Vertical transmission of overweight: Evidence from a sample of English adoptees

Vertical influences can significantly shape children overweight by affecting both genetics and the environment children are exposed to. This paper examines the vertical (parental) transmission of child overweight drawing upon a fifteen year sample of English adults and their children, both adopted and biological, for which we can retrieve clinical measures height and weight. We find that, when both parents are overweight, children exhibit an increased likelihood of overweight, irrespective of whether they are adopted or biological children. When both parents are obese as opposed to overweight the picture is different. We find that the likelihood of child overweight increases by 16.7 percentage points among natural (non-adopted) children but only by 4.5 percentage points among adopted children. This suggests that the transmission of overweight when both parents are obese is not merely genetic, and what has been called vertical or parental transmission plays a non-negligible role. Our findings are validated by are a battery of robustness checks.     

Optimal Valuation of Noisy Real Assets

We study the optimal valuation of real assets when true asset values are unobservable. In our model, the observed value cointegrates with the unobserved true asset value to cause serial correlation in the time series of observed values. Autocorrelation as well as total variance in the observed value are used to calculate an efficient unbiased estimate of the true asset value (the time–filtered value). The optimal value estimate is shown to have three time–weighted terms: a deterministic forward value, a comparison of observed values with previously determined time–filtered values, and a convexity correction for incomplete information. The residual variance measures the precision of the value estimate, which can increase or decrease monotonically over time as well as display a linear or nonlinear time trend. We also show how to revise time–filtered estimates based on the arrival of new information. Our results relate to work on illiquid asset markets, including appraisal smoothing, tests of market efficiency, and the valuation of options on real assets.     

Job satisfaction and employer-sponsored training

This article examines whether participation in employer-sponsored training has a causal impact on job satisfaction by accounting for individual fixed effects, individual-by-employer fixed effects and controlling for promotions in a sub-sample of the data to address the endogeneity of participation arising from within employer job changes. The estimates show a consistent, positive effect of participation in employer-sponsored training on job satisfaction. Conversely, participation in other types of training does not have a significant impact upon job satisfaction. Additionally, participation in employer-sponsored training has a strong, negative correlation with turnover even while controlling for job satisfaction. Training does not exhibit a lasting effect of either job satisfaction or turnover.     

Stakeholder value appropriation: The case of labor in the worldwide mining industry

Research Summary : We evaluate how the value appropriated by employees varies in response to an exogenous shock to the price of the firm's product and how this variation depends on institutional and ownership structures. Institutional and ownership structures that favor employees can influence firms’ location decisions and shareholders’ incentives to invest. Using data from the main copper mines in the world, we show that the value appropriated by employees rises in response to an exogenous increase in the price of minerals. Our results indicate that the magnitude of the increment in the value captured by employees is larger in stated‐owned companies, when labor regulations promote productivity‐based payments, when wages are determined through a centralized bargaining process, and when regulations associated with hiring and firing are more flexible. Managerial Summary : We show how labor regulations and state ownership affect the value appropriated by employees when there are exogenous changes in the price of the firm's products. Since the value generated by a firm is distributed among different stakeholders, a higher appropriation of value by employees results in lower appropriation by another party. Therefore, by changing the distribution of value, managerial decisions about location and entry could be affected. For instance, shareholders of firms with positive future expectations about the prices of their products might prefer to enter markets in which salary negotiations are not centralized or where partnership with the local government is not mandatory. Overall, our analysis calls for the consideration of the external environment when evaluating value appropriation by different types of stakeholders.     

Indian farmers’ valuation of yield distributions: Will poor farmers value ‘pro-poor’ seeds?

Potential poverty traps among the rural poor suggest a need to reduce poor farmers’ vulnerability by stabilizing crop yields and limiting yield losses. Advances in biotechnology will help address this need directly with crops that tolerate climate fluctuation or resist biotic stresses. Evaluating ex ante how farmers will value these ‘pro-poor’ seeds is important for delivery design, but also challenging. This paper describes an experimental economic approach to understanding farmers’ valuation of such seeds. Using data from a survey and experiment, I assess Indian farmers’ valuation of changes in the mean, variance, and skewness of payoff distributions. These farmers value increases in expected value, but seem indifferent about higher moment changes in payoff distributions. Farmer traits such as wealth and risk exposure affect their valuation of these changes only mildly. While various limitations to the experimental approach must qualify practical implications of these findings, the experiment demonstrates the viability of conducting valuation experiments with open-ended questions in developing countries.     

