David Wyman

Low-wealth entrepreneurs and access to external financing

Purpose – The purpose of this paper is to explore the relationship between low-wealth business founders in the USA and external startup funding. Specifically, the authors test whether a founders’ low personal net worth is correlated with a lower probability of acquiring funding from outside sources during the business creation process. Design/methodology/approach – The authors use a double-hurdle Cragg model to jointly estimate: first, the decision to acquire external financing; and second, the amount received. The sample is the US-based Panel Study of Entrepreneurial Dynamics II (PSED II). The PSED II tracks business founders attempting to start ventures from 2005 to 2012. Findings – Receipt of outside financing during business formation is largely determined by the business founder’s personal finances (controlling for human capital, venture type and industry, and whether money was sought in the first place). A higher household net worth results in larger amounts of external funding received. Low-wealth ...

Collapse: the decline and fall of master planned golf course communities

Purpose The purpose of this paper is to examine the pricing of vacant lots in master planned golf course communities (GCCs) over the period of 2000-2016. The authors compare the longitudinal pricing behavior of different lot types during this economic cycle and examine the causes of the property bubble and subsequent deterioration of the business model with the arrival of the Financial Economic Crisis (FEC). Design/methodology/approach The authors construct spatial hedonic models for three master planned GCCs in Pickens County, South Carolina and use interaction dummies to examine the pricing of different types of vacant lots before and after the FEC. Findings The authors find that there is a collapse in value for interior lots in the GCCs compared to interior lots in the county. As interior lots comprise over 50 percent of inventory in a typical master planned GCC, this loss of real estate value threatens the viability of such communities in the aftermath of the FEC. Practical implications The research results inform real estate investors, real estate developers, current homebuyers and potential homebuyers of the impacts of the FEC on master planned GCCs and some of the risks associated with such developments. Originality/value This is the first paper the authors are aware of that indicates the financial viability of master planned GCCs is associated with the pricing fragility of interior lots during cyclical markets. While demand for premium quality lots suffers, there is a collapse in demand for interior lots during the crisis.

Hidden complexity in housing markets: a case for alternative models and techniques

Purpose - – The purpose of this exploratory paper is to examine the lack of reliability of traditional neo-classical models and to argue that it is due to the hidden complexity and non-linearity that may operate at times in residential housing markets. As a result, market efficiency may be a special case, rather than the prevailing rule. An alternative framework that incorporates the higher order concepts of complexity – based on the non-linear, emergent behavior of multiple agents – is required to model discontinuities and imbalances in the housing markets. Design/methodology/approach - – The paper examines the building block concepts required to model the complexity of the housing market and analyzes their implications. These implications can be counter-intuitive and help explain the failure of policy makers to model the recent bust in global housing markets. Findings - – The paper finds that policy makers need to adopt an analytical framework that incorporates non-linearity, emergence and other building blocks of complexity in order to construct representative financial models that help understand systemic imbalances that may afflict residential housing markets. Originality/value - – This is the first paper to ones knowledge that argues that policy makers should adopt an alternative theoretical framework based on complexity concepts in order to create more effective financial models; such models should include indicators that provide early warning signals of potential discontinuities in housing markets.