Uncovered interest parity: it works, but not for long

If an investor borrows in a low interest currency and invests in a high interest currency, the interest differential accrues in a lumpy manner, formally just like the dividend payments on a stock. The investor will receive the interest differential discretely at the point when a position is rolled over from one day to the next. A position that is not held open overnight receives no interest differential because intradaily interest rates are zero. Using a large data set of intradaily exchange rate data, we run uncovered interest parity (UIP) regressions over different short time intervals taking careful account of the settlement rules in the spot foreign exchange market. We find results that are supportive of the uncovered interest parity hypothesis over very short windows of data that span the time of the discrete interest payment. However, adding even a few hours to the span of the window destroys the positive uncovered interest parity results.     

Asymmetric competition in retail store formats: Evaluating inter- and intra-format spatial effects

Our study aims to analyze the role of store format in retail competitive interactions, specifically, the relationship between growth, location strategy, and market response. To assess this relationship, we propose an extension of the classic models of spatial interaction, which incorporate the asymmetric competitive effects linked to the concept of store format. An empirical application allows us to confirm greater spatial rivalry within store formats (intra-format) than between store formats (inter-format). This implies a certain hierarchical organization when consumers select a retail store, first choosing the type of store at which they will shop and later a particular store within this format. The results are important for retailers who want to configure an optimal network of store locations as well as public administrators who must regulate commercial activity.     

Leaders,Values, and Organizational Climate: Examining Leadership Strategies for Establishing an Organizational Climate Regarding Ethics

This paper examines the critical role that organizational leaders play in establishing a values based climate. We discuss seven mechanisms by which leaders convey the importance of ethical values to members, and establish the expectations regarding ethical conduct that become engrained in the organizations climate. We also suggest that leaders at different organizational levels rely on different mechanisms to transmit values and expectations. These mechanisms then influence members practices and expectations, further increase the salience of ethical values and result in the shared perceptions that form the organizations climate. The paper is organized in three parts. Part onebegins with a brief discussion of climates regarding ethics and the critical role of values. Part two provides discussion on the mechanisms by which leaders and members transmit values and create climates related to ethics. Part three provides a discussion of these concepts with implications for theory, research, and practice.     

Divergent and Convergent Idea Generation in Teams: A Comparison of Computer-Mediated and Face-to-Face Communication

Many tasks and decisions in business, including management consulting, are performed in group settings. Computer-mediated communication (CMC) tools (e.g., Lotus Notes) are increasingly being used by businesses to support teams in a variety of settings. Considerable research in information systems has demonstrated the advantages of electronic brainstorming (EBS) for generic tasks involving only divergent thinking. However, it is unclear whether the benefits of CMC extend to tasks that require both divergent and convergent processes. Per task–technology fit theory (TTF) (Zigurs and Buckland 1998), the use of computer-based group communication support tools, including chat systems in wide-spread use today, may be less effective for convergent processes than for divergent processes. This study experimentally compares the performance of computer-mediated and face-to-face (FTF) teams on tasks requiring both divergent and convergent processes. Consistent with theoretical predictions, the results revealed that computer-mediated teams outperformed FTF teams in the divergent aspects of the tasks, while FTF teams outperformed computer-mediated teams in the convergent aspects of the tasks.     

Choose, Choose, Choose, Choose, Choose, Choose, Choose: Emerging and Prospective Research on the Deleterious Effects of Living in Consumer Hyperchoice

The ideology of consumption and the imperative of consumer choice have washed across the globe. In today's developed economies there is an ever-increasing amount of buying, amidst an ever-increasing amount of purchase options, amidst an ever-increasing amount of stress, amidst an ever-decreasing amount of discretionary time. This brief essay reviews research suggesting, for example, that hyperchoice confuses people and increases regret, that hyperchoice is initially attractive but ultimately unsatisfying, and that hyperchoice is psychologically draining. Future research is then discussed, including how and why hyperchoice may have other toxic effects on people, including the degrading of moral emotions and behavior.     

Shaping of Moral Intensity Regarding Software Piracy: A Comparison Between Thailand and U.S. Students

Software piracy is a major global concern forbusinesses that generate their revenues throughsoftware products. Moral intensity regardingsoftware piracy has been argued to be relatedto the extent of software piracy. Anunderstanding of the development of moralintensity regarding software piracy inindividuals would aid businesses in developingand implementing policies that may help themreduce software piracy. In this research westudied the similarities and differences indevelopment of moral intensity regardingsoftware piracy among university students intwo different cultures, the U.S. and Thailand. In particular, we studied the influence of theimmediate community of individuals, such asother students, faculty, and other universityemployees, on the development of moralintensity regarding software piracy of the twogroups of students. Results indicate that, ingeneral, there are significant differences inmoral intensity regarding software piracybetween students from the US and Thailand, andthat gender differences also exist. Though theeffect of the immediate community on theself-perception of moral intensity regardingsoftware piracy of students was significant,there appears to be very little significantdifferences in this effect between the studentsin the two different countries studied. Thefindings have implications for teachingbusiness ethics, and for developing andimplementing policies to curb global softwarepiracy.     

Hierarchical Bayesian conjoint models incorporating measurement uncertainty

The authors explore situations where consumers supplement their judgments with a measurement of uncertainty about their own preferences, either implicitly or explicitly, and develop two sets of hierarchical Bayesian conjoint models incorporating such measurements. The first set of models uses the relative location of a rating to determine the importance or weight given to the rating, in a regression setting. The second set uses interval judgment as a dependent variable in a regression setting. After specifying the models, the authors perform a theoretical comparison with a basic Bayesian regression model. They show that, under different conditions, the proposed models will yield more precise individual-level partworth estimates. Two simulated data examples and data from a conjoint study are used to illustrate the gains that could be obtained from modeling uncertainty. In the empirical application, the authors show that model fit improves when ratings for items that respondents do not like are given more weight compared to ratings for items that they do like. Electronic Supplementary Material  The online version of this article (doi:) contains supplementary material, which is available to authorized users.