Knowledge Sharing through Face‐to‐Face Communication and Labour Productivity: Evidence from British Workplaces

We investigate whether the adoption by workplaces of human resources management (HRM) practices that enhance face‐to‐face communication (FTFC) among employees is associated with productivity gains. The analysis is based on a nationally representative sample of over 500 British trading establishments drawn from the linked 2004 Workplace Employment Relations Survey and Annual Business Inquiry, for which objective measures of labour productivity (value added per employee) are available. We find a positive association between productivity and FTFC in problem‐solving groups, teams and meetings of senior or line managers and employees, provided that FTFC is adopted on a continuous basis. Our finding suggests that British workplaces in the trading sector could increase their productivity by implementing HRM practices in such a way as to enhance knowledge sharing through employees' personal interactions.     

Inside Ownership, Risk Sharing and Tobin's q-Ratios: Evidence from REITs

We investigate relations among inside ownership, managerial expenses, risk sharing and equity valuations. Our engine of analysis—Real Estate Investment Trusts (REITs)—provides a unique and rich framework for analysis since we can calculate extremely accurate measures of asset replacement costs, and hence relative valuation (Tobin's q ). Further, the nature of the financial statements allows us to examine the impact of insider ownership on agency costs since we can accurately measure the costs of the entire management team. Our results show that firms with greater insider holdings tend to invest in assets with lower systematic risk and use less debt in their capital structure. At the same time, managerial expenses are lower as inside ownership increases. Finally, higher levels of insider ownership are associated with higher relative valuation as measured by both higher premiums to net asset value and higher multiples of cash flows. The results have implications for the design of optimal management contracts for both REITs and firms in general.     

Oil and Gas Exploration Valuation and the Value of Waiting

The timing flexibility of investments in oil and gas assets can potentially add value. In this article, we examine the value of waiting in exploration projects and propose a real option–based valuation method using least-squares Monte Carlo simulation. We show that the dynamics of the oil and gas prices have a large impact on the value of the option to wait, especially for projects with long lead times and durations. The uncertainty in the forward price curve is modeled using a two-factor stochastic price process. The article also presents the valuation method in the form of MATLAB functions and routines that can be used as an efficient test and analysis platform using the industry-standard input formats.     

Incentive Redesign and Collaboration in Organizations: Evidence from a Natural Experiment

Research summary : Separating the individual from the social effects of incentives has been challenging because of the possibility of synergies in team production. We observe a unique natural experiment in a South Korean e‐commerce company in which a switch from pay‐for‐performance to fixed (but different) salaries took place in a staggered and effectively random manner across employees. In this case, social and individual effects perspectives make opposing predictions, enabling a critical test. We find evidence consistent with social effects of incentives, particularly as predicted by goal framing theory. The results have implications for the design of incentives to foster collaboration, organizational learning, and organizational performance. Managerial summary : Managers often neglect the deeper hypothesis behind pay‐for‐performance schemes—that people primarily care about how much they are individually paid. An opposing school of thought contends that incentives have social effects too—that individuals care about not only what they receive but also what their peers receive. It is difficult to say whether individual or social effects would be more salient in a context, without a proper experiment with randomization. We exploit a rare opportunity provided by a company that changed its incentive system in a random order, thus unintentionally creating a natural experiment. The results strongly validate the existence of social effects of incentives, but also make the general case for the opportunity to learn from experimenting with organization design in a systematic manner. Copyright © 2017 John Wiley & Sons, Ltd.     

Blocked But Not Tackled: Who Founds New Firms When Rivals Dissolve?

Research summary: This article examines the role of competitive shocks in creating opportunities for new firm foundings. I argue that the sudden dissolution of rival firms may release resources that create opportunities for firm formation, particularly among employees facing impediments to capturing value in their current organizations. Analyzing microdata from the legal services industry, I use unexpected deaths of solo‐practicing attorneys as quasi‐exogenous sources of rival dissolution. Results indicate that these shocks increase the odds of founding by about 30%, with stronger effects among attorneys with weaker social connections or higher competition for promotion. The article thus highlights the role that founders play in reallocating dissolved rivals' resources while demonstrating that founding may be an important outlet for “blocked” employees to capture value from opportunities. Managerial summary: This article finds that the shutdown and dissolution of a rival organization may spur employees to found new firms. As a consequence, managers may find it valuable to pay attention to employees' turnover intentions following the dissolution of a rival. Findings suggest that employees who are having trouble advancing in the firm may be the most likely to found a new organization when a rival dissolves, so managers may want to focus retention efforts on these individuals. To the extent that managers wish to capture customers, employees, and other resources that were formerly attached to a dissolved rival, managers may wish to be aware that they could be in competition with their own employees for these resources and opportunities. Copyright © 2017 John Wiley & Sons, Ltd.     

