Does corporate diversification reduce value in high technology firms?

We find that firm value is reduced via industrial diversification and this reduction in value depends upon a firm’s technology intensity. We consider that asymmetric information problems are more severe in technology intensive industries and find that high tech industry firms present distinctly larger value reduction when compared to low tech industry firms. The negative valuation effect is greater for firms that have a relatively larger amount of intangible assets and greater R&D capital. We determine that our findings are robust to different estimation methods and alternative excess value measures.     

There and back again – estimating equivalence scales with measurement error

Using income satisfaction data from the German Socio-Economic Panel, we find large differences in the equivalence weight of a partner when it is being estimated by direct and reverse regressions. We argue that neither of the two models will produce consistent estimates when there is stochastic error in satisfaction and measurement error in incomes. We propose a correction of mismeasured incomes using a constructed alternative income measure. The corrected results are relatively close to those obtained from direct regression. We do not find evidence that previous studies, using the direct regression method, severely suffer from measurement error in incomes.     

Does CEO inside debt compensation benefit both shareholders and debtholders?

Review of Quantitative Finance and Accounting - We examine whether the proportion of CEO inside debt holdings (pension and deferred compensation) to stock holdings benefit both shareholders and...     

Reference Income Effects in the Determination of Equivalence Scales Using Income Satisfaction Data

We estimate household equivalence scales, i.e. the needs of additional adults and children relative to a single adult, using income satisfaction data from the German Socio‐Economic Panel. We extend previous studies applying this approach by taking reference income into account. This allows separating needs‐based from reference effects in the determination of income satisfaction. We show that this adjustment helps to overcome a bias causing an overestimation of adults’ and an underestimation of children’s needs‐based equivalence weights. Our results indicate that controlling for income comparisons substantially increases children’s equivalence weight relative to that of adults.     

R&D employee tenure in MNC subsidiaries: the role of institutional distance and experience

Long tenure of research and development (R&D) employees helps organisations to utilise employees' knowledge over a sustained time period and strengthen their competitive advantage. It also allows organisations to benefit from the training investments made on their R&D employees. Thus, identifying the determinants of R&D employees' tenure is crucial for designing effective R&D employee retention strategies. This paper analyses the factors explaining R&D employees' tenure in the subsidiaries of multinational corporations (MNCs). Building on institutional theory, we claim that formal and informal institutional distance between MNCs' home and host country might lead to R&D employees' short tenure in subsidiaries. We further suggest that R&D employees' international experience and MNCs' host country experience play a moderating role. We find support for our hypotheses by mobilising an original database that combines patent data and the LinkedIn profiles of 939 R&D employees in 256 MNC subsidiaries in India.