The real estate code of ethics: Viable or vaporous?

Several recent articles in the field of ethics and business have raised questions concerning the viability of professional ethical codes. Are such codes serious, effective tools for promoting and enforcing an ethical standard of behavior? Or do the codes more closely resemble clever, elaborate public-relation ploys? The purpose of this paper is to analyze the content, role and efficacy of one such ethical code, namely, The Code of Ethics of the National Association of Realtors. The paper examines the ethical principles embodied, implicitly or explicitly, in this Code; it tests these principles for coherence, comprehensiveness, clarity and enforce-ability. Furthermore, it seeks to determine whether this Code articulates standards of ethical conduct that are higher than those already required by law and whether the Code successfully translates a general ethical vision down to concrete, everyday real estate practice.     

Informal firms in developing countries: entrepreneurial stepping stone or consolation prize?

The potential dynamic benefits of a firm having the option to adopt informal status are analysed. Informality may be a stepping stone, without which formality may never be achieved. This result is obtained for a broad range of realistic parameter values, suggesting a potential dynamic case for government support of informal firms. Informality may alternatively play a converse role as a consolation prize, with a firm only entering an industry (formally) because it recognizes that if profitability is disappointing, it can switch to informality. However, this result is obtained for a range of parameter values so narrow as to be of no practical significance.     

The Service Economy: Standardisation or Customisation?

Service firms are squeezed between customisation and standardisation (the latter emphasises productivity in accordance with neo-classic economic theory). This presents a dilemma to service firms and to economic theory. The theoretical logics of both are discussed and a third theory, based on modulisation, is presented. The article investigates the issue of towards which of the three logics the service sector is developing. This is measured via two surveys carried out in Denmark. The results of the surveys say that the development is towards that of customisation with some minor tendencies towards modulisation. These results are discussed thoroughly.     

The Japanese Export Insurance Arrangements: Promotion or Subsidisation?

Japan has promoted its exports by reducing the risks accompanying overseas sales through short‐term facilities for exporters. Short‐term export insurance schemes operated in line with rules on minimum premia are not prohibited according to current international trade rules. The insured amount of underwriting has however grown steadily and the balance of accounts of export insurance has deteriorated over a sustained, ‘long‐term’ period. The Japanese government has supported the system by reinforcing its financial base. In the 1980s and 1990s, the amount of claims was almost three times higher than premium incomes. Although the Japanese government may have subsidised exporters through the export insurance system, such subsidisation is notionally at least in accordance with the current regulations of the global trading system. The multilateral trading system has included export insurances at premium rates inadequate for covering the long‐term operating costs and losses of the programmes in the list of export subsidies. The current Members of the WTO are obliged to abide by the Agreement on Subsidies and Countervailing Measures which comprises the illustrative list of export subsidies. However, the Agreement also stipulates that export insurances consistent with the interest rate provisions of the OECD Arrangement should not be considered as an export subsidy. Therefore, provision of export insurances not prohibited by the WTO regulations may be considered by developing countries undergoing trade deficits as a means of export promotion. Japan has done similarly for the past half century.     

The Consumer Product Safety Commission: Benefit or Boondoggle?

The Consumer Product Safety Commission has been subject to the criticism of all parties involved in the regulation of the safety of consumer products. This paper evaluates the Commission's performance, examining both the sources of the Commission's regulatory problems and the extent to which recent amendments to the Consumer Product Safety Act will ameliorate these problems. Alternative approaches to the regulation of consumer product safety are suggested.     

Rating standards around the world: A puzzle?

Using panel data on S&P's credit ratings for firms from 63 countries over the 2000–2016 period, we uncover divergent patterns in the rating standards over time. Standards strengthen by 1.5 notches for U.S. firms and by 2.2 notches for other developed country firms, but weaken by 1.2 notches for emerging country firms. Default and credit spread tests show that standards tightening for U.S. and other developed country firms is likely unwarranted, whereas standards loosening for firms in emerging economies appears to be justified. This novel and puzzling evidence suggests that S&P does not adopt consistent global standards over time.     

