approach is used to achieve the objectives. First, theoretical formulations are proposed for the relationships between microparameters and macroproperties. Then numerical simulations are conducted to quantify the relationships.

Findings

The Young's modulus is mainly determined by particle contact modulus and affected by particle stiffness ratio and slightly affected by particle size. The Poisson's ratio is mainly determined by particle stiffness ratio and slightly affected by particle size. The compressive strength can be scaled by either the bond shear strength or the bond normal strength depending on the ratio of the two quantities.

Research limitations/implications

The quantitative relationships between microparameters and macroproperties for parallel‐bonded PFC2D specimens are empirical in nature. Some modifications may be needed to model a specific material. The effects of the particle distribution and bond strength distribution of a PFC2D specimen are very important aspects that deserve further investigation.

Practical implications

The results will provide guidance for people who use distinct element method, especially the PFC2D, to model brittle materials such as rocks and ceramics.

Originality/value

This paper offers some new quantitative relationships between microparameters and macroproperties of a synthetic specimen created using bonded particle model.

Details

Engineering Computations, vol. 23 no. 6
Type: Research Article
ISSN: 0264-4401

Keywords

Content available
Article
Publication date: 1 October 2020

Manjulika Srivastava, Bijayalaxmi Mishra, Dev Kant Rao, Navita Abrol, Vandana Varma and Bharat Bhushan

The purpose of this paper was to analyse the research trends on the Indian Open and Distance Education (ODE) system as reflected in the articles published in the prominent…

Abstract

Purpose

The purpose of this paper was to analyse the research trends on the Indian Open and Distance Education (ODE) system as reflected in the articles published in the prominent journals of distance education across the world.

Design/methodology/approach

A study was undertaken to review the research articles on ODE in India published in 11 prominent peer-reviewed journals of distance education during the period 2010–2019. Content analysis was done to find out areas of research undertaken in the ODE of India based on a validated classification of research areas; types of research studies conducted; and authorship and publication patterns.

Findings

Out of a total of 2,571 articles published in 11 selected journals, only 191 (7.42%) pertained to ODE in India. The majority of these 191 articles (68.42%) were published in Indian journals. The Indian and Asian journals together accounted for 93.55% of total articles. Globally, the share of articles on the Indian ODE system was significantly low ranging between 4.27 and a maximum of 10.77%, which was much below expectations from a country having the maximum number of ODE learners in the world. Results further revealed that 63% of the contributors to research on ODE in India were affiliated to Indira Gandhi National Open University.

Research limitations/implications

The limitation of this study was only analysing the research articles published in journals of distance education and other types of articles, namely, book reviews, editorials, field notes and workshop reports were excluded from the analysis.

Practical implications

The study is intended to help researchers, policymakers, and open and distance education institutions to draw a roadmap for the promotion and conduct of system-based research, which would be vital for strengthening the system.

Social implications

The quantum of research is not proportionate to the number of faculty members working in the ODE system of India and the large number of learners that it serves, which is a matter of concern. For any system to grow its periodic systemic review is essential. The research outcomes need to be ploughed back into the system for its betterment.

Originality/value

The study is original. There is no such study undertaken till date. This study will be extremely useful to researchers, as the gaps in distance education research which are yet to be addressed, have been identified by the authors.

Details

Asian Association of Open Universities Journal, vol. 15 no. 2
Type: Research Article
ISSN: 1858-3431

Keywords

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Article
Publication date: 21 October 2020

Krittika Banerjee and Ashima Goyal

After the adoption of unconventional monetary policies (UMPs) in advanced economies (AEs) there were many studies of monetary spillovers to asset prices in emerging market…

Abstract

Purpose

After the adoption of unconventional monetary policies (UMPs) in advanced economies (AEs) there were many studies of monetary spillovers to asset prices in emerging market economies (EMEs) but the extent of contribution of EMEs and AEs, respectively, in real exchange rate (RER) misalignments has not been addressed. This paper addresses the gap in a cross-country panel set-up with country specific controls.

Design/methodology/approach

Fixed effects, pooled mean group (Pesaran et al., 1999) and common correlated effects (Pesaran, 2006) estimations are used to examine the relationship. Multiway clustering is taken into account to ensure robust statistical inferences.

Findings

Robust evidence is found for significant monetary spillovers over 1998–2017 in the form of RER overvaluation of EMEs against AEs, especially through the portfolio rebalancing channel. EME RER against the US saw significantly more overvaluation in UMP years indicating greater role of the US in monetary spillovers. However, in the long-run monetary neutrality holds. EMEs did pursue mercantilist and precautionary policies that undervalued their RERs. Precautionary undervaluation is more evident with bilateral EME US RER.

Research limitations/implications

It may be useful for large EMEs to monitor the impact of foreign portfolio flows on short-run deviations in RER. Export diversification reduces EME mercantilist motives against the US. That AE monetary policy significantly appreciates EME RER has implications for future policy cooperation between EMEs and AEs.

Originality/value

To the best of the author's knowledge such a comparative analysis between AE and EME policy variables on RER misalignment has not been done previously.

