Reaching for the stars: the appointment of celebrities to corporate boards

For a sample of over 700 celebrity appointments to corporate boards of directors over the period 1985–2006, we find positive excess market returns at the time of their announcement. The 1-, 2-, and 3-year long-run performance of the appointing firms provide corroborating evidence of the value of these appointments. We conclude that the appointment of celebrities as directors increase a firm’s visibility in a fashion consistent with Merton’s (J Finance 42:483–510, 1987) investor recognition hypothesis.     

Third-degree price discrimination,quality choice,and welfare

Employing an endogenous quality choice model, we reconsider the effect on welfare of monopolistic third-degree price discrimination. We prove that price discrimination always enhances welfare, mainly because the quality improvement owing to price discrimination increases consumer surplus. Moreover, we show that third-degree price discrimination benefits all parties, including consumers in the higher priced market if the preference differences between markets are sufficiently large.     

Nanotechnology innovation system: Understanding hidden dynamics of nanoscience fusion trajectories

Nanoscience and technology has introduced a new dimension to basic sciences and a range of technologies. Researchers from various scientific disciplines are aggressively getting involved in the relevant research as a parallel way to boost nanoscience competitiveness through academic research, and corporations are directing their R&D activities towards the exploration and exploitation of nanotech opportunities. For years, it has been said that innovation is achieved by breaking through the boundaries of existing technologies. This paper has argued how nanotechnology is driven by scientific research and in what way traditional disciplines are fused into this emerging area. We attempt to provide an empirical analysis of the dynamics of nanoscience fusion trajectories, which is typically a focused area in innovation studies. In this paper, we seek to understand the attributes that are likely to enable scientific disciplines to fuse into nanoscience through a combination of quantitative and qualitative search within nanotechnology systems of innovation (NanoSI). An insight of the similarity and disparity of fusion between Europe and Japan is also provided. Finally, we develop an integrative framework to explore the co-evolutionary nature of nanotech. The paper then tries to derive some implications that would be useful for science and technology policy makers as well as for researchers in traditional scientific disciplines.     

Public investment and business cycles: The case of Japan

This paper examines the effect of public investment on macroeconomic fluctuations in Japan by comparing the effects of central and local government investments. Impulse response functions show that central government investments slightly but persistently stimulate industrial production, while local government investments have no positive impact on business cycles. In terms of policy effectiveness, these results suggest that the Japanese government should not employ local public sector investments as a policy instrument for economic stabilization.     

'Let your science be human': Hume's economic methodology

This essay examines David Hume's economic methodology. The authorcharacterises Hume's understanding of human actions as interactionism.Its key point is that interactions generate the disinterestedview of ‘the spectator’ in the human mind. Humeapplies this idea of the disinterested spectator to the positionof social scientists in understanding social phenomena. ThusHume's approach to social science can be regarded as interpretive.The author also points out the difference between Hume's methodin social science and historical study. Considering this difference,the author argues that we should refer to Hume's social theoryrather than historical works in order to understand his economicmethodology.     

Public versus Private Ownership and Fund Manager Turnover

We examine the correlation between organizational structure (public vs. private) and managerial turnover in a large sample of United States offered mutual funds. Consistent with the hypothesis that publicly traded and privately held firms have different incentive structures and, as such, should differ in their treatment of internal control mechanisms, we find that public sponsors are more sensitive to prior fund performance when making replacement decisions and experience smaller post turnover performance improvements. Additional testing suggests a greater likelihood of fund manager replacement when mutual funds are team managed and when fund boards are more independent.     

Motivation and ability as predictors of play behavior in state‐sponsored lotteries: An empirical assessment of psychological control

This research explores the interaction of motivation and ability to explain individuals' level of participation in state‐sponsored lotteries. The motivation–ability framework is considered from the perspective of perceived control wherein Rotter's (1966) locus of control serves as a perceived ability to influence lottery outcomes, and the Burger and Cooper (1979) desire for control serves as a motivation to play. With the use of a sample of adult consumers residing in a state with a government‐sponsored lottery, predicted results were found. Specifically, the consumers who played the lottery to the greatest extent were those with internal locus of control (high perceived ability) and high desire for control (high motivation). © 2001 John Wiley & Sons, Inc.     

Public investment and regional business cycle fluctuations in Japan

This article examines the relationship between public investment and regional business cycle fluctuations in Japan. In particular, we focus on the effects of ‘discretionary’ changes in public investment, a portion of investment unrelated to the current state of macroeconomic circumstances. The empirical results show that such portions of public investment amplify regional business cycle fluctuations.     

Perceived Ethicality of Insurance Claim Fraud: Do Higher Deductibles Lead to Lower Ethical Standards?

Insurance claim fraud costs insurance companies, policymakers, and taxpayers billions of dollars every year and has been described as the second largest white collar crime. The most common insurance fraud activity and one that contributes a significant portion of dollar losses is the practice of padding claim amounts in the event of a loss. One of the largest issues insurance companies face is that policyholders often do not perceive insurance claim padding as an unethical behavior. However, very little research has examined the factors that contribute to such perceptions. Considering how consumers often attempt to justify fraudulent behavior from a fairness perspective, the present work examines how the amount of the deductible in an insurance claim situation can influence feelings of fairness and ethicality. The results of an experimental study show that higher deductible amounts result in stronger perceptions that insurance claim padding is fair to the insurance company, weaker perceptions that the behavior is unethical, and higher proposed claim award amounts. The study also shows, however, that the deductible amount effects are attenuated for consumers who display higher ethical standards as reflected by their scores on the consumer ethics scale. Implications are discussed with respect to the insurance industry, deviant consumer behavior, and general business ethics theory.