The Impact of Enterprise Size on Employment Tribunal Incidence and Outcomes: Evidence from Britain

Employment Tribunals are the formal means of adjudicating disputes over individual employment rights in the UK. This article hypothesizes that, because small firms favour informality over formality, they are more likely (i) to experience employee claims than large firms; (ii) to be subject to different types of claims; (iii) to settle prior to reaching a formal Tribunal; and (iv) to lose at a Tribunal. Data from the 2003 Survey of Employment Tribunal Applications are used to examine these hypotheses. They are generally supported, although in relation to the third there was no size effect. Furthermore, our results show that firms that have procedures and follow them are more likely to win than those firms that do not have any procedures. Recognizing the benefits of informality, while also ensuring that small firms follow proper standards of procedural fairness, is a policy dilemma that has yet to be resolved.     

The Economic Impact of Anticipated House Price Changes—Evidence from Home Sales

If realized house prices have the wealth effect and the collateral effect on the economy, anticipated house price changes should have similar economic effects. This article empirically analyzes the effects of single‐family home sales, which are shown to be able to predict house prices in the literature, on economic production, using 372 metropolitan statistic areas in the United States from the first quarter of 1981 to the second quarter of 2008 in a panel vector error correction model. Changes in home sales are found to Granger because the growth rate of per‐capita gross metropolitan product and the dynamic effects are visualized with impulse response functions. Supporting evidence for the economic impact of home sales is also found in contemporaneous regressions.     

The Productivity Effects of Participatory Employment Practices: Evidence from New Japanese Panel Data

We report the first results for Japanese firms on the effects of clusters of participatory employment practices (or participation/employee involvement at the top level as well as at the grassroots level, and financial participation) by estimating production functions using new panel data. We find that the introduction of a group of complementary practices will lead to a significant 8–9 percent increase in productivity. However, the full productivity effect is felt only after a long developmental period.     

The Impact of Dividend Reinvestment Plans on Firm Payout Choices—Evidence from Real Estate Investment Trusts

This study investigates whether firm dividend payout choices are influenced by the presence of a Dividend Reinvestment Plan (DRIP). Given that DRIPs help retain capital, we show that dividend‐paying firms with a DRIP will tend to pay a high dividend and maintain a stable payout policy. Using a multinomial logistic model, we show that in comparison to REITs without DRIPs, REITs with DRIPs have a higher payout ratio and are less likely to: (1) pay regular dividends with extra dividends and share repurchases, (2) distribute extra dividends, repurchase shares, yet omit regular dividends and (3) omit all payouts. In addition, we find that REITs with a capital‐retaining DRIP invest more aggressively and such increased investment activities are undertaken without raising the reliance on external financing.     

The Pricing of Seasoned Equity Offerings: Evidence from REITs

Real estate investment trusts (REITs) have been a very active sector in the capital market over the last few years. This paper examines the pricing of seasoned equity offers by equity REITs during 1991–1996. Consistent with Parsons and Raviv's model, we find that SEOs by REITs are underpriced with respect to both the closing price on the day before and the closing price on the day of the offer. Underpricing depends on the institutional ownership of the firm's common stock. Issues by firms with higher institutional ownership are more underpriced for post-1990 REITs. Further, consistent with the notion that theories of IPO pricing apply to SEOs as well, the underpricing of SEOs is a function of the issue size and of the underwriter's reputation.     

Why managers divest—Evidence from New Zealand's largest companies

Chief Executives from New Zealand's largest companies were surveyed to distinguish divesting and nondivesting companies, and to identify the relative importance of the factors and motives which led to the divestment of 208 business units in the period 1985 through 1990. The divesting companies were considerably larger and faster growing than nondivestors. The typical divestment was motivated by the need to convert unattractive assets into liquid form which could then be held to strengthen the balance sheet, or reinvested in either the core business or new areas.     

The Effect of Ability on Young Men's Self‐Employment Decision: Evidence from the NELS

Using the National Educational Longitudinal Study data, we examine the role of pre‐market abilities on young men's self‐employment decision. Our results indicate that cognitive and non‐cognitive abilities are two important, in opposing directions, predictors of self‐employment. We also find that cognitive and non‐cognitive abilities may differ in their malleability with the latter being more malleable during adolescence.     

Risk and Return on Real Estate: Evidence from Equity REITs

We analyze monthly returns on an equally weighted index of eighteen to twenty-three equity (real property) real estate investment trusts (REITs) that were traded on major stock exchanges over the 1973–87 period. We employ a multifactor Arbitrage Pricing Model using prespecified macroeconomic factors. We also test whether equity REIT returns are related to changes in the discount on closed-end stock funds, which seems plausible given the closed-end nature of REITs.
Three factors, and the percentage change in the discount on closed-end stock funds, consistently drive equity REIT returns: unexpected inflation and changes in the risk and term structures of interest rates. The impacts of these variables on equity REIT returns is around 60% of the impacts on corporate stock returns generally. As expected, the impacts are greater for more heavily levered REITs than for less levered REITs. Real estate, at least as measured by the return performance of equity REITs, is less risky than stocks generally, but does not offer a superior risk-adjusted return and is not a hedge against unexpected inflation.     

