European Views of Advertising

Abstract

The effects of brand beliefs and attitude-toward-the-ad (A_ad) on immediate and delayed measures of attitude-toward-the-brand (A_b)were investigated for individuals who were more- and less-involved with the message of a print advertisement. Results suggest A_ad's and brand beliefs' influence on immediate and delayed measures of A_b depend on individuals' involvement with the message. As expected, for individuals who are more-involved with an advertising message, both beliefs and A_ad influenced A_b. This relationship held even after a one-week delay. For those less-involved with the advertising message, however, beliefs had no significant influence on brand attitudes, measured immediately following advertising exposure or after a one-week delay. A_ad was shown to have a significant influence on brand attitudes in both time conditions. Implications for theory and practice, as well as directions for future research, are discussed.     

When do venture capitalists collaborate? Evidence on the driving forces of venture capital syndication

Using a sample of 2,373 unique capital contributions from 437 venture capitalists (VCs) over subsequent rounds into 961 start-ups during the period 1995–2005 in Germany we disentangle the circumstances under which lead VCs engage in syndicate relationships with partner VCs. The results indicate that syndication is more pronounced when VCs face higher risks that need to be diversified and capital burdens are larger. Moreover, we document that industry investment experience lends legitimacy to lead VCs, allowing them to enter syndicate relationships to enhance their network positions. In general, greater industry experience is associated with more syndication. Lastly, the results show that lead VCs involve new/additional partners in subsequent financing rounds to leverage their idiosyncratic skills and knowledge to improve deal selection and/or provide a better quality of managerial advice.     

Foreign exchange,fractional cointegration and the implied–realized volatility relation

Almost all relevant literature has characterized implied volatility as a biased predictor of realized volatility. In this paper we provide new time series techniques to investigate the validity of this finding in several foreign exchange options markets, including the Euro market. First, we develop a new fractional cointegration test that is shown to be robust to both stationary and non-stationary regions. Second, we employ both intra-day and daily data to measure realized volatility in order to assess the relevance of data frequency in resolving the bias. Third, we use data on implied volatility traded on the market. In contrast to previous studies, we show that the frequency of data used for measuring realized volatility within a fractionally cointegrating framework is important for the results of unbiasedness tests. Significantly, for many popular exchange rates, the use of intra-day rather than daily data affects the emergence of a different bias, as the possibility of a fractionally integrated risk premium admits itself!     

Vergleich von Allokationsmethoden zur Kapazitätsvergabe bei grenzüberschreitenden Netzengpässen

Several market initiatives within Europe aim at implementing flow-based methods for capacity allocation. Compared to the common transaction-based methods, these new methods are supposed to lead to an improved utilisation of cross-border capacities. In order to quantify the implications, a model for the coupled consideration of the power plant dispatch and the resulting load flows in the transmission system was developed. By means of detailed data of the Central Western European region the model was used to highlight the advantages of a flow-based allocation. Due to the more accurate mapping of the actual flows within the algorithm, the trade volume can be increased significantly leading to an enhanced convergence of the single market prices. However, the involved market players do not benefit in the same way from the trading possibilities in the presented case. The algorithm does not send direct economic signals regarding the profitability of different locations of power plants because of the required simplifications in the practical implementation. But the system-wide impact of the input in a certain location can be evaluated and therefore also be controlled where appropriate.     

Fixed capital and internal rate of return

For a neo-Austrian process of production, more generally multisectoral fixed capital models, it is shown that the maximum rate of growth and the minimum rate of interest are both equal to the internal rate of return. This von Neumann type equality is here obtained in absence of truncation, i.e., free disposal of fixed capital. If several internal rates of return coexist, the economically significant one is the maximal one. This result provides theoretical grounds for the internal rate of return criterion in infinite horizon.     

Managing asymmetries in information flows and interaction between R&D,manufacturing, and service in complex product development

Studies of new product development have demonstrated the value of effective interaction between research and development (R&D) and manufacturing, but few studies also include service operations despite their growing importance. Building on in‐depth studies of two firms in the capital goods sector, the paper illustrates how the structural differences between the R&D‐manufacturing and R&D‐service interfaces result in serious information and interaction imbalances, and presents managerial means to handle these. The paper makes three contributions. First, it shows the value of moving beyond a dyadic perspective to studies of more complex structures involving triads of specialized functions. Second, the paper underlines the role of informational flows that can compensate for asymmetries in such triads and facilitate thoughtful trade‐off decisions. Third, the paper highlights the importance of creating conditions for integrated knowledge‐based approaches across functions, which involve the generation and sharing of new knowledge. The paper ends with an emerging management agenda to support such integrative efforts in complex product development projects.     

Education and early career outcomes of second-generation immigrants in France

We estimate a flexible reduced form dynamic model of schooling choices and labor market outcomes in France. Our analysis focuses on the comparison between second-generation immigrants and their French-natives counterparts. We show that the gap in higher education attainments between those two sub-populations is mainly explained by parents' background, and that schooling investment is the main determinant of the gap in permanent employment. After conditioning on schooling and observed characteristics, we find that ethnic origin explains less than 6% of the gap in access to permanent employment. A test of equality of counterfactual probabilities of accessing permanent employment across ethnic groups (measured at identical individual characteristics) typically fails to be rejected.