Child hunger in the developing world: An analysis of environmental and social correlates

Using two complementary methods in a framework that allows incorporating both environmental and household-level factors, we explore the correlates of underweight status among children. We use individual children as the units of analysis in 19 African countries, and subnational survey strata in 43 African, Asian and Latin American countries. We consider the relationship between household-level demographic and health survey data, environmental factors from external geospatial data sets and two indicators of malnutrition among children aged 1–3, deviations from the international standards of weight-for-age and height-for-age. We discuss methods for data integration. In general, household determinants explain more variation than environmental factors, perhaps partly due to more error-prone measurement at the community level. Among individual children, some measures of agricultural capacity are related to lower incidence of child hunger, while among regions, measures relating to urbanness and population density show a stronger relationship. We give recommendations for further study, data collection and policy making.     

A Review of: “STATISTICS OF EXTREMES” By Emil J. Gumbel Columbia University Press New York, 1958 375 pp. $15.00

Standard procedures for evaluating future cash flows are to find an appropriate discount rate consistent with the cash flow's risk and then to derive a present value. While discounted cash flows seem appropriate for many instances, finding appropriate discount rates is often difficult, or discount rates may not exist when the risk is actually a function of a decision that requires the cash-flow valuation. We consider two approaches that have been suggested to alleviate this problem: the capital asset pricing model (CAPM) and the risk-neutral pricing arguments from option theory. We discuss the assumptions inherent in these models and show the results on the well-known news vendor model. Our option pricing results correspond to Singhal's [17] results using CAPM and a different valuation procedure for the option pricing model. We, however, derive a simpler expression that clearly illustrates differences from the standard form ignoring risk.     

Strategic planning: valuing and managing portfolios of real options

This article presents a value-based strategic planning framework suitable for valuing and managing portfolios of corporate real options. The proposed framework combines insights from strategic management theory with novel quantitative valuation tools from finance. Strategic planning is viewed as a process of actively developing and managing portfolios of corporate real options in the context of competitive interactions. As such, the expanded valuation framework recognizes that future growth opportunity value deriving from the firm's resources and capabilities must explicitly account for uncertainty, adaptability, and competitive responsiveness. The resulting expanded valuation framework is able to capture the value of the adaptive resources and capabilities that enable a firm to adapt and re-deploy assets, develop and exploit synergies, and gain competitive advantage via time-to-market and first- or second-mover advantages. We show how two basic metrics in this value-based framework, current profitability of assets in place and future growth option value, can be obtained from financial market data and how they can be used in active portfolio planning.     

Affect or information? Labeling policy and consumer valuation of rBST free and organic characteristics of milk

Using a labeling policy framework, we answer the question of whether attitude has an impact on consumers’ valuation of rBST-free and organic characteristics of milk. We utilize 2 years of consumer survey data and a hedonic model to estimate marginal effects of attitude on consumer valuation of rBST-free and organic milk. Findings indicate that in 2001 milk value was impacted by attitude, regardless of whether attitude was measured using an opinion based or behavioral construct. In 2004 the contribution of attitude to value was insignificant. Implications for labeling policy are discussed.     

Lighting the way or stealing the shine? An examination of the duality in star scientists' effects on firm innovative performance

Do star employees enhance or constrain the innovative performance of an organization? Using data from 456 biotechnology firms between 1973 and 2003, we highlight the duality of the effects that stars have on firm performance. We show that while stars positively affect firms' productivity, their presence constrains the emergence of other innovative leaders in an organization. We find that firm productivity and innovative leadership among non‐stars in a firm are greatest when a star has broad expertise and collaborates frequently. We offer cross‐disciplinary insights into the role of human capital as a source of competitive advantage, suggesting that the value of human capital in a firm is contingent on the mutual dependence inherent in high‐status employees' relationships with other individuals in a firm. Copyright © 2014 John Wiley & Sons, Ltd.     

