The Paramour’s Advantage: Sexual Favoritism and Permissibly Unfair Discrimination

Despite the prevalence of sexual favoritism in the workplace, there is much debate over whether this phenomenon rises to the level of prohibited discrimination and harassment. While the United States Supreme Court has not yet involved itself in adjudicating issues of sexual favoritism, the Equal Employment Opportunity Commission, however, has issued guidelines. The California Supreme Court recently addressed the “sexual favoritism as sexual harassment/discrimination” issue and, absent better guidance from the federal courts, the California decision provides interesting insights for the legal and business communities. This article explores key issues involving workplace romances, sexual favoritism, and Title VII’s prohibition of sexual harassment as an illegal form of discrimination based on sex. We use the recent California Supreme Court decision in Miller to illustrate the legal and managerial challenges facing policy makers and management practitioners. We conclude with a discussion of policy alternatives for creating a discrimination- and harassment-free workplace while effectively managing workplace romances and instances of sexual favoritism.

A Model for Predicting Outcomes of Sexual Harassment Complaints by Race and Gender

Organizational scholars have studied the impact of sex on sexual harassment outcomes but left unexplored the influences of race. Thus, we use social identity theory to explore the role of race stereotypes and their influences on sexual harassment outcomes. We posit that stereotypes of African-American women tend to be much more negative than those of white women and this serves to marginalize their position both as victims of sexual harassment as well as complainants.

Appearance-based Sex Discrimination and Stereotyping in the Workplace: Whose Conduct Should We Regulate?

Court treatment of sex discrimination and harassment claims based on appearance and gender stereotyping has been inconsistent, particularly where the facts involve reference to sexual orientation. Ironically, court willingness to allow such claims may turn on the choice of verbal or physical conduct by, or the sex or sexual orientation of, the alleged offenders. Because plaintiffs in such situations may assert retaliation claims to increase their chances of prevailing, employers should focus less on regulating aspects of personal appearance unrelated to job performance and more on problematic reactions by co-workers. Workplace civility policies may hold promise for limiting both legal liability and practical consequences in the absence of a legislative response.

Relief and Redress for Targets of Workplace Bullying

Workplace bullying is a particularly insidious form of counterproductive workplace behavior that results in significant costs to both targets and organizations. We explore existing and potential avenues of relief and redress available to targets. Relief refers to activities focused on eliminating the bullying as well as the mechanisms used to treat those who have been bullied. Redress refers to third-party remedies that involve the financial and/or non-financial compensation of targets. The optimal strategy for dealing with workplace bullying involves both effective organizational interventions to help prevent and address bullying incidents and strong legislative mechanisms to allow for restitution and compensation. This two-pronged strategy provides targets of bullying with multiple sources of relief and redress.

Market entry of firms with different legal forms: an empirical test of the influence of institutional factors

Drawing upon institutional theory we develop a conceptual model and investigate the determinants of market entry for worker cooperatives, publicly traded and limited-liability companies. Our results show that formal institutional conditions (i.e., mercantile legislation) influence the start-up choice of entrepreneurs regarding the legal form of their new venture. In addition, we take into account the influence of informal institutional conditions (i.e., local corporate culture) on the market entry rate of firms with different legal structures. Findings show that, while market entry is sensitive to the general economic climate, entry rates of firms with a different legal structure respond differently to the same economic conditions.

“The Times They Are a-Changin”: Family Responsibilities Discrimination and the EEOC

Family responsibilities discrimination, bias against workers based on their responsibilities to care for family members is widespread in many organizations and is rapidly becoming a twenty-first century workplace concern. Employers who harass, pass over for promotion, and even terminate workers because they care for children, elderly parents or spouses, or disabled family members have been sued with more frequency and have been paying increasing amounts in verdicts. Recently, the EEOC took an important step toward ending this discrimination by issuing enforcement guidelines that will educate employers and employees about family responsibilities discrimination and caregivers’ rights and responsibilities. The Guidelines explain how federal equal employment opportunity laws apply to workers who struggle to balance work and family, and what firms can do to avoid potential legal problems and accompanying liabilities with respect to family responsibilities and caregiving discrimination.

