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This thesis provides a comprehensive analysis of the determinants for the optimal choice of contract terms on a unique type of debt instrument: Eurobonds. A discussion of corporate finance theories that postulate the use of debt contract features for mitigating financing inefficiencies provides the foundation for the development of the empirical investigation. More specifically, theories that associate the choice of debt features namely, maturity, call options, convertible options, and protective covenants with firm's and market's characteristics are discussed in detail. Emphasis is also given to the theoretical predictions about the interdependencies established between the debt features that are viewed as alternative control devises for mitigating debt-contracting costs. Panel data and simultaneous-equations estimation methods are used to regress the relevant debt features on a set of proxies for firm characteristics, market conditions, and related contract features for a sample of 377 Eurobonds issued by UK companies over the period 1986-1999. The evidence from both panel data and simultaneous-equations analyses provide strong support to the prediction that both callable and short-term debt and convertible and debt with protective covenants are used as alternative control devises to mitigate agency costs. Further evidence suggests, however, that contrary to the fundamentals guiding the choice of maturity and callability structures, the use of convertible options and protective covenants in Eurobond contracts seems to be determined by equity agency costs rather than debt agency costs. Some support is also found for the risk uncertainty theory underlying the use of convertibles and for the liquidity risk arguments regarding the choice of protective covenants. No support is found for signalling and interest tax-shield hypotheses. Some proposals for further research on debt contract design are identified and discussed.

The determinants of economic growth have long been of interest, and have been empirically investigated in a number of recent studies. A common question in this area is: why have some countries achieved high rates of economic growth whilst the others remained at lower levels? Evidence from the literature indicates that some countries, particularly East Asian countries or small island states exploiting their own comparative advantage, achieve very rapid rate of growth and catch up with already well-off countries. Others, in particular those from Sub-Saharan Africa, have very little or no growth. This thesis empirically investigates the determinants of economic growth in Cyprus over the period 1960-1995 to evaluate whether the Cypriot economic growth during this period is better explained in an 'old' or 'new' growth modelling framework. Advanced multivariate time series techniques are applied to test the validity of models and to examine the relative importance of different variables which may have an impact on both the long-run and short-run growth of the Cypriot economy. The empirical findings show that physical capital investment, human capital and tourism investment are the major causes of growth in the Cypriot economy.

This thesis consists of three self-contained studies on technology and exporting of Indian firms in the post-liberalization era. In Chapter 1, we describe the background of Indian economic reforms, provide a general introduction and motivation, and give a brief outline of the thesis. Chapter 2 introduces the data, the variables used in the empirical estimations of the followed chapters, the sample selection steps, and presents some descriptive statistics. Chapter 3 studies regional and national productivity convergence among manufacturing firms in India, using a panel data over the period 1999 to 2010. We find that firms are converging to both their national and regional frontier, and they converge faster to their national frontier than to the regional frontier. We pay attention to the effects of globalisation on the speed of convergence, and find that both export and outward FDI facilitates firms’ productivity growth but slows down the convergence speed. Chapter 4 investigates the role of financing sources on the joint decision to invest in technology and to export, for both manufacturing and service firms in India. We find that firms with higher internal financing are more likely to engage in technology investment and exporting, and this pattern is consistent between manufacturing and service firms. The effects of external financing sources are not statistically significant for manufacturing firms, but show a significant and positive effect on service firms’ decision to undertake technology investments. We further investigate the impact of financial reforms in India for the manufacturing firms, and find a weak effect of the financial reforms in reducing the effects of internal sources on exporting. Chapter 5 summarises the main findings and implications of the thesis, and provides a short discussion of future research directions.

This dissertation consists of four chapters on the economics of technology. The chapters study different aspects of innovation generation and diffusion. In broad terms, chapter one looks at how innovation spreads by social contact, while chapter two looks at welfare consequences of diffusion. Chapter three examines how information sources affect diffusion, and chapter four looks at the relation of finance with innovation generation. The first chapter empirically investigates the dynamics of the marginal propensity to pirate for computer software. We introduce a state space formulation that allows us to estimate error structures and parameter significance, in contrast to previous work. For data from 1987-92, we find a rising propensity to pirate as the number of existing pirate copies increases, and higher late piracy incidence than implied by static models. We strengthen prior results on the impact of piracy in the spreadsheet market, finding it to be the only significant internal influence on diffusion. However, when we allow for negative error correlation between legal and pirate acquisitions, we contradict earlier work by finding that, in the word processor market, piracy did not contribute to diffusion and only eroded legal sales. The second chapter is a paper forthcoming in the European Journal of Operational Research. We present an information good pricing model with persistently heterogeneous consumers and a rising marginal propensity for them to pirate. The dynamic pricing problem faced by a legal seller is solved using a flexible numerical procedure with demand discretisation and sales tracking. Three offsetting pricing mechanisms occur: skimming, compressing price changes, and delaying product launch. A novel trade-off in piracy's effect on welfare is identified. We find that piracy quickens sales times and raises welfare in fixed size markets, and does the opposite in growing markets. In our model, consumers benefit from very high rates of piracy, legal sellers always dislike it, and pirate providers like moderate but not very high rates. In the third chapter, we study the effect of different information sources on technology adoption between and within companies. Our model of economically optimising companies predicts that initial adoption will be primarily affected by information that reduces uncertainty about a technology’s performance, while intensification of intra-firm use will be mainly influenced by information that increases income from the technology. The theory is tested on data describing adoption of organic farming techniques by UK farmers. Our predictions are broadly supported by the empirical results. Information from land agents, farmers, and newspapers mainly influences initial adoption, from academia and government largely influences intensification, and from crop consultants, suppliers, and buyers influences both. Financing innovation presents informational and control problems for the financier, and different solutions are used for funding of US companies and universities. In the fourth chapter, we examine how funding characteristics influenced the change in innovation during the 2007-8 financial crisis for both. We extend prior theories of external financing’s effect on company performance during crises, firstly to university performance, and secondly to show the influence of time variation in aggregate funding. Empirical results are consistent with our theory: external dependence and asset intangibility had a limited effect on company innovation on entering the crisis, but increased university innovation. We do not describe here the limitations and gaps of the studies, and proposals for future work. Instead, they are addressed in the conclusions of each chapter.

