Relative productivity growth and the secular “decline” of U.S. manufacturing

There has been considerable debate about the causes of the “decline” of U.S. manufacturing over the post-war period. We show that the behavior of employment, prices and output in manufacturing relative to services over this period can be explained by a two-sector growth model in which productivity shocks are the only driving forces. Household preferences turn out to play a key role in our model. The data are consistent with a specification where households are unwilling to substitute goods for services (the estimated elasticity of substitution is statistically indistinguishable from zero), so the economy adjusts to differential productivity growth entirely by re-allocating labor across sectors.     

Predictability of tail risks of Canada and the U.S. Over a Century: The role of spillovers and oil tail Risks☆

We examine the tail risk spillovers between Canada and U.S. stock markets using over a century data, and also account for the roles of tail risks of other advanced economies (France, Germany, Japan, Italy, Switzerland, and the UK) and oil-market tail risk. We use the “best” tail risk measure obtained from different variants of the Conditional Autoregressive Value at Risk (CAViaR) model developed by Engle and Manganelli (2004) in the predictive model and compare its performance with that of an AR(1) benchmark model. We find strong evidence of risk spillovers between the two stock markets. We find contrasting evidence for the predictability of oil-market tail risk, with positive predictability in case of the net oil exporter and negative in case of the net oil importer. Further results using tail risks of other advanced economies (combined) support possible diversification potential for Canadian stocks in the presence of market risks of advanced economies other than the U.S. Our findings have implications for investors and are robust to various out-of-sample forecast horizons, alternative data frequencies, data splits, and 1% and 5% VaRs.     

A decomposition of trends in U.S. consumer expenditures on communications and travel: 1984–2002

This paper offers a conceptual and partly empirical decomposition of the trends in U.S. consumer expenditures on five communications and nine transportation subcategories between 1984 and 2002. We find that inflation nearly always increases unit prices. Income effects are positive for all categories, meaning that these are all normal goods, not inferior ones. We speculate that taste changes have contributed to increasing expenditures in most categories, with the exception of out-of-town lodging, the public transit component of the public transportation category, and the old communication media categories of postage and reading. We suggest that production and technological changes have led to decreased unit prices in most categories. In the private vehicle operations categories, technological improvements dominate, so that expenditure shares have been decreasing despite increasing demand. Conversely, in the new media categories, taste changes dominate, so that expenditure shares are increasing despite technological improvements which lower prices. The decomposition explored here enhances our understanding of these important expenditure categories, and provides a useful methodology with which to examine trends in other categories as well.     

The effect of unethical behavior on trust in a buyer–supplier relationship: The mediating role of psychological contract violation

Research on trust in buyer–supplier relationships has tended to focus on the performance outcomes of a trusting relationship, as well as the processes that serve to build trust. Largely absent from the buyer–supplier literature is an in-depth examination of activities that break down trust, and the resulting effect on supplier trust in the buyer. The authors propose and test a model that evaluates psychological contract violations between a buyer and a supplier as a mediating variable of the effect of unethical activities on trust within a partnership. Survey data was collected from 110 tier one suppliers of major corporations in the state of Ohio. Our results show how a supplier's perception of a violation of the psychological contract either partially mediates or fully mediates the relationship between the buyers unethical activity and the suppliers trust in that buyer. We discuss how suppliers may demonstrate bounded ethicality when they overlook perceived unethical behaviors by the buyer.     

Factors affecting delinquency of household credit in the U.S.: Does consumer sentiment play a role?

