Rebranding ex‐convicts

We develop a theoretical model explaining how the problem of poor labor market outcomes for ex‐convicts might be alleviated by an external intervention. While employers wish to avoid associating with those who will end up returning to crime, they cannot be certain from the available information which convicts will reoffend and which will not. We illustrate that, notwithstanding this informational asymmetry, a government (or a civic society) can nevertheless design a costly, yet net socially beneficial program through which some ex‐convicts can credibly convey their good intentions to employers. Such a “rebranding” program can help more ex‐convicts find legitimate work, with fewer electing to return to crime than would otherwise have been the case.     

Economic evaluation of rituximab in addition to standard of care chemotherapy for adult patients with acute lymphoblastic leukemia

Aims: Acute lymphoblastic leukemia (ALL) is an aggressive form of leukemia with a poor prognosis in adult patients. The addition of the monoclonal antibody rituximab to standard chemotherapy has been shown to improve survival in adults with ALL. However, it is unknown whether the addition of rituximab is cost-effective. The objective was to determine the economic impact of rituximab in addition to standard of care (SOC) chemotherapy vs SOC alone in newly-diagnosed Philadelphia chromosome-negative, CD20-positive, B-cell precursor ALL.

Methods: A decision analytic model was constructed, based upon the Canadian healthcare system. It included the following health states over a lifetime horizon (max ≈60 years): event-free survival (EFS), relapsed/resistant disease, cure, and death. SOC was either hyper-CVAD or the Dana Farber Cancer Institute (DFCI) ALL consortium. EFS, overall survival, and serious adverse event (SAE) rates were derived from a large randomized controlled trial. Costs of the model included: first-line treatment and administration, disease management, second-line and third-line treatment and administration, palliative care, and SAE-related treatments. Inputs were sourced from provincial and national public data, the literature, and cancer agency input.

Results: Quality-adjusted life-years (QALYs) increased by 2.20 QALYs with rituximab in addition to SOC. The resulting mean Incremental Cost-Effectiveness Ratio (ICER) was C$21,828/QALY. At a willingness-to-pay threshold of C$100,000/QALY, the probability of being cost-effective was 98%. Decision outcomes were robust to the probabilistic and deterministic sensitivity analyses, including the SOC backbone as either hyper-CVAD or DFCI.

Limitations: The results of this analysis are limited by generalizability of the chemotherapy backbone to Canadian practice.

Conclusions: For adults with ALL, rituximab in addition to SOC was found to be a cost-effective intervention, compared to SOC alone. The addition of rituximab is associated with increased life years and increased QALYs at a reasonable incremental cost.     

Capturing flexible correlations in multiple-discrete choice outcomes using copulas

This paper aims to examine three purchase patterns which frequently occur in multiple-discrete choice situations: joint-purchase, quantity-preference, and quantity-concordance. First, “joint-purchase” refers to the tendency that two products are either purchased together or separately. Second, “quantity-preference” refers to the tendency to purchase a product in preferred amounts. Third, “quantity-concordance” refers to the tendency that purchase quantities of two products are either concordant or discordant. These patterns are mainly attributed to unobserved factors such as economic reasons, habits, time pressure, mood, and/or physical environment. No study has fully incorporated the three purchase patterns simultaneously.In this study, we develop a unified copula-based approach which can incorporate all the three purchase patterns simultaneously. The proposed approach is so flexible that any copula function or parametric distribution can be used. We use a simulation study to illustrate the trade-off between the Gaussian copula and the FGM copula. We show the Gaussian copula which captures the full range of correlations quickly becomes infeasible as the number of choice alternatives increases. On the contrary, the FGM copula substantially reduces the computational complexity and is scalable to larger dimensions. Furthermore, we extend the range of correlations of the FGM copula at almost no cost by introducing the sine generating function. To show the scalability, we apply this approach to IRI scanner panel data with 13 alternatives. Throughout two empirical studies, we show that the three purchase patterns indeed exist in our data. Moreover, we find that ignoring the three purchase patterns distorts key managerial metrics such as demand predictions and price elasticities. This results in suboptimal managerial decisions regarding peelies promotions, bundling, and package size. Furthermore, we illustrate that managers can improve the profitability of promotions by implementing a joint promotion strategy based on the three purchase patterns.     