Informed trading around earnings announcements—Spot,futures, or options?

Recent literature reports higher single stock options (SSO) volume before earnings announcements (EA). There are no studies that explore single stock futures (SSF) in this context because of illiquid SSF markets in developed countries. Similar to SSO, SSF provide embedded leverage and facilitate short selling although at a lower cost, but do not provide downside-risk protection. India’s liquid SSO and SSF provide a unique setting to study the preference of informed traders. We observe an increase in both SSO and SSF volume before EA. Further, SSF dominate SSO possibly due to SSO becoming expensive before EA and higher information leakage in India.     

Misfortunes or mistakes? : Cultural sensemaking of entrepreneurial failure

This study examines cultural views of venture failure through the lens of sensemaking, which includes attributions of causality. Specifically, we explore failure accounts that are attributed to mistakes made by entrepreneurs, and those attributed to misfortunes outside the control of the entrepreneur. Reports of entrepreneurial failures from 1999 to 2001 were collected from seven major US newspapers, and 389 accounts of failure were analyzed for statements identifying the failure's cause. The data suggest that cultural sensemaking of failure varies by the geographical area where failure occurs. In addition, 331 accounts of the consequences of failure were analyzed which suggest that failure has a large impact on the stigmatization of the entrepreneur and entrepreneurship within the local area, as well as on the individual entrepreneur's view of themselves following failure.     

The Dynamics of Online Purchase Visits: Inertia or Switching?

This paper studies the dynamics of online purchase patterns, focusing on the impact of the channel used on conversion probability, as well as the transition of channel use over time. A novel data set from a major Chinese online travel agency is used for analysis, consisting of four months of data with 24,337 store visits through three types of channels: direct visit, search advertising and referral. Results of a Bayesian multinomial logit model show that the search channel significantly affects consumers’ conversion probability, and show a high degree of inertia in channel use. This finding contrasts sharply with suggestions of previous research that most future purchases will converge to the direct-visit channel.     

The sharing economy: Your business model's friend or foe?

The sharing economy, a rising pattern in consumption behavior that is based on accessing and reusing products to utilize idle capacity, presents both tremendous possibilities and significant threats for emerging as well as incumbent businesses. As of today, it is unclear whether this economy is merely another ephemeral trend in consumption or whether we are experiencing a real shift in how goods are accessed, distributed, and used. Furthermore, little is known about how existing business models are affected by the sharing economy. These two issues represent the central motivation for the development of this article. Consequently, an examination of why the sharing economy has the potential to produce a long-term transformation in consumption behavior is followed by a consideration of how this change might affect companies’ business models. Based on a renowned business model framework and a variety of current illustrative examples, we propose central questions managers must ask themselves in order to be prepared to respond to changes brought about by this new economic trend.     

Normative Self-Interest or Moral Hypocrisy?: The Importance of Context

We re-examine the construct of Moral Hypocrisy from the perspective of normative self-interest. Arguing that some degree of self-interest is culturally acceptable and indeed expected, we postulate that a pattern of behavior is more indicative of moral hypocrisy than a single action. Contrary to previous findings, our results indicate that a significant majority of subjects (N = 136) exhibited fair behavior, and that ideals of caring and fairness, when measured in context of the scenario, were predictive of those behaviors. Moreover, measures of Individualism/Collectivism appear more predictive of self-interested behavior than out-of-context responses to moral ideals. Implications for research and practice are discussed. George W. Watson received his Ph.D. from Virginia Tech, his M.B.A. from California State at Fullerton, an M.S. in Systems Management from the Naval Postgraduate School in Monterey, an a B.A. in Business Administration from the University of Washington, Seattle. His teaching focus is on corporate social responsibility and ethics. Dr.Watson’s current research interests include moral psychology,ethical decision making, and ideology. He has published in Business Ethics Quarterly, Business and Society, and the Journal of Business Ethics. Farooq Sheikh received his BS in Physics from Indiana University of Pennsylvania, and his Ph.D. from Smeal College of Business, Penn State University. He is currently Assistant Professor of Operations Management, School of Business at the State University of New York at Geneseo. Dr. Sheik’s research interests include rational and behavioral models in business operations, bounded-rational behavioral models in population games, social norms, game theory and cross-disciplinary research involving behavioral models.     