The Health Consequences of Adverse Labor Market Events: Evidence from Panel Data

This study investigates the associations between self‐assessed adverse labor market events (experiencing problems with coworkers, employment changes, financial strain) and health. Longitudinal data are obtained from the National Epidemiological Survey of Alcohol and Related Conditions. Our findings suggest problems with coworkers, employment changes, and financial strain are associated, respectively, with a 3.1 percent (3.3 percent), 0.9 percent (0.2 percent), and 4.5 percent (5.1 percent) reduction in mental health among men (women). Associations are smaller in magnitude and less significant for physical health.     

The Employment Effects of Minimum Wages: Evidence from a Prespecified Research Design The Employment Effects of MinimumWages

This article presentsevidence on the employment effects of recent minimum wage increases from a prespecified research design that entailed committing to a detailed set of statistical analyses prior to “going to” the data. The limited data to which the prespecified research design can be applied may preclude finding many significant effects. Nonetheless, the evidence is most consistent with disemployment effects of minimum wages for younger, less‐skilled workers.     

The Impact of Employment on Parental Coresidence

We examine the extent to which parents use housing and shared living arrangements as a form of risk‐sharing for their adult children, using detailed data on children and parents in the Health and Retirement Study for 1998–2012. On average, a young man moving from full‐time to nonemployment raises the likelihood of coresiding with a parent by 1.5 percentage points; moving from full‐time employment to being part‐time employed raises the likelihood of coresiding with a parent by 2 percentage points. The implied elasticity of parental coresidence with respect to the son's income is ‐1.1; for daughters, the elasticity is ‐0.5.     

The Impact of Training on Labour Mobility: Individual and Firm‐level Evidence from Britain

We investigate the impact of different types of training on the mobility expectations of workers, using three surveys. Most training episodes produce some transferable skills, and most transferable training is paid for by employers. Overall, training has no impact on mobility in three out of every five cases; the remaining cases are split equally between those where training increases and those where it decreases mobility. We find that training is more likely to lead to lower mobility when it is less transferable to other firms, is sponsored by firms, and where its objectives include increasing the identification of employees with corporate objectives.     

The Impact of Mergers on Quality Provision: Evidence from the Airline Industry

We examine how mergers affect quality provision by analyzing five U.S. airline mergers, focusing on on‐time performance (OTP). We find that airline mergers have minimal negative impacts on OTP, and likely result in long‐run improvements due to efficiencies. Importantly, we show that this finding is not driven by post‐merger changes in price that could affect OTP. Consequently, at least in the case of airlines, policymakers should not, as a rule, fear the negative quality effects of mergers.     

Employment Effects of Acquisitions: Evidence from Acquired European Firms

This paper examines the employment effects of acquisitions for acquired European firms, taking non-random selection of acquisition targets explicitly into account. Following the empirical firm growth literature and theories put forward in the mergers and acquisition (M&A) literature, we control for convergence dynamics in firm size and distinguish between different types of acquisitions. Empirically, we estimate an endogenous treatment model using accounting data for a newly created sample of acquired and non-acquired European firms. Our results reveal positive employment effects for different types of acquisitions indicating that M&As likely induce efficiency gains.     

The Impact of the Entry of Biosimilars: Evidence from Europe

Biologics represent a substantial and growing share of the U.S. drug market. Traditional “small molecule” generics quickly erode the price and share of the branded product upon entry, however only a few biosimilars have been approved in the US since 2015, thereby largely preserving biologics from competition. We analyze European markets, which have had biosimilar competition since 2006. Using our own survey, we analyze how market features and public policies predict biosimilar entry, price, and penetration, finding significant heterogeneity across countries and products. Effective buyer institutions are associated with increased biosimilar penetration. Our estimates can inform ongoing policy discussions.     

The Effect of Graduated Response Anti‐Piracy Laws on Music Sales: Evidence from an Event Study in France

Despite the problem that filesharing poses to the creative industries, there is little research on the effectiveness of governmental anti‐piracy policies. This study analyzes how the HADOPI ² graduated response law in France affected digital music sales. Using a panel of sales data from the four major labels, we applied a difference‐in‐difference approach, comparing sales trends in France to a control group of European countries. We find that increased consumer awareness of HADOPI caused French iTunes music sales to increase by 22‐25%. The observed sales increase is larger in high piracy genres than low piracy ones, strengthening the causal interpretation of our results.