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We compare allocation rules in uniform price divisible-good auctions. Theoretically, a “standard allocation rule (STANDARD)” and a “uniform allocation rule (UNIFORM)” admit different types of low-price equilibria, which are eliminated by a “hybrid allocation rule (HYBRID).” We use a controlled laboratory experiment to compare the empirical performances of these allocation rules.

We conduct three-bidder uniform price divisible-good auctions varying the different allocation rules (standard, uniform, or hybrid) and whether or not explicit communication between bidders is allowed. For the case where explicit communication is allowed we also study six-bidder auctions.

We find that prices are similar across allocation rules. Under all three allocation rules, prices are competitive when bidders cannot explicitly communicate. With explicit communication, prices are collusive, and we observe collusive prices even when collusive agreements are broken. Collusive agreements are particularly fragile when the gain from a unilateral deviation is larger, and an implication of this is that collusive agreements are more robust under STANDARD.

We do not find conclusive evidence of differences in performance among allocation rules. However, there is suggestive evidence that STANDARD may be more vulnerable to collusion.

Divisible-good uniform price auctions are used in financial markets, but it is not possible to use naturally occurring data to test how alternatives to the standard format would perform. Using laboratory methods we provide an initial test of alternative allocation rules.

Besides the technological challenge of flying a space probe for ten years before arriving at the final mission destination, one is confronted with a potential loss of knowledge during this period. The purpose of this paper is to give an overview of the general knowledge management applied for such a mission. It aims to give details for a new approach, the video approach, to capture expertise knowledge of engineers and scientists.

The video approach included the visit of all instrument teams for several days, executing interviews with engineers, technicians and scientists. During the interviews a table of content (/toc/) with attached keywords was generated. The final video was transferred into a computer‐readable form and connected with the table of content. The methodology that was used to prepare and execute the interviews, the final video material and the storage and structure of the table of content and keywords is presented.

The experimenter interviews and the follow‐up work are finished. The paper finds that feedback received so far is positive and some experimenter teams use the approach for internal work.

The existing videos are not integrated into the existing standard office environment. Another technology step needs to integrate video capture, search and play into the existing, e.g. document processing, environment. The quality of the approach is difficult to estimate as the captured information might only be used in the years to come.

Proof of concept is given and lessons‐learned listed.

An new approach is documented giving technical implementation, setup, execution and approach details. Suitable as a reference paper for any organization with similar knowledge management requirements.

Purpose: In reality, financial decisions are made under conditions of asymmetric information that results in either favorable or adverse selection. As far as financial decisions affect growth of the firm, the latter must also be affected by either favorable or adverse selection. Therefore, the core objective of this chapter is to examine the determinants of each financial decision and the effects on growth of the firm under conditions of information asymmetry.

Design/Methodology/Approach: This chapter uses data for the non-financial firms listed in S&P 500. The data cover quarterly periods from 1989 to 2014. The statistical tests include linearity, fixed, and random effects and normality. The generalized method of moments estimation method is employed in order to examine the relative significance and contribution of each financial decision on growth of the firm, respectively. Standard and proposed proxies of information asymmetry are discussed.

Findings: The results conclude that there is a variation in the impact of financial variables on growth of the firm at high and low levels of information asymmetry especially regarding investment and financing decisions. A similar picture emerges in the cases of firm size and industry effects. In addition, corporate dividen d policy has a similar effect on firm growth across all asymmetric levels. These findings prove that information asymmetry plays a vital role in the relationship between corporate financial decisions and growth of the firm. Finally, the results contribute to the vast literature on the estimation of information asymmetry by demonstrating that the classical and standard proxies for information asymmetry are not consistent in terms of the ability to differentiate between favorable or adverse selection (which corresponds to low and high level of information asymmetry).

Originality/Value: This chapter contributes to the related literature in two ways. First, this chapter offers updated empirical evidence on the way that financing, investment, and dividends decisions are made under conditions of favorable and adverse selection. Other related studies deal with each decision separately. Second, the study offers new proxies for measuring information asymmetry in order to reach robust estimates of the effects of financial decisions on growth of the firm under conditions of agency problems.

