Proxy For Competition Research Articles

Competition with trees does not influence root characteristics of perennial grasses in semi-arid and arid savannas in South Africa

Savannas support mixed tree-grass communities and interactions between these are typically viewed as being competitive based on studies that focused on grass aboveground production. However, an important plant response to competition and resource limitation is an increase in root reserves. We investigated root characteristics of perennial grasses in the presence and absence of trees as a proxy of competition in South African savannas in three sites that differed in rainfall. We based our study on the hypothesis that competition from trees and water limitation will result in increased storage in roots of grasses under trees. Results indicate no significant effect of variation in rainfall of the different study locations on root characteristics of grasses. Furthermore, trees did not significantly influence most grass root characteristics that we measured. The only exception was nitrogen-content that showed an increase with rainfall and tree presence through potentially higher mineralization rates and nitrogen availability in the under-tree canopy environment. As the study sites are in the drier rainfall range in South Africa, it is likely that trees and grasses in these dry savannas may have a positive relationship conforming to the stress-gradient hypothesis. Alternatively, grasses and trees may be using complementary water and nutritional resources.

Bank competition, concentration and financial stability in the Turkish banking industry

This paper analyzes the impact of competition and concentration on bank stability in the Turkish banking industry over the period 2002–2012. The Boone indicator and the efficiency-adjusted Lerner index are used as proxies for competition, while the non-performing loans (NPL) ratio and Z-scores are used as proxies for bank stability. The main results indicate that competition is negatively related to the NPL ratio but positively related to the Z-score. The results further indicate that greater concentration has a positive impact on the NPL and a negative impact on the Z-score. We also use a quadratic term of the competition measures to capture a possible non-linear relationship between competition and stability. The results show that the coefficient of the quadratic term is negative for the NPL model and positive for the Z-score model. Overall, our findings provide support for the competition-fragility view.

Price competitiveness and government incentives for simulating the meetings industry

Purpose – The purpose of this paper is to examine the extent to which price competitiveness accounts for the observed precipitated decline in the number of meetings taking place in Macau from 2009 to 2012, in spite of the rapid growth in overall tourism, diversification in its tourism offering, and the sizable expansion of its capacity and facilities for hosting business tourism over the same period. Design/methodology/approach – Analyzing historical as well as comparative data in a cross-section analytic design, the study suggests an implied competitive price range (using comparative accommodation prices as a proxy) beyond which financial incentives may be ineffectual in attracting meetings Findings – Examination of price levels as a proxy of competitiveness in attracting meeting events in the single case of Macau proved inconclusive. Other factors beyond mere price competitiveness likely account for the declining number of meetings in Macau from 2009 to the end of 2012. Originality/value – Overall, the above findings pose a challenge for the continued general development of MICE industry in Macau and its meetings industry in particular. Despite the noble and generous efforts of its government agencies to arrest the decline in the number of meetings and maintain Macau’s position as a meetings industry hub through monetary incentives and subvention packages for organizers, it would benefit them and the private sector to explore channeling more resources toward addressing the fundamental and structural factors that can improve long-term competitiveness in attracting more meeting events.

Heterogeneous monetary transmission process in the Eurozone: Does banking competition matter?

This paper examines the implications of banking competition for the interest rate channel in the Eurozone over the period 2003–2010. We use an Error Correction Model (ECM) approach to measure the long-run and short-run relationships between money market rates, bank interest rates, and our competition proxy, namely, the Lerner index. We find that competition (i) reduces the bank lending interest rates, (ii) increases the long-term interest pass-through and (iii) speeds up the adjustment towards the long-run equilibrium in the short-run. Therefore, increased competition would improve the effectiveness of monetary policy transmission through the interest rate channel, and from this point of view should be fostered in the Eurozone. Finally even if we observe that other factors related to the recent crisis matter for monetary policy transmission, bank competition remains a key determinant of the pass-through.

Heterogeneous Monetary Transmission Process in the Eurozone: Does Banking Competition Matter?

This paper examines the implications of banking competition for the interest rate channel in the Eurozone over the period 2003-2010. We use an Error Correction Model (ECM) approach to measure the long-run and short-run relationships between money market rates, bank interest rates, and our competition proxy, namely, the Lerner index. We find that competition (i) reduces the bank lending interest rates, (ii) increases the long-term interest pass-through and (iii) speeds up the adjustment towards the long-run equilibrium in the short-run. Therefore, increased competition would improve the effectiveness of monetary policy transmission through the interest rate channel, and from this point of view should be fostered in the Eurozone. Because the 2007-2009 financial crisis has undoubtedly led to a modification of the monetary policy and an increase of the heterogeneity in the Eurozone, we control and extend our results by considering many other aspects than the market structures that can affect the interest rate pass-through. Even if we observe that other factors (economic heterogeneity, systemic risk, banking stability, and capitalization) matter for monetary policy transmission, bank competition remains a key determinant of the pass-through.