AN OVER‐THE‐COUNTER APPROACH TO THE FOREX MARKET

The foreign exchange (FOREX) market is an over‐the‐counter market characterized by intermediation and significant bid–ask spreads. However, most of the existing international macroeconomics literature models the FOREX as a standard Walrasian market. This article constructs a dynamic general equilibrium model of intermediation in the FOREX market. We use our framework to compute standard measures of FOREX liquidity, such as bid–ask spreads and trade volume, and study how they are affected by macroeconomic fundamentals and market microstructure. We also study how FOREX market microstructure affects the volume of international trade and, consequently, welfare. Our empirical exercise offers support to the models' main predictions.     

Crude oil prices and the balance of trade: Asymmetric evidence from selected OPEC member countries

The contribution of this article is to assess whether the effects of crude oil price fluctuations on the trade balance are symmetric or asymmetric in the context of an individual oil-exporting country, specifically four OPEC member countries – Iran, Nigeria, Saudi Arabia, and Venezuela. To examine this subject thoroughly, we use three different measures of trade balances such as oil trade balance, non-oil trade balance, and total trade balance, and examine whether oil prices are asymmetrically passed on to the trade balances for those OPEC countries in the long- and short-run. After implementation of the nonlinear autoregressive distributed lag (ARDL) model, we find that changes in oil prices indeed have asymmetric effects on the oil trade balance for all four OPEC countries in the long-run, though not in the short-run. In the case of the non-oil and total trade balance, however, the asymmetry of oil price changes is not detected in both the long- and short-run.     

The impact of labour unions on external auditor selection and audit scope: evidence from the Korean market

We examine whether labour unions influence external auditor selection and audit scope. As a major user group of financial information, labour unions likely demand financial information of high quality and thus high-quality audits. As a union’s request for wage increases is likely strong when a firm is performing well, management facing wage negotiations with the labour union has incentives to manipulate earnings downward and may therefore prefer auditors who allow more discretion. Using union data unique to Korea during 2005–2008, we find that firms with a stronger labour union tend to choose higher-quality auditors (i.e. Big N or industry specialist auditors). We also find that unionization is negatively (positively) associated with positive (negative) abnormal audit fees and audit hours, and the effects are more pronounced when the union is stronger and more active. Given that departures from normal audit fees and audit hours in either direction arguably impair audit quality, this finding is consistent with our prediction of unions’ demand for high-quality audits. Overall, our findings suggest that labour unions play an important role in determining audit quality.     

Collective Dynamics of Citizenship Behaviour: What Group Characteristics Promote Group‐Level Helping?

A basic tenet of research on organizational citizenship behaviour (OCB) is that OCB aggregated across individuals improves organizational performance. Departing from the typical focus on individual-level OCB, the construct of group-level OCB (GOCB) recently emerged as a critical group function that affects various group effectiveness measures. Despite the clear link between GOCB and team performance, the existing literature provides a limited understanding with regard to the antecedents of GOCB, mostly focusing on leadership variables. Establishing helping behaviour (a core dimension of OCB) as a collective construct, this study substantially expands the antecedents of group-level helping, and empirically tests their effects using three different operationalizations of group-level helping. The results, based on a sample of 96 work units, show that membership diversity in gender and education decreased group-level helping, whereas diversity in tenure increased it. Group-level helping was also positively related to leadership characteristics (supportive unit manager, transformational top management) and perceived competence of unit members. In addition, the analysis further indicated that perceived competence is a positive predictor of group-level helping only when the unit members also believe that others are trustworthy in terms of integrity and benevolent motivation. From a methodological standpoint, the study provides important insights by comparing different ways of operationalizing collective constructs.     

Image Repair Campaign Strategies Addressing Race: Paula Deen,Social Media,and Defiance

This multi-method study examines how the use of social media in a crisis campaign involving race-related issues may affect a public figure’s credibility and perceived response appropriateness. First, image repair theory is used to analyze Paula Deen’s image repair campaign in the wake of the National Enquirer’s revelation that she admitted to using the “N-word” during a lawsuit deposition. Our analysis shows her response strategies were unsuccessful because her apology did not center on the allegations, and she was contradictory in her bolstering, minimization, and mortification strategies. We build on the Deen case study results by exploring the effectiveness of tweeted message strategies in a race-related crisis via Twitter. We use a mixed-design experiment examining how public figure type (politician v. TV celebrity) and response strategy (moral defense, performance defense, defiance defense, no defense) affect perceptions of a female public figure’s credibility and perceptions of the appropriateness of the response. Results show that any of the three responses are better than no response when addressing charges of racial insensitivity. A defiance defense, as newly tested strategy, and moral defense worked better for the TV celebrity condition than the politician condition. Implications are discussed.