Athanasios Romanopoulos (p), Theodore Metaxas

Anna Lundgren

The aim of the study is to identify the financial determinants of firm bankruptcy in the Greek hotel sector for the period of 2010-2020. Combining legal bankruptcy events and financial data from two credible databases, an imbalanced sample occurs with five and a half thousand hotels of which thirteen were declared bankrupt, belonging solely to the economic activity “hotels and similar accommodation” corresponding to NACE code 5510. The econometric method is a multi-period logistic regression with clustered robust standard errors, an approach widely used in finance, but with most applications examining aggregated rather than segregated sectors. With the assistance of a stepwise procedure for variable selection, the main results show that the likelihood of Greek hotel bankruptcy is an increasing function of leverage and size and a decreasing function of EBITDA to total liabilities. By extending the bankruptcy horizon by two years, leverage keeps its qualities, but statistical significance for liabilities coverage and size becomes intermittent. A comparison is done also with two related studies conducted in Greece but for earlier time periods, the one for the whole economy with the same methodology and the other for hotels with multiple discriminant analysis and the traditional set of Altman’s financial ratios. By loading the other studies’ variables into the multi-period logit, results differ in terms of relevance and statistical significance, as also the sign for size with the whole economy model, suggesting that updated industry-specific bankruptcy modeling is more appropriate. The implications of the study offer empirical early warning indicators of hotel default and can be informative for stakeholders involved in the sustainability of the sector.

Amit Batabyal (p), Seung Yoo

Vasiliki Charalampidou

We analyze interregional competition between two regions A and B that use taxes to attract a representative creative class member (the entrepreneur). This entrepreneur establishes a firm in either region A or B and this action guarantees her profit. However, if the entrepreneur locates in region A then she also obtains a stochastic, location-specific rent that is either high with positive probability or low with positive complementary probability. In this setting, we accomplish three tasks. First, given values of the two tax rates, we determine the payoff to the entrepreneur in the two regions for the two possible values of the location-specific rent in A. Second, we ascertain when the entrepreneur will locate in A for both values of the rent and when she will locate in B. Finally, we compute the tax rate that B will set and then specify a condition which ensures that the entrepreneur locates in B.

Luiz Fernando Viana (p), Valmir Emil Hoffmann, Hugo Pinto, Newton da Silva Miranda Jr.

Amit Batabyal

This paper examines innovation as a reaction to a shock in the process of regional economic resilience. A single case study that considered the impact of the COVID-19 pandemic was conducted with a footwear cluster in São João Batista, Santa Catarina, in the South Region of Brazil. After the data were collected through interviews with different regional actors, a thematic analysis was performed with categorical saturation. The findings show that workers, small industries, and outsourced firms providing manufacturing services were especially affected. In addition, the cost of rent shaped workforce emigration, which limited the region's economic recovery. The reaction included measures to absorb the shock, business expansion efforts, entrepreneurship, support for industries, and innovation, particularly process innovation. In terms of its implications, this paper supports the complementarity of innovations as an adjustment to a shock. It also suggests that the nature of the shock influences the relationship between types of innovation and regional economic resilience. Finally, this paper argues that innovation is a robust mechanism that drives resistance and economic recovery, opposing the theoretical segmentation between moments of absorption and creative response. These findings enhance our understanding of the effects and reactions to a pandemic shock in a traditional industry in an emerging economy.

Anna Lundgren (p)

Luiz Fernando Viana

Nordic freedom of movement and the possibility to work in another Nordic country was introduced already in the 1950s. However, despite similarities between the Scandinavian languages and resemblances between the countries as regards both culture and welfare systems, only 1.7% of the working-age population work in another Nordic country than the one where they were born (2020) (Lundgren & Wøien Meijer, 2022) This is low compared to 13-16% internal migration within Nordic countries (Heleniak, 2020). Also, cross-border commuting figures are low, with only 0.5% commuting to a job in another Nordic country which is below the EU average of 1% (2015-2018) (Lundgren & Wøien Meijer, 2022). This contrasts with the Nordic Council of Ministers’ vision that the Nordic Region will be the most integrated region in the world by 2030.
In a qualitative study based on interviews conducted in 2022 with stakeholders in three different Nordic case study regions; the metropolitan Greater Copenhagen region, Vestfold Telemark in Norway with proximity to both Sweden and Denmark, and the remote region of Greenland, we have explored the motivation for cross-border labour market mobility. What are the attraction forces? What are the driving forces? And what are the obstacles to cross-border labour market mobility? In line with previous research, the results show that several factors serve as attraction forces and driving forces, e.g. economic, social and cultural factors, while the most important intervening obstacles to cross-border labour market mobility are political/ administrative. In this paper, we present the main challenges for labour market mobility in the case study regions and discuss how policy responses to increasing labour market mobility can be developed in a cross-border and multi-level and polycentric governance context.