U.S. Family-Run Companies–They May Be Better Than You Think

Despite the common perception of public family-run companies as poor investments, the evidence shows that they actually perform quite well. And there may be some good reasons for this: A family that both owns and controls a company avoids the classic agency problem—the natural tendency of professional managers to pursue some private interests at the expense of their shareholders—that confronts most publicly traded companies. The family's concentrated, long-term investment in the company and knowledge of the business make them potentially effective and highly motivated monitors.
Using a sample of "true" family firms from the S&P 500 (one that deliberately excludes "founder companies" like Microsoft and Dell), the authors show that these companies have in recent years produced considerably higher stock returns than their non-family counterparts. At the same time, family companies with dual-class share structures produced lower returns than those with a single class of shares, and the returns to dual-class firms with insider-dominated boards were still lower. Specific examples highlight the different ways that families maintain control, the consequences of the CEO choice (family member versus professional manager), and the potential benefits of the family's permanent presence, including a long-term investment focus and reputation for fair dealing with corporate stakeholders.     

REPLACEMENT PARTS MANAGEMENT: THE VALUE OF INFORMATION

Exponential smoothing (ES) and weighted moving average (WMA) are the predominant methods used to predict future demand for replacement parts. They require simple calculations and make use of information readily available. By gathering more information and doing additional calculations, more accurate forecasts can be developed. However, the cost of collecting the additional data could exceed the inventory cost savings from the better demand forecast. This paper presents a straightforward method for determining when the benefits of a more complex forecasting method outweigh the total costs required to use the method.     

The Evolution of European Central Bank Independence: An Updating of the Masciandaro and Spinelli Index

In an earlier paper in this journal, Masciandaro and Spinelli computed an index of central bank independence for a number of countries on the basis of the institutional arrangements in place in 1990. Since then the situation has changed and therefore that work needs an updating. This shows that the Bundesbank remains the most independent central bank, but several other central banks have increased their independence: see the cases of Spain, Italy, France, the Netherlands and Great Britain. The Bank of Spain has registered the biggest improvement and the Bank of Portugal remains the least independent.     

Big philanthropy and the funding of black organizations

Conclusion The general overview of foundation giving to promote black interests and the specific look at the Ford-MARC relationship support the notion that few foundation grants will go to “controversial” or “political” projects. The Peterson Commission estimated that only three percent of all private foundation grants are “innovative” and an even smaller percentage are “politically controversial.” Most often, these projects usually become controversial after the grant is made. A 1971 Urban League study revealed that grants for human services made by private foundations to black and Spanish-speaking communities were disproportionately low when measured in terms of the per capita needs of the minority population. Nevertheless, it is unrealistic to expect Ford, Rockefeller Brothers, Mott, or Carnegie to redistribute income or become the “cutting edge of social change”.