Earnings Announcements and Information Asymmetry: An Intra‐Day Analysis*

This paper examines the effect of earnings announcements on information asymmetry as perceived by specialists. We use changes in quoted bid‐ask spreads and depths (relative to the average value in the non‐announcement period) as proxies for changes in information asymmetry in the market. To our knowledge, we are the first to employ a model that captures the simultaneous nature of the specialists' choice of spreads and depths in reaction to earnings news. We provide evidence that spreads are wider and depths are smaller before the release of earnings announcements. We also find that changes to depths are greater for announcements of quarterly earnings than for announcements of annual earnings and changes to spreads persist longer into the post‐announcement period when announcements are made outside trading hours. These changes to spreads and depths persist when earnings announcements are made after trading hours.     

An economic analysis of the use of student evaluations: implications for universities

In this paper, we develop an analytical model of joint maximizing behavior on the part of students and professors to develop policy rules for universities who use student evaluations as tools for increasing professor effort and, thereby, student knowledge. More precisely, we examine the potential benefits of student evaluations, the consequences of over‐emphasizing them and the optimal level of emphasis that should be placed on them. This exercise allows us to determine conditions under which student evaluations would result in an increase in teaching effort and student knowledge, and environments where it would result in professors manipulating grading schemes to obtain higher student ratings, i.e., grade inflation. Copyright © 2003 John Wiley & Sons, Ltd.     

Firing Blanks? An Analysis of Discursive Struggle in HRM

ABSTRACT   We revisit Karen Legge's (2001 ) critique of HRM in which she argues that the attempt of modernist/positivist HRM research to show that HRM improves organizational performance is a 'spent round'. We note that despite spirited challenges by Legge and others, the discourse of HRM is becoming increasingly dominant. Accordingly, we use discourse analysis to examine why this might be the case. Specifically, we analyse the texts produced in the engagement between Karen Legge and David Guest to show how modernist/positivist texts like those of Guest have been successful in constructing an identity for HRM and embedding it in the broader academic discourse concerning the employment relationship, while critical researchers like Legge face a number of difficulties in producing 'counter-texts'.     

BOND PORTFOLIO IMMUNIZATION: TESTS OF MATURITY, ONE- AND TWO-FACTOR DURATION MATCHING STRATEGIES

This paper provides additional evidence on the usefulness of duration as a strategy tool by developing a two-factor duration model and by using a reasonably reliable database to compare empirically the relative performance of maturity, one-factor duration, and two-factor duration matching strategies in immunizing portfolios of default-free and option-free bonds against interest rate risk. The results suggest that, on average, duration models, even for arbitrarily assumed simple stochastic processes, are more accurate than maturity models and that increased accuracy may be achieved by increasing the length of the planning period and the number of factors in the model.     

Factor analysis and development: A reply

The suggestion by Mr. Bumb that several of our factor analyses are spurious is questioned on both technical and empirical grounds. Evidence of exceeding robustness of our factor-analytic results is presented.     

Bank capitalization and lending behavior after the introduction of the Basle Accord

In this paper, we provide evidence that banks with a low level of capitalization have reduced their commitment with respect to lines of credit after the introduction of the Basle Accord. A bank's lending behavior reflects its level of commitment towards borrowers, which in turn affects the level of effort it exerts on screening and monitoring the activities of borrowers. We find that the post-Basle Accord market reaction to the announcement of lines of credit issued by banks with a low level of capitalization is significantly lower than the reaction to other types of bank credit announcements. We interpret this result as evidence that some banks have a low level of commitment associated with lines of credit after the Basle Accord.

Employee Turnover in International Brand Hotels in Russia: A Comparison of Nationals and Foreign Nationals

ABSTRACT

This empirical study tests the relations between employee turnover and the organizational dimensions of service climate, comparing nationals and foreign nationals in the international brand Russian hotel industry. This study extends the geographic scope of employee turnover to the undertested Russian context. Responses were analyzed using a partial least squares model. Results show that nationals’ and foreign nationals’ responses to model variables diverge. Job insecurity directly affects the turnover intentions of Russian nationals, while its effect for foreign nationals was indirect through organizational commitment and job satisfaction. Compounded indirect effects of turnover antecedents and service climate dimensions are also examined and discussed.     

Why Create Value for Others? An Exploration of Social Entrepreneurial Motives

Social entrepreneurs create value for and with target communities in need. This paper responds to calls for research addressing social entrepreneurs’ drive to benefit others. We draw from psychology to augment the understanding of motives in entrepreneurship before conducting a phenomenon‐driven, instrumental case study of social entrepreneurs’ motives. We find some emotions, such as entrepreneurial passion and frustration, lead to self‐oriented motives, while sympathy and empathy are precursors for other‐oriented motivations, such as altruism and social justice. This work provides a theoretical platform for future studies in entrepreneurial motivation that addresses the importance of nonfinancial motives and associated rewards for fostering engagement in the sector.     

The job stress–job performance relationship in the social service encounter

• The current study empirically examines job performance by considering perceived customer demands as a new antecedent of job stress (JS) and the mediating role of emotion‐focused coping (EFC) on the relationship of JS and physical consequences (PC), and in‐turn job performance. A mailed survey that solicited 2500 social service providers working in the United States rendered a useable random sample of 533. Regression analyses supported the hypothesized relationships. Findings suggest that emotions play an important role in the quality of the social service encounter evidenced by the mediating role of EFC in the relationship between JS and job performance. The introduction of an intervening variable (i.e., EFC) in the JS–job performance relationship extends affective event theory (AET). The findings offer management new insights into the service encounter by identifying a source of JS that creates barriers to value added benefit creation.

Copyright © 2008 John Wiley & Sons, Ltd.     

Has the CDS market influenced the borrowing cost of European countries during the sovereign crisis?

This paper assesses the potential influence of the growing CDS market on the borrowing cost of sovereign states during the European sovereign crisis. We analyze the sovereign debt market to ascertain the pattern of information transmission between the CDS and corresponding bond markets. Our methodological innovation is the use of a non-linear specification rather than the linear VECM specification customarily employed. Using a panel smooth transition model during the 2008–2010 period, we find that: 1) linearity tests clearly reject the null hypothesis of a linear transmission mechanisms between the bond and the CDS markets; 2) market distress alters the mutual influence and 3) the higher the distress the more the CDS market dominates the information transmission between CDS and bond markets.