Employment Discrimination and the International Workplace: A Review of Recent US Court Rulings

The extraterritoriality clause in the Civil Rights Act of 1991 amended Title VII and the ADA to include employment discrimination protection for US citizens working abroad for US employers. A review of recent court rulings demonstrates an absence of lawsuits involving alleged violations of the extraterritorial provision. Instead, recent cases show that Americans working outside of the US are filing charges against foreign employers rather than US employers and applying state level employment statutes rather than federal legislation. In addition, non US citizens are exhibiting a trend toward invoking US federal and state statutes against US employers. These cases are reviewed and implications discussed for managing employment relations in an increasingly international workplace.

Employee Moral Rights: Recognizing Their Implicit Financial Investments in the Firm

The literature on employee (moral) rights has been limited to workplace human rights. This essay focuses on Employee Moral Rights defined as the moral claims individuals are entitled to due to their role as employees. Noting they make significant (although implicit) financial investments in the firm they work for, this essay argues dedicated employees should be treated as financial investors, which implies dedicated employees have the moral right to (1) be treated as every other financial investor; (2) share in the firm’s profits; (3) timely, accurate, and sufficient disclosure of significant information; (4) protection from senior managers’ abusive self-dealing; and (5) mechanisms to protect their financial investment including fair severance payments and effective pension protection.

The cost implications of waste reduction: factor demand, competitiveness and policy implications

Manufacturing produces both good and “bad” outputs, such as waste, which have negative environmental effects. Economic (e.g., tax) and non-economic (e.g., reputation) incentives encourage firms to reduce waste. However, such practices are costly because decreases in output produced or increases in inputs used may accompany waste reduction. We employ a cost function approach to evaluate patterns of output and waste production and capital, labor, and materials use, for UK manufacturing plants. We find that costs of waste reduction generally imply increasing materials use and capital and labor input saving, but vary by county, region, and industry.

Stochastic productivity measurement

Stochastic productivity indicators are defined, and superlative measures of these indicators are derived. It is shown that, in the presence of complete markets or a common-expectations equilibrium, differences in the market values of firms are superlative indicators of cross-sectional productivity differences. Exactness results are used to decompose nonstochastic productivity indicators into a measure of true productivity change and a measure of ‘luck’. The decomposition is illustrated empirically.

Debreu’s coefficient of resource utilization, the Solow residual, and TFP: the connection by Leontief preferences

Debreu’s coefficient of resource utilization is freed from individual data requirements. The procedure is shown to be equivalent to the imposition of Leontief preferences. The rate of growth of the modified Debreu coefficient and the Solow residual are shown to add up to TFP growth. This decomposition is the neoclassical counterpart to the frontier analytic decomposition of productivity growth into technical change and efficiency change. The terms can now be broken down by sector as well as by factor input.

Short-cuts in issuance decisions and subsequent small firm performance

This paper examines the subsequent change in performance characteristics of companies that make security issuance choices consistent with “following the herd.” It extends the literature on decision heuristics (i.e., decision short-cuts) by exploring the outcome of mimicking behavior. Results suggest that firms that issue equity in an environment consistent with mimicking are associated with subsequent increased risk of bankruptcy relative to their non-mimicking counterparts. Moreover, the results also suggest that these mimicking actions are not associated with subsequent changes in profitability. This gives support to the argument that decision short-cuts produce suboptimal results. Moreover, the effect is concentrated in very small (i.e., micro-cap) companies, but not present for companies in larger size categories. Similar patterns for debt issuers who mimic competitors are not observed, which may reflect the greater scrutiny imposed by lenders and debt under-writers with regard to debt issuances.