In this study, we provide both theoretical and empirical evidence on the determinants of household loan delinquency for home ownership, credit card and auto loans for the U.S. states in a panel framework over a period from 2003 through 2017. In particular, we examine the impact of consumer sentiments on loan delinquency rates. We show that improved current consumer sentiment significantly induce lower mortgage, credit card and automobile loan defaults in the American states subdivided into four different regions. We also find that the higher overall and expected consumer sentiment raise loan delinquencies. Implicit in this finding is the apparently excessive and inappropriate expansion of loans in the U.S. economy in the face of consumers’ optimism, which in turn, provides an intuitive understanding of the circumstances that could precede a depression or outbreak of anomalies in the financial sector. Our general findings further exhibit significant positive effect of unemployment rate and mostly adverse effect of per capita income on mortgage and automobile loan delinquency rates. The results provide some compelling evidence with regard to the effect of consumer confidence on household credit delinquency rates across various states in the U.S. and are robust to alternative measures of income and mortgage rates.     

Identification of management development needs: a comparison across companies of different ownership – foreign,joint venture and local in Sri Lanka

This paper presents the results of an empirical investigation of seventy-eight human resource managers employed in seventy-eight wholly foreign-owned, foreign and local joint venture and wholly local-owned export-oriented clothing manufacturing companies in Sri Lanka. The study investigated human resource managers' views on whether organizations identify development needs of managers, and, if so, from what sources. The findings of the study shed light on the identification of management development needs and on differences across companies of different ownership. The data revealed evidence of the existence of the identification of development needs of managers in the industry. Organizational strategies, succession plans and performance appraisal give rise to identify development needs of managers, other than requests from both heads of divisions/immediate superior managers who like their subordinates to be developed and managers themselves who desire to develop. Further, the results of the analysis of variance revealed that in certain aspects there are significant differences in the identification of development needs of managers. The results and implications of the findings are discussed.     

When was the U.S. housing downturn predictable? A comparison of univariate forecasting methods

This paper uses three classes of univariate time series techniques (ARIMA type models, switching regression models, and state-space/structural time series models) to forecast, on an ex post basis, the downturn in U.S. housing prices starting around 2006. The performance of the techniques is compared within each class and across classes by out-of-sample forecasts for a number of different forecast points prior to and during the downturn. Most forecasting models are able to predict a downturn in future home prices by mid 2006. Some state-space models can predict an impending downturn as early as June 2005. State-space/structural time series models tend to produce the most accurate forecasts, although they are not necessarily the models with the best in-sample fit.     

High-investment HR values and firm performance among local firms and U.S. MNCs’ subsidiaries in South Asia: a comparative study

Grounded in institutional theory, this study investigates the differential adoption and internalization of high-investment human resource (HR) values by local companies and by subsidiaries of US firms located throughout South Asia; and the impact of these HR values on firms’ performance. In line with our predictions, results suggest that US subsidiaries have a greater rate of adoption of high-investment HR values compared to local South Asian firms. Contrary to our predictions, however, both types of firms are similar in the level of internalization of their respective HR values. Finally, while greater levels of high-investment HR value adoption is associated with firm performance across the board, this relationship tends to be stronger for US MNCs’ subsidiaries compared to local South Asian companies. Theoretical and practical implications for the transfer and diffusion of high-investment HR values in institutionally and culturally distant contexts are discussed.     

The evolution of U.S. monetary policy: 2000–2007

A vector autoregression with time-varying parameters is used to characterize changes in Federal Reserve policy that occurred from 2000 through 2007 and describe how they affected the performance of the U.S. economy. Declining coefficients in the model׳s estimated policy rule point to a shift in the Fed׳s emphasis away from stabilizing inflation over this period. More importantly, however, the Fed held the federal funds rate persistently below the values prescribed by this rule. Under this more discretionary policy, inflation overshot its target and the funds rate followed a path reminiscent of the “stop-go” pattern that characterized Fed behavior prior to 1979.     

Cultural boundaries of self-justification and prospect theories in escalation of commitment: a US–Mexico comparison

The interplay among managers' cultural origin (i.e. Mexican vs. the USA), decision context and framing was investigated to test the cultural boundaries of self-justification and prospect theories in escalation of commitment. An experimental design indicated that, although a negative decision frame had a greater impact on escalation of commitment among Mexican managers, a positive frame had a greater impact on escalation of commitment among American managers. Moreover, a pattern indicating that framing had an opposite effect in each country emerged when the decision context was negative. Specifically, when the incoming information is positive, US decision-makers escalate their commitment to a failing course of action, whereas it is negative incoming information that leads to escalation for Mexican decision-makers.     

