Do foreign institutional investors destabilize China’s A-share markets?

This paper investigates the effect of foreign institutional investors on the stability of Chinese stock markets. Previous literature views this investor group as destabilizing feedback traders. We use the abolition of ownership restrictions on A shares as a natural experiment. There is strong evidence that foreign institutions have a stabilizing effect on Chinese stock markets and contribute to market efficiency. This finding is robust across exchanges, sample periods, size quintiles and alternative model specifications. By contrast, domestic investors appear to engage in positive feedback trading. Our results have important implications for market regulation.     

Efficiency of Microfinance Institutions: A Data Envelopment Analysis

This study examines the cost efficiency of 39 microfinance institutions across Africa, Asia and the Latin America using non-parametric data envelopment analysis. Our findings show non-governmental microfinance institutions particularly; under production approach, are the most efficient and this result is consistent with their fulfillment of dual objectives: alleviating poverty and simultaneously achieving financial sustainability. However, bank-microfinance institutions also outperform in the measure of efficiency under intermediation approach. This result reflects that banks are the financial intermediaries and have access to local capital market. It may be possible that bank-microfinance institutions may outperform the non-governmental microfinance institutions in the long run.     

Structural and executional drivers of downstream revenue

Revenue flows that occur at other related organizational units and over time are an important part of customer profitability analysis and resource planning. This study analyzes downstream revenue generated from establishing a series of additional organizational units. The setting is a central hospital which established a group of specialty outreach clinics. Using a specially-collected time-series database I show two distinct patterns, depending on the clinic's specialty. One type triggers immediate incremental downstream revenue to the clinic's sponsoring department. The other type of clinic generates revenue that is smaller in value, later in time and mostly in departments not associated with the sponsoring department's medical specialty. Structural and executional clinic characteristics such as distance and clinic frequency differentially affect the amount of revenue generated, implying a need for tailoring performance measures to “clinic type”. Overall, my results suggest caution in developing performance measures that include financial impact in other organizational units – context matters even in a relatively homogenous setting of specialty clinics in one hospital system.     

Enhancing mental models,analogical transfer,and performance in strategic decision making

Recent research suggests that managers often make strategic decisions in novel situations by utilizing past experiences to reason by analogy. However, there is substantial evidence that decision makers often fail to identify and apply knowledge about one situation to a similarly structured situation. Two experimental studies investigated the mechanisms impacting knowledge transfer from one managerial situation (the source) to an analogous situation. The results show that exposure to variation in the source situation improves transfer performance. Variation decreases performance in the short term but improves learning and increases analogical transfer. Higher performance on and systematic search of the source situation also increase transfer performance. These results yield important implications for enhancing analogical transfer in strategic decision making and for future research on reasoning by analogy. Copyright © 2012 John Wiley & Sons, Ltd.     

The perception of kosher as a third party certification claim in advertising for familiar and unfamiliar brands

This study was undertaken to investigate the inclusion of a kosher claim in an advertisement for a familiar and unfamiliar brand of breakfast cereal. Results showed that, as hypothesized, for the familiar brand a kosher third party endorsement led to significantly more kosher attribute-related thoughts, more favorable product attitude and greater purchase intention. For the unfamiliar brand, no significant impact upon these dependent measures was observed given a kosher endorsement. Findings are interpreted from a cognitive perspective regarding the salience of the kosher attribute in a product familiarity context. Managerial implications are discussed.     

The economics of enforcement: The case of OSHA

A model of enforcement is developed that determines the impacts of OSHA actions on regulated parties. This model analyzes the effect of decision procedures developed by OSHA to enforce the law and their effect on resource allocation within the firm. It is concluded that the impacts from both the initial inspection and reinspection programs on the resource allocations of firms have likely been insignificantly different from zero. If OSHA is to increase the allocation of injury control resources of firms through its enforcement program, it must increase the costs of noncompliance that it imposes on firms.     

Author Index Volume 19 2001

Authors Index

Author Index Volume 19 2001     

Accounting comparability and relative performance evaluation in CEO compensation

We investigate whether accounting comparability is associated with the likelihood that CEO compensation is tied to relative accounting performance (e.g., return on assets). We predict that higher accounting comparability increases the risk-sharing benefit of accounting-based RPE because peer firm performance better controls for common risk in RPE firm performance. Thus, firms that have higher accounting comparability with potential performance peers will be more likely to include accounting-based RPE as a component of the total CEO compensation contract. We find support for this prediction using (1) an explicit test design that relies on the ex ante terms of CEO compensation contracts obtained from proxy disclosures, and (2) an implicit design that relies on the actual realizations of CEO compensation. To provide further evidence, we examine the association between accounting comparability and the selection of performance peers when the CEO compensation contract includes an accounting-based RPE component. We find that higher comparability between the RPE firm and a potential peer firm increases (decreases) the potential peer firm’s likelihood of being selected into (dropped from) the peer group. Cross-sectional analyses show that this association is less pronounced, or not present, when the relative performance measure is price-based (as opposed to accounting-based), indicating that these results do not merely reflect a more general role of comparability in all RPE contracts.