Norwegian School of Economics and Business Administration

Displaying 1-24 of 24 results

  • White Papers // Jul 2011

    International Debt Shifting: Do Multinationals Shift Internal Or External Debt?

    Multinational companies can exploit the tax advantage of debt more aggressively than national companies by shifting debt from affiliates in low tax countries to affiliates in high tax countries. Previous papers have either omitted internal debt or external debt from the analysis. The authors are the first to model the...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Apr 2011

    Voluntary Prepayments And Credit Rationing

    The author constructs a model to illustrate that, if voluntary prepayments is penalty-free, the interest rate alone may be insufficient for the lender and the borrower to reach a loan agreement resulting in the occurrence of credit rationing. Then other contract variables such as collateral or maturity have to be...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Mar 2011

    On The Pricing Of Performance Sensitive Debt

    Performance Sensitive Debt (PSD) contracts link a loan's interest rate to the borrower's measure of credit relevant firm performance, e.g., if the borrower becomes less creditworthy, the interest rate increases according to a predetermined schedule. PSD provisions are included in approximately 35% of all U.S. and Canadian corporate loans (1994-2009,...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Feb 2011

    The Equity Premium And The Risk Free Rate In A Production Economy. A New Perspective

    The authors study a competitive equilibrium in a production economy, i.e., a system of prices at which firms' profit maximizing production decisions and individuals' preferred affordable consumption choices equate supply and demand in every market. They derive the equilibrium price of the firm and the equilibrium short term interest rate,...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Feb 2011

    Media Firm Strategy And Advertising Taxes

    Empirical evidence suggests that people dislike ads in TV programs and other media products. In such situations standard economic theory prescribes that the advertising volume can be optimally reduced by levying a tax on ads. However, making use of recent advances in the theory of firm behavior in two-sided markets,...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Aug 2010

    The Contrary Forces Of Innovation A Conceptual Model For Studying Networked Innovation Processes

    Innovation processes represent a particular challenge to industrial network theory, given its emergence from a focus on explaining why businesses tend to be much more intertwined in stable collaborative networks than what can reasonably be associated with the fundamental assumptions underlying the general equilibrium market theory of mainstream of economics....

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Aug 2010

    Studying Innovation Processes In Real-Time

    It has recently been argued that there is a mismatch between the knowledge of innovation processes and the methods commonly employed to study them (S?rensen et al., 2010). However, while S?rensen et al. suggest experimental methods as the way forward, the authors will in this paper explore and discuss the...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Aug 2010

    Process Thought And Business Network Research

    The objective of this paper is to make a contribution to the ongoing work to further depict and understand the process characteristics of interaction and networks in the context of business development. Based on a fundamental appreciation of the interrelated and dynamic characteristics of business activities within as well as...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Aug 2010

    How Users Shape And Use Markets

    In this paper the authors consider the interrelationships between users and market shaping. Current research addressing the user is centred upon product development/innovation and user configurations. They argue that this dominant "Co-construction of users and technology" perspective has a weak link to markets (and indeed marketing activities). The purpose of...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Aug 2010

    Duels Or Duets? Characterizing Interaction Between Companies

    Two metaphors - duel and duet - is used to identify the possible variation in interaction between organizations. Each of the metaphors describes a special type of interaction and if applied to organizations give interesting effects on both the single organization as well as for the organizations as a collective....

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Aug 2010

    Public Information And IPO Underpricing

    The authors analyze the effect of public information on rational investors' incentives to reveal private information during the book building process and their demand for allocations in the IPO. The model generates several new predictions. First, investors require more under pricing to truthfully reveal positive private information in bear markets...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Oct 2009

    Evidence On Competitive Advantage And Superior Stock Market Performance

    This paper analyzes the value-relevance of industry-based and resource-based competitive advantage in a large sample of firms listed on the Oslo Stock Exchange. The authors measure competitive advantage by a single variable and perform a new decomposition into its underlying sources. In 1986-2005, the industry-based and the resource-based competitive advantage...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Sep 2009

