Alternative hierarchies of the attitude-behavior relationship: The impact of brand commitment and habit

The theory of reasoned action and the low-involvement hierarchy model were tested using cross-lagged panel correlation. It was proposed that the low-involvement hierarchy model would more accurately reflect the behavior of low-brand-committed individuals and that the theory of reasoned action would more accurately reflect the behavior of high-brand-committed individuals. Although the findings did not completely support these hypotheses, the general thrusts of the hypotheses appear to be supported. Additionally, behavior was hypothesized and shown to influence habit for all individuals.     

Performance pricing in bank debt contracts

Performance pricing links bank debt interest rate spreads to a borrower's performance via two options. Interest-decreasing performance pricing reduces spreads if credit quality improves. It is more common when prepayment is more likely or costly and when adverse selection costs are higher, and is less common when multiple performance measures better predict credit quality. Interest-increasing performance pricing increases spreads if credit quality deteriorates. It is more common when lenders reduce interest rates to add this provision, when downgrades are more likely, and when moral hazard costs are higher. We find lower spreads for contracts with interest increasing performance pricing.     

The Effect of Format Changes and Ownership Consolidation on Radio Station Outcomes

Analyzing a panel dataset tracking format changes and ownership consolidation in local radio markets, we find that format changes frequently have enabled stations to improve their performance, The success of reformatting varies widely across format, and the likelihood that changing to another format will boost station performance declines as that format space becomes more crowded, Successful reformatting is not limited to large radio groups, In fact, weak evidence that radio groups garner economies of scope from owning multiple stations in the same format is the only indication we find that larger radio groups have been able to choose formats strategically in order to obtain a boost in their listening shares. In the face of substantial and, ongoing ownership consolidation in local radio markets, our results suggest that format changes by smaller station groups may counter the potential exercise of market power by a radio group that acquires a substantial share of a particular audience demographic through merger.     

How Firms Make Capital Expenditure Decisions: Financial Signals, Internal Cash Flows, Income Taxes and the Tax Reform Act of 1986

This paper empirically assesses the determinants of future net capital expenditures for a broad cross-section of COMPUSTAT firms from 1973 to 1989. We explore three general categories of factors expected to affect investment: (1) external equity financing, (2) internally generated accounting information, and (3) tax incentives. We find that external financing and information plays a role in that both positive stock returns and equity issuances indicate future increases in investment. The results suggest that high stock prices not only lower the cost of capital, but also signal good investment opportunities. Accounting information about internal sources and uses of funds are also important in the investment decision. In particular, net income and depreciation are positive indicators of future investment while there is a tradeoff between the payment of dividends and investment. Further, positive changes in available cash liquidity also motivate future investment. While taxes are not important in the investment decision on average, we find that firms with previously higher income taxes invested substantially more in 1985 and 1986. This coincides with the repeal of the investment tax credit and the accelerated depreciation schedules in the Tax Reform Act of 1986. We view this as evidence that federal tax policy in the 1980's induced firms with high income tax obligations to accelerate capital expenditures just before the favorable tax treatment of capital expenditures was eliminated.     

Book Reviews

Colin Macandrews (Ed.), Central Government and Local Development in Indonesia, Singapore: Oxford University Press, East Asian Social Science Monographs, 1986, pp. 270, 36 Tables, 2 Figures, 4 Maps.

Himpunan Peraturan Perundang-undangan Republik Indonesia di Bidang Ketenaga-kerjaan [Labour Legislation in Indonesia], Vols I-III, Jakarta: P.T. Twins, 1986.

Michael A. Costello, Thomas R. Leinbach and Richard Ulack, with Marilou Palabrica-Costello and Bambang Suwarno, Mobility and Employment in Urban Southeast Asia: Examples From Indonesia and the Philippines, Boulder: Westview Press, 1987, pp. xvi + 191. $Us 26.50.

Susan Abeyasekere, Jakarta: A History, Singapore: Oxford U.P., 1987, pp. xvii + 280. Cloth: $45.00.

David P. Chandler and M.C. Ricklefs (Eds), Nineteenth and Twentieth Century Indonesia: Essays in Honour of Professor J.D. Legge, Clayton, Vic. : Monash University Centre of Southeast Asian Studies, 1986, pp. 281. $14.00.

Graeme J. Hugo, Terence H. Hull, Valerie J. Hull, Gavin W. Jones, The Demographic Dimension in Indonesian Development, Singapore: Oxford University Press, 1987, pp. xxv + 417. $50.00.

I Ketut Nehen and Ian R. Wills, Land Preparation in West Java: Benefits and Costs of Alternative Techniques, Agency For Agricultural Research and Development, Indonesia, and International Rice Research Institute, 1986, pp. xii + 159.

Michael Smith et al., Asia's New Industrial World, London: Methuen, 1985, pp. vi + 136. £2.95.

Australian Institute of Urban Studies, Review of Australian Assistance to the Indonesian Water Supply and Sanitation Sector, A Report for the Australian Development Assistance Bureau, 1986, pp. xxxiii + 305, $26.00 plus postage.     

Job-worker mismatch and cognitive decline

We have used longitudinal test data on various aspects of people'scognitive abilities to analyse whether overeducated workersare more vulnerable to a decline in their cognitive abilities,and undereducated workers are less vulnerable. We found thata job-worker mismatch induces a cognitive decline with respectto immediate and delayed recall abilities, cognitive flexibilityand verbal fluency. Our findings indicate that, to some extent,it is the adjustment of the ability level of the overeducatedand undereducated workers that adjusts initial job-worker mismatch.This adds to the relevance of preventing overeducation, andshows that being employed in a challenging job contributes toworkers’ cognitive resilience.     

HOW REVOLUTIONARY IS THE “NERICA REVOLUTION”? EVIDENCE FROM UGANDA

A new high‐yielding upland rice variety known as New Rice for Africa (NERICA) has been widely recognized as a promising technology for addressing the food shortage in sub‐Saharan Africa. However, there has been no on‐farm yield data to support this optimism. The present study attempts to assess the actual and potential yield of NERICA in Uganda where it has been introduced recently. We found that NERICA's yield is higher (2.5 tons) for farmers who had rice‐growing experience than those who had no previous experience (1.7 tons). These findings strongly indicate that strengthening training, extension, and other supporting systems is the key to the success of the “NERICA revolution” in this country.