Smoking prevalence in the United States: Differences across socioeconomic groups

This paper uses recent US state-level data to examine smoking behavior across four population groups divided by age, literacy, income and ethnicity. Another contribution lies in the consideration of various smoking control policies and the full costs of smoking. Overall, the results show that non-price smoking policies are relatively more effective than price or tax policies in reducing smoking prevalence and that these policies gain effectiveness as the population begins to age.

Do liquidity induced changes in aggregate dividends signal aggregate future earnings growth?

Extant empirical literature does not provide abundant evidence for the information content hypothesis regarding firm-level dividend signaling. Although this is consistent with the argument against an optimal firm-level dividend policy, this does not imply an absence of an optimal aggregate dividend level. Aggregate dividends and earnings may exhibit stronger associations if aggregation filters out firm-specific earnings information and indicates macroeconomic trends. Using macroeconomic data, we show that aggregate payout ratios signal aggregate future earnings growth for horizons up to 4 years, and that excess aggregate liquidity plays an important role in this relationship.

Application of a double bootstrap to investigation of determinants of technical efficiency of farms in Central Europe

The paper provides one of the first applications of the double bootstrap procedure (Simar and Wilson 2007) in a two-stage estimation of the effect of environmental variables on non-parametric estimates of technical efficiency. This procedure enables consistent inference within models explaining efficiency scores, while simultaneously producing standard errors and confidence intervals for these efficiency scores. The application is to 88 livestock and 256 crop farms in the Czech Republic, split into individual and corporate.

The productivity performance of Irish dairy farms 1984–2000: a multiple output distance function approach

This study measures productivity growth on Irish dairy farms over the period 1984–2000. A total factor productivity index is constructed for the dairy system and is decomposed into technical change, efficiency change, and changes in scale efficiency. This is achieved by estimating a stochastic output distance function model of the production technology in use on Irish dairy farms. Overall, productivity on Irish dairy farms grew by 1.2% per annum over the sample period.

A generalized procedure to recover the first derivatives of a production function when the firm is a profit maximizer

Partial derivatives of production functions are necessary in many instances to characterize the technology of firms. We present here a general method to recover the first derivatives of the production function of a profit maximizing firm. The method is systematic and applies even when the optimization problem of the firm is subject to additional constraints. It allows researcher to recover returns to scale and technological progress in complex situations.

The aggregation of capital over vintages in a model of embodied technical progress

The paper considers how to measure capital in a model where technical progress is embodied in new units of capital. This embodiment model also assumes that once new units of capital are installed, it cannot be “unbolted” and sold on the second hand market. A significant difference between this Solow–Harper model and the traditional capital services model due to Jorgenson and his coworkers is that rising real wage rates will generally induce early retirement of assets; i.e., this model can provide an explanation for obsolescence. The paper studies how to aggregate over vintages and how to measure depreciation in the context of this embodiment model. These problems are more complicated than the corresponding problems in the traditional capital services model because the age of retirement of an asset is endogenous in the embodiment model. The paper uses duality theory to simplify the exposition.

How useful are signals? A micro-structure analysis

We analyze how the market processes a signaling event by studying a sample of self-tender offers, events often viewed as signals of firm value. By examining changes in the degree of informed trading, we find asymmetric information costs fall at announcement, remain low throughout the event, and increase at offer expiration. By 1 month following expiration, informed trading returns to a level not significantly different from that prior to the offer. Higher risk firms have significantly larger declines in information asymmetry during the offer. Increases in information asymmetry persist 1 month following expiration for firms with lower pre-offer informed trading.

Productivity and efficiency of state-owned enterprises in China

The purpose of this paper is to evaluate the variations in SOE efficiency and productivity from the perspectives of macroeconomic fluctuations and systematic reform in China during 1986–2003. We use Data Envelopment Analysis to measure SOE efficiency. Subsequently, we use the Malmquist Index of Productivity change to measure productivity growth. The empirical results show that SOE efficiency and productivity exhibited obvious improvements during periods of strong systematic reform and a prosperous economy. The systematic reform after 1998 had a clear-cut impact on SOE performance.