Firm Performance, Political Influence and External Shocks
This article is devoted to the analysis of the existence of target capital structure of insurance companies and empirical testing of wide known capital structure theories for Russian insurance companies. Trade-of and “pecking order” theories were consider and the model that reflects the impact on the capital structure indicators various characteristics of firms was build. Traditional for insurance markets coefficients: net premium / capital ratio and liabilities / active ratio were consider as capital structure indicators. It was showed that trade-of theory is more adequate for Russian insurance market. It was discovered the existence of target capital structure. Such indicators as firm size, the share of premiums transferred to reinsurance, return on assets, return on capital has significant impact on the capital structure. The opportunity to grow, which was estimated as growth in premiums, and the breadth of the range didn’t has significant impact.
The aim of the research is to conduct an empirical investigation and reveal what types of globalization and innovation strategies in turbulent and unfavorable regional institutional environment are most likely to be associated with different trajectories of Russian manufacturing firms’ performance in 2007- 2012. We employ the results of empirical survey of 1000 medium and large enterprises in manufacturing (2009) linked to financial data from Amadeus database and the data on the regional institutional environment. We test that (1) introduction of innovations before the crisis ceteris paribus helped the firms to successfully pass the crisis and recover. We expect that (2) companies that became globalized before the crisis (via importing of intermediate and capital goods; exporting; FDI; establishment of partner linkages with foreign firms) ceteris paribus are more likely to successfully pass the crisis and grow. And (3) propose the positive effect of synergy of innovation efforts and globalization strategy of the firm. We expect that the abovementioned factors are complimentary and reinforce the ability of the firm to recover after crisis shock. We found strong support for the hypothesis that firms financing introduction of new products before the crisis and simultaneously managed to promote and sell them on the global market were rewarded by quick return to the growing path after global crisis. Other strategies, i.e. solely innovations without exporting play insignificant role while exporting without attempts to introduce new products contribute even negatively to post-crisis recover. Institutional environment also matters: in the regions with less level of corruption firms were more likely to grow after the crisis
At the present time the problem of managing the cost of capital in conditions of external economic shocks is particularly relevant. This occurs because of implementation in 2014 by Bank of Russia new requirements for the structure and capital adequacy of Russian banks in accordance with the Basel 3 capital standards. In this paper we investigate the dependence between the total capital value of the Russian Federation banking sector and the main macroeconomic indicators. Also we assessed the extent and speed of their impact on capital, based on the vector autoregression model.