Are stricter investment rules contagious? Host country competition for foreign direct investment through international agreements

We argue that competitive diffusion is a driver of the trend toward international investment agreements with stricter investment rules, namely defensive moves of developing countries concerned about foreign direct investment (FDI) diversion in favor of competing host countries. Accounting for spatial dependence in the formation of bilateral investment treaties and preferential trade agreements that contain investment provisions, we find that the increase in agreements with stricter provisions on investor-to-state dispute settlement and pre-establishment national treatment is a contagious process. Specifically, a developing country is more likely to sign an agreement with weak investment provisions if other developing countries that compete for FDI from the same developed country have previously signed agreements with similarly weak provisions. Conversely, contagion in agreements with strong provisions exclusively derives from agreements with strong provisions that other FDI-competing developing countries have previously signed with a specific developed source country of FDI.     

Testing the Unstable Middle and Two Corners Hypotheses About Exchange Rate Regimes

The recent rash of international currency crises has generated considerable interest in the role that exchange rate regimes have played in contributing to these crises. Many economists have argued that efforts to operate adjustably pegged exchange rate regimes have been a major contributor to “the unstable middle” hypothesis and some have argued that this unstable middle is so broad that only the two corners of hard fixes or floating rates will be stable in a world of high capital mobility—the two corners or bipolar hypothesis. Two recent empirical studies by researchers at the International Monetary Fund reach opposing conclusions on these issues. We examine the issue further and show that conclusions can be quite sensitive to how exchange rate regimes are grouped into categories and the measures of currency crises that are used. In general we find that the dead center of the adjustable peg is by far the most crisis prone broad type of exchange rate regimes, but that countries need not go all the way to freely floating rates or hard fixes to substantially reduce the risks of currency crises.

MIGRATION,SOCIAL NETWORKS,AND CREDIT: EMPIRICAL EVIDENCE FROM PERU

We seek evidence of the causal relationship between migration, social networks, and the probability of receiving credit in a developing country where credit markets are weak and internal migration is common. Migrants may face binding asymmetric information constraints as they often lack collateral. Social networks can help mitigate these constraints. Conversely, migrants might face higher liquidity constraints and might, therefore, demand more credit than nonmigrants. The effect of migration on participation in the credit market is thus ambiguous. Compounding this, migration and credit may be jointly determined. We utilize rich data from Peru to establish the net effect of migration on credit and the role that social networks play in this relationship.     

Identifying the gaps in ethical perceptions between managers and salespersons: A multidimensional approach

This research examines, in a general manner, the degree and character of perceptual congruity between salespeople and managers on ethical issues. Salespeople and managers from a diversity of organizations were presented with three scenarios having varying degrees of ethical content and were asked to evaluate the action of the individual in each scenario. Findings indicate that, in every instance, the participating managers tended (1) to be more critical of the action displayed in the scenarios, (2) to view the action as violating a sense of contract or promise, and (3) to view the action as less culturally acceptable than did the salespeople.Tony L. Henthorne is Associate Professor of Marketing at the University of Southern Mississippi. Dr. Henthorne has published in such journals asPsychology and Marketing andJournal of Professional Services Marketing.Donald P. Robin is Professor of Business Ethics and Professor of Marketing at the University of Southern Mississippi. Dr. Robin is coauthor with Eric Reidenbach of two recent books on business ethics. Dr. Robin has contributed several articles on business ethics in such journals asJournal of Marketing, Journal of the Academy of Marketing Science, andJournal of Business Ethics. He is also a frequent lecturer on the topic of business ethics.R. Eric Reidenbach is the Director of the Center for Business Development and Research and Professor of Marketing at the University of Southern Mississippi. Dr. Reidenbach has written numerous articles for such journals asJournal of Business Ethics, Journal of Marketing, Journal of Macromarketing, andJournal of the Academy of Marketing Science. Dr. Reidenbach has coauthored two books on business ethics.     

A conceptual model of corporate moral development

The conceptual model presented in this article argues that corporations exhibit specific behaviors that signal their true level of moral development. Accordingly, the authors identify five levels of moral development and discuss the dynamics that move corporations from one level to another. Examples of corporate behavior which are indicative of specific stages of moral development are offered.R. Eric Reidenbach is Professor of Marketing and Director of the Center for Business Development and Research at the University of Southern Mississippi. He has written extensively on business and marketing ethics.Donald P. Robin, Professor of Business Ethics and Professor of Marketing at the University of Southern Mississippi, is coauthor with R. Eric Reidenbach of two recent books on business ethics with Prentice-Hall. He is a frequent lecturer on business ethics and is the author of several articles on the subject.     

Antecedents and Consequences of Cronyism in Organizations

In this paper we discuss cronyism that exists between superiors and subordinates. Cronyism is defined as favoritism shown by the superior to his or her subordinate based on their relationship, rather than the latter's capability or qualification, in exchange for the latter's personal loyalty. We argue that two cultural antecedents, namely particularism and paternalism, give rise to strong ingroup bias and unreserved personal loyalty, which in turn lead to cronyism. We examine the consequences of cronyism at the individual level with respect to job satisfaction, organizational commitment, and ingratiation. We also discuss how cronyism affects performance, morale, and inertia at the organizational level. Cronyism can be observed in all cultures; however, its manifestation is likely to vary from one culture to another.     

Flight‐to‐safety and the credit crunch: a new history of the banking crises in France during the Great Depression†

Despite France's importance in the interwar world economy, the scale of the French banking crises of 1930–1 and their consequences have never been fully assessed quantitatively. The lack of banking regulation severely limited the availability of balance sheet data. Using a new dataset of individual balance sheets from more than 300 banks, this article shows that the crises were much more severe than previously thought, although they did not affect the main commercial banks. By reconstructing financial flows, this study shows that the fall in bank credit was mostly driven by a flight‐to‐safety by deposits, from banks to savings institutions and the central bank. The decrease in bank deposits due to bank runs was offset by an increase in deposits with savings institutions, with the central bank, and in cash hoarding, whereas the decrease in bank credit was not offset by an increase in loans from non‐bank financial institutions. In line with the gold standard mentality, cash deposited with savings institutions and the central bank was used to decrease marketable public debt and increase gold reserves, rather than pursuing countercyclical policies. Despite massive capital inflows and rising aggregate money supply, France suffered from a severe, persistent credit crunch.