Circles of Ethics: The Impact of Proximity on Moral Reasoning

We report the results of an experiment designed to determine the effects of psychological proximity—proxied by awareness of pain (empathy) and friendship—on moral reasoning. Our study tests the hypotheses that a moral agent’s emphasis on justice decreases with proximity, while his/her emphasis on care increases. Our study further examines how personality, gender, and managerial status affect the importance of care and justice in moral reasoning. We find support for the main hypotheses. We also find that care should be split into two components, one related to protection (or compassion) and the other to the preservation of relationships. Although gender does not affect moral reasoning directly, we find that it does so indirectly via personality, controlling for age, professional status, and professional background. We do not find a significant effect of managerial status on ethics of justice, but do find that holding a managerial position has a negative impact on ethics of care. Regarding personality, we detect significant positive effects of conscientiousness on ethics of justice and of neuroticism on ethics of care.     

Ordinal vs cardinal status: Two examples

We demonstrate that in models where agents have concerns for status the model predictions can drastically change depending on whether status is modelled as an ordinal or cardinal magnitude. As a proof, we show that two well known theoretical findings are not robust to the substitution of ordinal status with cardinal status [Frank, R.H., The Demand for Unobservable and Other Positional Goods. American Economic Review, (75):101–116, 1985.] and viceversa [Clark, A. and Oswald, R.J., Comparison-Concave Utility and Following Behavior in Social and Economic Settings. Journal of Public Economics, (70):133–155, 1998.].     

Investment–cash flow sensitivities,credit rationing and financing constraints in small and medium-sized firms

The controversy on whether investment–cash flow sensitivity is a good indicator of financing constraints is still unsolved. We apply a comprehensive approach by cross-validating our analysis with both balance sheet and qualitative data on self-declared credit rationing and financing constraints on a sample of mainly small and medium-sized firms. Our qualitative information shows that (self-declared) credit rationing is (weakly) related to both traditional a priori factors—such as firm size, age and location—and lenders’ rational decisions taken on the basis of their credit risk models. We use the qualitative information on firms which were denied (additional) credit to provide evidence relevant to the investment–cash flow sensitivity debate. The evidence shows that self-declared credit rationing significantly discriminates between firms which possess or not such sensitivity, while a priori criteria do not. The same result does not apply when we consider the wider group of financially constrained firms (which do not seem to have a higher investment–cash flow sensitivity), supporting the more recent empirical evidence in this direction.     

Excess Volatility of Exchange Rates with Unobservable Fundamentals

The authors present tests of excess volatility of exchange rates which impose minimal structure on the data and do not commit to a choice of exchange rate "fundamentals." The method builds on existing volatility tests of asset prices, combining them with a procedure that extracts unobservable fundamentals from survey-based exchange rate expectations. The method is applied to data for the three major exchange rates since 1984, and broad evidence is given of excess volatility with respect to the predictions of the canonical asset-pricing model of the exchange rate with rational expectations.     

Property development firms IPOs in Brazil： Was there overpricing or not？

Between September 2005 and October 2007, representative companies of the Brazilian residential real estate market adopted a strategy intended to increase their investment capacity by Initial Public Offer （IPO）. The setting at that time was favorable for constructing residential real estate designed for the middle class, in view of two main factors： First, in 2005, a restructuring of the Brazilian finance system had relaxed requirements needed to receive financing for the purchase of residential property; Second, there was substantial demand in the middle class market because most developers had been focusing on the upper class market in order to guarantee the sale resources in the production phase. Thus, it was necessary to enhance the investment capacity of the real estate companies to attend the middle-class demand. These two factors, associated with a favorable outlook for the Brazilian, as well as the global economy, encouraged those representative companies to rapidly increase their investment capacity by IPO in a short time. The focus of this article is to analyze the quality of the investments in the stock of these real estate companies （21 offers were taken into account in the analysis）. In order to identify what these companies＇ expectations were and how they supported their decisions to enter BOVESPA with their designated prices and amounts, correlating offers against the BOVESPA Index （market index） were also analyzed. The results allow concluding that these offers were not supported by validated procedures of pricing, but rather were just speculative offers, even though we do take into account the investment grade granted to the Brazilian economy within the period concerned in our analysis.     

From rules to collaborative practice: When regulatory mechanisms drive collective co-production

The paper develops an analysis of latent spaces of co-production enacted by the government. Based on a survey and interviews, the authors identified the elements of co-production logics which emerged from the interactions of members of Brazilian municipal health councils. Collective co-production emerges when members adhere to a set of norms and values which are favourable to co-operation. The paper explains how councils’ regulatory mechanisms can drive the understanding of their members in relation to co-production and its benefits.     

Scoring environmental credentials: a review of UK conference and meetings venues using the GREENER VENUE framework

This paper investigates frameworks to conceptualise, monitor and compare corporate social responsibility (CSR) performance at individual conference venues, and provides a new comparative framework that organises and communicates information detailing business performance on 10 environmental policy initiatives (EPIs) (expressed by the acronym “GREENER”) using a CSR scale (expressed by the acronym “VENUE”). This GREENER VENUE framework reduces the gap in the CSR literature by accentuating discretionary practices, and by exhibiting conceptual and psychometric properties enabling the framework's application to broad and diverse contexts. Its use is grounded in theory: the framework is practical, simple to implement, easily understandable and highly relatable. Applying the GREENER VENUE framework to data collected via a self-administered internet questionnaire of 191 UK conference and meeting venues reveals that the biggest groups of such venues are classified as “Eager” on a rising scale from Eternal denial (11%), through Unmotivated (16%), to Nonchalant (30%) and so to Eager (36%), and finally, the top group, Venerated (7%). The paper also investigates the relative influence of all 10 EPI variables of the GREENER measure – considered simultaneously – towards enhancing firms’ behaviour on an inventory of 18 well-known environmental best practices (EBPIs).     

Entrepreneurial intervention in electronic markets: the influence of customer participation

In electronic markets, web 2.0 is emerging in a disruptive way. In this work we conceptualize web 2.0, identifying all its functionalities and firm applications. We describe technological and social changes that should brought in the firm to take benefit of the advantages of the web 2.0, as well as its relationship with knowledge management. We explain how knowledge transfer in the firm can create value through web 2.0 applications. Finally we develop a model who relates the web 2.0 and its potential to create value in the firm, adapting Amit and Zott (Strategic Management Journal 22: 493–520, 2001)’s dimensions to the web 2.0 particular case.