Consumption effects of genetic modification: what if consumers are right?⋆

This paper develops a model of differentiated consumers to examine the consumption effects of genetic modification (GM) under alternative labelling regimes and segregation enforcement scenarios. Analytical results show that if consumers perceive GM products as being different than their traditional counterparts, GM affects consumer welfare and, thus, consumption decisions. When the existence of market imperfections in one or more stages of the supply chain prevents the transmission of cost savings associated with the new technology to consumers, GM results in welfare losses for consumers. The analysis shows that the relative welfare ranking of the ‘no labelling’ and ‘mandatory labelling’ regimes depends on: (i) the level of consumer aversion to GM products; (ii) the size of marketing and segregation costs under mandatory labelling; (iii) the share of the GM product in total production; and (iv) the extent to which GM products are incorrectly labelled as non‐GM products.     

Credit supply and corporate capital structure: Evidence from Japan

In this paper we examine how financial constraints, especially fluctuations in the supply of credit, affect the capital structure of 1537 publicly listed Japanese firms from 1980 to 2007, in a data set with 33,000 observations. It is one of the first studies to do so and is inspired by the recent studies of Leary (2009) and Faulkender and Petersen (2006). Japan was selected due to the extreme credit supply fluctuations observed during the last 30 years. It thus offers an ideal natural experiment to test the impact of credit supply on corporate capital structure. In particular, in our panel data study we investigated the impact of the asset bubble in the 1980s and the credit crunch of the late 1990s on corporate capital structure decisions. The results of this paper show, among other findings, that financial policy decisions are indeed influenced by monetary conditions and the supply of credit. In particular, smaller sized firms face financial constraints, especially during economic downturns.     

An empirical analysis of marginal conditional stochastic dominance

Stochastic dominance is a more general approach to expected utility maximization than the widely accepted mean–variance analysis. However, when applied to portfolios of assets, stochastic dominance rules become too complicated for meaningful empirical analysis, and, thus, its practical relevance has been difficult to establish. This paper develops a framework based on the concept of Marginal Conditional Stochastic Dominance (MCSD), introduced by Shalit and Yitzhaki (1994), to test for the first time the relationship between second order stochastic dominance (SSD) and stock returns. We find evidence that MCSD is a significant determinant of stock returns. Our results are robust with respect to the most popular pricing models.     

Leadership integrity and the role of human resource management in Greece: Gatekeeper or bystander?

With ethical misconduct commonplace in organizations and with the touting of competitive advantage associated with ethical organizational practices, considerable attention has turned to leadership integrity. Leaders are uniquely situated to influence the behavior of organizational members, and integrity has been shown to be instrumental in supporting ethical behavior and decision‐making. This article explores the role and influence of human resources management (HRM) in supporting leadership integrity among a group of large organizations operating in crisis‐stricken Greece. Although the institutional and cultural context of Greece appears to exacerbate role tensions confronted by human resources (HR) professionals, its forces are not deterministic; findings from in‐depth interviews with 12 HR directors indicate that the HR potential to secure ethical influence at the top level is primarily contingent on the nature of the organization's culture. Cultures of integrity enable HR executives to influence integrity and ethical behavior in top management teams (TMTs). In contrast, compliance‐based organizational cultures appear to breed a fickle HR presence: fostering integrity and ethical behavior for the middle and lower levels of an organization, while turning a blind eye to integrity violations at the top.     

Managerial characteristics and performance of eurozone mutual funds

We investigate the relation between observable managerial characteristics (i.e., gender, age, tenure, professional qualifications, and advanced education) and performance in diversified equity mutual funds domiciled in the eurozone. We find that differences in the fund alphas are statistically significant only in groups based on age, tenure, and professional qualifications (i.e., chartered financial analyst [CFA]). We also find a significant positive relation for age and CFA certification with a fund's risk-adjusted performance and a significant negative relation for tenure. However, we find no significant effect for gender and advanced education (i.e., master of business administration [MBA]). The differences in risk taking are significantly related only with age and tenure; the former has a negative and the latter a positive relation with risk taking.