Evaluating Facilitated Modelling Processes and Outcomes: An Experiment Comparing a Single and a Multimethod Approach in Group Model Building

Facilitated modelling approaches have been suggested as helpful tools to support negotiation in strategic analysis processes due to their potential to facilitate cognitive change and enhance consensus and commitment with final decisions. In the present research, we developed an experimental framework to compare what two of these approaches, that is, group model building and a multimethod approach, contribute to the process and outcomes in the negotiation of strategies. In the multimethod approach, we combined strategic options development and analysis with computer simulations of the group model building approach. We explored the differences between these two modelling approaches in facilitating cognitive change, consensus and commitment by building an experimental research design with real clients, working on their organisation’s problem. Furthermore, we compared the type and content of participants’ contributions in the strategic conversation. The lessons from the experiment conducted are twofold. On one hand, the multimethod approach encouraged more divergent contributions and produced a higher degree of cognitive change than group model building (i.e., the single approach). On the other hand, group model building encouraged more contributions about content related to causes of the problem and enhanced more commitment to the final solution than the multimethod approach. Hence, the conducted experiment brings new insights into the benefits of using multimethods and possible losses resulting from such combinations. Accordingly, we have presented opportunities for further research regarding the combination of facilitated modelling approaches.     

Loss persistence and returns in the UK

In this study, we examine whether estimated loss reversal probabilities are fully reflected in UK stock market prices. Overall, we provide evidence of varying degrees and types of loss firm mispricing with respect to estimated loss reversal probabilities. In particular, a significant and positive relationship between loss reversal probability and annual returns is found only for firms with higher trading costs. When looking at monthly returns, however, especially for the financial statement release month subsequent to the loss year, a significant and positive relationship is found for all firms. Thus, the evidence is consistent with UK market participants not fully incorporating relevant information into the pricing of loss firms and, as a consequence, being surprised by the content of the earnings for many or all UK loss firms.     

Mergers & acquisitions research: A bibliometric study of top strategy and international business journals, 1980–2010

Mergers and acquisitions (M&As) are important modes through which firms carry out their domestic and international strategies and have been noted as the CEOs favorite strategy. As a significant field of study, M&A-research has accumulated substantial knowledge. This bibliometric study examines the extant strategy and international business literature on M&As. Methodologically, we examined a sample of 334 articles published in sixteen leading management/business journals, during a 31 year period — from 1980 to 2010. The results provide a global perspective of the field, identifying the works that have had the greater impact, the intellectual interconnections among authors and works, the main research traditions, or themes, delved upon on M&A-related research. Structural and longitudinal analyses reveal the changes in the intellectual structure of the field over time. A discussion on the accumulated knowledge and future research avenues concludes this paper.     

Crime and social norms

In this paper, we develop a general equilibrium model of crime. It is shown that law and norms are substitutes in achieving a stable equilibrium. Here we offer a new interpretation of different theories of social norms in the context of crime and deterrence. The law and economics theory is presented as an opportunism-limiting approach to norms whereas the evolutionary theory is presented as an opportunity cost approach.Received: January 2003, Accepted: July 2003, JEL Classification: D59, K14, K42Paper presented at the 3rd annual meeting of SPIE Portuguese Association for Research in Economics, June 22-23, 1998, Braga and at the 15th annual meeting of the European Association of Law and Economics, September 24-26, 1998, Utrecht. I am grateful to two referees and the editor for helpful comments that much improved the paper, and to Dorothea Kübler, Eric Posner, Dieter Schmidtchen, and Stergios Skaperdas for suggestions that much improved this paper, and to Kelly Markva for research assistantship. The author acknowledges the financial support of FCT, Lisbon, Portugal. Part of this paper was written while the author visited Stanford Law School. The usual disclaimer applies.     

Dynamic Law Enforcement with Learning

This article modifies a standard model of law enforcement toallow for learning by doing. We incorporate the process of enforcementlearning by assuming that the agency's current marginal costis a decreasing function of its past experience of detectingand convicting. The agency accumulates data and information(on criminals, on opportunities of crime), enhancing the abilityof future apprehension at a lower marginal cost. We focus onthe impact of enforcement learning on optimal compliance rules.In particular, we show that the optimal fine could be less thanmaximal and the optimal probability of detection could be higherthan otherwise. It is also suggested that the optimal imprisonmentsentence could be higher than otherwise.     

Long-run versus short-run behaviour of the real exchange rates

This paper discusses the mean stationarity of real exchange rates by using new time series methods and new tests. The question whether the real exchange rates have a unit root or are level reverting is set in the general and flexible framework of fractionally integrated processes. The estimations and tests sustain the claim that real exchange rates may be nonstationary and not revert to any short-run parity. However, estimations also suggest that real exchange rates behave differently on the short and on the long run and that they may revert to parity in a century-long period.     

Lending relationships in the interbank market

We use a unique dataset to show that relationships are an important determinant of banks' ability to access interbank market liquidity. More precisely, we find that: (i) banks with a larger reserve imbalance are more likely to borrow funds from banks with whom they have a relationship, and to pay a lower interest rate than otherwise; (ii) smaller banks and banks with more non-performing loans tend to have limited access to international markets, and rely more on relationships; (iii) relationships are established between banks with less correlated liquidity shocks. These results suggest that relationships allow banks to insure liquidity risk in the presence of market frictions such as transaction and information costs. Our analysis explicitly controls for the endogeneity of bank relationships.     

Manufacturing Skill‐biased Wage Inequality,Natural Resources and Institutions

We use an extensive dataset on occupational wages to measure the manufacturing skill premium and assess, for the first time, the influence of natural resources and institutional quality—in addition to traditional drivers—for advanced and less‐advanced countries and the full sample. The new findings, regarding 21 countries between 1988 and 2008 in the main panel estimations, suggest the premium of advanced countries rises with tertiary enrollment, net foreign direct investment (FDI) and institutional quality, and falls with centralized wage negotiations and geographically diffuse natural resource activities, mainly re‐exportation related. In less‐advanced countries, the premium rises with net FDI, scale effects, centralized wage negotiations and geographically concentrated natural resource activities (absorbing scarce skilled workers), and falls with trade, diffuse natural resource exploration (using mainly unskilled workers) and high‐technology exports, as emerging national low‐end technology industrial exporters may lower skill pay compared with foreign industrial exporters. In the full sample, the premium rises with scale effects, trade, institutional quality and concentrated natural resources, and falls with the relative skilled‐labor supply, centralized wage negotiations and diffuse natural resources. The results account for a wider diversity of situations compared with the previous studies.