The structure of information release and the factor structure of returns

We model how firms releasing information on different dates causes the CAPM to fail, requiring an additional factor based on the information structure to price assets. We exemplify this mechanism’s empirical relevance using quarterly earnings announcements, which cluster across months along size and book-to-market. Seventy percent of the alpha reduction from including SMB and HML occurs in the four main earnings announcement months. The information structure factor accounts for all of SMB and HML’s seasonal alpha reduction and one third of their overall alpha reduction. Controlling for size and book-to-market, exposures to SMB and HML vary with firms’ earnings announcement month.     

Going to market: A comparative study of Russian and Rromanian marketing managers

This study compares the effects of and adjustments to market economy forces on the part of marketing managers in Russia and Romania. Data supporting this comparison and the test of four hypotheses were gathered by personal interviews with Russian and Romanian managers. The findings show that, although marketing managers in both countries were drastically affected by market forces, Romanian managers were able to recognize and respond to market forces better than were Russian managers. The behavior of Romanian marketing managers also depended more on the type of enterprise ownership (state, joint stock, or private) than did the behavior of Russian marketing managers.     

“Step into the Real Texas”: Associating and claiming state narrative in advertising and tourism brochures

Texas is one of the most popular states for tourists. Using quantitative and primarily qualitative methods, we analyzed how marketers of small cities and towns associate their place to four central components of the Texas state narrative – the flag, official and unofficial symbols, territory, and social–historical mythology – in advertising and tourism brochures in the years 2008–2010. We discovered that in parallel to the overuse of the “associating to well-known brand/narrative” strategy, marketers also invest efforts toward claiming the narrative. Thus our second goal was to discover which techniques were used in order to claim the state narrative. Using the state of Texas as an example may provide a test case for typology, associating and claiming state narratives in promotional materials.     

The optimal composition of foreign exchange reserves

This paper presents a model for selecting an optimal foreign exchange reserves portfolio for semi-industrial and developing countries, using the mean—approach. The model described here focuses on the relationship between the composition of reserves and that of imports, as well as the impact of return and risk of the investments in each currency. The empirical importance of these factors is demonstrated by investigating the optimal policy for Israel in the period 1972–1976. In comparing the actual and the efficient portfolio of different groups of countries, we find that profit considerations play a greater role in semi-industrial and developing countries than in industrial ones.     

From exploiting to investing: A survey of us firms doing business in russia

US companies have been accused by the Russian media of flooding the Russian markets with their exports, repatriating their revenues or using them to buy Russian resources cheaply, and, as a result, increasing Russia's unemployment and decreasing its standard of living. Russia, argue many Russian experts interviewed in the past several years, is being badly exploited and its culture cheapened with Western candy, which in 1994 took $5 billion from consumers in Russia. On the other hand, US companies, which have been entering the Russian market in increasing numbers, argue that exporting products and services to Russia enhances the satisfaction of Russian consumers and contributes to the country's economy. They further say that as they become more familiar and comfortable with the Russian market, they change their strategies and increase their investment in Russia. Are US companies exploiting Russia or investing in its economic expansion? In this study the author investigated the entry strategies to Russia of 87 large US companies starting in 1989. These were randomly selected corporations, including a cross-section of consumer goods, industrial goods, computers, oil and gas, fast food, and consulting companies. What emerged was a captivating, historical drama, which changes rapidly from making money through exporting to Russia, to commitment through investment in plants and employment. For example, while the most popular entry doors to Russia have been exportlimport and joint ventures, most strategy changes since 1989 have been to wholly-owned subsidiaries, which usually require substantial investment. Yesterday's Snickers Bars exporter, Mars Candy, created a wholly-owned subsidiary, Masterfoods, and spent $70 million to build a chocolate and pet food factory that employs many Russians. In addition, a greater number of US companies entered the Russian market after the 1992 Yeltsin economic shock therapy and had a much needed stabilizing effect on the Russian economy. So, what may have been perceived as a one-sided relationship has been evolving to growth and mutual commitment. And as the Russian economy continues to grow, these companies will grow and prosper, too. Executives who are interested in the Russian market are advised that this market is real, growing, and worth considering. To enter and grow in this market, however, executives are cautioned that business deals in Russia must be structured in unfamiliar ways, and that they must employ local workers and respect Russia's culture and history. © 1997 John Wiley & Sons, Inc.     

The marketing of political candidates

While the controversy concerning the validity and purpose of broadening the concept of marketing is still an ongoing one, the present article focuses on the field of political marketing and compares its historical development with that of American business. In doing so, it is shown that political marketing, viz., the process by which political candidates and ideas are targeted at the voters in order to satisfy their political needs and thus gain their support, has gone through the stages of (1) candidate orientation. (2) sales-management orientation, and is presently experiencing a transition to a (3) marketing concept orientation. These orientations parallel the development in the orientation of American business from product to sales to marketing focus. In addition, the article also suggests that marketing and political marketing share many basic concepts and tools. Consequently, it is concluded that political marketing should be included within the boundaries of the existing marketing theory. The author would like to thank Professor Philip Kotler for his insightful comments on an earlier version of this paper, and for his encouragement.     

Production flexibility, stochastic separation, hedging, and futures prices

We study a dynamic model where uncertainty about interim outputadjustments causes producers to face price, cost and outputuncertainty. Stochastically separable production decisions areindependent of the producer's risk preferences and expectationsand are based on the prevailing futures price as a certain outputprice. Conditions under which futures contracts achieve stochasticseparation are established. Optimal hedging and maturity structureof futures contracts, equilibrium futures prices, and the effectsof futures trading on output are studied. The systematic riskpremium depends on the product of the futures beta and the covarianceof the market return with production revenues.     

Transformation of marketing management in Russia: A qualitative and theory building approach

Casual observers of Russian management are quick to portray a simplistic, well packaged, and seemingly accurate picture of life of Russian managers. Russia, they say, is imploding and disintegrating. In 1992, the inflation rate was 3,000 percent, and in the first 6 months of 1993, the monthly inflation rate ranged from 25 to 30 percent. The gross national product declined 25 percent in 1992 and continued to decline in 1993. Management life in Russia, these observers say, is unbearable, hell. Russian managers have been order-takers from central planners and regulators for more than 70 years. They have been accustomed to working in a stable and predictable environment, and therefore could not possibly be effective in the shock-therapy-induced market economy that began in January, 1992. However, these observers could not be further from the truth. I concluded from my study of Russian management decision making in 1989, 1991, and 1992 that in a rapidly changing and chaotic environment, Russian managers are quick to recognize the effects of the evolving market economy and take rapid corrective or exploitive action. The 3-year effort is a qualitative study of Russian management transformation and the development of a theoretical framework. What I found was that contrary to my findings in 1989 and 1991, the Russian economic shock therapy, which began in 1992, has infused life into Russian managers. As a result, they have been quick to recognize the effects of such economic forces as inflation, uncertainty, competition, consumer selectivity, credit, cash flow, and raw material on their enterprises. Likewise, they were also quick to respond, for example, by restructuring, downsizing, developing more competitive strategies, increasing promotions and sales force, and seeking foreign investors. In these respects, Russian management behavior resembles Western management behavior. © 1995 John Wiley & Sons, Inc.