The impact of knowledge accumulation and geographical spillovers on productivity and efficiency: The case of U. S. shipbuilding during WWII

This paper examines the productivity and efficiency experience of World War II Liberty ship builders using two complementary paradigms which can be viewed as alternative specifications of the endogenous growth model introduced by Romer (1986) and the stochastic frontier production model introduced by Aigner, Lovell, and Schmidt (1977). We develop modifications in the endogenous growth model to allow for learning as well as spatial spillovers by relating productivity growth to cumulative productive experience (the ‘learning curve’) and to worker experience as it is transferred and utilized across different geographical regions. We also consider the relative impact of both proximal and distant simultaneous production on productivity growth. We then utilize a framework in which the efficiency component of productivity growth is explicitly considered using a stochastic frontier model wherein contributions to productivity growth introduced in the endogenous growth model are formally modeled as determinants of efficiency change.     

Corporate Charitable Contributions: A Corporate Social Performance or Legitimacy Strategy?

This study examines the relation between firms’ corporate philanthropic giving and their performance in three other social domains – employee relations, environmental issues, and product safety. Based on a sample of 384 U.S. companies and using data pooled from 1998 through 2000, we find that worse performers in the other social areas are both more likely to make charitable contributions and that the extent of their giving is larger than for better performers. Analyses of each separate area of social performance, however, indicate that the relation between giving and negative social performance (cited concerns) only holds for the environmental issues and product safety areas. We find no significant association between corporate philanthropy and employee relations concerns. In general, these findings suggest that corporate philanthropy may be more a tool of legitimization than a measure of corporate social responsibility.     

Hong Kong's Code of Ethics Initiative: Some Differences between Theory and Practice

As a result of the public demand for higher ethical standards, business schools are increasingly taking ethical matters seriously. But their effort has concentrated on teaching business ethics and on students' ethical behavior. Business faculty, in contrast, has attracted much less attention. This paper explores the context and the implications of an alleged case of plagiarism in a master's dissertation submitted to a university lacking both an ethical code of conduct and a formalized procedure to deal with academic misconduct. The events evolved into a bitter political process in which the more ethically aware members of faculty challenged efforts to cover-up. Here the focus is on the motives and behavior of faculty members involved in this case rather than the alleged plagiarist's. The role played by the main actors involved in the process in examined using the theory of moral development and the organizational politic perspective. The paper discusses the mechanisms available to raise ethical awareness and prevent academic misconduct, and the limitations of self-regulation and self-monitoring that prevails in the university system. It also examines the impact of ethics instruction and faculty ethical standards on students' behavior and concludes that ethics instruction can only be effective when the principles taught are in line with daily actions of their instructors.     

Explaining Success: the Rule of Ten Percent and the Example of Market Share

This article has four aims. First, the author argues that, for good reasons, it has been impossible to find any single variable that accounts for more than 10% of the variation in business performance: he calls this the rule of 10%. Second he shows how a 10% effect can be presented graphically to seem much more significant. Third, given problems of measurement and definition, even the 10% which is explained may prove to be of limited value, which is illustrated with the well-established link between market share and return on investment. Fourth, even where variables can be identified and their contribution quantified, he questions the extent to which this can be done in a form useful to managers. The overall conclusion is that determinants of business success are so complex that managers should reject any "one big explanation" however convincing the presentation.     

THE MAGNITUDE OF PRICING ERRORS IN THE ARBITRAGE PRICING THEORY

In this paper the arbitrage pricing theory (APT) pricing errors for individual securities are estimated employing maximum likelihood factor analysis and Fama-MacBeth style aggregation. Results show that the pricing errors are large and statistically significant and that there is a high degree of variability in pricing errors across securities. This evidence contradicts the prevailing APT intuition that the pricing errors can be ignored as negligible. Pricing errors are also found to be related to residual variance and firm size.