Persuasive Advertising and Product Differentiation

We suggest a simple framework for characterizing alternative ways that “persuasive advertising” may affect consumer preferences. We illustrate the implications of our theory—and contrast it with results from models of informative advertising—by analyzing the relationship between the degree of product differentiation and equilibrium levels of advertising. The analysis suggests that a positive relationship between equilibrium levels of advertising and (inherent) product substitutability is consistent only with advertising that “increases perceived product differences.”     

Evolution of the Infant Health Production Function

Michael Grossman's seminal publication on the demand for health and health production (Grossman 1972) has spawned a substantial body of research focusing on the production of infant health. This article provides a systematic review of the published literature to date on infant health production and how it has evolved over the past 3–4 decades as data have become more available, computing has improved, and econometric methods have become more sophisticated. While empirical research in most fields has expanded in corresponding ways, the infant health production research has become an important part of the broader and inherently multidisciplinary literature on intergenerational health. The strongest and most robust findings are that policies matter for infant health, particularly those affecting access to health care, and that prenatal smoking and other chemical exposures substantially compromise infant health. Promising directions for future research include elucidating relevant pathways, reconciling the largely inconsistent estimated effects of nutrition and education, and exploring the roles of preconceptional and lifetime health care, paternal factors, social support, housing, complementarity and substitutability of inputs, factors that modify effects of inputs, and evolving medical technologies.     

Blockholder Exit Threats and Financial Reporting Quality

Recent theoretical and empirical studies suggest that blockholders (shareholders with ownership ≥ 5 percent) exert governance through the threat of exit. Blockholders have strong incentives to gather private information and sell their shares when managers are perceived to underperform. To prevent blockholders from selling their shares and the firm from suffering a stock price decline, managers align their actions with the interests of shareholders. As a result of the greater manager‐shareholder alignment, managers' actions are more likely to be in shareholders' best interest, and consequently there is less need for managers to manipulate earnings. Consistent with these predictions from economic theory, we find evidence that as exit threat increases, firms have higher financial reporting quality. Theory also predicts that the impact of blockholders' exit threat on financial reporting quality (FRQ) should increase as the manager's wealth is tied more closely to the stock price, and this is what we find. Our study contributes to the research on the impact of shareholders on FRQ and to an emerging literature on the impact of blockholders in financial markets. Blockholders play an important role in managers' reporting outcomes through their actions as informed investors.     

Women’s snowboarding – some experiences and perceptions of competition

This article focuses on female snowboarders’ experiences with, and perceptions of, snowboard competitions. The article is based on a study conducted at an international women’s snowboard camp. The purpose of the camp was to discuss strategies for promoting females’ participation in the snowboard organisations and in snowboard competition. Interviews were held with eight participants aged 18–31?years. Most of the participants had been previously involved in competition. Their experience had been both negative and positive. Most of the participants perceived snowboard facilities (Big air and Half-pipe) as being too large for females and a possible constraint on participation. Moreover, the study’s findings reveal ideas concerning alternative competition formats as well as arguments for ‘women-only’ sessions as a feasible way to reach more female snowboarders, to provide skill enhancement, and to increase participation in the competitions. The findings are discussed in light of the development of snowboarding and Bourdieu’s theoretical framework.     

The performance of venture capital investments: Do investors overreact?

Using a unique proprietary data set of over 5400 realized and unrealized venture capital investments between 1980 and 2005, we examine the impact of demand-related factors, e.g. entrepreneurial activity, as well as supply-related factors, i.e. money provided by VC investors, on the return of individual VC investments. This way, we are able to shed more light on the question whether volatile VC investment returns are rather driven by fundamental changes with regard to the number of attractive investment opportunities or by the overreaction by investors. We find that rising demand for VC, i.e. an increase in entrepreneurial activity, results initially in higher returns. However, our results also indicate that overreaction on the supply side can be observed, destroying deal-level results. Overfunding, specifically overinvesting seems to be a recurring characteristic of the VC industry. In fact, contra-cyclical investment strategies yield highest deal-level returns.     

Measuring worker flows

The study explores differences between two measurement concepts of worker flows widely used in the literature referred to as the turnover and reallocation concepts. It is found that measuring worker flows by the turnover concept leads to substantially (about 5% of total employment) higher worker flow estimates and slightly increases age, size and industry group effects on firm level worker flows as well as differences between growing and declining firms relative to the reallocation concept.     

Copper trade and production of copper,brass and bronze goods in the Oldenburg monarchy: copperworks and copper users in the eighteenth century

This paper explores trade connections – or the lack of such – between copperworks and copper processing plants in the Oldenburg Monarchy in the eighteenth century. Domestic customs areas, high tariffs on raw material export and import bans sought to encourage domestic copper and brass goods production of Norwegian copper raw material, however this was only realised halfway. The raw material from Norway was largely exported, and copper and brass materials used to produce copper-, brass and bronze goods were imported from all over the world. The copperworks and processing plants in the Monarchy never became strongly integrated due to several reasons. First, shareholders of copperworks acquired favourable credit deals abroad, and preferred to export the copper, and second, copper materials had different features and processing plants used all sorts of copper inputs in the making of goods, not only copper raw material. Norway produced mostly gar copper, so copper plants and coppersmiths had to turn elsewhere for other types of copper. Production of copper and brass goods increased, but did not meet the domestic demand partly due to a strong foreign competition. The optimal goal of ‘mercantilist theory’ regarding copper and brass import substitution was not reached.