    Convergence, Complementarity Or Disruption: Enterprise Search And Business Intelligence

    Business intelligence has been used in companies for decades, enabling management to make decisions and to increase their competitiveness in the market. Search technology has enabled users to access all types of information from anywhere at anytime. In today's world, where the amount of information is ever growing, professionals see...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Sep 2009

    Organizing For Interaction. "The Missing Link In Supply Chain Management"

    A supply chain can be defined as a series of units that transforms raw materials into finished products and delivers the products to customers (Mabert and Venkataramanan, 1998). Some of the units in a supply chain may be located inside the boundaries of a focal organization, while others cross such...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Jun 2009

    Liquidity And Shareholder Activism

    This paper documents that stock liquidity improves shareholders' incentive to monitor management. Using a hand-collected sample of contested proxy solicitations and shareholder proposals as occurrences of shareholder activism, the authors find that poor firm performance increases the probability of shareholder activism and that this relationship is much stronger for firms...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Jun 2009

    The Long-Term Discount Rate

    The authors develop an expression for the long-term discount rate in an economy in which a representative consumer has access to both a risk-free and a risky production technology. Even when the risk-free sector is very small, and with probability one becomes a negligible fraction of the economy in the...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // May 2009

    The Inefficiency Of Diversification In Economies With Endogenous Liquidation Costs

    The authors consider a two-asset economy in which consumers are subject to liquidity shocks. Consumers (or banks in the case of delegation) may liquidate these assets in order to finance shortfalls of liquidity. The costs of liquidation for a consumer depend on the liquidity positions of other consumers since those...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // May 2009

    A Model Of Deferred Callability In Defaultable Debt

    Banks and other financial institutions raise hybrid capital as part of their risk capital. Hybrid capital has no maturity, but, similarly to most corporate debt, includes an embedded issuer's call option. To obtain acceptance as risk capital, the first possible exercise date of the embedded call is contractually deferred by...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Apr 2009

    Congested Interregional Infrastructure, Road Pricing And Regional Labour Markets

    Traffic congestion and the policies to combat it have been studied extensively. However, most studies neglect the labour market impacts of congestion. Many also fail to account for the simultaneity between commuting and migration. This paper models impacts such as unemployment disparities, changes in commuting flows and changes in the...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Mar 2009

    Bank Capital, Borrower Power, And Loan Rates

    The authors test the predictions of several recent theories of how bank capital affects the rates that banks charge their borrowers. Key to all these theories is the notion that the relative bargaining power of a bank and its borrower are critical. They find that banks with low capital are...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Mar 2009

    The Optimality Of Interbank Liquidity Insurance

    This paper studies banks' incentives to engage in liquidity cross-insurance. In contrast to the previous literature the authors do not consider a situation where banks meet centrally to determine the structure of their insurance arrangements. Instead they view interbank insurance as the outcome of bilateral (and non-exclusive) contracting between pairs...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Feb 2009

    Modern Portfolio Management With Conditioning Information

    This paper studies models in which active portfolio managers optimize performance relative to a benchmark and utilize conditioning information unavailable to their clients. The authors provide explicit solutions for the optimal strategies with multiple risky assets, with or without a risk free asset, and also consider various constraints on portfolio...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Jan 2009

    Are Buyout Sponsors Market Timers In RLBOs?

    This paper examines the exit strategy of buyout sponsors in RLBOs (Reverse Leveraged Buyouts). LBO restructuring decision is affected by the market timing of sponsors. LBO duration is negatively related to hot IPO market proxy and industry valuation, suggesting sponsors spend less time in LBOs under favorable external market conditions....

