We explain a counterintuitive empirical finding: Firms facing more import competition do more innovation. In our model, factors are trapped inside a firm. An increase in import competition encourages a firm to innovate by reducing the opportunity cost of inputs. Without trapped factors, trade...

In this paper the relation between ownership structure, board composition and firm performance is explored. A panel of Swedish listed firms is used to investigate how board composition affects firm performance. Board heterogeneity is measured as board size, age and gender diversity. The results...

In this paper we analyze whether a firm’s return to its R&D stock is affected by seller-buyer interactions. We suggest that firms that are in close contact with their customers will be relatively more sensitive to their customers’ needs, and therefore adjust their R&D activities accordingly....

This paper studies corporate risk management in a context with financial constraints and imperfect competition on the product market. We show that the interactions between firms heavily affect their hedging demand. As a general rule, the firms’ hedging demand decreases with the correlation...

In the psychology literature, “choking under pressure” refers to a behavioural response to an increase in the stakes. In a natural experiment, we study the gender difference in performance resulting from changes in stakes. We use detailed information on the performance of high-school...

The goal of the present paper is to investigate not only the dynamics of the Greek public debt, but also what are the appropriate measures required for achieving fiscal consolidation. The empirical estimation is carried out using a macroeconomic dataset spanning the period 1980-2008 and both the...