Wealth Effects of International Acquisitions by US Banks

The wealth effects of international acquisitions by US banks (USBs) are examined in this study. The results show that shareholders of USBs experience significant negative excess returns when banks make international acquisition announcements. Excess returns are significantly negative when banks announce acquisitions in developed countries. The excess returns are not different for first time versus subsequent acquisition announcements. However, excess returns are significantly negative for USBs that are frequent acquirers overseas. Sampling by time periods, negative excess returns are observed during the fixed exchange rate regime (1965–1973) and during the post Tax Reform Act of 1986 era. Cross‐sectional regressions indicate that profitability and efficiency measures are positively associated with excess returns.     

Governance and Performance Implications of Diversification Strategies: Evidence from Large U.S. Firms

Recent research focuses on explaining the diversification discount. However, there is little direct evidence regarding the relation among ownership structure, corporate governance, and corporate diversification. The results in this paper suggest that agency issues do not account for firms adopting a particular diversification strategy. Also, the performance consequences of the shift in the diversification strategy and the subsequent changes in institutional and block ownership structures are not related to agency issues. In fact, investors seem not to avoid diversified firms per se. We suggest that observed board and ownership differences between diversified and focused firms are due to their being at different stages of corporate evolution.     

SUSTAINABLE URBANIZATION: NEEDED POLICY CHANGES FOR INDIA

This paper is concerned with two questions: what is it that is unsustainable about the process of urbanization and growth of cities in developing countries?; and why do countries persist with strategies that are evidently unsustainable? Making use of data from India, which today has the second largest urban population in the world, and taking note of increasing global concern for sustainable urbanization, this paper points out that the developing countries have to move beyond a general acceptance of the concept to see it being put into practice.     

Falsified or Substandard? Assessing Price and Non‐price Signals of Drug Quality

Pharmaceutical products can be of poor quality either because they contain zero correct active ingredient (referred to as “falsified”) or because they contain a nonzero but incorrect amount of the right active ingredient (referred to as “substandard”). Although both types of poor‐quality drugs can be dangerous, they differ in health consequence, price, and potential policy remedies. Assessing basic quality of 1437 samples of Ciprofloxacin from 18 low‐to‐middle‐ income countries, we aim to understand how price and nonprice signals can help distinguish between falsified, substandard, and passing drugs. Following the Global Pharma Health Fund e.V. Minilab® protocol, we find 9.88% of samples have less than 80% of the correct active ingredient and 41.5% of these failures are falsified. Falsified and substandard drugs tend to differ in two observable attributes: first, falsified drugs are more likely to mimic drugs registered with local drug safety regulators. Second, after controlling for other factors, substandard drugs are on average cheaper than passing generics in the same city but the price of falsified drugs is not significantly different from that of passing drugs on average. These data patterns suggest that careful consumers may have information to suspect a drug is substandard before purchase but substandard drugs can still exist to cater to poor and less‐educated population. In contrast, falsified drugs will be more difficult for consumers to identify ex ante because they appear similar to high‐quality, locally registered products in both price and packaging.     

An empirical assessment of cross‐cultural age self‐construal measurement: Evidence from three countries

This study investigated which age measures, independent or interdependent, were better for cross‐cultural consumer research. Specifically, it assessed the fit between the “actual” and “ideal” self‐concept model within the framework of self‐construal theory by examining the actual and ideal self‐attributed age identity across South Korea ( n = 480), China ( n = 207), and France ( n = 338) using both independent and interdependent age identity scales. Multivariate analyses revealed differences for individuated self‐schemata across the three countries for actual and ideal age self‐construal, as well as for actual other‐referent interdependent age self‐schemata. However, the reverse occurred too: The ideal interdependent ages showed a lack of difference across the three different cultures. Overall, the results indicate that interdependent decade scales are better than independent age scales for cross‐cultural consumer behavior studies. Though such scales are more complex, they are easy to translate and to administer, and simple to analyze and to interpret. Evidence also suggests that such scales are reliable and robust across disparate samples in the countries studied. © 2011 Wiley Periodicals, Inc.     

