Director expertise and co-option in industry superannuation funds?

This study examines whether independent directors who possess financial expertise and are independent from the CEO (i.e., non-co-opted) are associated with improved outcomes for industry superannuation funds. Our results highlight that independence alone is insufficient to improve fund outcomes. Instead, we find that only non-co-opted independent directors benefit fund members in terms of higher performance and lower fees. Moreover, we find that independent directors' financial expertise is not associated with fund performance and fees. Our study has implications for regulators and superannuation funds who are currently debating the need for one-third independent directors on the board of Australian superannuation funds.     

Branding strategies,marketing communication,and perceived brand meaning: The transfer of purposive,goal-oriented brand meaning to brand extensions

This article develops and tests a conceptual model of the transfer process whereby perceived similarity organized around shared goals facilitates the transfer of knowledge and affect from a parent brand to an extension of that brand. Empirical results, based on two well-known brands and two hypothetical product extensions for each brand, demonstrate that the availability of well-formed, goal-derived categories associated with a parent brand establishes an organizing framework for consumers' assessments of similarity thatfacilitates the transfer of consumer knowledge and attitude from the parent brand to a brand extension in another product category. This facilitating effect of similarity does not occur in the absence of goal-derived categories. The results also reveal how marketing communication can be used to facilitate the transfer process by framing similarity in terms of common goals. Implications are discussed for the organization of consumer knowledge and affect across product categories and for understanding prior research findings on brand extension. Ingrid M. Martin (imartin@csulb.edu) is an associate professor of marketing at California State University at Long Beach. Her research has examined issues in the area of consumer goals as they guide structuring and processing marketing information, product choice and usage. Her research has been published in theJournal of Consumer Research, Journal of Marketing Research, Journal of Public Policy & Research, and five book chapters. David W. Stewart (david.stewart@marshall.usc.edu) is the Robert E. Brooker Professor of Marketing in the Marshall School of Business at the University of Southern California. He is the immediate past editor of theJournal of Marketing. Dr. Stewart has authored or co-authored more than 200 publications and seven books. Shashi Matta (matta@marshall.usc.edu) is a doctoral candidate in marketing at the Marshal School of Business, University of Southern California. His research interests include branding, and services marketing. Shashi’s research has been published in theJournal of Consumer Research.     

Buyer power and supplier incentives

This paper analyzes the origins and welfare consequences of buyer power. We show that if suppliers are capacity constrained or have strictly convex costs, there are two different channels through which large buyers can obtain more favorable terms from their suppliers. In particular, we show how the presence of large buyers can then erode the value of suppliers’ outside option. Somewhat surprisingly, we show how this can induce suppliers to undertake strategies that lead to higher output and potentially higher welfare.     

A strategic market game with seigniorage costs of Fiat money

Summary. A model that includes the cost of producing money is presented and the nature of the inefficient equilibria in the model are examined. It is suggested that if one acknowledges that transactions are a form of production, which requires the consumption of resources, then the concept of Pareto optimality is inappropriate for assessing efficiency. Instead it becomes necessary to provide an appropriate comparative analysis of alternative transactions mechanisms in the appropriate context. Received: September 5, 2000; revised version: May 3, 2001     

Strategic freedom, constraint, and symmetry in one-period markets with cash and credit payment

Summary. In order to explain in a systematic way why certain combinations of market, financial, and legal structures may be intrinsic to certain capabilities to exchange real goods, we introduce criteria for abstracting the qualitative functions of markets. The criteria involve the number of strategic freedoms the combined institutions, considered as formalized strategic games, present to traders, the constraints they impose, and the symmetry with which those constraints are applied to the traders. We pay particular attention to what is required to make these strategic market games well-defined, and to make various solutions computable by the agents within the bounds on information and control they are assumed to have. As an application of these criteria, we present a complete taxonomy of the minimal one-period exchange economies with symmetric information and inside money. A natural hierarchy of market forms is observed to emerge, in which institutionally simpler markets are often found to be more suitable to fewer and less-diversified traders, while the institutionally richer markets only become functional as the size and diversity of their users gets large.Received: 5 June 2003, Revised: 18 November 2003, JEL Classification Numbers: C7, G10, G20, L10, D40, D50. Correspondence to: Eric SmithEric Smith, Martin Shubik: We are grateful to Lloyd Shapley, Duncan Foley, and Doyne Farmer for discussions in the course of this work.     

Competitive search markets for durable goods

Summary. This paper considers a dynamic version of Akerlof's (1970) lemons problem where buyers and sellers must engage in search to find a trading partner. We show that if goods are durable, the market itself may provide a natural sorting mechanism. In equilibrium, high-quality goods sell at a higher price than low-quality goods but also circulate longer. This accords with the common wisdom that sellers who want to sell fast may have to accept a lower price. We then compare the equilibrium outcomes under private information with those under complete information. Surprisingly, we find that for a large range of parameter values the quilibrium outcomes under the two information regimes coincide, despite the fact that circulation time is used to achieve separation. Received: August 24, 2000; revised version: October 24, 2000     

Gold,liquidity and secured loans in a multistage economy

A multistage economy with durables with finite and with unbounded lives is considered. The importance of the existence of both asset and rental markets is considered. It is shown that without rental markets efficiency may not be achieved and a stationary state that might exist with rental markets need not exist. The meaning of the existence of a 100% backed loan is considered. The roles of gold and land as stores of value and money are considered.Research supported in part by ONR Grant N00014-86-K-0220 and by NSF Grant No. SES-8812051.     

Outsourcing, Imports and Labour Demand

This paper examines the effects of purchased services and imported intermediate materials on the labour demand for different skills in German manufacturing sectors. We derive and estimate a factor demand system based on the generalised Box–Cox cost function nesting both the normalised quadratic and the translog functional form. We find that the impacts of output and capital growth are more important in explaining the demand for heterogeneous labour than substitution effects between labour and non–labour inputs. Similarly, the increasing use of both imported materials and purchased services is a consequence of output growth rather than input substitution.
JEL classification : J 23; O 33     

Structure,Clearinghouses and Symmetry

We introduce and justify a taxonomy for the structure of markets and minimal institutions which appear in constructing minimally complex trading structures to perform the functions of price formation, settlement and payments. Each structure is presented as a playable strategic market game and is examined for its efficiency, the number of degrees of freedom and the symmetry properties of the structure