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Oct 2008

    An Arbitrary Benchmark CAPM: One Additional Frontier Portfolio Is Sufficient

    The benchmark CAPM linearly relates the expected returns on an arbitrary asset, an arbitrary benchmark portfolio, and an arbitrary MV frontier portfolio. The benchmark is not required to be on the frontier and may be non-perfectly correlated with the frontier portfolio. The benchmark CAPM extends and generalizes previous CAPM formulations,...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Feb 2011

    The Equity Premium And The Risk Free Rate In A Production Economy. A New Perspective

    The authors study a competitive equilibrium in a production economy, i.e., a system of prices at which firms' profit maximizing production decisions and individuals' preferred affordable consumption choices equate supply and demand in every market. They derive the equilibrium price of the firm and the equilibrium short term interest rate,...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Feb 2011

    Media Firm Strategy And Advertising Taxes

    Empirical evidence suggests that people dislike ads in TV programs and other media products. In such situations standard economic theory prescribes that the advertising volume can be optimally reduced by levying a tax on ads. However, making use of recent advances in the theory of firm behavior in two-sided markets,...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Aug 2010

    Public Information And IPO Underpricing

    The authors analyze the effect of public information on rational investors' incentives to reveal private information during the book building process and their demand for allocations in the IPO. The model generates several new predictions. First, investors require more under pricing to truthfully reveal positive private information in bear markets...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Apr 2009

    Congested Interregional Infrastructure, Road Pricing And Regional Labour Markets

    Traffic congestion and the policies to combat it have been studied extensively. However, most studies neglect the labour market impacts of congestion. Many also fail to account for the simultaneity between commuting and migration. This paper models impacts such as unemployment disparities, changes in commuting flows and changes in the...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Oct 2009

    Evidence On Competitive Advantage And Superior Stock Market Performance

    This paper analyzes the value-relevance of industry-based and resource-based competitive advantage in a large sample of firms listed on the Oslo Stock Exchange. The authors measure competitive advantage by a single variable and perform a new decomposition into its underlying sources. In 1986-2005, the industry-based and the resource-based competitive advantage...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Oct 2008

    An Arbitrary Benchmark CAPM: One Additional Frontier Portfolio Is Sufficient

    The benchmark CAPM linearly relates the expected returns on an arbitrary asset, an arbitrary benchmark portfolio, and an arbitrary MV frontier portfolio. The benchmark is not required to be on the frontier and may be non-perfectly correlated with the frontier portfolio. The benchmark CAPM extends and generalizes previous CAPM formulations,...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Sep 2009

    Convergence, Complementarity Or Disruption: Enterprise Search And Business Intelligence

    Business intelligence has been used in companies for decades, enabling management to make decisions and to increase their competitiveness in the market. Search technology has enabled users to access all types of information from anywhere at anytime. In today's world, where the amount of information is ever growing, professionals see...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Aug 2010

    The Contrary Forces Of Innovation A Conceptual Model For Studying Networked Innovation Processes

    Innovation processes represent a particular challenge to industrial network theory, given its emergence from a focus on explaining why businesses tend to be much more intertwined in stable collaborative networks than what can reasonably be associated with the fundamental assumptions underlying the general equilibrium market theory of mainstream of economics....

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Aug 2010

    Studying Innovation Processes In Real-Time

    It has recently been argued that there is a mismatch between the knowledge of innovation processes and the methods commonly employed to study them (S?rensen et al., 2010). However, while S?rensen et al. suggest experimental methods as the way forward, the authors will in this paper explore and discuss the...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Aug 2010

    Process Thought And Business Network Research

    The objective of this paper is to make a contribution to the ongoing work to further depict and understand the process characteristics of interaction and networks in the context of business development. Based on a fundamental appreciation of the interrelated and dynamic characteristics of business activities within as well as...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Aug 2010

    How Users Shape And Use Markets

    In this paper the authors consider the interrelationships between users and market shaping. Current research addressing the user is centred upon product development/innovation and user configurations. They argue that this dominant "Co-construction of users and technology" perspective has a weak link to markets (and indeed marketing activities). The purpose of...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Aug 2010

    Duels Or Duets? Characterizing Interaction Between Companies

    Two metaphors - duel and duet - is used to identify the possible variation in interaction between organizations. Each of the metaphors describes a special type of interaction and if applied to organizations give interesting effects on both the single organization as well as for the organizations as a collective....