Regression evidence of safety-net support in Canada and the U.S., 1893–1992

Using annual deviations between the stock market and accounting valuations of major banks, this paper constructs synthetic century-long time series for the intangible safety-net capital generated by reporting and supervisory policies in Canada and the U.S. The credibility of the modeling exercise that produces these synthetic time series is supported by evidence that, in each country, all sustained surges in the value of estimated safety-net capital correlate in appropriate ways with regulatory events and crisis pressures. We invite others to test the qualitative usefulness of our framework by applying the method to data from other countries.     

The currency of talent management—A reply to “talent management and the relevance of context: Towards a pluralistic approach”

In this paper we provide a commentary on the article in this Special Issue by Thunnissen, Boselie, and Fruytier on the relevance of context to the field of talent management. We concur that a more critical, pluralist approach to talent management scholarship is needed, that talent management should go beyond a mere economic exchange between talent and their employer, and that further research is needed to explore the link between macro, meso and micro level considerations. Thunnissen, Boselie, and Fruytier pose insightful questions about the contribution of talent management to the social and moral development of society and legitimating talent management at meso level. For us, these questions raise issues about the extent to which individual agency in ethical issues is possible in environments designed to regulate and control talent. We suggest that underexplored notions of strategic exchange and individual identity provide a richer picture of the talent employment relationship and raise a number of possible directions for future talent management research.     

Introduction to “Unintended Consequences: The U.S. Postal Service Conundrum of Service,Business, Labor,and Politics”

Employee Responsibilities and Rights Journal -     

Switches in price discovery: Are U.S. traders more qualified in making valuations?

The literature on the price discovery of dually listed stocks postulates that domestic markets generally dominate in driving changes in prices and make a strong contribution to price discovery. In this study, we provide evidence challenging this view. We analyze a case of two dually listed mobile communication firms that experienced a more than 80% loss in their value in response to a regulatory decision to allow other new operators to enter the communication market in the domestic market. We find that during the negative momentum period, price discovery switched from the domestic to the foreign market, making the NYSE more important in terms of price discovery. Our findings suggest that, regardless of the origin of the news, such dramatic shocks that carry long-term implications are processed differently, with U.S. traders, rather than the domestic ones, being the main information processors.     

Benefits and Strategic Outcomes: Are Supplemental Retirement Plans and Safer Driving Related in the U.S. Trucking Industry?

We suggest that a firm's benefits can relate to important organizational outcomes that have strategic implications. We propose a number of mechanisms that could relate benefits to strategic outcomes, including the notion that benefits can help attract and retain the type of employees who are most likely to perform in ways consistent with the firms’ strategies. We illustrate this with the case of supplemental retirement benefits in an actual setting, the long‐haul trucking industry. We report positive organization‐level relationships associated with the management choice of offering these benefits. Our results show that firms offering supplemental retirement plans engage in significantly safer driving practices, as measured by the proxy of driver insurance costs, as hypothesized. These findings show that benefits can be related to outcomes that have strategic implications for the firm. By showing that retirement plans may be of value to organizations, we help to bridge the academic‐practitioner divide and provide motivation and guidance for additional work on this important but underresearched topic. © 2015 Wiley Periodicals, Inc.     

Intention and behavior: a Bayesian meta-analysis with focus on the Ajzen–Fishbein Model in the field of environmental behavior

We employ a Bayesian normal hierarchical model to investigate the relationship between intention and behavior as it is posited by Ajzen and Fishbein’s theory of planned behavior (TPB). Area of application is the field of environmental behavior. Eleven studies reporting correlations between intention and behavior were identified. Our Bayesian hierarchical model expects a correlation of r _xy = 0.54 between those variables. This effect size is above average with regard to meta-analyses, which include other, non-environmental areas of application.