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This paper aims to analyse the recent changes to the Pillar 2 regulatory-prescribed methodologies to classify and calculate credit concentration risk. Focussing on the Prudential Regulation Authority’s (PRA) methodologies, the paper tests the susceptibility to bias of the Herfindahl–Hirscham Index (HHI). The empirical tests serve to assess the assumption that the regulatory classification of exposures within the geographical concentration is subject to potential misuse that would undermine the PRA’s objective of obtaining risk sensitivity and improved banking competition.

Using the credit exposure data from three global banks, the HHI methodology is applied to the portfolio of geographically classified exposures, replicating the regulatory exercise of reporting credit concentration risk under Pillar 2. In doing so, the validity of the aforementioned assumption is tested by simulating the PRA’s Pillar 2 regulatory submission exercise with different scenarios, under which the credit exposures are assigned to different geographical regions.

The paper empirically shows that changing the geographical mapping of the Eastern European EU member states can result in a substantial reduction of the Pillar 2 credit concentration risk capital add-on. These empirical findings hold only for the banks with large exposures to Eastern Europe and Central Asia. The paper reports no material impact for the well-diversified credit portfolios of global banks.

This paper reviews the PRA-prescribed methodologies and the Pillar 2 regulatory guidance for calculating the capital add-on for the single name, sector and geographical credit concentration risk. In doing so, this paper becomes the first to test the assumptions that the regulatory guidance around the geographical breakdown of credit exposures is subject to potential abuse because of the ambiguity of the regulations.

The purpose of this paper is to theorize how the industry life cycle unfolds differently across places and how economic agglomeration varies over time.

The paper relies on literature review and conceptual analysis.

It generates a dynamic geographic concentration model (i.e. an industry’s degree of geographic concentration drops in the growth stage, rises in the mature stage, and drops again in the new growth stage) and a localized industry life-cycle model (i.e. temporal dynamics differ between the center and the periphery).

It makes contribution by theorizing that the extent to which an industry is geographically concentrated changes over time, and by demonstrating how an industry’s center and periphery may experience different temporal dynamics.

The issue of export instability exerts an enduring fascination for economists with an interest in the area of economic development. Over several decades a voluminous literature has emerged embracing debates on the domestic consequences and on the causes of export instability. The purpose here is to examine these debates and an attempt is made to set out different theoretical stances, to classify and examine empirical findings, and to indicate the directions in which the debates have moved. Such a statement of a review article's purpose is, of course, incomplete without more specific delineation of the boundaries within which the general objectives are pursued. Here that delineation has three facets.

The purpose of this paper is to examine whether competitor concentration relates to better customer acceptance of the firm’s offerings and better networking of the firm with competitors and government officials.

The research is conducted in the context of the transition economy of Vietnam, using a combination of methods. Qualitative interviews are followed by a survey of 199 small firms in Hanoi, Vietnam. Since competitor concentration is count data, Poisson regression is used to test the relationship between networking, customer acceptance, and competitor concentration.

The results show that locating in a competitor concentration area improves customer acceptance of the firm’s offerings and increases networking with competitors, while decreasing networking with government officials. Competitor concentration does not help improve firm performance.

A sample of 199 businesses in the food, furniture, and jewelry sectors in Hanoi may not be representative of all private businesses in Vietnam. The use of cross-sectional data could not establish causational relationships among variables.

Small firms in transition economies should be aware of the trade-offs between initial customer acceptance and negative consequences of being in a competitor concentrated area. Thus, once the firm’s offerings are generally accepted by customers, the firm may consider moving out of competitor concentration areas to expand and differentiate.

This paper points out that in the absence of effective market institutions, businesses want to be located near a concentration of similar firms as a means of gaining initial customer acceptance. This initial acceptance does not necessarily help firms improve business performance beyond the firm’s survival.

This paper represents an empirical study of how geographic proximity influences the search advantage and the transfer problem of interfirm networks.

By using the data collected from 226 Chinese manufacturing firms, this study examines the proposed hypotheses.

The authors’ findings suggest that (1) geographic proximity is an important antecedent for promoting knowledge transfer, whereas it lowers the degree of knowledge novelty; and (2) geographic proximity also moderates the effects of interfirm networks on knowledge novelty and knowledge transfer.

This study contributes the literature of interfirm network and provides practical implications by addressing the ways in which manufacturing firms can promote knowledge transfer and acquire novel knowledge.

The purpose of this paper is to examine changes in manufacturing agglomeration in a small open economy over the last decade. This is done during a time when manufacturing in most developed countries is in relative decline.

This work adapts the methodology developed by De Propris to measure the relative level of manufacturing agglomeration across space and time. It combines different measures utilising the location quotient technique, thereby allowing the relative strengths of manufacturing in different areas to be compared with the national (UK) level. The work goes further by also calculating the EG index to compare the levels of concentration and specialisation.

This research shows that manufacturing agglomeration has increased in Wales at a time when manufacturing employment is decreasing. Concentration and specialisation have continued to increase across the last decade despite manufacturing's steady decline.

This work details for the first time the relative intensity of agglomeration across space and time in a small open economy. This is often neglected in other economic “cluster” work but may be key to understanding economic development in the twenty‐first century.

There is considerable variation in the extent of globalization across industries. The authors attempt to identify the structural conditions of the industry that lead to these variations.

Based on a sample of 33 manufacturing industries over the nine-year period from 2007 to 2016, the authors test for antecedents of industry globalization.

The authors find that industry globalization is positively affected by medium levels of barriers to entry, industry competition, industry assistance, low and mediums levels of capital intensity, industry concentration and industry regulation and negatively affected by low levels of technological change and industry assistance. In addition, the life cycle stage of the industry has an impact on the level of globalization with the growth stage having the highest level of globalization.

