Vladimer Papava

DOI: https://doi.org/10.6000/1929-7092.2017.06.46

Published: 31 August 2017 

Abstract: The paper offers a new concept of the technological backwardness in many, mostly in poor countries – the retroeconomics. The goal of the research is to set out the main reasons why in many (and first of all in poor) countries the economies used obsolete technologies. Such countries are getting to into the trap of technological dependency on the economically developed countries. The feasible tools for a technological leap from such dependency are discussed. The main threat of the preservation of the retroeconomy – its zombification is discussed as a main barrier for technological updating of economy, and in general as an obstacle for Schumpeterian creative destruction. Much importance is given to the key principle of bankruptcy procedures against zombified retro-firms. The bankruptcy legislation should ensure the timely liquidation of non-viable firms. A country’s legislative framework should strive for the establishment of a sound legal space on the market, when only really viable firms will exist. The role of the government is very important to resolve the problem of the technological backwardness.

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Jukka Ilomäki and Hannu Laurila

DOI: https://doi.org/10.6000/1929-7092.2017.06.43

Published: 23 August 2017 

Abstract: The central bank acts as a social planner, and adjusts the real risk-free rate of return to correct any mispricing in the stock market so that the emergence of positive or negative bubbles is avoided. The analysis shows that the central bank must raise the risk-free rate in the case of a positive bubble, and vice versa. Moreover, the central bank should intervene in the stock market even if it does not have perfect information about the bubble. This is because the sequential dividend yields in the pricing equations are stationary. Thus, even the delayed reaction of the central bank prevents the fundamental value and the equilibrium price from drifting apart for extended periods.

Somnath Chattopadhyay and Suchismita Bose

DOI: https://doi.org/10.6000/1929-7092.2017.06.44

Published: 23 August 2017 

Abstract: This study explores stock market efficiency in India after allowing for potential structural changes induced by reforms processes and/or external shocks. The endogenous determination of structural break dates, using mostly Clemente, Monta˜n´es, & Reyes (1998) (CMR) methodology, allows us to identify important events in this respect. External shocks such as occasional stock market scams, policy and political regime changes, oil price shocks and the effect of global market meltdowns have caused abrupt or one time changes in the series mean (additive outlier model), while the reforms processes stand out to be the single most important cause for the gradual shifts in the level of stock indices (innovation outlier model). This underlines the importance of institution building and the domestic policy stance in countering external shocks.

Ahmad Hamed Awwad Almanasir and B. Shivaraj

DOI: https://doi.org/10.6000/1929-7092.2017.06.45

Published: 23 August 2017 

Abstract: This paper aimed to assess the corporate governance voluntary disclosure level and the impact of a set of corporate governances (CG) attributes on the level to which corporate governance voluntary disclosure is conducted in Jordan. Another objective was to determine if Jordanian industrial listed corporations adhere to and disclose good CG practices voluntarily, and if they do, to determine the factors influencing such disclosure. This study employed 61 industrial listed firms for the years 2010-2014. The research developed a general voluntary CG disclosure index composing of 15 Jordanian Corporate Governance Codes and gauged the relationship via pooled OLS and regression method. The results indicated that the proposed Jordanian Corporate Governance Index (JCGI) enhanced voluntary corporate governance disclosure among Jordanian listed firms over the examined years. They also showed varying levels of CG disclosures in different scenarios; 1) it is lower in firms with higher managerial ownership and 2) higher relative to the independent directors’ proportion on the board, audit firm size, and audit committee presence with institutional ownership. Evidence on the compliance level towards the CG code in Amman Stock Exchange is unique and the study is distinct as it provides a pioneering evidence of the achieved compliance level.

Adam Śliwński, Anna Karmańska and Tomasz Michalski

DOI: https://doi.org/10.6000/1929-7092.2017.06.42

Published: 05 July 2017 

Abstract: The paper aims to present the results of an assessment of development of insurance sector in chosen European countries like Poland, UK, Germany and France over the financial crisis especially from product’s innovation point of view. The comparison between the level of taxonomic measures in two points in time let the Authors to write main conclusion that insurance markets have been not so innovative in chosen countries. The level of innovations have been especially law in terms of insurance offer (Products). The first part of the paper ends with a short description of so called new risks that impose a level of innovations within an insurance sector. The second part contains a discussion about possibility of using learning curve concept for the process of insurance product innovation especially products “without claims history”.