This paper aims to describe the development of a knowledge management system (KMS) for the Nadir and Occultation for Mars Discovery (NOMAD) instrument on board the ESA/Roscosmos 2016 ExoMars Trace Gas Orbiter (TGO) spacecraft. The KMS collects knowledge acquired during the engineering process that involved over 30 project partners. In addition to the documentation and technical data (explicit knowledge), a dedicated effort was made to collect the gained experience (tacit knowledge) that is crucial for the operational phase of the TGO mission and also for future projects. The system is now in service and provides valuable information for the scientists and engineers working with NOMAD.

The NOMAD KMS was built around six areas: official documentation, technical specifications and test results, lessons learned, management data (proposals, deliverables, progress reports and minutes of meetings), picture files and movie files. Today, the KMS contains 110 GB of data spread over 11,000 documents and more than 13,000 media files. A computer-aided design (CAD) library contains a model of the full instrument as well as exported sub-parts in different formats. A context search engine for both documents and media files was implemented.

The conceived KMS design is basic, flexible and very robust. It can be adapted to future projects of a similar size.

The paper provides practical guidelines on how to retain the knowledge from a larger aerospace project. The KMS tool presented here works offline, requires no maintenance and conforms to data protection standards.

This paper shows how knowledge management requirements for space missions can be fulfilled. The paper demonstrates how to transform the large collection of project data into a useful tool and how to address usability aspects.

The main objective of this study is to examine whether firms follow the financing hierarchy as suggested by the Pecking Order Theory (POT). The External Funds Needed (EFN) model offers a financing hierarchy that can be used for examining the POT. As far as the EFN considers growth of sales as a driver for changing capital structure, it follows that shall firms plan for a sustainable growth of sales, a sustainable financing can be reached and maintained. This study uses data about the firms listed in two indexes: Dow Jones Industrial Average (DJIA30) and NASDAQ100. The data cover quarterly periods from June 30, 1999, to March 31, 2012. The methodology includes (a) cointegration analysis in order to test for model specification and (b) causality analysis in order to show the generic and mutual associations between the components of EFN. The results conclude that (a) in the majority of the cases, firms plan for an increase in growth sales but not necessarily to approach sustainable rate; (b) in cases of observed and sustainable growth of sales, firms reduce debt financing persistently; (c) firms use equity financing to finance sustainable growth of sales in the long run only, while in the short run, firms use internal financing, that is, retained earnings as a flexible source of financing; and (d) the EFN model is quite useful for examining the hierarchy of financing. This study contributes to the related literature in terms of utilizing the properties of the EFN model in order to examine the practical aspects of the POT. These practical considerations are extended to examine the use of the POT in cases of observed and sustainable growth rates. The findings contribute to the current literature that there is a need to offer an adjustment to the financing order suggested by the POT. Equity financing is the first source of financing current and sustainable growth of sales, followed by retained earnings, and debt financing is the last resort.

Building upon the framework of the tradeoff model of capital structure and motivated by the equity market timing theory, we examine whether equity misvaluation is a source of adjustment “costs” that will affect a firm’s leverage adjustment speed toward target. We also investigate whether the quality of a firm’s long-term growth options will influence the decisions of managers to exploit the mispriced equity to converge to the optimum. Using a sample of listed Taiwanese firms during 1992–2014 and employing the market-to-book decomposition as developed by Rhodes-Kropf, Robinson, and Viswanathan (2005), we find that overleveraged and overvalued firms demonstrate faster adjustment speed than overleveraged but undervalued firms. Furthermore, controlling for the misvaluation status, high-growth firms converge to target faster than their low-growth counterparts. The effect of growth options on the relation between equity mispricing and adjustment speed does not mirror the effect of financing deficits. With the detailed financial information of the local companies across a rather long time series, this study provides incremental inputs to the literature of capital structure from the determinants of target leverage, the estimation of leverage adjustment speeds, to the identification of the sources of adjustment costs in an emerging market where institutional environment is strikingly different from the US.