First, the major limitation of the paper is that the authors rely entirely on trade data to measure the level of industry globalization. The authors did not have a choice because foreign direct investment (FDI) data are available only at the country level. Second, given that globalization can occur at the country, industry and firm levels, the focus on industry-level structural characteristics alone may be seen as a limitation.

The results of the study can provide guidance to practicing managers to apply industry analysis for predicting the potential for and direction of globalization of their industries. This will enable them to formulate appropriate strategies to cope with global competition.

The study has important public policy implications. National governments have many levers at their command that can be used to influence the structural characteristics of industries, such as industry regulation, industry assistance and industry concentration. They can selectively use these levers to either facilitate or impede globalization.

Much of the empirical focus of prior research on globalization has been on countries, rather than industries, as the unit of analysis. There is clearly variation in the extent of globalization across industries with some industries highly integrated while others remain primarily local or regional. Based on a novel approach to measure the extent of globalization at the industry level, the authors identify its antecedents. The value of the paper lies in the fact that the analysis of 33 manufacturing industries over a ten-year period shows that the structural characteristics of the industries drive their extent of globalization.

This paper aims to examine the geographic distribution of social enterprises at the local sub-district level in one Indian state.

This paper adopts a multimethod approach. The exploratory phase involved interviews and analysis of social enterprise distribution at the national level. Phase 2 involved mapping the distribution of social enterprises at the sub-district level in one state. Distribution around established social enterprises was plotted using latitude–longitude positions. Grounded theory approach to analysing qualitative data was adopted to identify the mechanism for agglomeration.

Social entrepreneurship sees the entrepreneurial problems as solving universalized social problems abstracting them out of the geo-historical and political economic context of the social problem. This study shows that solving a social problem is itself implicated in a social–historical organizational context of aid giving within developing countries. Networks of resources that early enterprises enable draw newer organizations toward them and lead to the formation of clusters. While such clusters might improve chances of enterprise survival, the phenomenon inadvertently leads to a new kind of inequity, as areas with fewer social enterprises lack the organizational infrastructure necessary for delivery of welfare.

Research in social enterprises needs to pay more attention to the context of the enterprises or society in addition to its current focus on universal social problems. Social enterprises themselves could be new sources of inequity in terms of the organizational infrastructure they represent.

Policymakers need to make directed efforts that respond not only to social problems but also to the socio-historic-organizational contexts where the problems are being solved and seeding the entrepreneurial effort in those spaces.

The purpose of this study was to explore the impact of the formation of industrial clusters on the obtainment of professional human resources, to verify the impact of human resources on clustering relationships and firm’s performance and to understand whether the formation of clusters can contribute to the obtainment of professional human resources and the improvement of competitiveness of enterprises. It was expected that solutions could be found to make new contributions through the verification of special economic zones (SEZs).

Using manufacturers in Taiwan’s SEZs as the subjects, this study explored the impact on the obtainment of professional human resources after the formation of industrial clusters in SEZs, through conducting and empirical study with a questionnaire survey.

The professional human resources are the essential factor for the formation of industrial clusters and the improvement of competitiveness. This study also confirmed that industries can have professional human resources by industrial clustering and that this will produce a positive impact on the enterprise clustering relationships, which can also have a positive impact on firm’s performance and can enhance the enterprise’s competitive advantage.

Industrial clustering is the key factor to attract professional human resources; industrial clusters can enhance firm’s performance; and professional human resources affect firm’s performance of enterprises.

No study has discussed the topic of clusters from the perspective of SEZs also including six export processing zone (EPZ) parks in Taiwan. This study discussed the topic using theories relating to clustering and human resources. The formation of industrial clusters can result in higher competitiveness in the face of the global market. The EPZ industrial cluster provides an excellent investment environment. Coupled with one-stop express services and geographic advantage, the land-use rate is up to 97 per cent and the per hectare output value amounts to NTD 3.2 billion, setting a successful example of an industrial cluster.

The purpose of this paper is to investigate the substitutability of corporate hedging and diversification in the real estate investment trusts (REITs) industry. The authors hypothesize that, relative to diversified firms, focused firms are more likely to be associated with hedging. The role of firm size is also analyzed.

The logistic regression approach is utilized to analyze the probability of hedging and the panel regression approach is used to examine the amount of hedging.

The authors find that, relative to diversified firms, firms focused on a single property type are more likely to engage in hedging. However, this finding is significant only for smaller firms, which implies a non-linear relation between hedging and firm size. The evidence is not as strong when firm focus is measured by geographic concentration. In terms of hedging amount, smaller firms’ average hedge ratio is greater than that of larger firms. For either small or large firms group, hedging amounts increase with firm focus measured by either property or geographic concentration and increase with firm sizes.

The results imply that, relative to diversified REITs, REITs focused on a single property type are more likely to engage in hedging. However, this finding is significant only for smaller firms, which implies a non-linear relation between hedging and firm size. The evidence is not as strong when firm focus is measured by geographic concentration, suggesting that geographic concentration is perceived to be less risky than property type concentration. For either small or large firms group, hedging amounts increase with firm focus measured by either property or geographic concentration and increase with firm sizes, which implies that hedging amount does not depend on firm size. The sample period is limited to the years 2010 to 2013 because some data needs to be manually collected.

The results imply that REITs consider both property diversification and hedging in managing their risk.

The research represents an early attempt to investigate the relation between corporate hedging and diversification. The investigation into the REIT industry has several advantages such as a lower likelihood of using derivatives for speculation.