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Understanding how firms gain competitive advantage is perhaps the central question faced by strategy researchers (Rouse and Daellenbach, 1999; Powell, 2001). An examination of competitive advantage within the context of new markets presents an important and interesting dimension of this problem. It offers the opportunity to examine the potential for different types of entrant to establish competitive advantage. While competitive advantage in new markets has been addressed from a number of different theoretical perspectives, the suggestion here is that a resource-based conceptual lens can better explain the nature of the competitive challenge facing firms. A theoretical model of competitive advantage in new markets is developed, which highlights the importance of a firm's resource and capability endowments at the time of market entry, although it is argued that the main challenge faced by firms is the ability to adapt, where this refers to a firm's ability to develop the capabilities that are critical for success in new markets. Empirical research is carried out in respect of two UK-based on-line sectors, the Internet Service Provider sector and the online broking sector. The results of the survey research provide further evidence and support for the role of initial endowments of resources and capabilities at the time of new market entry, while the main findings of the case study research develop theory in respect of capability development in both new and established firms, suggesting that the process of capability development is itself an evolutionary one.

The thesis argues that as technology and the economy are closely related, one factor undermining Mexico's economic performance may be the lack of a coordinated technology and innovation policy. It examines the relationships between three main participants in the national system of innovation: government, firms and financial institutions. Indigenous technology development in Mexico has become a more relevant debate since the country evolved from a protected to an open economy. Therefore, the period of study starts with the background of the 1970s, while the core of the thesis covers the mid-1980s onwards. It is argued that the economic crises of this period justify the need for, and hence the assessment of, government participation. Among the different government policy tools, this work focuses on the financing of private firms' technology projects. Small and medium-size enterprises (SMEs) are the subgroup of firms analysed through both quantitative and qualitative methods. Empirical evidence was gathered mainly from primary sources, including documents, in-depth interviews and a national survey of SMEs that have sought support from government agencies for undertaking technology projects. Even if Mexico has the main elements that, by international standards, any national system of innovation should have, this research shows that the short-termism of the government policies to promote the development of technology clashes with the long-term nature of technology projects. The lack of effective coordination between participants within the system undermines the creation of national technology capabilities. Designers and users of technology promotion programmes are isolated from each other, and bridging institutions, like business chambers, are not bringing them closer overcoming divide. Small firms do not have internal resources for research and development (R&D) activities, and banks have been reluctant to fund technology projects. Therefore, this thesis makes the case for government intervention, while suggesting more suitable actions for change.

The objective of this dissertation is to contribute to the understanding of the interaction between ownership and efficiency when sequential decisions are taken by majority voting. The first chapter analyzes the influence of dynamic voting in the productive efficiency of a firm. Inefficiencies arise as a result of conflict in decision making concerning two decisions: technology choice and distribution of aggregate production. Two distinct constitutions are considered: employee and outside ownership. When the initial constitution turns out to be inefficient, the firm's owners can hand over control rights to efficient investors in exchange for a selling price. Constitutional change, by allowing current owners to internalize social surplus, would in principle increase efficiency. Yet constitutional change will never take place, giving rise to institutional inertia. The second chapter considers the effect of redistribution on efficiency in a the framework of a general cooperative where both the set of alternatives and the preference profile of voters is unrestricted. Efficiency is defined by a public decision, i.e. the implementation of a productive technology, as well as by a collection of individual investment decisions, i.e. employees' choice of effort. The first result provides conditions that, by restricting conflicts of interest in redistribution, ensure the existence of equilibrium in collective choice. It turns out that, provided that an equilibrium exists, the technology implemented in the firm is always Pareto efficient. This result holds even if it may lead to greater distortions in employees' choice of effort. The remaining analysis compares the direct effect of redistribution on efficiency via employees' individual investment with its indirect effect via distortions on technology choice. The last chapter investigates the effect of privatization on the efficiency of a public firm within the context of a representative democracy. Public decisions are implemented by a self-interested government selected by majority voting. Collective choice is embodied by the firm's regulation policy as well as by the tax shedule imposed on citizens. Provided privatization takes place, two polar ownership structures are analyzed: concentrated and dispersed ownership. The main result is that concentrated ownership, by favoring the participation of lobbies in the political game, may increase the efficiency of a regulated firm. This result is robust to both a hidden information model and a normal hazard approach.