Details

International Journal of Emerging Markets, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1746-8809

Keywords

Abstract

Details

The Impacts of Monetary Policy in the 21st Century: Perspectives from Emerging Economies
Type: Book
ISBN: 978-1-78973-319-8

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Article
Publication date: 12 January 2021

Aswini Kumar Mishra and Vedant Bhardwaj

This paper analyzes the welfare implications of the unequal distribution of wealth amongst the social and religious groups by studying the segregation of these groups…

Abstract

Purpose

This paper analyzes the welfare implications of the unequal distribution of wealth amongst the social and religious groups by studying the segregation of these groups across different occupations.

Design/methodology/approach

The authors use measures suggested by Alonso-Villar and Río (2017) and del Río and Alonso-Villar (2018) to compute the well-being of social groups (based on caste system prevalent in the Indian subcontinent) and religious groups due to their segregation across different regions (urban and rural) and occupations and social welfare loss of the society due to the segregation. Here social groups comprise of ST: Scheduled Tribe, SC: Scheduled Caste, OBC: Other Backward Caste and Others: other remaining castes; while, religious groups comprise of followers of Hinduism, Islam, Christianity and other religious groups.

Findings

The result shows that SC and ST groups are worse; while, the “others” group is better off due to the segregation of social groups across both regions and occupation. Similarly, in the case of religious groups, the analysis reveals that followers of Christianity are better off due to the segregation across region and occupation. It further shows that followers of Hinduism are negatively impacted while followers of Islam and other religious groups were better off due to the segregation across the regions.

Originality/value

Various researchers have studied the wealth inequality and unequal distribution in India over the years but did not dive further into the welfare implications of segregation of social and religious groups from wealth perspectives in India.

Details

International Journal of Social Economics, vol. 48 no. 3
Type: Research Article
ISSN: 0306-8293

Keywords

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Book part
Publication date: 9 December 2013

Sudha Kornginnaya

To describe the Pragathi Bandhu Groups (PBG) Model and portray the performance of PBG farmers encouraged by their financial and decision-making participation in micro…

Abstract

Purpose

To describe the Pragathi Bandhu Groups (PBG) Model and portray the performance of PBG farmers encouraged by their financial and decision-making participation in micro financing and labor sharing, as well as to analyze the factors that influenced participation of small farmers in PBG.

Design/methodology/approach

The empirical study is confined to the small farmers and laborers of PBG functioning in the coastal districts of Karnataka State in India. The study is conducted in Belthangady and Bantwal Taluks of Dakshina Kannada (DK) Districts-Udupi taluk of Udupi District in the State of Karnataka. Primary data from 100 farmer members, selected at random in each of the Taluks, is collected through personal interview by administering semi-structured interview schedules and open discussion. In addition, the data on the functions and the performance of PBG in the State of Karnataka in India are also collected from the official records of Shri Kshetra Dharmasthala Rural Development Project (SKDRDP) and their field-level functionaries through informal discussions. Factor analysis is performed with principal component analysis followed by Varimax rotation to analyze the factors that influenced participation of small farmers in PBG.

Findings

Results show that the implementation of PBG Model, through the collective participation of small farmers in micro financing, free labor sharing, financial and decision-making activities underlying the functions of PBG Model, has helped them to achieve robust performance in terms of increased savings mobilization, loan utilization, and value of free labor sharing and acres of land brought under cultivation with the help of irrigation facilities created by them. The factor analysis has derived four factors that influenced the participation of farmers in PBG (agriculture development, financial participation, capacity building, and other benefits) which explain 63.701 of total factor variance.

Practical implications

The findings of this paper can benefit the small farmers and laborers in replicating the PBG Model and its initiatives that address shortages of labor and credit, as well as the high cost of labor, particularly in the unorganized sector in the agrarian economy.

Originality/value

The insights offered are likely to be beneficial to the distressed small farmers, development agencies, and agriculture policy makers to solve the agrarian crisis caused due to shortages of labor and farm credit.

Details

Sharing Ownership, Profits, and Decision-Making in the 21st Century
Type: Book
ISBN: 978-1-78190-750-4

Keywords

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Article
Publication date: 5 May 2004

Teresa Serra, Barry K. Goodwin and Allen M. Featherstone

Off‐farm investment decisions of farm households are analyzed. Farm‐level data for a sample of Kansas farms observed from 1994 through 2000 are utilized. A system of…

Abstract

Off‐farm investment decisions of farm households are analyzed. Farm‐level data for a sample of Kansas farms observed from 1994 through 2000 are utilized. A system of censored dependent variable models is estimated to investigate the factors that influence the composition of farm households’ portfolios. The central question underlying the analysis is whether farm income variability influences off‐farm investment decisions. Previous analyses on the determinants of non‐farm investments have failed to consider the role of income variability. Results of this study indicate that higher farm income fluctuations increase the relevance of non‐farm assets in the farm household portfolio, thus suggesting these assets are used as farm household income risk management tools.

Details

Agricultural Finance Review, vol. 64 no. 1
Type: Research Article
ISSN: 0002-1466

Keywords

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