Orange County Bankruptcy: Financial Contagion in the Municipal Bond and Bank Equity Markets

We examine the spillover wealth effects of the Orange County, California bankruptcy announcement in December 1994 on municipal bonds, municipal bond funds, and bank stocks. This bankruptcy is prominent because of unprecedented losses and because it was caused by a highly leveraged derivatives strategy rather than a shortage of tax revenues and excess spending. We find contagion in the bond market with significantly negative abnormal returns for municipal bond funds without direct exposure to Orange County and for non‐Orange County municipal bonds. In addition, our findings suggest the contagion spills over to the common stocks of investment and commercial banks that deal in or use derivatives; however, the equities of banks unexposed to derivatives are not affected.     

中国员工"工作/生活平衡"的理论框架

“:工作/生活平衡(work-lifebalance)”是全球人力资源管理领域的前沿课题。文章在对有关“工作/生活平衡”理论和实证研究的各种文献的综合回顾的基础上,提出了中国“工作/生活平衡”的理论框架。通过问卷调查,经过统计学方法的分析和检验,得出结论:发现中国员工面对的工作需求远大于世界很多国家,总体的“工作/生活平衡”状况不容乐观;中国员工老年亲属的支持作用相当显著,是中国“工作/生活冲突”的一个重要的缓和因素。     

The evolution of consumer knowledge and sources of information: Hungary in transition

The authors’ research in Hungary during the period of transition to a market economy provides an opportunity to examine the evolving relationships between consumer product knowledge and its antecedents, including advertising, personal search, interpersonal sources, and brand experience. Their findings, based on survey data collected in Budapest in 1992 and 1998, indicate that the market information variables explain more variance in consumer knowledge later rather than earlier in the transition. Advertising is an important predictor of consumer knowledge later but not earlier in the transition, personal search is important at both times, and interpersonal sources are not important in either time period; brand experience is negatively related to knowledge earlier in the transition and positively related later in the transition. This study allows one to begin to understand the boundary conditions associated with studies conducted in developed economies. Managerial implications for firms investing in transitional economies are presented. Robin A. Coulter (robin.coulter@business.uconn.edu) is Ackerman Scholar and an associate professor of marketing in the School of Business at the University of Connecticut. She received her Ph.D. from the University of Pittsburgh. Her research interests include branding, cross-cultural consumer behavior, advertising, and research methods. Her work has appeared in theJournal of Consumer Research, the Journal of Consumer Psychology, theJournal of Applied Psychology, and theInternational Journal of Research in Marketing. Linda L. Price (llprice@email.arizona.edu) is Soldwedel Professor of Marketing in the Eller School of Management at the University of Arizona. She received her Ph.D. from the University of Texas at Austin. Her research combines qualitative and quantitative methodologies to examine the active, emotional, imaginative aspects of consumers’ decisions and activities, and the social and cultural context of marketplace behaviors. Her work has appeared in theJournal of Consumer Research, Journal of Marketing, and other leading marketing, management, and social science journals. Lawrence Feick (feick@katz.pitt.edu) is a professor of business administration in the Katz Graduate School of Business at the University of Pittsburgh. He received his Ph.D. from Pennsylvania State University. His current research focuses on cross-cultural consumer behavior, consumer word-of-mouth, and referrals. His work has appeared in the Journal of Marketing, theJournal of Marketing Research, the Journal of Consumer Research, Psychological Bulletin, andPublic Opinion Quarterly. Camelia Micu (camelia.micu@business.uconn.edu) is a marketing doctoral candidate at the University of Connecticut. Her research interests include advertising and product trial and cross-cultural consumer behavior.     

Retraining midcareer managers: Career history and self-efficacy beliefs

Many corporations are retraining midcareer managers in order to combat employee obsolescence and boost corporate competitiveness. The receptivity of midcareer managers to retraining is mixed. Those managers who believe they can master new work-related learning (in the terms of this study, those who have positive self-efficacy in learning beliefs) are most amenable to retraining. The objective of the present study was to determine the antecedents of positive self-efficacy beliefs for midcareer managers facing retraining. We discovered that managers' advancement potential and the relevance of their previous training had a profound impact on their self-efficacy beliefs. These findings have important practical implications. The seeds of receptivity to retraining are planted throughout managers' careers. Hence, retraining should not be viewed on a program-by-program basis, but rather should be understood in the broader context of corporate life and individual career history. To prepare for the inevitable corporate evolution and change demanded in a dynamic business environment, senior executives and human resource managers should be proactive in creating those conditions that facilitate the development of positive self-efficacy in learning beliefs.     

Crafting a public image: An empirical study of the ethics of ghostwriting

Ghostwriting is viewed by some as a necessary element for crafting an effective public image. Defenders of ghostwriting see no ethical dilemma in the practice because the audience knows the speechgiver is not necessarily the speechwriter. Alernatively, those regarding ghostwriting as unethical view the practice as deceitful. This group argues that the audience does not recognize the employment of a speechwriter and thus a speechgiver relies on the words of another to fortify personal ethos. This article examines several positions regarding the ethics of ghostwriting and discusses an empirical study testing three major positions found in ghostwriting literature. Findings from the study indicate that respondents do recognize the use of speechwriters by certain individuals in certain circumstances.Linda A. Riley is a College Associate Professor in the Department of Marketing, College of Business Administration and Economics at New Mexico State University. She also serves as the Director of the Center for Economic Development Research and Assistance in the College of Business Administration and Economics.Stuart C. Brown is Assistant Professor of Rhetoric and Professional Communication in the English Department at New Mexico State University.     

Bringing the Future Forward: The Effect of Disclosure on the Returns-Earnings Relation

This paper studies how firm disclosure activity affects the relation between current annual stock returns, contemporaneous annual earnings and future earnings. Our results show that firms with relatively more informative disclosures "bring the future forward" so that current returns reflect more future earnings news. We also find that changes in disclosure activity are positively related to changes in the importance of future earnings news for current returns. These results suggest that a firm's disclosure activity reveals credible, relevant information not in current earnings, and that this information is incorporated into the current stock price.     

Risk and Market Segmentation in Financial Intermediaries' Returns

This study examines both the quantity and price of risk exposure for different segments of financial intermediaries. Overall, we find evidence of market segmentation in the U.S. financial services industry. Specifically, we find that securities firms, consistently over the sampling period 1974–1994, had the most market risk exposure with the lowest market risk premium. Banks' market risk fluctuated over the sampling period. Banks increased their market risk-taking after the shift in monetary target in October 1979 and the announcement of the risk-based capital requirements in July 1988. The banks' market risk became the highest and insignificantly different from securities firms'. The results are consistent with the moral hazard argument; that is, banks took on more risk to take advantage of government guarantees as their charter value declined. Banks were subject to relatively high interest rate risk premium. However, in response to increased interest rate volatility and decreased charter value after October 1979, banks (while they increased their market risk exposure) lowered their interest rate risk exposure to an insignificant level. The results suggest that the federal safety net may have been perceived by the market as covering only market risk but not interest rate risk. Overall, we find little evidence of interest rate risk exposure, suggesting the prevalence of hedging programs using interest rate derivatives. The interest rate risk premiums, unlike the risk exposure, differ across financial intermediaries.