Managerial Political Behavior in Innovation Portfolio Management: A Sensegiving and Sensebreaking Process

By applying formalized innovation portfolio management systems, firms seek to ensure an alignment of their goals and strategy with their employees' different abilities, actions, and outcomes. However, research indicates that nonrational, political behavior also determines formalized innovation portfolio management decision‐making processes. Research on political behavior in respect of innovation portfolio management usually conceptualizes political behavior as a set of self‐serving activities, such as negotiation, bargaining, coalition building, and acquiring power, aimed at protecting, maintaining, or promoting an actor's self‐interest and power. Consequently, extant research tends to focus on political behavior's dysfunctional impacts on decision‐making processes and their subsequent outcomes. This paper challenges this negativity bias by exploring a novel, neutral specification of political behavior and its relation to innovation portfolio management decision‐making processes. By conducting an automotive industry case study focusing on the innovation portfolio management decision‐making processes, the paper analyzed the data from 43 interviewees. The conceptual model shows that managers' political capabilities determine their ability to behave politically. According to the results, political behavior comprises the activities that prepare the stage and orchestrate others in order to form a political coalition. Furthermore, results show that political behavior functions as a sensegiving and a sensebreaking process, with managers seeking to shape an innovation project's understanding according to their interests and to influence portfolio decisions. The resulting novel specification of political behavior extends the construct's scope and validity by investigating their functional and dysfunctional aspects, and by indicating that a political sensemaking process complements formalized innovation portfolio management decision‐making processes.     

Sustainability concerns in luxury supply chains: European brand strategies and French consumer expectations

Sustainability in supply chain management has become a concern in both research and practice. Although consumption and purchasing have been significantly explored in the luxury sector, a gap in supply chain studies is still evident. Therefore, the aim of this article is to examine how industry bodies and supply chain partners address sustainability concerns in the European luxury sector and how they respond to consumer expectations. In an explanatory study, we have collected data about sustainable supply chain practices in 11 European luxury good companies, by interviewing and surveying 13 managers. In a first consumer study, we held interviews with French luxury consumers in Bordeaux about their sustainability expectations (N = 170). The results show that while the distribution of attention is dependent on the respective supply chain activities, luxury goods companies address sustainability concerns and aim to take responsibility for their activities. However, the emphasis is on the dimension of economic sustainability. A comparison with sustainability expectations of French luxury goods consumers suggests that business practices are not perfectly well aligned with these expectations. Consumers put more emphasis on social and environmental sustainability dimensions. On the other hand, business activities concerning waste reduction and raw material management rather well match consumer expectations.     

Optimal Social Insurance with Endogenous Health*

In this paper, I analyze optimal insurance against unemployment and disability in a private information economy with endogenous health and search effort. Individuals can reduce the probability of becoming disabled by exerting prevention effort. I show that the optimal sequence of consumption is increasing for a working individual and constant for a disabled individual. During unemployment, decreasing benefits are not necessarily optimal. The prevention constraint implies increasing benefits while the search constraint demands decreasing benefits while being unemployed. However, if individuals respond sufficiently to search incentives, the latter effect dominates the former and the optimal consumption sequence is decreasing during unemployment.     

What satisfies younger versus older employees,and why? An aging perspective on equity theory to explain interactive effects of employee age,monetary rewards,and task contributions on job satisfaction

In light of increasingly age-diverse workforces, organizations face the challenge of fostering job satisfaction among both younger and older employees. Combining equity theory with an aging perspective, we propose that due to age-related shifts in motives and goals, younger versus older employees’ job satisfaction will depend differently on monetary rewards (outcome side of equity theory), task contributions (input side of equity theory), as well as on imbalances (inequity) in the relationship between monetary rewards and task contributions. In a multisource study with 166 managers, we found that while younger employees were satisfied primarily by monetary rewards, older employees were satisfied primarily by their task contributions. Most importantly, a three-way interaction indicated that younger versus older employees react differently to two types of inequity: Being proportionally over-rewarded (i.e., receiving high monetary rewards for low task contributions) reduced older (but not of younger) employees’ job satisfaction. By contrast, under-reward inequity (i.e., receiving low monetary rewards for high task contributions) decreased younger (but not of older) employees’ job satisfaction. These age-dependent effects of job features on job satisfaction reveal important theoretical as well as practical implications.     

