scholarly journals Companies under stress: the impact of shocks on the production network

2021 ◽  
Vol 10 (1) ◽  
Author(s):  
Róbert Pálovics ◽  
Primož Dolenc ◽  
Jure Leskovec
Keyword(s):  
Financial Crisis ◽  
Performance Indicators ◽  
Matched Pairs ◽  
Production Network ◽  
Production Networks ◽  
The Future ◽  
Trading Partners ◽  
Financial Crisis Of 2008 ◽  
The Impact ◽  
Different Levels

AbstractIn this paper we analyze the effect of shocks in production networks. Our work is based on a rich dataset that contains information about companies from Slovenia right after the financial crisis of 2008. The processed data spans for 8 years and covers the transaction history as well as performance indicators and various metadata of the companies. We define sales shocks at different levels, and identify companies impacted by them. Next we investigate stress, the potential immediate upstream and downstream impact of a shock within the production network. We base our main findings on a matched pairs analysis of stressed companies. We find that both shock and stress are associated with reporting bankruptcy in the future and that stress foremost impacts the future sales of customers. Furthermore, we find evidence that stress not only results in performance losses but the reconfiguration of the production network as well. We show that stressed companies actively seek for new trading partners, and that these new links often share the industry of the shocked company. These results suggest that both stressed customers and suppliers react quickly to stress and adjust their trading relationships.

scholarly journals The impact of the financial crisis on earnings management: Empirical evidence from Italian and Spanish listed companies

2019 ◽  
Vol 16 (2) ◽  
pp. 121-130 ◽  
Author(s):  
Francesco De Luca ◽  
Francesco Paolone
Keyword(s):  
Financial Crisis ◽  
Financial Markets ◽  
Performance Indicators ◽  
Listed Companies ◽  
Publicly Traded ◽  
Publicly Traded Companies ◽  
Time Period ◽  
Security Offerings ◽  
The Impact ◽  
Giving Bad News

Our study adopts a reliable and widely acknowledged model to detect accounts manipulation in order to assess the impact of the financial crisis on Italian and Spanish listed companies’ propensity to manage their earnings. The analysis is conducted on 565 publicly traded companies on the Italian and Spanish financial markets during the time period 2005-2013. We find a lower propensity to manipulate earnings in both countries during the pre-crisis period (2005-2008) as suggested by a decrease in the number of high-risk manipulators until 2008 included. With the spread of the financial crisis, companies become more manipulators. We believe that the reason for this is to avoid giving bad news to markets, investors, and lenders after that the crisis may have impacted too negatively on firms’ performance indicators and financial equilibrium. Our empirical results provide various implications for further studies related to managements’ incentives concurrently with security offerings.

The Impact of the Asian Financial Crisis on Foreign Workers in Taiwan

1998 ◽  
Vol 7 (2-3) ◽  
pp. 145-169 ◽  
Author(s):  
Joseph S. Lee
Keyword(s):  
Labor Market ◽  
Financial Crisis ◽  
Economic Crisis ◽  
Construction Projects ◽  
Economic Structure ◽  
Asian Financial Crisis ◽  
Foreign Workers ◽  
Skilled Workers ◽  
The Future ◽  
The Impact

Having experienced an economic crisis earlier, Taiwan was on its way to recovery when the crisis struck in 1997. In general, Taiwan's labor market was hardly affected by the crisis. Although the demand for foreign workers continues, there will be a decline in the employment of foreign workers in the future. The completion of construction projects and the upgrading of the economic structure would imply a lesser demand for foreign workers in the next few years. In the future, while the Taiwanese labor market would be more restrictive of less-skilled workers, it would be more open to professionals and highly skilled.

Bailing out the Wealthy: Responses to the Financial Crisis, Ponzi Neoliberalism, and the City

2010 ◽  
Vol 3 (3) ◽  
pp. 54-84 ◽  
Author(s):  
Alan Walks
Keyword(s):  
Public Policy ◽  
Financial Crisis ◽  
Global Financial Crisis ◽  
Financial Economic ◽  
Nation States ◽  
The Future ◽  
The Global Financial Crisis ◽  
Developed World ◽  
The Impact ◽  
The City

