When Is Bad News Really Bad News?

We examine whether the price response to bad and good earnings shocks changes as the relative level of the market changes. The study is based on a complete sample of annual earnings announcements during the period 1988 to 1998. The relative level of the market is based on the difference between the current market P/E and the average market P/E over the prior 12 months. We find that the stock price response to negative earnings surprises increases as the relative level of the market rises. Furthermore, the difference between bad news and good news earnings response coefficients rises with the market.     

Charitable Conflicts of Interest

This paper looks at conflicts of interest in the not-for-profit sector. It examines the nature of conflicts of interest and why they are of ethical concern, and then focuses on the way not-for-profit organisations are especially prone to and vulnerable to conflict-of-interest scandals. Conflicts of interest corrode trust; and stakeholder trust (particularly from donors) is the lifeblood of most charities. We focus on some specific challenges faced by charitable organisations providing funding for scientific (usually medical) research, and examine a case study involving such an organisation. One of the principal problems for charities of this kind is that they often distribute their funds within a relatively small research community (defined by the boundaries of a small region, like an American state or Spanish Autonomous region, or a small country), and it often proves difficult to find high-level researchers within the jurisdiction to adjudicate impartially the research grants. We suggest and recommend options appropriate for our case study and for many other organisations in similar situations.     

Multimarket contact of US newspaper chains: circulation competition and market coordination

Post-war ownership consolidation and acquisition in the US newspaper industry has given rise to extensive market contact amid the remaining chains. This paper studies the impact of this industrial structure on local daily newspaper competition. It seeks to examine whether multimarket contact (MMC) between two newspaper chains can facilitate coordinating exclusive circulation areas for their respective newspapers in proximate circulation markets. Econometric results indicate a strong linkage between the MMC variable and reduced circulation competition for 218 papers in the midwest US. Advertising prices are found to be significantly higher with MMC newspapers.     

Entrepreneurial Dispositions and Goal Orientations: A Comparative Exploration of United States and Russian Entrepreneurs

We refine and extend the study of entrepreneurial dispositions by linking three classic hallmarks of the entrepreneur—achievement motivation, risk–taking propensity, and preference for innovation—to the goal orientations of United States and Russian entrepreneurs. The results suggest that entrepreneurial dispositions vary according to culture and the entrepreneur's primary goal for the venture. The results have important implications for theoretical development linking dispositions and entrepreneurial behavior in different settings and for entrepreneurial education and government policy.     

Risk Sharing and Compensation Guides for Managers and Members of Vertical Beef Alliances

Vertical alliances in beef are growing in importance. Alliances struggle with decisions on how to compensate members. Both conceptual development and empirical analysis are needed. A conceptual framework building on transaction cost and principal agent literature is developed and strategies for sharing feeding and packing margins are analyzed. Premiums for high-quality cattle increase revenues to the alliance. Margin and premium sharing interactions are investigated and guidelines are presented. Compensations that provide incentives for improving cattle quality help ensure the success of alliances as vertical coordination and quality control mechanisms.     

How much do firms hedge with derivatives?

For 234 large non-financial corporations using derivatives, we report the magnitude of their risk exposure hedged by financial derivatives. If interest rates, currency exchange rates, and commodity prices change simultaneously by three standard deviations, the median firm's derivatives portfolio, at most, generates $15 million in cash and $31 million in value. These amounts are modest relative to firm size, and operating and investing cash flows, and other benchmarks. Corporate derivatives use appears to be a small piece of non-financial firms’ overall risk profile. This suggests a need to rethink past empirical research documenting the importance of firms’ derivative use.     

Plugged In or Disconnected? A Model of the Effects of Technological Factors on Employee Job Embeddedness

Technology continues to play an ever‐increasing role in both our work and private lives. In parallel with this expanding reliance on technology has been a shift in how people now view their jobs. Therefore, the purpose of this article is to provide a theoretical model that bridges these two areas—technology and employee attitudes (more specifically, work‐related feelings of embeddedness). Within our model, we consider aspects of common work‐related technologies and key perceptual variables related to technology, and how both areas can influence embeddedness in one's job. We conclude the article by providing examples of how specific technologies that are commonly found in today's work environment may influence job embeddedness perceptions, and we discuss the implications of the model on both theory and practice. © 2015 Wiley Periodicals, Inc.     

Supply and Social Cost Estimates for Biomass from Crop Residues in the United States

The components of social costsincluded in the supply analysis are cashoutlays and opportunity costs associated withharvest and alternative residue uses, potentialenvironmental damage that is avoided byexcluding unsuitable land, and costs in movingresidues from farms to processing plants. Regional estimates account for the growingconditions and crops of the main agriculturalareas of the United States. Estimates includethe main U.S. field crops with potential forresidue harvest: corn, wheat, sorghum, oats,barley, rice and cane sugar. The potentialcontribution of residues to U.S. energy needsis discussed.     

GSEs,Mortgage Rates,and Secondary Market Activities

Fannie Mae and Freddie Mac are government-sponsored enterprises (GSEs) that securitize mortgages and issue mortgage-backed securities (MBS). In addition, the GSEs are active participants in the secondary mortgage market on behalf of their own investment portfolios. Because these portfolios have grown quite large, portfolio purchases (in addition to MBS issuance) are often thought to be an important force in the mortgage market. Using monthly data from 1993 to 2005 we estimate a VAR model of the relationship between GSE secondary market activities and mortgage interest rate spreads. We find that GSE portfolio purchases have no significant effects on either primary or secondary mortgage rate spreads. Further, we examine GSE activities and mortgage rate spreads in the wake of the 1998 debt crisis, and find that GSE portfolio purchases did little to affect mortgage rates. This empirical finding is robust to alternative identification assumptions and to alternative model and variable specifications.