Nexus Between Concentration and Fragility Across EU Banking Systems

Abstract This study assesses the relationship between concentration and financial fragility in the EU banking systems between 2001 and 2009. We investigate if the idea of increasing competition in EU as a result of a single European market it fits with the issue of financial stability of the European financial system. We test the competition implications on financial stability during the crisis and pre-crisis period, too. We use as proxy for competition two structural indicators - Herfindahl-Hirschman Index (HHI) and the concentration rate of the top five largest banks (CR5). The banks’ financial stability is represented by Z-score. The model is estimated on a panel of 923 commercial banks from 27 countries members of European Union for the 2001–2009 periods. Because we work with a large number of cross-sections and a short times series, we will use Generalized Method of Moments (GMM) Dynamic Panel Data models. The results validate both views, depending on group of countries and pre-crisis /crisis period. In the case of CR5, all results are statistically relevant, less for the euro zone and, except for the new member states, increased concentration has a negative impact on financial stability, so it confirms the competition stability theory. The results for the Herfindahl-Hirschman Index (HHI) are statistically relevant only for the countries outside the euro zone and the new members and it is validated the competition-fragility vision: the greater the concentration in the system, measured by the HHI index (i.e. less competition), the higher the Z-score indicator, therefore the bank financial stability increases.

Association between market concentration of hospitals and patient health gain following hip replacement surgery.

ObjectivesTo assess the association between market concentration of hospitals (as a proxy for competition) and patient-reported health gains after elective primary hip replacement surgery.MethodsPatient Reported Outcome Measures data linked to NHS Hospital Episode Statistics in England in 2011/12 were used to analyse the association between market concentration of hospitals measured by the Herfindahl-Hirschman Index (HHI) and health gains for 337 hospitals.ResultsThe association between market concentration and patient gain in health status measured by the change in Oxford Hip Score (OHS) after primary hip replacement surgery was not statistically significant at the 5% level both for the average patient and for those with more than average severity of hip disease (OHS worse than average). For 12,583 (49.1%) patients with an OHS before hip replacement surgery better than the mean, a one standard deviation increase in the HHI, equivalent to a reduction of about one hospital in the local market, was associated with a 0.104 decrease in patients’ self-reported improvement in OHS after surgery, but this was not statistically significant at the 5% level.ConclusionsHospital market concentration (as a proxy for competition) appears to have no significant influence (at the 5% level) on the outcome of elective primary hip replacement. The generalizability of this finding needs to be investigated.

Competition, corporate governance, ownership structure and risk reporting

Purpose – This study aims to measure the extent of mandatory and voluntary risk reporting and investigate the impact of competition, corporate governance and ownership structure on risk reporting practices in annual reports of Egyptian companies. Design/methodology/approach – A number of theoretical perspectives including proprietary cost, agency theory, stakeholder theory, political cost, signalling theory and legitimacy theory are used to derive research hypotheses and identify the potential determinants of risk reporting practices in the annual reports of Egyptian companies. The annual reports of 105 listed companies for 2007 were examined to measure the extent of risk reporting and examine potential determinants of risk reporting. An unweighted disclosure index, based on Egyptian Accounting Standards (EAS) 25, has been used to measure the level of mandatory risk reporting while content analysis – sentence approach – is used in coding voluntary risk reporting. Multiple regression analysis is used in evaluating the relationships between competition, corporate governance, ownership structure and risk reporting. Findings – The results indicate a low level of compliance with mandatory risk reporting requirements. A low extent of voluntary risk reporting with a tendency to report more backward-looking and qualitative risk disclosure compared to forward-looking and quantitative risk disclosure is indicated. Agency theory and proprietary cost provide explanations for the variation of risk reporting in corporate annual reports. It is suggested that competition, role duality, board size, ownership concentration and auditor type are key determinants of risk reporting practices in Egypt. Research limitations/implications – The scoring and classification process suffers from inherent judgment limitations and subjectivity, which cannot be entirely eradicated. The study applies a cross-sectional approach and examines risk reporting practice and its determinants at one point in time. However, longitudinal research may provide a better understanding of risk reporting practices of Egyptian companies. The use of only one proxy of competition is one of the limitations of this study. Practical implications – The findings regarding mandatory disclosure level and nature of voluntary risk disclosure should be on concern to regulatory authorities and standard-setters. Originality/value – The study aims to contribute to risk reporting research through addressing not only mandatory but also voluntary risk reporting in emerging economies in general and Egypt in particular. In addition, examining the impact of competition on risk reporting is a main contribution of this study.