Multinational Diversification and Corporate Performance: Evidence from European Firms

We investigate the empirical relationship between accounting based measures of performance and the degree of multinational diversification for a set of European chemical industry firms. We find that for these firms, the degree of multinational diversification is strongly related to superior financial performance. The results hold for each of the three sample years. The findings suggest that multinational firms outperform purely domestic and exporting firms. The results provide strong support for gains from multinational diversification. The results indicate that while greater European unification may have eroded potential benefits of exploiting international capital and product market imperfections, the benefits of firm specific economies of scope and scale as well as managerial and financial synergies are still realised through exports.     

International acquisitions in the united states: Evidence from returns to foreign bidders

This paper provides evidence on the minimally explored topic of abnormal returns earned by stockholders of foreign bidders seeking to acquire a target firm in the USA. Four sources of influence on abnormal returns are identified: changes in net wealth of the bidder associated with changes in exchange rates; possible value-destroying managerial discretionary behavior by bidders with excess cash flows, as suggested by Jensen; comparative advantages for foreign bidders domiciled in relatively favorable tax jurisdictions; ownership status of the target, i.e. whether the target is an entire firm and whether it involves divested assets. The study includes 77 firms from 10 countries. The results show that stockholders of foreign bidders earn significant, negative abnormal returns surrounding the announcement of an acquisition in the USA. These abnormal returns become increasingly negative over the 15 days after the announcement of the acquisition, indicating that more information about the acquisition is revealed to investors subsequent to the initial announcement. Cross-sectional regressions indicate that relative exchange rates and cash positions explain variation in abnormal returns. A decline in the value of the dollar increases abnormal returns for the foreign bidder, thus supporting the net wealth hypothesis. The results also show that cash-rich foreign firms tend to enjoy higher abnormal returns when making acquisitions in the USA. The result provides support for the Froot and Stein cash-constrained hypothesis rather than for Jensen's free-cash-flow theory.     

Enhancing occupational health and safety in young workers: the role of social marketing

• Young workers (age 15–24) suffer work‐related injury at a much higher rate than older workers, yet research on the role and effectiveness of social marketing to influence and improve workplace safety is limited.
• A review of the relevant literature reveals that significant gaps exist in terms of effectively using social marketing to reduce young worker injury rates.
• A comprehensive, multi‐faceted social marketing approach is required to address young worker safety.
• Directing more attention toward the practice of social marketing can enhance the effectiveness of campaigns to reduce workplace injuries.

Copyright © 2007 John Wiley & Sons, Ltd.     

Impulse buying: A systematic literature review and future research directions

This paper performs a comprehensive analysis of academic research on impulse buying following a systematic literature review approach. Drawing on the TCCM framework suggested by Paul and Rosado-Serrano, we synthesize the impulse buying literature and develop a future research agenda. Accordingly, this review synthesizes impulse buying research in terms of theory development, context, characteristics, and methodologies to examine the development of the literature over time. This systematic review shows that impulse buying research is fragmented and still developing due to its transition from a traditional retail environment into different online channels. Furthermore, this paper proposes a conceptual framework based on the literature synthesis, presenting antecedents and mediators of impulse buying behaviour. Finally, this review identifies overlooked areas in impulse buying literature and provides insightful directions to advance research in the domain. Overall, this research effort makes a significant contribution to consumer behaviour literature, specifically to impulse buying literature.     

Examining trying as a mediator and control as a moderator of intention–behavior relationship

This article presents a modified model of the theory of planned behavior by incorporating trying as a mediator and actual control as a moderator of the intention–behavior relationship. The revised model was tested with the use of structural equation models for eight commonly performed activities (N = 240). Results provide general support for the model suggesting that intentions influenced the level of trying, which, in turn, influenced behavior. Correlation analysis employing Fisher's z transformation revealed that actual control moderated the relationship between trying and behavior. Implications of the findings are discussed. © 1998 John Wiley & Sons, Inc.