Hope Springs Eternal - French Bondholders and the Soviet Repudiation (1915-1919)

Repudiations rarely occur due to their extreme nature. This paper provides an empirical study based on an original database: prices of a Tsarist bond traded in Paris before and after its repudiation by the Soviets. A structural VAR is used to disentangle French market shocks from repudiation specific ones. After the repudiation, we identify shocks that are related with bailouts, hopes of partial bailouts, negotiations with the Soviets and the Russian civil war. We argue that bond prices essentially reflected expected extreme events that never took place and were thus subject to a “Peso problem”.The authors thank Howard Bodenhorn, Michael Bordo, Frans Buelens, Ariane Chapelle, André Farber, Georges Gallais-Hamonno, Jean-Jacques Heirwegh, Marie-Paule Laurent, Larry Neal, Hugh Rockoff, Ariane Szafarz, Gail Triner, Andrey Ukhov, Loredana Ureche-Rangau, Daniel Waldenstr?m, Marc Weidenmier, Eugene White as well as the editor, William Goetzmann, an anonymous referee, the participants of the 2005 BETA workshop in historical economics and of the 2005 European Historical Economics Society Annual Conference for helpful comments. The first author also thanks M. Gallais-Hamonno and Ms. Bodilsen for their help and availability when collecting the data respectively at the Université d’Orléans and at the SBF.     

Exploring the ethical behavior of managers: A comparative study of four countries

Donaldson and Dunfee's (1994) social contracts theory of economic ethics was subjected to empirical scrutiny to determine whether it can explain differences in behavior between cultures. Data collected utilizing a series of vignettes developed by Fritzsche and Becker (1984) were examined for differences in indicated ethical behavior among American, Japanese, Korean and Taiwanese managers. Rationale for the behavior was classified according to hyper and community norms which were supported or violated. The results suggest that the three East Asian countries do not neatly cluster together in relation to the U.S. in terms of their patterns of ethical behavior. Nonetheless, when we examined the specific rationale for the decisions provided by the managers, the effects of Asian cultural characteristics became more notable. We also found that the social contracts theory provided a much needed bridge between ethical universalists and relativists. The specific reasons underlying their decisions are discussed in the light of cultural and social differences.This research project was partially supported by a research grant from the School of Business and Management, The Hong Kong University of Science and Technology.     

The Effects of Consumption Variability on Saving: Evidence from a Panel of Muscovite Households**

Due to the high uncertainty characterizing them, transition economies provide an extraordinary opportunity to test the precautionary saving hypothesis. This paper represents an attempt to exploit this opportunity. We use a panel of 2,346 Muscovite households, over the 12 months of 1996, to construct two time‐varying measures of consumption growth variability, which we use as proxies for households’ perceived uncertainty. We then regress household saving on these uncertainty variables using a GMM‐system estimator. We find that both uncertainty measures generally have a positive and statistically significant effect on saving. This result, which is robust to the use of different measures of saving, supports the precautionary saving hypothesis.     

Strategies for successful organizational downsizing

This article reports the results of a study of 30 organizations that engaged in downsizing over a four-year period. Three questions were investigated: (1) What general strategies are used by organizations to downsize? (2) What are the effects of downsizing on organizational performance? (3) What are downsizing's “best practices?” or, What are the differences between organizations that effectively downsize and those that do not? Three main strategies for downsizing are explained, the managerial actions to overcome the negative effects of downsizing are enumerated, and the best practices of successful downsizing firms are presented.     

Flat priors vs. ignorance priors in the analysis of the AR(1) model

The paper compares, by a Monte-Carlo study based on an AR(1) model, the performance of the flat prior and the ignorance prior suggested by Phillips. It argues that the ignorance prior gives heavy weight to values of the autoregressive parameter p higher than 1, and hence distorts the sample evidence as summarized in the likelihood function. It yields bimodal posterior distributions, with the second mode at p higher than 1, even when the true value of p is substantially less than 1.     

The role of family conglomerates in emerging markets: What Western companies should know

Large, diversified, family‐owned businesses are dominant players in the economies of most emerging markets and can be excellent business partners for Western companies. This article highlights the evolutionary patterns of family conglomerates (FCs) and delineates principal drivers of their growth, expansion, and internationalization. Those aspects of FCs examined in this study include early mover advantages, foreign alliances, competitive market positioning, and diversification. Also discussed are entry‐mode considerations for Western companies contemplating doing business in the fast‐growth markets of East Asia, Latin America, and elsewhere. © 2004 Wiley Periodicals, Inc.     

Developing an index of online customer satisfaction

This paper integrates and applies the concept of ‘satisfaction’ from three fields: management information systems (MIS), marketing and e-commerce. E-customers are viewed as both computer users and customers and as a result researching customer satisfaction in e-commerce needs to integrate aspects of satisfaction from each of these fields. This study defines e-customer satisfaction and develops an index using a weighted sum model. The index is tested using a Korean sample. Analyses suggest an acceptable model and a generalisable set of measures from which managers and researchers evaluate online satisfaction and, especially, marketing strategies in financial services industries.     

Tunneling or Value Added? Evidence from Mergers by Korean Business Groups

We examine whether firms belonging to Korean business groups (chaebols) benefit from acquisitions they make or whether such acquisitions provide a way for controlling shareholders to increase their wealth by increasing the value of other group firms (tunneling). We find that when a chaebol-affiliated firm makes an acquisition, its stock price on average falls. While minority shareholders of a chaebol-affiliated firm making an acquisition lose, the controlling shareholder of that firm on average benefits because the acquisition enhances the value of other firms in the group. This evidence is consistent with the tunneling hypothesis.