Franchise Core Competency and Its Relationship with Environmental Uncertainty,Competitive Advantage,and Financial Performance: An Empirical Assessment of Food-Service Franchise Firms

This paper examines the relationships between environmental uncertainty, franchise core competency, competitive advantage, and financial performance within the context of food-service franchise companies that build and maintain harmony between external characteristics and internal resources and competency. A survey of 156 food-service franchise firms provides the basis for this empirical investigation. Findings show that both environmental uncertainty and franchise core competency can lead to firm success – but in very different ways. Franchise core competency enhances firm performance by providing differentiation advantage, whereas environmental uncertainty improves performance through franchise core competency. This paper discusses the implications of these findings for researchers and managers.     

Convergence and diversification in cable industry: An empirical analysis of the deployment pattern of cable telephony in US local telecommunications markets

The primary purpose of this study is to examine the deployment pattern of cable telephony in the US local telecommunications market. A model is established stressing that the size of local markets and the specific cost advantages of local cable systems are associated with the deployment of cable telephony by cable operators.     

WHAT ELUDES INTERNATIONAL AGREEMENTS ON CLIMATE CHANGE? THE ECONOMICS OF GLOBAL PUBLIC GOODS

This paper provides an analysis of global warming policy as the provision of a global public good. Using a regional model composed of thirteen world regions, the paper shows how disparate incentives among the regions hinder a shift from a Business As Usual (BAU) policy to a Globally Optimal Policy (GOP). In the BAU scenario, there will be large variations in impacts from warming across the regions, meaning some countries have little incentive to participate in collective agreements. Under the GOP scenario, negative impacts from global warming will be significantly reduced in some regions resulting in strong incentives for these regions to press for action. The paper finds that an optimal regulation could save Europe, India, and Africa hundreds of billions of dollars per year by the end of this century, but would cause additional costs to China, Russia, Canada and the USA. Under the optimal regulatory framework, higher levels of abatement are required for developing countries, worsening the existing climate equity problem.     

Intragroup Transactions,Corporate Governance,and Corporate Philanthropy in Korean Business Groups

This study examines how the corporate philanthropy decisions of group-affiliated firms in Korea (Chaebol firms) are made. Based on the attention-based view, we argue that when corporate decision makers at group-affiliated firms focus their attention more (less) on internal markets than external stakeholders because of the firm’s high (low) reliance on intragroup transactions, the firm will decrease (increase) its level of corporate philanthropy. We further argue that the relationship will be stronger when governance mechanisms focus on the instrumental value of corporate philanthropy. Using a panel sample of group-affiliated firms in Korea from 2011 to 2015, we find that as intragroup sales increase, the level of corporate philanthropy decreases, and such a negative relationship is stronger when outside director representation and foreign investor ownership are high. Our study suggests that internal dependence and corporate governance mechanisms jointly affect the level of corporate philanthropy at firms in a business group. Thus, this study contributes to the literature on corporate philanthropy, business group, and corporate governance.     

Narrative Transportation and Paratextual Features of Social Media in Viral Advertising

This study establishes that the experience of narrative transportation has a positive influence on viral advertising. The relative strength of this relationship, however, depends on several boundary conditions associated with the paratextual features of social networking service (SNS) environments. Specifically, it is stronger if the senders and intended receivers have personal ties. Moreover, the influence of narrative transportation is negatively moderated by advertising disclosure that elicits persuasion knowledge. Finally, the negative effect of persuasion knowledge is reduced if the ad appears with a higher number of “likes,” which increases social proof for viral ads. Implications regarding viral advertising and social media behaviors are discussed.     

Testing for a Debt‐Threshold Effect on Output Growth

Using the Reinhart–Rogoff dataset, we find a debt threshold not around 90 per cent but around 30 per cent, above which the median real gross domestic product (GDP) growth falls abruptly. Our work is the first to formally test for threshold effects in the relationship between public debt and median real GDP growth. The null hypothesis of no threshold effect is rejected at the 5 per cent significance level for most cases. While we find no evidence of a threshold around 90 per cent, our findings from the post‐war sample suggest that the debt threshold for economic growth may exist around a relatively small debt‐to‐GDP ratio of 30 per cent. Furthermore, countries with debt‐to‐GDP ratios above 30 per cent have GDP growth that is 1 percentage point lower at the median.     

Who benefits most? The effects of managerial assistance on high- versus low-performing small businesses

This study investigates the relationship between outside managerial assistance and small business performance using a conditional quantile regression approach. The model was tested using a sample of 902 ventures that received managerial or technical assistance from the U.S. Small Business Administration's Entrepreneurial Development Resource Partners. Results show that outside assistance for primary business functions, such as marketing strategy, promotional strategy, financial management and general management, is more effective for firms with lower levels of financial performance. Outside assistance for secondary business functions, such as human resources and obtaining capital, is likely to have a greater impact on firms in the middle- to upper-quantile levels. Based on the results, we propose that managerial outside assistance providers should employ different approaches for firms with lower versus higher levels of financial performance.     

Do green packages lead to misperceptions? The influence of package colors on consumers’ perceptions of brands with environmental claims

Consumers need accurate information about brands’ environmental impacts to guide their purchase decisions. Researchers have studied consumers’ perceptions of green products and marketers’ environmental claims. Policy makers provide guidelines to minimize deceptiveness of environmental claims. Yet, little attention has been paid to what contextual cues can influence consumers’ judgments of environmental claims and green products. Drawing on conceptual fluency theory, the current research proposes that a color that matches the content of a message makes the information easier to process, thereby increasing the appeal of the message. The authors demonstrate that using the color green on a product’s package can enhance consumers’ perceptions of the brand’s environmental impact. Ironically, this positive effect of green can also lead to consumers’ misperceptions of the brand’s environmental impact if green is used for brands that are not environmentally superior. Implications and suggestions for policy makers, marketers, and consumers are provided.     

Measuring impacts and adaptations to climate change: a structural Ricardian model of African livestock management1

This article develops a new cross‐sectional methodology that explicitly incorporates adaptation into an analysis of the impacts of climate change. The methodology examines how a farmer will change choices of species and number to adapt to climate. The approach is applied to study Africa, where the impacts of climate change are expected to be the most severe. The results indicate that in warmer places, African farmers switch from beef cattle to more heat‐tolerant goats and sheep. In wetter places, farmers switch from cattle and sheep to goats and chickens. The results indicate that large commercial livestock operations specializing in beef cattle will be hard hit from climate change whereas small farmers who can easily substitute to goats and/or sheep will be more resilient.