DEVIL'S ADVOCACY IN MANAGERIAL DECISION-MAKING

There is some debate about the potential value of using devil's advocates in top-level organizational decision-making. In this paper, the contrasting views on this question are summarized briefly and the field and laboratory research on the devil's advocate and related techniques is discussed. This research is then used as the basis for detailed suggestions on the effective use of devil's advocates in improving managerial decisions.     

Ownership structure and golden parachutes: Evidence of credible commitment or incentive alignment?

Using a sample of S & P 500 firms, we find that golden parachutes are associated with concentrated external ownership, less concentrated internal ownership, and non-Delaware incorporation. We find little support that concentrated external owners use golden parachutes as credible commitment devices. The general multivariate results support the incentive alignment hypothesis, and reaffirm the view that golden parachutes are a mechanism used to align managerial and shareholder interests when there is a separation between ownership and control. (JEL G32)     

The Morishima gross elasticity of substitution

We show that the Hotelling–Lau elasticity of substitution, an extension of the Allen–Uzawa elasticity to allow for optimal output-quantity (or utility) responses to changes in factor prices, inherits all of the failings of the Allen–Uzawa elasticity identified by Blackorby and Russell [(1989) Am Econ Rev 79: 882–888]. An analogous extension of the Morishima elasticity of substitution to allow for output quantity changes preserves the salient properties of the original Hicksian notion of elasticity of substitution. We thank Paolo Bertoletti for drawing our attention to the issue addressed in this paper and for his comments on an earlier draft.     

An empirical test of trust-building processes and outcomes in sales manager-salesperson relationships

This study examines three trust-building processes and outcomes in sales manager-salesperson relationships. This study, based on a sample of more than 400 business-to-business salespeoples from a variety of industries, shows two trust-building processes (predictive and identification) to be significantly related to salesperson trust in the sales manager. Interpersonal trust was found to be most strongly related to shared values and respect. Trust was directly related to job satisfaction and relationalism, and indirectly related to organizational commitment and turnover intention. Thomas G. Brashear (brashear@mktg.umass.edu) (Ph.D., Georgia State University) is an assistant professor of marketing in the Isenberg School of Management at the University of Massachusetts-Amherst. James S. Boles (jboles@gsu.edu) (Ph.D., Louisiana State University) is an associate professor of marketing in the Robinson College of Business at Georgia State University. His research has appeared in a variety of journals, including theJournal of Marketing, theJournal of Business Research, theJournal of the Academy of Marketing Science, theJournal of Retailing, theJournal of Personal Selling and Sales Management, and theJournal of Applied Psychology. His areas of research interest include personal selling, sales management, key and strategic account management, and business relationships. Danny N. Bellenger (mktdnb@langate.gsu.edu) (Ph.D., University of Alabama) is currently chairman of the Marketing Department in the Robinson College of Business at Georgia State University. His research has appeared in a number of academic journals including theJournal of Marketing Research, theJournal of Marketing, theJournal of Advertising Research, theCalifornia Management Review, theJournal of Retailing, theJournal of Personal Selling and Sales Management, Industrial Marketing Management, and theJournal of Business Research. He has authored four monographs and four textbooks on marketing research, sales, and retailing. Charles M. Brooks (brooks@quinnipiac.edu) (Ph.D., Georgia State University) is an associate professor and chair of the Department of Marketing and Advertising at Quinnipiac University. His research has appeared in theJournal of Business Research, theJournal of Retailing, Marketing Theory, and theJournal of Marketing Theory and Practice.     

Onsite concurrent review: impacts on utilization, medical complications and expense

An evaluation of onsite concurrent review over and above the effects of Aetna's precertification program demonstrated reduced utilization and expenses, especially for ancillary services, and no adverse effects on rates of medical complications.     

Production, trade, prices, exchange rates and equilibration in large experimental economies

We study market equilibration in laboratory economies that are larger and more complex than any that have been studied experimentally to date. Complexity is derived from the fact that the economies are “international” in economic structure with multiple input, output, and foreign exchange markets in operation. The economies have twenty-one markets and due to the fact that they have roughly fifty agents, the economies are characterized by several hundred equations. In spite of the complexity and interdependence of the economy, the results demonstrate the substantial power of the general equilibrium model of perfect competition to predict the direction of movement of market-level variables. Empirical patterns in the convergence process are explored and described.     

Piercing the Veil of Uncertainty in Transboundary Pollution Agreements

This paper addresses the question of how uncertainty in costs and benefits affects the difficulty of reaching a voluntary agreement among sovereign states. A measure of difficulty is constructed related to side-payments necessary to make an agreement a Pareto-improving move. Using a simple model, it is shown that uncertainty actually makes agreement easier.JEL classifications: Q5, H4, D7, D8An earlier version of this paper was presented at the Conference on Risk and Uncertainty in Environmental and Resource Economics, Wageningen, The Netherlands, June 2002.     

Is Meta-Analysis a Noah's Ark for Non-Market Valuation?

This paper describes meta-analytical methods as they have been appliedto non-market valuation research. These studies have been used to reviewand synthesize literature and, more recently, in benefit transfer. Thissecond use imposes a higher standard on the consistency in economicconcepts being summarized and in the resources included in ameta-analysis. To meet this need, the paper proposes and illustrates astructural framework using a generalized method of moments estimator toestimate the parameters of a preference function with the benefitsestimates usually encountered in meta-analytic summaries.