Mobilizing ethnic competition

Ethnic competition theory provides a powerful explanation for ethnic conflict, by demonstrating how variation in ethnic mobilization relates to intergroup struggles over scarce resources. However, the tendency to capture such relationships at the aggregate level, through macro-level proxies of intergroup competition, offers little insight into the processes through which ethnic grievances mobilize into contentious action. This article integrates insights from the social movements literature to address how competitive contexts crystallize into broader conflicts. Drawing on data from the civil rights-era Ku Klux Klan—perhaps the quintessential case of contentious ethnic organization in the United States—the analysis focuses on the ways in which meso-level arrangements mediate the relationship between overarching competitive contexts and ethnic conflict. Results of a paired comparative analysis of KKK mobilization in Greensboro and Charlotte demonstrate that social and spatial relations within each city shaped the contours of perceived competition and subsequent ethnic organization in ways that were not always predictable through observation of conventional proxies of competition.

Competitiveness of Indonesian Small and Medium Food Processing Industry: Does the Location Matter?

In this paper, we compare the competitiveness between clustered and dispersed Small Medium Enterprises(SMEs) in Indonesian food processing industry. This study was driven by the important role of SMEs inIndonesian food processing industry for helping low income people access the low price foods. Furthermore, asIndonesian Government implements policy that support clustered SMEs, it could be expected that SMEs in thecluster area could pursue and emphasize different performance than their non clustered counterparts. Primarydata was collected in West Java, Indonesia. The sample includes only companies with fewer than 100 employeesand those operate in the food processing industry. We put market orientation, innovation, and businessperformance as proxy of competitiveness. Mean comparison statistics was used to compare market orientation,innovation and business performance of clustered and dispersed SMEs. The main findings were found throughdata analysis notably there was significant difference between clustered and non clustered SMEs in marketorientation, innovation and business performance.

Investor Competition over Information and the Pricing of Information Asymmetry

ABSTRACTWhether the information environment affects the cost of capital is a fundamental question in accounting and finance research. Relying on theories about competition between informed investors as well as the pricing of information asymmetry, we hypothesize a cross-sectional variation in the pricing of information asymmetry that is conditional on competition. We develop and validate empirical proxies for competition using the number and concentration of institutional investor ownership. Using these proxies, we find a lower pricing of information asymmetry when there is more competition. Overall, our results suggest that competition between informed investors has an important effect on how the information environment affects the cost of capital.JEL Classifications: G12; G14.

Investor Competition Over Information and the Pricing of Information Asymmetry

Whether the information environment affects the cost of capital is a fundamental question in accounting and finance research. Relying on theories about competition between informed investors as well as the pricing of information asymmetry, we hypothesize a cross-sectional variation in the pricing of information asymmetry that is conditional on competition. We develop and validate empirical proxies for competition using the number and concentration of institutional investor ownership. Using these proxies, we find a lower pricing of information asymmetry when there is more competition. Overall, our results suggest that competition between informed investors has an important effect on how the information environment affects the cost of capital.

Calibrating the liana crown occupancy index in Amazonian forests

Lianas hold an important, but understudied, role in forest dynamics, however they are difficult to measure and detailed liana measurements are time consuming. Many researchers have therefore used an ordinal scale index, the crown occupancy index (COI), to describe the liana load carried by trees. Here we assess the overall effectiveness, in terms of accuracy, precision, repeatability and efficiency, of the COI in tropical forests. We relate the COI to more detailed liana measurements at the individual tree-level and site-level, comparing sites with different levels of liana infestation. Our results show (1) that the COI accurately measures individual tree and plot level liana loads, indicated by the strong correlations between the COI and the number and basal area of lianas. However, (2) as expected, the COI is only weakly related to the basal area of lianas rooted close to the tree, which is a proxy for competition for below-ground resources. The COI is also (3) an efficient measure of liana loads, as the input time needed for a COI survey is considerably less than that of a detailed liana survey. We also (4) found a high degree of repeatability in COI classification between observers. Additionally (5), the COI can be used to differentiate between sites in terms of their overall liana canopy competition (precision), but (6) may not be a precise indicator of the site-level mean basal area of lianas in tree crowns.

