The Effects of Norms on Investor Reactions to Derivative Use

Prior research indicates that a firm's use of derivatives to manage business risks is viewed favorably by investors. However, these studies do not consider a potentially key factor in this setting—namely, the typical behavior (or norms) regarding derivatives by other firms in the industry or the firm itself. In this paper, we report the results of multiple experiments that test whether norms are influential in affecting investors’ evaluations of firms’ derivatives choices. Our results show that the generally favorable reactions to derivative use actually reverse and become unfavorable when firms’ derivative decisions are inconsistent with industry or firm norms. Somewhat surprisingly, though, we find that industry and firm norms are not viewed similarly by investors. These results expand our understanding of how investors respond to firm's derivative use decisions and demonstrate the role of norms as factors that influence investors’ judgments in financial reporting settings. Our results have implications for firm managers making decisions about derivative use.     

Straight to the Core — Explaining Union Responses to the Casualization of Work: The IG Metall Campaign for Agency Workers

The existing literature provides different accounts on the strategies of unions regarding marginal workers. It has been argued that under increasing labour market segmentation, unions have either to prioritize their core constituencies and to seek compromises with management, or to adopt inclusive strategies towards peripheral workers to counterbalance eroding bargaining power. This article shows that both strategies represent equally viable options to protect the interests of unions' core members. The strategic choice depends on the (perceived) competition between core and peripheral employees related to employers' personnel strategies; this affects the possible alignment of interests between unions' core members, on the one hand, and either management or peripheral employees, on the other. Our historical analysis of union strategies towards agency workers in the German metal sector illustrates this mechanism, and identifies institutional change towards liberalization as the trigger for aggressive segmentation strategies by employers and for inclusive union strategies.     

Access (Not) Denied: The Impact of Financial, Human, and Cultural Capital on Entrepreneurial Entryin the United States

Entrepreneurship contributes to business dynamics in all economies, and the individual benefits of starting a business are clear. Nonetheless, access to business start-ups may not be available to all people because of resource constraints. Using a unique new data set for the United States, we examine the relative importance of three forms of resources in pursuing start-up ventures: financial, human, and cultural capital. Our analysis of the Panel Study of Entrepreneurial Dynamics shows that neither financial nor cultural capital resources are necessary conditions for entrepreneurial entry. By contrast, potential entrepreneurs gain significant advantages if they possess high levels of human capital. Specifically, advanced education and managerial experience are significantly positively associated with entrepreneurial entry. Our findings suggest that attempts at entering entrepreneurship, at least in the short-term, may be increasing, as opportunities to acquire human capital are becoming more widespread.     

Empathetic responses to advertising: Testing a network of antecedents and consequences

It has been proposed conceptually that viewers respond to certain advertisements via Empathetic Responses; that is, by feeling with depicted characters. Such deep viewer engagement is especially valued in today’s media environment and is central to dramatic advertising strategies. Nevertheless, Empathetic Responses remain relatively understudied. We situate Empathetic Responses within a model comprising high-level personality domains (within the “Big Five”), lower-level personality facets (multidimensional Trait Empathy), and Perceived Ad Vividness, all as antecedents, as well as consequent Ad-Evoked Feelings. Our findings clarify the composition and function of Empathetic Responses, adding to both basic and applied understandings.

Tradeoffs between sensory attributes and organic labels: the case of orange juice

Researchers have investigated the role of sensory attributes and organic labels on consumers’ preferences and perceptions of food, but few has examined whether sensory attributes are relevant for consumers who prefer organic food and the extent to which sensory attributes influence consumer's marginal willingness to pay for organic food. The objective of this study is to determine how sensory attributes and organic label work together to influence consumer's stated preference and marginal willingness to pay for orange juice. To achieve this, we conducted a blind sensory evaluation of two orange juices followed by a discrete choice experiment to determine the extent to which consumer's stated preference for orange juice labelled as organic is affected by sensory experience preceding the choice experiment. Random parameter logit models and latent class conditional logit models are used to explain stated preference. Results indicate that the effect of sensory attributes on consumer's marginal willingness to pay differed by organic juice and conventional juice.     

Relational marketing: development,debates and directions

Abstract

Relationship marketing (RM) is an umbrella term for a loose collection of ideas and concepts that emerged in different empirical contexts from the late 1970s. Informed by diverse research traditions, it represented at one and the same time an extension of existing ideas within marketing management and a very different way of thinking about marketing. Though cooperation has not been a core element of the marketing management lexicon, debates about cooperation and competition predate the 1970s. Moreover, re-engaging with relational perspectives raises important questions about managerial autonomy and about the utility of the market as a regulating force. The paper calls for the development of a more realistic theory of networks with inputs from both business and consumer marketing contexts.     

The effect of more rules‐based guidance on expense disclosure under International Financial Reporting Standards

International Financial Reporting Standards (IFRS) are often described as principles‐based; however, we show that IFRS and Australian pre‐IFRS expense‐related standards are more rules‐based than pre‐IFRS expense disclosure in New Zealand. Thus, we examine expense disclosure in New Zealand and Australia around IFRS adoption to provide evidence on the effect of more or less rules‐based standards on voluntary disclosure. First, we add to the rules versus principles‐based standards debate by finding higher voluntary expense disclosure under more rules‐based standards (e.g. IFRS). This contrasts with expectations, as we would expect fewer voluntary disclosures under more rules‐based standards as there would be fewer possible voluntary disclosures. Second, we document that New Zealand firms have significantly less voluntary expense disclosure than size‐ and industry‐matched Australian firms in both the pre‐ and post‐IFRS period. However, all measures of expense disclosure significantly improved post‐IFRS for New Zealand, whilst little change occurred for Australian firms. Thus, there is greater financial statement comparability across these countries post‐IFRS, but not full harmonization. Third, we show that the relationship between most firm characteristics and expense disclosure is weaker post‐IFRS. In addition, cross‐listed firms and loss‐making firms have a higher level of expense disclosure, as contrasted with firms in the investment and property industry which have a lower percentage of unspecified expenses but also report fewer voluntary expenses.     

Harmonization relating to auditor independence: the Eighth Directive,the UK and Germany

The European Union Eighth Directive on the approval of auditors covers auditor independence only to a very limited extent. The provisions in the five articles on this subject are far less detailed than they were in the drafts of the directive, so that almost all specific regulation is left to the Member States. An examination of the development of the articles dealing with independence and integrity shows how the need to compromise, in order to reach an agreement, frustrated the intentions of the harmonizers. This paper traces the development of the independence rules in the Eighth Directive from the avant projet through the drafts to the final directive. It assesses the extent to which pre-Eighth Directive regulation in the UK and Germany may have affected the directive and then examines the implementation of the directive in the two countries. It concludes that national culture and accounting traditions prevented harmonization of independence rules through the Eighth Directive.     

Advances in Joint Modelling: A Review of Recent Developments with Application to the Survival of End Stage Renal Disease Patients

The use of joint modelling approaches is becoming increasingly popular when an association exists between survival and longitudinal processes. Widely recognized for their gain in efficiency, joint models also offer a reduction in bias compared with naïve methods. With the increasing popularity comes a constantly expanding literature on joint modelling approaches. The aim of this paper is to give an overview of recent literature relating to joint models, in particular those that focus on the time‐to‐event survival process. A discussion is provided on the range of survival submodels that have been implemented in a joint modelling framework. A particular focus is given to the recent advancements in software used to build these models. Illustrated through the use of two different real‐life data examples that focus on the survival of end‐stage renal disease patients, the use of the JM and joineR packages within R are demonstrated. The possible future direction for this field of research is also discussed.