Corporate sexual equality and firm performance

Research summary: Previous studies have mixed findings on the relation between corporate socially responsible policies and firm performance. This paper focuses on a specific type of corporate social responsibility—corporate sexual equality, measuring how a firm treats its lesbian, gay, bisexual, and transgender (LGBT) employees, consumers, and investors—and examines whether and how it relates to firm performance. Using a longitudinal dataset of public firms in the U.S. during the period of 2002–2006, we demonstrate that firms with a higher degree of corporate sexual equality have higher stock returns and higher market valuation. We also identify one of the mediating channels, the labor market channel, that brings higher productivity to firms that embrace sexual equality. Managerial summary: Corporate sexual equality measures how a company treats its lesbian, gay, bisexual, and transgender (LGBT) employees, consumers, and investors. It is an important dimension of corporate social responsibility policies and diversity management. Using a longitudinal dataset of public firms in the U.S. during the period of 2002–2006, we demonstrate that firms with a higher degree of corporate sexual equality have higher stock returns, higher market valuation, and higher labor productivity. Our findings suggest that discriminatory hiring behaviors based on sexual orientation hurt employers and shareholders financially and that implementing corporate sexual equality policies can enhance firms' financial performance, generating competitive advantages in labor markets and mutual benefits between employers and employees. Copyright © 2016 John Wiley & Sons, Ltd.     

Global alliance networks: A comparison of biotech SMEs in Sweden and Australia

The role of networks in business operations is widely recognized. We discuss social network theory, identify its main constituents, and outline a methodology and procedure that enable the identification and valuation of informal networks in an international business-to-business environment. Research is carried on informal Internet networks among firms in the biotechnology industry from Sweden and Australia. We use the methodology to recognize salient nodes, determine prominence and identify structural holes that allow the unveiling of brokerage opportunities that lie latent in networks. Global firms and suppliers of industrial products that are or can position themselves effectively in a social network are in a position to leverage considerable value.     

Endemic malaria,malnutrition and child deaths

Past failures of nutrition programs could lead to disillusionment among governments with nutritionists unless realistic targets are adopted. High child death rates are due to both infection and malnutrition, both causes of high general fertility rates. A nutrition program in Zambia examined malarial infections and undernutrition as causes of death. Where malnutrition was diagnosed in youngest children, significantly more siblings had died. However, positive malaria in the youngest child was associated with most sibling deaths; rates being always higher among children where it was detected. A reduction in malaria transmission is proposed as a more effective policy than that of increasing general food production. This would reduce death rates and population growth and increase the availability of family resources for each child.     

Project valuation in the pharmaceutical industry: a comparison of least‐squares Monte Carlo real option valuation and conventional approaches

Least‐squares Monte Carlo simulation (LSM) is a promising new technique for valuing real options that has received little or no attention in the pharmaceutical industry. This study demonstrates that LSM can handle complex valuation situations with multiple uncertainties and compounded American‐type options. The limited application of real option valuation (ROV) in the pharmaceutical industry is remarkable, given the importance of accurate project valuation in an industry that requires large investments in high‐risk projects with long pay‐back periods, which is furthermore suffering from ever‐increasing development costs and shrinking profit margins. The LSM model developed in this study is constructed as an extension of a discounted cash flow model that should be familiar to economists active in the pharmaceutical industry. A number of pharmaceutical projects have been evaluated using LSM ROV, binominal real option valuation and expected net present value techniques. The different results yielded by these methods are explained in terms of differences in risking assumptions and ability to capture the value of flexibility. The analysis provides a framework to introduce the basic concepts of real option pricing to a non‐specialist audience. The LSM model illustrates the potential for real‐life commercial assessment as the versatility of the technique allows for an easy customisation to specific business problems.     

Who leaves,where to,and why worry? employee mobility,entrepreneurship and effects on source firm performance

We theorize that the value provided by the firm's complementary assets has important implications for the exit decisions of employees and their subsequent effects on the firm's performance. Using linked employee‐employer data from the U.S. Census Bureau on legal services, we find that employees with higher earnings are less likely to leave relative to employees with lower earnings, but if they do, are more likely to create a new venture than join another firm. Employee entrepreneurship has a larger adverse impact on source firm performance than moves to established firms, even controlling for observable employee quality. Our findings suggest that in knowledge intensive settings, managers should focus on tailoring compensation packages to help minimize the adverse impact of employee entrepreneurship, particularly among high performing individuals. Copyright © 2011 John Wiley & Sons, Ltd.