The impact of venture capital on the productivity growth of European entrepreneurial firms: ‘Screening’ or ‘value added’ effect?

We aim to ascertain to what extent the better performance of European venture capital (VC)‐backed firms in high-tech industries is due to either ‘screening’ or ‘value added’ provided by VC investors. We compare portfolio firms' productivity growth before and after the first VC round, using a matched control group as benchmark. We show that productivity growth is not significantly different between VC and non-VC-backed firms before the first round of VC financing, whereas significant differences are found in the first years after the investment event. We also find that the value-adding services provided by VC investors ‘imprint’ the portfolio firm.     

Does the world real interest rate affect the real exchange rate? The South East Asian experience

Abstract

We analyze the consequences of US real interest rate rises on the real exchange rate (RER) in a two-good overlapping generations model of a semi-small open economy. The equilibrium RER depreciates (appreciates) when the world interest rate increases in a debtor (creditor) country. We then study empirically the reaction of the RER in a set of South East Asian (SEA) countries to shocks in US real interest rates. The results support the conclusions of the theory model at least for Singapore, Thailand and South Korea during the period 1980 – 2001. This points towards world interest rate shocks as possible trigger factors for exchange rate crises during the adjustment process towards the new equilibrium.     

Identity and entrepreneurship: do school peers shape entrepreneurial intentions?

We incorporate the concept of social identity into entrepreneurship and analyze the determinants of having entrepreneurial intentions. We argue that an entrepreneurial identity results from an individual’s socialization. This could be parental influence but, as argued in this paper, also peer influence. Based on Programme for International Student Assessment (PISA) 2006 data in which students report their entrepreneurial intentions at the age of 15, we find that having an entrepreneurial peer group has a positive effect on an individual’s entrepreneurial intentions. We find that the strength of the peer effect in a country is moderated by prevailing values, namely individualism.     

The Bystander in Commercial Life: Obliged by Beneficence or Rescue?

The recent case between Apple and the FBI, in which Apple refused to comply with a court order to aid the FBI in overriding the security features of an iPhone used by one of the San Bernardino terrorists, brought the tension between national security and individual rights to the forefront. This article looks at the case and these two core values from a liberal communitarian ethics perspective, and provides an analysis of how these values are reflected in U.S. law. It concludes with an ethical discussion relevant to the resolution of differences between high-tech corporations and the government.     

The expected retail customer: Value co-creator,co-producer or disturbance?

The purpose of this paper is to explore expectations among front-line employees regarding their customers and how these expectations can be understood in relation to strategies of customer participation and value co-creation. Two categories of expectations are identified; operative and interactive. In particular, the operative expectations reveal a service practice that is heavily structured by large-scale systems and ideals of rational efficiency. It is argued that co-creation needs to be discussed on both the strategic level, i.e. in terms of what the “customer”/market wants, and on the operative level, where the customer's direct contribution to the value-creating process has its focus.     

The Feldstein–Horioka puzzle in South Africa: A fractional cointegration approach

The Feldstein–Horioka (FH) puzzle, that is the strong correlation between saving and investment in a world where obstacles to capital mobility are limited, has been studied extensively since it was exposed in 1980. Even though the theoretical and empirical literature has examined many of its potential causes, the puzzle persists. This paper aims at shedding further light on the issue by investigating the relationship between saving and investment in South Africa since 1946 using fractional integration and cointegration techniques to account for high persistence in the series. We find evidence of fractional cointegration between saving and investment, indicating some degree of persistence in the gap between the two variables. We also find a structural break in saving and investment ratios to GDP around 1980, which roughly coincides with the start of a financial deregulation process in South Africa. While fractional cointegration holds before the break, it does not thereafter. In other words, while the FH puzzle is observed before the start of financial deregulation, it subsequently disappears. This suggests that financial deregulation may have loosened the link between saving and investment.