Corporate political strategies and firm performance: indications of firm‐specific benefits from personal service in the U.S. government

Firms employ a variety of political strategies (e.g., lobbying, contributions) in an attempt to gain influence or access to the public policy process. A variety of benefits may accrue to firms that are successful in creating a linkage with the government: information, access, influence, reduced uncertainty and transaction costs, etc. However, the direct benefits of such strategies are difficult to observe. One political strategy is studied here—personal service (having a firm representative serve in a political capacity). Event‐study methodology results show that such linkages with the government positively affect firm value. These findings indicate that firm‐specific benefits may result from political strategies. Copyright © 1999 John Wiley & Sons, Ltd.     

Long‐Term Growth in Housing Prices and Stock Returns

A firm's long‐term stock returns are negatively related to past growth in housing prices in the state where the firm is located. The housing price effect is persistent and robust to controlling for the long‐term stock return reversal effect, changes in mortgage interest rates across the states, cyclicality in housing prices and overall local economic conditions. There is no evidence that extant asset pricing models can adequately explain the effect. The study discusses potential explanations for, and the implications of, the cross‐regional housing price effect.     

Consumer perceptions of carbon labeling in print advertising: Hype or effective communication strategy?

Eco-labels are being used more frequently in the marketplace. Recently, carbon-neutral labels have emerged on product packaging and advertisements as a popular form of eco-label. How consumers view these specific labels is of both conceptual and practical interest. Therefore, in a mixed-experimental design building on congruity theory and Deighton's two-step model of advertising effectiveness, the authors examine how consumers view the credibility and environmental concern of companies who use these labels, as well as their resulting purchase intentions. A 2(product) × 2(label) × 3(information) mixed design was used to examine consumer perceptions and behavior intentions. Product category (environmentally neutral vs. environmentally harmful) was a within-subjects factor; the presence/absence of the carbon-neutral label and information (positive/negative/control) was both manipulated between-subjects factors. Results show that the presence of a carbon-neutral label in an advertisement, regardless of the type of product, leads to more favorable perceptions of company environmental concern. However, there is a more pronounced increase in consumer perceptions of company environmental concern for an environmentally harmful product than for an environmentally neutral product.     

How Chipotle used unbranded content to increase purchase intention by changing beliefs about ethical consumption

Abstract

To combat ad avoidance, advertisers are moving advertising into programs, a practice known broadly as branded entertainment. The difficulty of advertising to Millennials has also prompted the use of unbranded cause advertising, to increase awareness of issues championed by the brand, without triggering defensive persuasion-coping strategies. Chipotle combined both these trends when it produced a relatively unbranded piece of branded entertainment, Farmed and Dangerous, a four-episode sitcom that humorously dramatized the ethical issues raised by industrial farming. When the series ran on Hulu, an online television network, it increased sales for the Chipotle brand and won awards for its creators. This study reports a classic pre/post experimental design, to show how exposure to this unbranded entertainment increased purchase intention by changing beliefs about ethical issues related to the environment, nutrition, and gene technology.     

Government ownership,corporate governance and tax aggressiveness: evidence from China

This study investigates how government ownership and corporate governance influence a firm's tax aggressiveness. Using Chinese listed companies during 2003–2009, we find that compared with government‐controlled firms, non‐government‐controlled firms pursue a more aggressive tax strategy. In particular, non‐government‐controlled firms with a higher percentage of the board shareholdings and with a CEO who also serves as the board chairman are more aggressive. For government‐controlled firms, we find that board shareholding has an impact on tax aggressiveness and it does not differ between local and central government‐controlled firms. However, local government‐controlled firms in less developed regions where the implementation of corporate governance measures is generally less effective are more tax aggressive than those in other regions.     

Sectoral gender wage gap in Vietnam

Abstract

Price forecasting systems are of considerable importance to food security management by governments’ and non‐governmental organizations. Sparse data availability in low‐income economies, however, generally necessitates reliance on reduced form forecasting methods. Relatively recent innovations in heteroscedasticity‐consistent time series techniques offer price forecasting tools that are feasible given available data and analysis technologies in low‐income economies. Moreover, extended GARCH models exhibit superior out‐of‐sample forecast accuracy using monthly food price data from Madagascar. These techniques also permit cost reduction in food security operations by more precise estimation of the risk of hitting a critical price level.     

Quantifying corruption by a human capital earnings equation

This paper uses a human capital earnings equation to quantify administrative corruption in the public sector. Regression analyses are conducted based on information from surveys administered to public officials in Albania. After accounting for officials’ characteristics, e.g., schooling, experience, gender, type of agency, and public and private sectors’ features, we deduce that the administrative corruption was on average 2.6× the officials’ current salary in Albania, which is equivalent to 16.7% of the country’s GDP.