McDonald’s India: Pains of Partnering with a Delinquent Partner

McDonald’s India is a real-life, undisguised decision case. This US-based fast food multinational corporation set shop in India in early 1990s to gain early mover advantage in a country with a huge population. It struck joint ventures with two domestic Master Franchisee to grow its business. The company made efforts to localize its menu and customize its offerings to suit domestic customers. With the passage of time competition intensified and so did customer expectations. Of the two Master Franchisees, while Westlife Development Ltd. maintained cordial relations with McDonald’s, the chief executive officer of Connaught Plaza Restaurants Ltd. Vikram Bakshi became an impediment in its business plans. Differences between McDonald’s and Bakshi reached a flash point and the matter landed in the courts in India and London. Even after several years of litigation no clear winner emerged. As a consequence, while operations of Westlife Development flourished, the business of Connaught Plaza Restaurants remained stunted. While the two partners in the joint venture clashed, competitors took advantage of the situation to capture emerging opportunities. Even after over two decades of operations in the country, McDonald’s is not making profits. On the contrary it has accumulated losses of ₹4.22 billion by the end of 2018. The challenge facing McDonald’s is how to find a quick solution to the long-drawn problem and thereby accelerate the pace of growth of its business in one of the fastest growing economies in the world.

Valuation discrepancies in money market funds during market disruptions: evidence from Egypt

Money market funds (MMFs) are generally considered safe investment vehicles, but the 2008 global financial crisis showed their vulnerability during market disruptions resulting in increased regulatory oversight across developed markets to protect investors. This paper examines the effect of MMF accounting regulation on investors in an emerging market context. It hypothesizes that the continued use of amortized cost methods to account for MMFs’ Net Asset Value (NAV) during market disruptions can result in unfair treatment of investors. The Egyptian money market provided a unique laboratory to test this hypothesis over a prominent economic crisis that combined high levels of interest rate volatility with a redemption-only structure for MMFs. A model that measures the discrepancies between the amortized and floating market NAVs per certificate for various money market portfolios (MMPs) simulating MMFs of different durations is tested using the Egyptian data. A sharp rise in interest rates is found to lead to significant discrepancies between the amortized NAV per certificate relative to their floating value. Serial investor redemptions of the certificates compound the discrepancies, but only certificate holders remaining in the funds bear the accumulated losses, which are augmented for portfolios with higher durations. The results suggest that emerging market regulators consider introducing the rules that switch to floating NAV calculations for MMFs during such periods to promote equality across all investors.

Ethics of Finitude: Nursing and the Palliative Approach in Geriatric and Forensic Psychiatry

There is a called-for shift to an upstream provision of palliative care as an overall care approach within a health equity perspective. Our research explored how nurses in psychiatry engage with aging patients and mortality to discern enactment of ethical dimensions of care. Drawing from tenets of interpretative phenomenological analysis, forensic and geriatric psychiatry registered nurses working at a mental health facility in eastern Ontario completed interviews for analysis. Nurses engaged with mortality through a process of recognition and through the affirmation of their values. The affirmed values are aligned with the palliative care approach and within an ethics of finitude lens in that their enactment is partly premised on the recognition of patients’ accumulated losses related to human facticities (social, temporal, mortal). This research underscores preliminary insights on a process identifying care practices aligned with the palliative approach and possibilities for expanding upon an ethics of finitude lens.

TAX ON THE WITHDRAWAL OF CAPITAL AS A MECHANISM TO INCREASE THE CAPITALIZATION LEVEL OF ENTERPRISES

Topicality. Increasing the level of capitalization of the economy is of strategic importance for Ukraine, since market transformation in Ukraine is inherently capitalization of the economy. All this necessitates further investigation of the mechanisms of capitalization of enterprises, including tax mechanisms.Aim and tasks. Analyze tax on the withdrawal of capital and experience of its use in Estonia, identify its benefits and potential risks, propose improvements to its legislative support.Research results. The corporate income tax system is designed in such a way that dividends can be paid even if no profit is received. In the future, these dividends derived from one of the schemes are deposited on offshore accounts. According to conservative estimates of experts of the Institute for Social and Economic Transformation, the losses of the budget of Ukraine from offshore schemes amount to UAH 50-65 billion a year. The chances of tax evasion are great. Large Ukrainian companies, with the help of auditors, can reduce their tax burden from 18% to 3-4%. The main disadvantages of the income tax collection system are the discretion of the administration (the decision-making power of the officials at its discretion) and corruption. Many experts and businessmen see the solution to this problem by replacing the income tax with tax on the withdrawal of capital. This will ensure that business profits are not taxed as long as they are not paid out to the owners in the form of dividends and equivalent payments, that is, they are not taken out of business. Estimates of the negative short-term impact on budget revenues differ. The most optimistic estimates range from 0.5% to 1.2-1.3% of GDP. It is likely that the use of capital deduction will lead to a decrease in tax revenues, but such a sharp fall as the situation in Estonia in Ukraine is not likely to be, since the new tax will be paid by "loss-making" enterprises, and the operations used today for tax evasion will be taxed. Estimates of the negative short-term impact on budget revenues differ. The most optimistic estimates range from 0.5% to 1.2-1.3% of GDP. It is likely that the use of tax on the withdrawal of capital will lead to a decrease in tax revenues, but such a sharp fall as the situation in Estonia in Ukraine is not likely to be, since the new tax will be paid by "loss-making" enterprises, and the operations used today for tax evasion will be taxed.Analysis of the draft Law of Ukraine on tax on the withdrawal of capital allows to determine a number of proposals for its improvement in the part of enterprises that have accumulated losses in the amount exceeding their own capital or in the amount of UAH 100 million; exemption from tax on interest on the deposit, if they remain on it; defining the norms of the shortage that the enterprise can attribute to the property provided free of charge; deviation of the contractual value of the taxpayer's property upwards or downwards from ordinary prices; the unification of the tax rate on the withdrawal of capital with the tax rate on personal income.Conclusion. Tax on the withdrawal of capital forms a self-regulating economic system, that is, if dividends are not paid and invested in the development of an enterprise, then production increases, which in turn leads to an increase in value added tax and wage tax. The introduction of this tax will provide a number of positive consequences: growth of business activity, acceleration of modernization of enterprises, redistribution of the tax burden on all taxpayers, reduction of the tax burden; simplification of control and simplification of tax accounting, reduction of methods of tax minimization, shadowing of the economy.