Competition versus cooperation: How technology-facilitated social interdependence initiates the self-improvement chain

Consumers are increasingly using technologies such as wearables or mobile apps to achieve their self-improvement goals. Such technologies often contain features that enable social interdependence (competition or cooperation) among users to support them in improving their engagement, performance, and well-being (life satisfaction and personal growth). However, the critical question remains: does competition or cooperation best serve users in attaining these self-improvement goals? Evidence from an online experiment and a field study reveals that competition is more effective in driving performance and personal growth, while cooperation is superior in terms of behavioral engagement and life satisfaction. Furthermore, the results indicate that the effects are mediated by strive for success and fear of failure, two counteracting psychological processes. While competition is the stronger trigger for both pathways, downstream effects vary depending on the self-improvement goal considered. This research thus provides insights into whether and how users can best realize their self-improvement goals using technologies that include social features.     

Carry

We apply the concept of carry, which has been studied almost exclusively in currency markets, to any asset. A security’s expected return is decomposed into its “carry,” an ex-ante and model-free characteristic, and its expected price appreciation. Carry predicts returns cross-sectionally and in time series for a host of different asset classes, including global equities, global bonds, commodities, US Treasuries, credit, and options. Carry is not explained by known predictors of returns from these asset classes, and it captures many of these predictors, providing a unifying framework for return predictability. We reject a generalized version of Uncovered Interest Parity and the Expectations Hypothesis in favor of models with varying risk premia, in which carry strategies are commonly exposed to global recession, liquidity, and volatility risks, though none fully explains carry’s premium.     

Australian momentum: performance,capacity and the GFC effect

This paper assesses the performance of momentum strategies in Australia, and how they were affected by the GFC. This paper is the first to address the issue of the dollar capacity of momentum strategies in the Australian market. We find evidence of a strong momentum effect in Australia amongst the S&P/ASX200 constituents. We find that momentum portfolios suffered during the GFC, but the effect was not persistent. Finally, we show that the capacity of the momentum effect in Australia is large enough in dollar terms to reject the assertion that momentum is more of a theoretical than a practical construct.     

Asymptotics for Autocovariances and Integrated Periodograms for Linear Processes Observed at Lower Frequencies

One of the most frequently used class of processes in time series analysis is the one of linear processes. For many statistical quantities, among them sample autocovariances and sample autocorrelations, central limit theorems are available in the literature. We investigate classical linear processes under a nonstandard observation pattern; namely, we assume that we are only able to observe the linear process at a lower frequency. It is shown that such observation pattern destroys the linear structure of the observations and leads to substantially different asymptotic results for standard statistical quantities. Central limit theorems are given for sample autocovariances and sample autocorrelations as well as more general integrated periodograms and ratio statistics. Moreover, for specific autoregressive processes, the possibilities to estimate the parameters of the underlying autoregression from lower frequency observations are addressed. Finally, we suggest for autoregressions of order 2 a valid bootstrap procedure. A small simulation study demonstrates the performance of the bootstrap proposal for finite sample size.     

Appetite for destruction: Counterintuitive effects of attractive faces on people's food choices

Faces in general and attractive faces, in particular, are frequently used in marketing, advertising, and packaging design. However, few studies have examined the effects of attractive faces on people's choice behavior. The present research examines whether attractive (vs. unattractive) faces increase individuals’ inclination to choose either healthy or unhealthy foods. In contrast to the beliefs held by most marketing professors, but consistent with visceral state theories, exposure to attractive (vs. unattractive) opposite-sex faces increased choice likelihood of unhealthy foods. This effect was moderated by self-view-relevant attributes and exerted a particularly powerful influence on individuals who were single (vs. in a relationship) and individuals rating themselves as unattractive (vs. attractive). Furthermore, the effect was mediated by arousal, was stronger for men than for women, but did not generalize after exposure to attractive (vs. unattractive) same-sex faces. As pictorial exposure is sufficient for the effect to occur, these findings have important implications for marketing, advertising, and public health.