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Sep 2009

    Organizing For Interaction. "The Missing Link In Supply Chain Management"

    A supply chain can be defined as a series of units that transforms raw materials into finished products and delivers the products to customers (Mabert and Venkataramanan, 1998). Some of the units in a supply chain may be located inside the boundaries of a focal organization, while others cross such...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // May 2009

    The Inefficiency Of Diversification In Economies With Endogenous Liquidation Costs

    The authors consider a two-asset economy in which consumers are subject to liquidity shocks. Consumers (or banks in the case of delegation) may liquidate these assets in order to finance shortfalls of liquidity. The costs of liquidation for a consumer depend on the liquidity positions of other consumers since those...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Jul 2011

    International Debt Shifting: Do Multinationals Shift Internal Or External Debt?

    Multinational companies can exploit the tax advantage of debt more aggressively than national companies by shifting debt from affiliates in low tax countries to affiliates in high tax countries. Previous papers have either omitted internal debt or external debt from the analysis. The authors are the first to model the...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Apr 2011

    Voluntary Prepayments And Credit Rationing

    The author constructs a model to illustrate that, if voluntary prepayments is penalty-free, the interest rate alone may be insufficient for the lender and the borrower to reach a loan agreement resulting in the occurrence of credit rationing. Then other contract variables such as collateral or maturity have to be...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // May 2009

    A Model Of Deferred Callability In Defaultable Debt

    Banks and other financial institutions raise hybrid capital as part of their risk capital. Hybrid capital has no maturity, but, similarly to most corporate debt, includes an embedded issuer's call option. To obtain acceptance as risk capital, the first possible exercise date of the embedded call is contractually deferred by...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Mar 2011

    On The Pricing Of Performance Sensitive Debt

    Performance Sensitive Debt (PSD) contracts link a loan's interest rate to the borrower's measure of credit relevant firm performance, e.g., if the borrower becomes less creditworthy, the interest rate increases according to a predetermined schedule. PSD provisions are included in approximately 35% of all U.S. and Canadian corporate loans (1994-2009,...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Jan 2009

    Are Buyout Sponsors Market Timers In RLBOs?

    This paper examines the exit strategy of buyout sponsors in RLBOs (Reverse Leveraged Buyouts). LBO restructuring decision is affected by the market timing of sponsors. LBO duration is negatively related to hot IPO market proxy and industry valuation, suggesting sponsors spend less time in LBOs under favorable external market conditions....

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Mar 2009

    The Optimality Of Interbank Liquidity Insurance

    This paper studies banks' incentives to engage in liquidity cross-insurance. In contrast to the previous literature the authors do not consider a situation where banks meet centrally to determine the structure of their insurance arrangements. Instead they view interbank insurance as the outcome of bilateral (and non-exclusive) contracting between pairs...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Jun 2009

    The Long-Term Discount Rate

    The authors develop an expression for the long-term discount rate in an economy in which a representative consumer has access to both a risk-free and a risky production technology. Even when the risk-free sector is very small, and with probability one becomes a negligible fraction of the economy in the...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Jun 2009

    Liquidity And Shareholder Activism

    This paper documents that stock liquidity improves shareholders' incentive to monitor management. Using a hand-collected sample of contested proxy solicitations and shareholder proposals as occurrences of shareholder activism, the authors find that poor firm performance increases the probability of shareholder activism and that this relationship is much stronger for firms...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Feb 2009

    Modern Portfolio Management With Conditioning Information

    This paper studies models in which active portfolio managers optimize performance relative to a benchmark and utilize conditioning information unavailable to their clients. The authors provide explicit solutions for the optimal strategies with multiple risky assets, with or without a risk free asset, and also consider various constraints on portfolio...

    Provided By Norwegian School of Economics and Business Administration

  • White Papers // Mar 2009

    Bank Capital, Borrower Power, And Loan Rates

    The authors test the predictions of several recent theories of how bank capital affects the rates that banks charge their borrowers. Key to all these theories is the notion that the relative bargaining power of a bank and its borrower are critical. They find that banks with low capital are...

    Provided By Norwegian School of Economics and Business Administration