Differential mortality and social security

Abstract This paper studies the normative problem of redistribution between individuals who differ in their lifespans. We discuss aspects related to the objective function and argue that aversion to multiperiod inequality should be taken into account. Then, we study the properties of the social optimum both with full information and with asymmetric information. We highlight the role of aversion to multiperiod inequality and show that it has substantial consequences on the design of Social Security schemes. In particular, we show that for a low (resp. high) aversion to multiperiod inequality, a negative (resp. positive) implicit tax rate on continued activity is desirable.     

The intellectual structure of the journal Business Strategy and the Environment: A 25‐year author cocitation analysis

This article presents the intellectual structure and 25‐year author cocitation analysis of the journal Business Strategy and the Environment. The findings show that Business Strategy and the Environment is an emerging, well‐established journal in its field. The journal needs a core set of authors who are actively engaged in the production and certification of knowledge; further, it consists of a number of loosely linked research team contributors, each with its own areas of interest. The existence of these research teams is a sign of strength that characterizes the journal as it strives to foster a community of unified scholars whose published works advance our understanding of business strategic decisions and behavior with regard to the natural environment. This study is useful for contributors, readers, and editorial board members who form the journal's community of knowledge creation and certification.     

Demand fluctuations and capacity utilization under duopoly

Summary.  This paper studies the impact of uncertain demand on firms’ capacity decisions when they operate in an oligopolistic environment. We define a two-stage game where firms choose capacity in the first stage without knowing which state of Nature is going to realize, and output levels in the second, knowing which state is realized. We prove the existence of a symmetric subgame perfect equilibrium at which firms are in excess capacity compared with the capacity they would choose in the Cournot certainty equivalent game. Received: May 17, 1996; revised version July 31, 1996     

The Effect of Joint Auditor Pair Composition on Audit Quality: Evidence from Impairment Tests

Using a sample of firms from France, where the law requires the use of two auditors, we study the effect of auditor pair composition on audit quality by examining a specific account, goodwill impairment. We document that firms audited by a Big 4–non‐Big 4 auditor pair (BS) are more likely to book an impairment and book a larger impairment than firms audited by a Big 4–Big 4 auditor pair (BB) when low‐performance indicators suggest a greater likelihood of impairment. Moreover, firms audited by a BB pair reduce impairment disclosures when they book impairments, while firms audited by a BS pair do not, suggesting lower transparency for firms audited by a BB pair. Our results inform investors and firms in mandatory joint audit regimes, as well as regulators who are considering requiring joint audits.     

Sex,Race, and Job Satisfaction Among Highly Educated Workers

There has been a considerable amount of work focusing on job satisfaction and sex, generally finding that women are more satisfied than men despite having objectively worse job conditions. But there is little evidence on whether job satisfaction differs by race or ethnicity. We use data from the 2010 National Survey of College Graduates to examine the relation between job satisfaction and race and ethnicity among Asian, black, Hispanic/Latino, and white workers. Overall job satisfaction does not differ by sex among college graduates. Relative to white workers of the same sex, Asian and black workers are far less satisfied. The lower satisfaction of Asian and black workers relative to white workers is not explained by immigrant status, job match, or other individual or job characteristics.     

Specialization,diversification, and productivity: a panel data analysis of rice farms in Korea

This article examines the microeconomics of productivity associated with specialization/diversification in production activities, with an application to Korean rice farms. Korean rice farms tend to be very small and highly specialized. Our analysis examines the productivity effects associated with both farm size and farm specialization/diversification in Korean agriculture. Relying on farm‐level panel data, the analysis studies farm productivity in a multi‐input multi‐output context, accounting not only for changes in inputs and technical change in rice production, but also for the role of diversification in the production of other crops in current and previous periods. We find positive but small productivity gains from farm diversification. These gains come mostly from complementarity effects across farm outputs, with minimal effect of scale economies. The positive complementarity effects work against nonconvexity effects, which provide strong productivity incentives for rice farms to specialize.     

Coping with drought with innovative pricing systems: the case of two irrigation water management companies in France

In recent years, France has been facing particularly severe drought periods especially in summer. In a country where agriculture is the largest water user, some irrigation management companies have implemented innovative pricing systems to handle this situation. The objective of this article is to analyze the impact of these new management systems on farmers’ incomes, the revenue of the management companies, and the amount of water used. To do that, we develop a methodology using a stochastic model that simulates the representative farmer's optimal behavior in a context of climatic variability. An empirical application is made with a crop growth model and data collected from the Midi‐Pyrenees region. The results show that using these specific nonlinear pricing systems allow irrigation water managers to reduce the impact of drought on production. Moreover, the type of pricing implemented depends on the characteristics and capabilities of the water company. More particularly, these pricing systems can be used to anticipate agricultural water demand in order to avoid imbalance with water availability.     

Opportunistic tendencies in IJVS with the Japanese: The effects of culture,shared decision making,and relationship age

This study investigated how partners' self-reported opportunism and shared decision making varied by culture in international joint ventures (IJVs) with the Japanese. Data were gathered by a mail survey of senior officials in IJVs located in 11 host countries. Significant differences were found between partners from Western cultures and the Japanese, but not between other Asians and the Japanese. Indirect effects suggest that shared decision making neutralizes cultural tendencies toward opportunism. Results indicated that opportunistic tendencies did not diminish as the IJV relationship aged, and that shared decision making did diminish as the relationship aged.     

CEO Incentives and Corporate Social Performance

This paper examines the relationship between CEO incentives and strong and weak corporate social performance. Using the KLD database we find that incentives have no significant relationship with strong social performance. Salary and long-term incentives have a positive association with weak social performance.     

Chief Financial Officers as Inside Directors

Considerable prior research investigates whether the extent of insider presence on corporate boards is detrimental. However, the majority of past research treats all inside directors as a homogenous group. This study considers that issue in the context of chief financial officers (CFO) serving on their own company's board. Our research is important because individuals in different executive roles bring different skills and knowledge to board interactions, highlighting the potential for differential contributions. As prior research does not specifically distinguish CFOs from other board insiders, the potential benefits of knowledge sharing due to increased communication with other board members may have been masked. Specifically, the CFO is directly responsible for the quality of the financial reporting process and can therefore be associated with specific outcome measures. Our results show that the percentage of CFOs serving on their own boards is not large, likely due to the perspective (consistent with agency theory and reflected in independence guidelines) that company insiders on boards could promote their own best interest at the expense of shareholders. Contrary to this perception, we find that companies whose CFO has a seat on the board are associated with higher financial reporting quality (i.e., a lower likelihood of reporting a material weaknesses in internal controls or having a financial restatement, and better accruals quality). Yet, we also find potential drawbacks in that CFOs with a board seat tend to have higher excess compensation and lower likelihood of termination following poor performance, signaling greater entrenchment. While our results provide information to companies considering appointing the CFO to the board, both costs and benefits are demonstrated, and thus we conclude that each board should consider this decision based on its own circumstances and composition.