Discussion of “The impact of product market competition on the quantity and quality of voluntary disclosures”

Li (2010, this issue) examines how product market competition affects voluntary disclosure by firms. Using several competition proxies, she finds that both the competitive threat from potential entrants into an industry and from existing rivals affect the quantity and accuracy of voluntary profit and investment forecasts by firms in that industry. However, the study’s findings are inconclusive mainly because each competition proxy used can reflect both types of competitive threat. The focus of my discussion is to provide some comments and suggestions for future researchers to consider in examining how the nature of product market competition affects voluntary firm disclosure.

Competition and Firm Productivity: Evidence From Firm-Level Data

This paper presents empirical evidence on the impact of competition on firm productivity. Using firm-level observations from the World Bank Enterprise Survey database, we find a positive and robust causal relationship between our proxies for competition and our measures of productivity. We also find that countries that implemented product-market reforms had a more pronounced increase in competition, and correspondingly, in productivity: the contribution to productivity growth due to competition spurred by product-market reforms is around 12-15 percent.

Competition and Firm Productivity: Evidence from Firm-Level Data

This paper presents empirical evidence on the impact of competition on firm productivity. Using firm-level observations from the World Bank Enterprise Survey database, we find a positive and robust causal relationship between our proxies for competition and our measures of productivity. We also find that countries that implemented product-market reforms had a more pronounced increase in competition, and correspondingly, in productivity: the contribution to productivity growth due to competition spurred by product-market reforms is around 12-15 percent.

Are Competitive Banking Systems More Stable?

Using the Panzar and Rosse H‐statistic as a measure of competition in 45 countries, we find that more competitive banking systems are less prone to experience a systemic crisis and exhibit increased time to crisis. This result holds even when we control for banking system concentration, which is associated with higher probability of a crisis and shorter time to crisis. Our results indicate that competition and concentration capture different characteristics of banking systems, meaning that concentration is an inappropriate proxy for competition. The findings suggest that policies promoting competition among banks, if well executed, have the potential to improve systemic stability.

Bank Market Power and SME Financing Constraints*

Theoretical models of lending and industrial organization theory predict that firm access to credit depends critically on bank market structure. However, empirical studies offer mixed results. Some studies find that higher concentration is associated with higher credit availability consistent with the information hypothesis that less competitive banks have more incentive to invest in soft information. Other empirical studies, however, find support for the market power hypothesis that credit rationing is higher in less competitive bank markets. This study tests these two competing hypotheses by employing for the first time a competition indicator from the Industrial Organization literature – the Lerner index – as an alternative to traditional measures of concentration. We test the information and the market power hypotheses using alternative measures and firm borrowing constraints. We find that the results are sensitive to the choice between IO margins and traditional concentration measures. In particular, the HHI seems to support the information hypothesis while the Lerner index supports the market power hypothesis. The Lerner index, however, is found to be a more consistent indicator of market power across different measures of financing constraints. Moreover, the Lerner index is found to exhibit the larger marginal effect on the probability that a firm is financially constrained among a large set of firm level, bank market and environmental control variables. Our results are robust to alternative measures of financial constraints and cast doubt on the validity of relying on concentration measures as proxies of competition in corporate lending relationships (247 words).

Horizontal innovation-based growth and product market competition

The influence of the intensity of competition in the product market on economic growth is analyzed by developing an endogenous growth model with horizontal innovation. Product market competition is measured by (1 − Lerner index) and depends on both the share of factor inputs in total income and the degree of substitutability across goods. We find that the shape of the relationship between competition and growth can change dramatically according to which proxy of competition is used. We explain our results in terms of the interplay between the resource allocation and the profit incentive effects.

The Role of Competition in the Rise of Baroque and Renaissance Music

Section 1 introduces the hypothesis that competition among neighboring states may favor cultural innovation, and it surveys the available quantitative evidence. Section 2 starts from the assumption that European instrumental music had its breakthrough during the Baroque era and that the most famous composers came from the two countries characterized by the highest degree of political fragmentation: Italy and Germany. It suggests that political fragmentation has promoted musical composition and performance in several ways. The average duration of employment is proposed as a proxy for competition on the demand side. Section 3 shows that the most famous Italian and German composers of the Baroque period changed their employers significantly more often than their French and British counterparts did. Moreover, the Reformation led to musical competition between the Catholic and Protestant churches. Section 4 argues that competition for composers has also been important in other periods of European history – including competition between the Church and the courts. It shows that composers moved no less in the Renaissance than in the Baroque. Section 5 raises the question whether European music may also be said to express a competitive spirit.