“After End-2008 Structural Changes in Containership Market” and Their Impact on Industry’s Policy

The inability of carriers to forecast “demand for containerships” led them to order larger ships. Maritime economists were also unable to forecast it. The new-buildings cut cost per TEU, but “estimated economies of scale” are exhausted with ships beyond 21,000 TEUs, higher than the present. As average cost-AC was not at minimum, carriers did not produce at minimum efficient scale (MES). As larger ships are more competitive, smaller ships led to laid-up, and eventually scrapped. This strategy, however, did not bring the desirable balance between demand and supply. Due to falling demand, following the meltdown at the end of 2008, carriers priced their services at marginal cost-MC, and thus they accumulated losses. As a result, carriers resorted to frequent GRIs (freight rate increases). Supply exceeded demand and average distances fell after 2008. Containership market will remain depressed if economies of scale lead carriers to shipyards. Scrapping—the last hope—removed only 1/7 of the oversupply. Revenue, operating profits, and net profits, due to increased financial expenses, were lower than in the past. Aggressive ship-building programs could not be carried-out, because the depression meant that there are available only limited funds. The estimated funds required for new buildings were as high as $4 billion per carrier. So, the sector is in a vicious circle. The only helpful sign was the reduction in fuel prices after 2011 from $800/ton to $278 (2015). We also showed that ports and canals, through their traditional charging policy on size, penalized containerships for their efficiency—if volume discounts are not provided. Port dues and container handling and canal dues account for as much as 40% of the annualized containership cost. Finally, to study the relationship between concentration (market share) and revenue, operating profit and net profit, we ran three regressions; but only one gave a high correlation coefficient (0.97). This suggests that the containership market is purely competitive. We also showed that the Herfindahl index was 683 units (i.e., <1000) and Lerner’s index was 0.55—both indicating oligopolistic trends. Our model shows that containership market is either oligopolistic or purely competitive. This finding shows the double face of containership markets, which so much confused maritime economists.

Arrayed Waveguide Grating and Re-Circulating Buffer Based Optical Packet Switch

Optical packet switching has gained popularity in past decade. However, due to technical challenges all- optical switching is not implemented till date, still hybrid switching where both optical and electrical switching are used simultaneously by-passing the limitations of both the technologies. In fiber delay lines (FDLs) buffering is limited due to accumulated losses and noises, and most of the times short term storage is enough in optical switching, but in case of long term storage, re-circulating type buffer can be used, but again due to accumulation of degrading terms re-circulation count is limited therefore in case of longer duration storage, electronic buffer is better choice. In this paper, we have proposed a hybrid buffer based optical switch where both optical and electronic buffers are used for storage of contending packets, and optical buffer is re-circulating in nature. The performance of the switch is measured in terms of bit error rate (BER) and packet loss probability, and BER performance is compared with recently proposed design, and it has been found that the proposed switch is comparatively much superior to earlier one.

Post Amalgamation Prospects of Regional Rural Banks (RRBs) in Odisha: Policies and Practices

Regional Rural banks (RRBs) have been players in the regional and rural banking field since 1970s, continuously mobilising small savings from and disbursing credit to primary livelihoods. Despite certain key advantages with regard to portfolio of deposits, RRBs have lagged behind vis-à-vis their potential. A legacy of accumulated losses, a ballooning quantum of NPAs, rising incidence of frauds and adverse HR environment continue to be a drag on their prospects. A holistic reform which addresses all these concerns along with infusing a vibrant work culture in RRBs is the need of the hour.

Performance of Regional Rural Banks in Indian Economy: An Overview

Regional Rural Banks (RRBs) also known as ‘Gramin’ bank have emerged as an important rural credit delivery institution in India for meeting the credit requirements of the rural poor. These rural banks have been working for more than four decades in the Indian rural credit delivery system. They are state sponsored, regionally based and rural oriented commercial banks. The basic objective of this study is to analyse the growth and financial performance of RRBs in India from the period 2013 to 2016 based on some selected parameters like area coverage, profit and loss making RRBs, trends of profits and accumulated losses, overall position of non-performance assets and recovery rate. We have mainly used secondary data collected from various journals, books and available websites related to regional rural banks. The review of performance of RRBs shows the good growth performance of RRBs for providing better banking services to the rural people. From the analysis, we can draw the conclusion that rapid expansion of RRBs has been able to substantially reduce the regional disparities in respect of banking facilities in India.