The Evolution of Business Groups’ Corporate Social Responsibility

Although establishing gender equality in board and managerial positions has recently become more important for organizations, companies with low levels of gender diversity seem to perceive an ethical dilemma regarding the ways, in which they attempt to attain it. One way that organizations try to move toward gender equality is through the use of their corporate websites to manage potential applicants’ impressions of their current levels of, and actions to improve, gender diversity. The dilemma is whether to truthfully communicate their low level of gender diversity, conceal it, or exaggerate it. On the one hand, organizations that are truthful may find it difficult to achieve equality because women are less attracted to companies that lack diversity. On the other hand, organizations that are untruthful risk their moral legitimacy. The present work investigates gender diversity-related communication on the corporate websites of 99 major German companies. Based on theoretical work on minority attraction, we apply an organizational impression management taxonomy to guide our in-depth content analysis. With this approach, we hope to advance the understanding of how the issue of gender diversity is presented on corporate websites, which is useful for both organizational decision makers as well as diversity researchers. We found that although gender diversity-related communications on corporate websites contain both assertive and defensive organizational impression management tactics, as well as a third type of tactic we refer to as “acknowledgement,” assertive tactics were used more frequently. We argue the existence of a paradox whereby organizations use assertive impression management tactics to maintain pragmatic legitimacy but compromise their moral legitimacy by doing so. Furthermore, we argue that moral legitimacy can be maintained or restored through the sincere use of defensive impression management tactics and acknowledgement.     

Market Selection and Asymmetric Information

We consider a dynamic general equilibrium asset pricing model with heterogeneous agents and asymmetric information. We show how agents' different methods of gathering information affect their chances of survival in the market depending upon the nature of the information and the level of noise in the economy.     

Entry and price dynamics in a perfect foresight model

This paper studies firms' entry and price dynamics in a model that combines the assumptions of free entry and perfect foresight with the hypothesis of consumer's loyalty postulated by Phelps and Winter. The analysis of the transition to long-run equilibrium reveals that, in such a model, the entry of firms is related to the difference between current prices and costs. In relation to the growth of the firms' output, it is shown that the model is consistent with Gibrat's Law. Finally, it is shown that the size distribution of firms approaches asymptotically a Pareto distribution.     

Latin America in the rearview mirror

Latin American countries are the only Western countries that are poor and that are not gaining ground on the U.S. This paper evaluates why Latin America has not replicated Western economic success. We find that this failure is primarily due to TFP differences. Latin America's TFP gap is not plausibly accounted for by human capital differences, but rather reflects inefficient production. We argue that competitive barriers are a promising channel for understanding low Latin TFP. We document that Latin America has many more international and domestic competitive barriers than do Western and successful East Asian countries. We also document a number of microeconomic cases in Latin America in which large reductions in competitive barriers increase Latin American productivity to Western levels.     

My computer is infected: the role of users’ sensation seeking and domain-specific risk perceptions and risk attitudes on computer harm

Literature has traditionally shown the potentially harmful consequences of risk-taking in a variety of domains. Less scholarly attention, however, has been directed to the study of risk-taking in the computer use domain. Using scanned data from 1902 computers, we sought to analyze the potentially harmful consequences that sensation-seeking and computer use risk perceptions and attitudes had on users’ computer vulnerability. Results of the study indicated that general sensation-seeking as well as computer use risk perceptions and risk attitudes were predictive of computer harm. The general measure of sensation-seeking was predictive of both risk perceptions and risk attitudes which in turn translated into the existence of malicious software in users’ computers.     

Decision theories and probabilistic insurance: an experimental test

This paper reports the results of an experiment in which probabilistic insurance, as proposed by Kahneman and Tversky (1979), is compared both with full insurance and no insurance. The experimental results conform to the intuitive prediction that risk-averse agents who are indifferent between full insurance and no insurance, will prefer full insurance to probabilistic insurance and probabilistic insurance to no insurance. The first conclusion is incompatible with the predictions of expected utility theory, and the second with Kahneman and Tversky's prospect theory. We also show that Loomes and Sudgen's regret theory can easily accommodate these intuitive results. JEL Classification: C91, D81. We are most grateful to Graham Loomes and two anonymous referees for their very helpful comments. Financial support from the Ministerio de Ciencia y Tecnología, under project BEC2001-0535, and from the Generalitat Valenciana under project GRUPOS03/086, is gratefully acknowledeged.     

Estimation of log-GARCH models in the presence of zero returns

A critique that has been directed towards the log-GARCH model is that its log-volatility specification does not exist in the presence of zero returns. A common ‘remedy’ is to replace the zeros with a small (in the absolute sense) non-zero value. However, this renders estimation asymptotically biased if the true return is equal to zero with probability zero. Here, we propose a solution. If the zero probability is zero, then zero returns may be observed because of non-trading, measurement error (e.g. due to rounding), missing values and other data issues. The algorithm we propose treats the zeros as missing values and handles these by estimation via the ARMA representation. An extensive number of simulations verify the conjectured properties of the bias-correcting algorithm, and several empirical applications illustrate that it can make a substantial difference in practice.     

Why some firms never invest in formal R&D

In this paper we study the frequency of formal R&D investments. We link real options theory to the knowledge‐based view to explain how a firm's knowledge resources influence its frequency of investing in R&D to establish technological options. Specifically, we propose that a firm that lacks internal knowledge resources is more likely to never invest in R&D, a firm that has both internal and external knowledge resources is more likely to sometimes invest in R&D, while a firm that has internal knowledge resources but lacks external knowledge resources is more likely to always invest in R&D. Copyright © 2010 John Wiley & Sons, Ltd.     

Determinants of Electronic Word-of-Mouth on Social Networking Sites About Negative News on CSR

Journal of Business Ethics - Social network sites are a new communication channel to convey CSR information. They are interactive channels that let users participate, spread content and generate...     

Corruption and private participation infrastructure projects: The influence of vicarious experience and national animosity

This paper investigates the influence of vicarious experience and national animosity on the relationship between corruption and the performance of private participation infrastructure projects. Our analysis of 27,264 projects in 114 countries from 1997 to 2013 shows that higher levels of corruption are associated with higher risk of project failure. We also find that this effect is weakened by the presence of other firms from the same industry, as firms may learn from other companies how to deal with corruption. In contrast, we find the effect is strengthened by the presence of other firms from different industries. This result is due to a lower applicability of knowledge and to an increase in national animosity and discrimination from local stakeholders.