Theorising South Africa’s Corporate Governance

South Africa’s principal corporate governance report aspires to an ‘inclusive’ approach to corporate governance, in which companies are clearly advised to consider the interests of a variety of stakeholders. Yet, in common with many other countries, there is little discussion of the theoretical foundations and assumptions implicit in the recommended approach to corporate governance. The purpose of this article is to provide an analysis of corporate governance and the corporate environment in South Africa in terms of existing theory and models of corporate governance, and to provide a critique based on a consideration of traditional African values and the socio-economic necessities of post-apartheid South Africa. The result is the identification of an incompatibility between the current corporate environment in South Africa and the given exposition of African values. Some prospects for change are then identified.     

Meeting the Challenges for Franchising in Developing Countries: The Vietnamese Experience

While business format franchising is the industry standard for developed countries, it remains an aspiration for many developing countries. Despite the attraction for developing countries of systems, training, and support and despite the economic and regulatory infrastructure being in place for the development of business format franchising, a range of commercial and socio-cultural factors may conspire to prevent its full expression. This paper addresses franchising development in Vietnam, a developing country. It considers strategies to bridge the gap between Vietnamese franchise practice and franchising best practice. It proposes that in Vietnam's current state of development, the product and trade name model may be the appropriate starting point with a move to the business format model only when, and in places where, the socio-cultural, commercial, and economic factors and the legal environment can accommodate more sophisticated business format franchise arrangements.     

THE TWO FUNDAMENTAL THEOREMS OF ASSET PRICING FOR A CLASS OF CONTINUOUS‐TIME FINANCIAL MARKETS

The paper is concerned with the first and the second fundamental theorems of asset pricing in the case of nonexploding financial markets, in which the excess‐returns from risky securities represent continuous semimartingales with absolutely continuous predictable characteristics. For such markets, the notions of “arbitrage” and “completeness” are characterized as properties of the distribution law of the excess‐returns. It is shown that any form of arbitrage is tantamount to guaranteed arbitrage, which leads to a somewhat stronger version of the first fundamental theorem. New proofs of the first and the second fundamental theorems, which rely exclusively on methods from stochastic analysis, are established.     

‘Psychopaths’ at Work? Implications of Lay Persons’ Use of Labels and Behavioural Criteria for Psychopathy

In attempting to explain or deal with negative workplace behaviours such as workplace bullying, the notion of ‘workplace psychopaths’ has recently received much attention. Focusing on individual aspects of negative workplace behaviour is at odds with more systemic approaches that recognise the contribution of individual, organisational and societal influences, without seeking to blame a person(s) for their behaviour or personality disorder. Regarding a coworker as a psychopath is highly stigmatising, and given the relatively low prevalence of psychopathy in the community, is likely to be incorrect. Sources promoting the notion of workplace psychopathy provide lists of diagnostic criteria and appear to encourage the perception that it is common. This research examines how lay persons use behavioural criteria consistent with psychopathy and the label ‘psychopath’ in relation to a coworker. 307 Australian workers completed an online survey concerning their experience of workplace bullying, which also asked them to rate a coworker’s behaviour on a range of scales to assess perceptions of psychopathy. Rates of psychopathy, when using labels and behavioural criteria, were found to be much higher than scientific estimates of prevalence, for both participants who had been bullied and those who had not. A higher proportion of non-bullied participants classified a coworker as a psychopath when using the label ‘psychopath’, compared to when using behavioural criteria. The notion that there are psychopaths in every workplace should be treated with caution to ensure that the potential for ‘misdiagnosis’ and stigmatisation do not cause further harm in situations of unacceptable workplace behaviours.     

The contrasting interaction effects of improvisational behavior with entrepreneurial self-efficacy on new venture performance and entrepreneur work satisfaction

Although improvisation is often considered to be an elemental component of entrepreneurship, little work has been done to evaluate factors that influence the relationship of entrepreneur improvisational behavior with important outcome variables. In an attempt to partly fill this gap, the current study examines the moderating effect of entrepreneurial self-efficacy on the relationship of founders' improvisational behavior with both the performance of their startups and their individual level of work satisfaction using a national (United States) random sample of 159 entrepreneurs. In alignment with our predictions, improvisational behavior was found to have a positive relationship with new venture performance (i.e., sales growth) when exhibited by founders who were high in entrepreneurial self-efficacy, whereas improvisational behavior was found to have a negative relationship with new venture performance when exhibited by founders who were low in entrepreneurial self-efficacy. Contrary to our expectations, entrepreneurial self-efficacy was found to have a negative moderating effect on the relationship between entrepreneur improvisational behavior and work satisfaction.     

The restructuring and privatisation of British Rail: was it really that bad?

This paper uses a social cost‐benefit analysis (SCBA) framework to assess whether rail privatisation in Britain has produced savings in operating costs. The paper shows that major efficiencies have been achieved and consumers have benefited through lower prices, whilst the increased government subsidy has been largely recouped through privatisation proceeds. We also find that output quality is no lower (and is probably better) than under the counterfactual scenario of public ownership (pre‐Hatfield). The achievement of further savings is key to delivering improved rail services in the future. This paper finds that a privatised structure, where shareholders demand a return on their investment, has led to significant improvements in operating efficiency. It remains to be seen whether the new regime, with a not‐for‐profit infrastructure owner, will deliver the same efficiency improvements.     

The impact of large tax settlement favorability on firms’ subsequent tax avoidance

Review of Accounting Studies - I consider how large tax settlements compare to management expectations and then test how the favorability of a resolution (from the firm’s perspective) affects...     

Can a Dictator Turn a Constitution into a Can-opener? F.A. Hayek and the Alchemy of Transitional Dictatorship in Chile

Commenting on the Pinochet regime, Friedrich Hayek famously claimed in 1981 that he would prefer a ‘liberal’ dictator to ‘democratic government lacking liberalism.’ Hayek's defense of a transitional dictatorship in Chile was not an impromptu response. In late 1960, in a little known BBC radio broadcast, Hayek suggested that a dictatorial regime may be able to facilitate a transition to stable limited democracy. While Hayek's comments about Pinochet have generated much controversy, this paper neither provides a blanket condemnation of his views (he did not advocate dictatorship as a first-best ‘state of the world’) nor tries to excuse his failure to condemn the Pinochet junta's human rights abuses, but instead provides a critical assessment of Hayek's implicit model of transitional dictatorship.     

Subtle discrimination in the rental housing market: Evidence from e-mail correspondence with landlords

We find that landlords practice subtle discrimination in the rental housing market through the use of language associated with describing and viewing a unit, inviting further correspondence, making a formal greeting, and using polite language when replying to e-mail inquiries from a white name more often than to an African American name, they also send longer e-mails and respond quicker to white names.