Institutional investors’ ownership stability and their investee firms’ equity mispricing

This study examines the impact of institutional investors' equity ownership stability and their investment horizon to determine the impact on their investee firms' equity mispricing. Mispricing represents the difference between a firm’s market and fundamental values. We treat institutional investors as a heterogenous group, i.e., dedicated, transient, or quasi-indexer as defined by Bushee, 1998, Bushee, 2001 since their categorization determines their trading strategy. Higher institutional ownership, higher stability in institutional investors' equity ownership, and institutional investors classified as long-term are all associated with lower equity mispricing at investee firms.     

Quality investing in Asian stock markets

We examine two quality investing strategies using gross profitability (GP) or FSCORE, respectively, over the period of 2000–2016 in Hong Kong, Japan, Korea, Singapore and Taiwan stock markets. We find that the high-quality stocks generally earn positive returns in these markets. Both FSCORE and GP are significantly positively associated with subsequent stock returns in the cross-sectional regressions. We also find that financial institutions as sophisticated investor concern about stock quality. The actively managed institutions buy significantly more high-quality stocks than low-quality stocks in each of five Asian markets. The trading pattern is not significant in passively managed institutions.     

When political instability devaluates home-host ties

This study aims to shed light on how the value of home-host ties is contingent on political instability (i.e., political conflict and major institutional transitions). We hypothesize that by increasing the risk within the institutional structure, small political conflict positively moderates the relationship between home-host ties and location attractiveness, whereas full-fledged wars, in which risk to the institutional structure dominates erode the value of ties. Examining location choice decisions in Sub-Saharan Africa, we find evidence that home-host ties are not affected by small political conflict, while wars and major institutional transitions devaluate home-host ties.     

Entrepreneurs’ passion,home country’s institutional voids and small firm internationalization

The international entrepreneurship literature has revealed that entrepreneurs’ psychological characteristics drive a firm’s degree of internationalization. However, drivers that relate to entrepreneurs’ passion are not well developed in the international entrepreneurship literature. To fill this gap, this study uses a sample of 233 small firms to examine how entrepreneurs’ passion is related to small firms’ degree of internationalization and it also investigates whether this relationship is affected by levels of the home country’s institutional voids. The results show that passion is positively related to firms’ degree of internationalization and this relationship is positively moderated by levels of institutional voids. Implications for theory and practice are discussed.     

Materiality in an integrated reporting setting: Insights using an institutional logics framework

Using institutional logics as a theoretical framework and interviews with 20 preparers from 14 large organisations listed on the Johannesburg Stock Exchange (JSE), this paper focuses on examining differences in integrated reporting practices. The results reveal how a finance-centric market and professional logic interact with a stakeholder logic, leading to differences in the materiality determination process. Market-dominated firms have an internally focused approach to setting materiality which emphasises value-relevance for financial capital providers. Where logics are contested, materiality becomes an amalgamation of the factors which are important for shareholders and other stakeholders and essential for demonstrating compliance with codes of best practice. Organisations with market, professional and stakeholder logics aligned have the most sophisticated materiality determination processes. The emphasis shifts from lengthy reporting and compliance to providing a comprehensive account of the value creation process and how the business ensures long-term sustainability. In this way, how logics are instantiated may explain the considerable variation being observed in integrated reports. There are also implications for the propensity of firms either to view integrated reporting as a hegemonic challenge or to internalise it as part of a process of positive organisational change.     

Probing the role of institutional stereotypes in Americans’ evaluations of hazard-managing institutions

Abstract

Potential effects of institutional stereotypes on trust in hazard-managing organizations have been little explored. Americans’ views of attributes of government agencies, corporations, and non-profit advocacy groups (which try to influence policy) were probed in three surveys 2014–2016. Top-down ratings of positively and negatively phrased institutional attributes were based upon either perceived beliefs of ‘most Americans’ or the respondents themselves. Advocacy groups were rated most positive and least negative, and agencies the reverse, with corporations largely in the middle. Inter-individual differences in demographics, political ideology and interest, and worldviews produced modest variations in these views, supporting attributes’ culturally shared (i.e. stereotypical) nature. Explained variance in trust in institutions significantly increased (if with small to moderate effects) with the addition of stereotypes, particularly positive ones, controlling for other predictors. Institutional stereotypes may hold promise as complementary heuristics in citizen judgments of trust in hazard-managing organizations when they lack motivation or opportunity for situation-specific information; their effects when controlling for the latter (e.g. salient value similarity) remain to be tested.     

Coopetitive behaviours in an informal tourism economy

In the business literature, coopetition is defined as simultaneous cooperative and competitive activities among actors. In the informal economy, norms and trust take the place of formal contracts among actors and may allow these actors to move from engaging in competition to cooperation easily suggesting that patterns of coopetition in this context might be different to that in the formal economy. This research explores coopetition among informal tourism economy actors using the Institutional Analysis and Development Framework and the concept of shared resources. The results of qualitative case studies of pedicab drivers and street vendors in Yogyakarta indicate that simultaneous coopetition occurs when the actors share multiple resources while sequential coopetition occurs in the context of a single shared resource.     

Labor supply: Toward the construction of an alternative conception from post Keynesian and institutional economics

Post Keynesian and institutional economics have traditionally maintained a critical stance toward the orthodox model of labor supply, questioning many of its underlying assumptions. Nevertheless, this critical view has not led to the formulation of an alternative conception of labor supply that is sufficiently coherent and structured to be generally accepted within these branches of the literature. Accordingly, the purpose of this study is to contribute to the construction of such an alternative. To do so, the article starts by analyzing the relationship between the reasons that lead to individuals offering their labor and what that activity can bring to human beings in return. Secondly, the authors present an alternative concept of what workers contribute at work. They then analyze how the decision-making process regarding the labor supply actually takes place. Finally, the article concludes by briefly presenting certain additional points, in particular how differentiation is an inherent feature of the labor supply.     

Firm-level determinants of gender diversity in the boardrooms: Evidence from some emerging markets

This paper examines the determinants of board gender diversity in the context of emerging economies. Specifically, we investigate the impact of organizational characteristics on gender diversity in the boardrooms of Brazilian, Russian, Indian and Chinese firms and compare our findings with a control sample from US and UK. Analysing data for 1002 firms between a period of 2005 and 2012, we find some similarities between developed and emerging economies on the factors determining women representation on boards. In particular, we observe board gender diversity is positively related to the firm size, and it is inversely related to corporate risk across both emerging and developed economies. Family control affects positively board gender diversity only in India, China, UK and US. However, in contrast to developed countries, there is some evidence to suggest that state ownership has a negative effect on board gender diversity in India and Russia.     

Institutional versus non-institutional credit to agricultural households in India: Evidence on impact from a national farmers’ survey

A goal of agricultural policy in India has been to reduce farmers’ dependence on informal credit. To that end, recent initiatives are focused explicitly on rural areas and have a positive impact on the flow of agricultural credit. Despite the significance of the above initiatives in enhancing the flow of institutional credit to agriculture, the links between institutional credit and net farm income and consumption expenditures in India are not very well documented. Using large, national farm household level data and IV 2SLS estimation methods, we investigate the role of institutional farm credit on farm income and farm household consumption expenditures. Findings show that, in India, formal credit does indeed play a critical role in increasing both net farm income and per capita monthly household expenditures of Indian farm families. Finally, we find that, in the presence of formal credit, social safety net programs like the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) may have unintended consequences. In particular, MGNREGA reduces both net farm income and per capita monthly household consumption expenditures. On the other hand, in the presence of formal credit, the Public Distribution System may increase both net farm income and per capita monthly household consumption expenditures.