This article seeks to critically examine public policy response to the global financial crisis in the core of the developed world, and to understand the likely implications of this set of policy responses for the future trajectory of urban social crises. Instead of dealing with the internal contradictions of the financial-economic system that characterizes recent capitalism, and that produced the global financial crisis, the governments of the wealthiest countries are actively attempting to ‘solve’ the problem by re-installing a form of capitalism that I refer to as ‘ponzi neoliberalism’. The increasing dominance of ponzi dynamics in this system means it is inherently contradictory, inequitable, wealth-destroying in the aggregate, and unsustainable – I stress in particular the implications for the future form and trajectory of urban social inequality. In this article, I trace the roots of the global financial crisis and outline the parameters of ponzi neoliberalism. I then discuss how nation states are using public policy to resuscitate this system, and in doing so, are reproducing highly contradictory and unsustainable, but self-reinforcing, dynamics (doom-looping) that imperil future social and economic sustainability. I then consider the impact on the geography of the city, and argue that this strategy risks deepening urban social crisis. The longer that ponzi neoliberalism is allowed to continue, the deeper and more problematic will be the crisis, and the more limited will be the state capacity to respond to its contradictions.

Exchange rate volatility and exports: a panel data analysis

2016 ◽  
Vol 43 (2) ◽  
pp. 203-221 ◽  
Author(s):  
Flavio Vilela Vieira ◽  
Ronald MacDonald
Keyword(s):  
Exchange Rate ◽  
Financial Crisis ◽  
Emerging Economies ◽  
Exchange Rate Volatility ◽  
Content Type ◽  
International Financial Crisis ◽  
Export Volume ◽  
Oil Export ◽  
Financial Crisis Of 2008 ◽  
The Impact

Purpose – The purpose of this paper is to empirically investigate the role of real effective exchange rate (REER) volatility on export volume and also to address the impact of the international financial crisis of 2008. Design/methodology/approach – The empirical methodology is based on System GMM estimation for a set of 106 countries for the period of 2000-2011. Findings – For the complete sample of countries and for a set of developing/emerging economies, there is evidence that an increase (decrease) in REER volatility reduces (increases) export volume. The results are not robust once the oil export countries are removed from the sample. The estimated coefficients for the financial crisis dummy are positive and statistically significant, indicating that export volume were 0.14 percent higher after the financial crisis of 2008 compared to the previous period (2000-2007). There is also evidence that the export volume is price (REER) and income (trade weighted) inelastic. Research limitations/implications – The empirical results are valid for the complete set of countries and for developing and emerging economies when including the oil export countries, suggesting that countries should reduce exchange rate volatility in order to foster their export volume and that oil export countries have an important role on these results. Practical implications – The paper suggests that policymakers should adopt different policies to minimize exchange rate volatility if they seek to increase export volume. The international financial crisis had a significant impact on export volume in all estimated models regardless of the set of countries used. Originality/value – One of the main novelties of this work is that it deals with possible endogeneity using GMM estimators and addresses the issue of instrument proliferation, which is not a common feature of previous empirical studies on exchange rate volatility and trade flows. Another original aspect of the research is the construction of trade weighted variables for foreign income and REER based on the major 20 export partners for each country used in the panel data estimation. The work also incorporates the years following the international financial crisis of 2008, which is an additional empirical novelty, in order to address the impact of the international financial crisis on the export volume.

The revenue persistence of US accounting firms: impacts of SOX and financial crisis

2019 ◽  
Vol 31 (3) ◽  
pp. 523-548
Author(s):  
KiKyung Song ◽  
Eunyoung Whang
Keyword(s):  
Financial Crisis ◽  
Design Methodology ◽  
Market Conditions ◽  
Accounting Firms ◽  
Content Type ◽  
Advisory Services ◽  
Sarbanes Oxley ◽  
Financial Crisis Of 2008 ◽  
The Impact ◽  
Management Advisory

Purpose Typical accounting firms offer three types of accounting services to their clients: accounting and auditing (AA), tax (TAX) and management advisory services (MAS). Each accounting service has a different revenue persistence. Moreover, revenue persistence is affected by exogenous events such as new regulations (e.g. Sarbanes-Oxley Act [SOX] in 2002) and market conditions (e.g. the financial crisis of 2008). This paper aims to examine the revenue persistence of accounting services and how it is affected by SOX and the financial crisis. Design/methodology/approach Using 742 firm-year observations from 100 of the largest US accounting firms from 1999 to 2015, this paper examines whether revenue from AA, TAX and MAS has different degrees of persistence and how SOX and the financial crisis in 2008 change the revenue persistence of each accounting service. Findings This paper finds that MAS generates more persistent revenue than AA and TAX. SOX enhances the revenue persistence of MAS. The financial crisis makes revenue from AA less persistent than during the pre-financial crisis period. Originality/value This paper contributes to the understanding of the revenue persistence of accounting services and the impact of exogenous events such as SOX and the financial crisis of 2008.

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