The world in which companies operate today is volatile, uncertain, complex, and ambiguous, thus subjecting contemporary forms to an array of risks that challenge their viability in an increasingly competitive landscape. Organizations that cling to their traditional ways of operating impede their ability to survive while those able to embrace evolving changes and lever their strategic response capabilities (SRCs) will thrive against the odds. The possession of such capabilities has become a prominent explanation for effective adaptation to the impending changes but is rarely analyzed and tested empirically. Strategic adaptation typically assumes innovation as an important component, but we know little about how the innovative processes interact with the firm’s SRCs. Hence, this study investigates these implied relationships to discern their effects on organizational performance and risk outcomes. It explores the effects of SRCs and the role of innovation as intertwined adaptive mechanisms supporting strategic renewal that can attain superior performance and risk effects. The relationships are analyzed based on a large sample of US manufacturing firms over the decade 2010–2019. The study reveals that firms possessing effective SRCs have the ability to exploit opportunities and deflect risky situations to gain favorable performance and risk outcomes. While innovation indeed plays a role, the precise nature and dynamic effect thereof remain inconclusive.

The purpose of this study is to examine the influence of underwriter reputation on the valuation of Malaysian initial public offerings (IPOs).

This study employed cross-sectional multiple regression models to analyse the relationship between underwriter reputation and IPO valuation that included 466 IPOs listed on Bursa Malaysia from 2000 to 2017.

The results revealed that underwriter reputation had a significant negative association with IPO valuation. Firms that engaged the services of reputable underwriters had their IPO offer prices set lower than the intrinsic values during the listing. After incorporating firms' size, this study found a positive relationship between underwriter reputation and IPO valuation. Big firms (high quality) hired reputable underwriters for certification purposes as issuers were aware that the cost of hiring a reputable underwriter would be justified by increased transparency after listing. Therefore, firms that engaged reputable underwriters had approximately fair values since issuers assumed that the price would be close to the intrinsic value following enhanced transparency post-listing.

Future studies should focus on other non-financial factors, such as auditor reputation.

The present study provides new insights into the certification role of underwriters in valuing IPOs in the Malaysian market.

By utilizing a large sample of firms during the period 2006–2017, the author determine which types of firms are more likely to go bankrupt. The author shows that over-leveraged firms have significantly higher probability of going bankrupt, which highlight the importance of the concept of optimal corporate capital structure. The author finds that private firms and export-oriented firms experience lower hazard rates. Proposed hazard statistical model highlights that more profitable firms, firms with better liquidity, firms with more tangible assets and larger firms all have statistically higher survival rates. The author finds that bankruptcy rates are the lowest among service firms and the highest in construction industry. Ownership variables indicate that state-owned firms, firms with foreign ownership and firms, owned by holdings, are less likely to fail, all else equal. Finally, the author demonstrates that proposed statistical model successfully predicts the probability of bankruptcy. The mean cumulative hazard function for a group of surviving firms is statistically significantly lower compared to a group of failing firms. In order to survive in a long run, firm’s management should especially be aware of their optimal capital structure and use rather less leverage than going over the sustainable level.

I study the determinants of conventional leverage in a sample of publicly listed corporations based in Saudi Arabia, United Arab Emirates, and Qatar, for a period spanning from 2005 up to end of 2014, and investigate whether those determinants can also explain the utilization of Sukuk by the same corporations in their capital structures. Evidence related to the determinants of conventional leverage is consistent with results from prior studies conducted on corporations based in developed and developing countries. Firm’s size, profitability, tangibility, age, and tendency to pay dividends are significant determinants of conventional leverage. However, not all those factors significantly explain the utilization of Sukuk as a financing vehicle. The size of the firm remains to be the most significant factor, in addition to the conformance of those corporations with respect to Shari’a principles measured by their utilization of other Islamic investments and financing instruments. Overall, I conclude that models used to predict conventional leverage are not capable of fully explaining the determinants of Sukuk issuances.