Testing for structural breaks in factor loadings: An application to international business cycle

This paper proposes the implementation of the SupWald test of Andrews (1993) to detect structural breaks in the loadings of a static factor model. The procedure is illustrated by testing for structural breaks in the common factors of GDP growth series for a sample of advanced countries from 1950 until 2006.     

Governance with multiple objectives: Evidence from top executive turnover in China

We examine the relationship between Chief Executive Officer (CEO) turnover and the performance of listed Chinese firms and obtain two results. First, we find a negative relationship between the level of pre-turnover profitability and CEO turnover when firms are incurring financial losses, but no such relationship when they are making profits. Second, there is an improvement in post-turnover profitability in loss-making firms, but no such improvement in profit-making firms. These results indicate the existence of a time-varying objective function, whereby shareholders have a greater incentive to discipline their CEOs on the basis of financial performance when their firms are incurring financial losses rather than profits.     

Is Child Work Necessary?*

This article investigates the hypothesis that child labour is compelled by poverty. It shows that a testable implication of this hypothesis is that the wage elasticity of child labour supply is negative. Using a large household survey for rural Pakistan, labour supply models for boys and girls in wage work are estimated. Conditioning on non-labour income and a range of demographic variables, the article finds a negative wage elasticity for boys and an elasticity that is insignificantly different from zero for girls. Thus, while boys appear to work on account of poverty compulsions, the evidence for girls is ambiguous.     

Child Farm Labor: The Wealth Paradox

This article is motivated by the remarkable observation thatchildren of land-rich households are often more likely to bein work than the children of land-poor households. The vastmajority of working children in developing economies are inagricultural work, predominantly on farms operated by theirfamilies. Land is the most important store of wealth in agrariansocieties, and it is typically distributed very unequally. Thesefacts challenge the common presumption that child labor emergesfrom the poorest households. This article suggests that thisapparent paradox can be explained by failures of the marketsfor labor and land. Credit market failure will tend to weakenthe force of this paradox. These effects are modeled and estimatesobtained using survey data from rural Pakistan and Ghana. Themain result is that the wealth paradox persists for girls inboth countries, whereas for boys it disappears after conditioningon other covariates.     

Metaphor's validity in marketing research

Using metaphor is widespread in management and marketing because it provides creativity. However, metaphor's validity is seldom investigated. This article offers an analysis of the validity of metaphor using three steps: (1) analysis of the metaphor's source concept, (2) analysis of the metaphor's aptness, and (3) analysis of the process of metaphor generation. These three steps have been applied to investigate the validity of two very well‐known metaphors in marketing: product life cycle and brand personality. Results show these two metaphors lack validity when analyzed using the three steps. © 2009 Wiley Periodicals, Inc.     

The Successful Product Pioneer: Maintaining Commitment while Adapting to Change

Introducing pioneering products is an important entrepreneurial activity and the lifeblood of small businesses, yet previous literature on pioneering and performance in small firms has been inconclusive. Based on data gathered from entrepreneurs in 51 small computer firms, the study found that commitment (entrepreneurial confidence) and adaptability (corporate entrepreneurship and environmental dynamism) were especially beneficial to pioneers. The other three variables (product championing, marketing emphasis, and technological newness) contributed to performance across all new product introductions but did not have modifying effects on pioneering introductions in particular.     

Situational Project Management for Collaborative Research Projects

Collaborative research projects form a specific project type, aimed at organizing innovation endeavors between industry, academic, and public partners. They've become increasingly widespread and their management is challenged due to ambiguously defined goals and the heterogeneous interests of many partners. We present a situation‐specific approach that enables managers to select established project management knowledge according to changing needs along the project life cycle. Making use of thematic analysis, we develop a graphical framework to describe and analyze project situations. Further we establish situation profiles as a concept to relate each situation to a management method that corresponds with its managerial needs.     

Exploring the generative power of performance measurement systems design

Prior studies recognise the enabling power of incompleteness in the design of Performance Measurement Systems (PMS). We add to these studies by exploring the ‘time dimension’ of incompleteness as a way to delve into the generative power of design. To this aim, we rely upon the experience of a knowledge-intensive organization during the design of a new PMS. While knowledge complexity engaged the participants within an open-ended design process, incomplete measures were associated with unfolding memories of the past and confident beliefs in future solutions, which generated effects through the knowledge gaps that they entailed, as well as through the projections in the past and in the future that they enabled. By delving into the time dimension of incompleteness, we add to prior studies on PMS design by showing the relationships between managers' hopes for the future, patterns of memory (and forgetting) of the past and incompleteness in design. In particular, we show that although incomplete measures stimulate managers' aspirations and search for further possibilities, it is forgetting about the past (its evolving memories) that triggers this search, facilitates new actors entering the design process and enables unpredictable outcomes of design.     

Post-earnings announcement drift: Spanish evidence

This paper analyses whether earnings announcements in the Spanish stock market are followed in subsequent months by a return drift in the same direction as the earnings surprise. Two alternative earnings surprise measures are used and they both provide strong post-earnings announcement drifts. In order to find an explanation for this anomaly we first make several unconditional adjustments, which include the CAPM, the Fama–French (J Financ Econ 33:3–56, 1993) three-factor model, a liquidity factor, controlling portfolios by size and book-to-market ratio, and controlling for the momentum effect. Second, we make a conditional analysis following two different approaches: (i) studying the relation with the business cycle and (ii) studying whether this phenomenon can be explained through a conditional version of the CAPM and the Fama-French model. None of these adjustments are able to satisfactorily capture the Spanish post-earnings announcement drift. A final analysis offers some slight evidence in favour of the limits-to-arbitrage explanation. A previous version of this paper is available in the Working Paper Series of FUNCAS (no. 221, 2005), who we thank for their collaboration in the research diffusion in Spain. We also acknowledge the financial support of the Ministerio de Ciencia y Tecnología (SEJ2005-09372/ECON), Conselleria d’Empresa, Universitat i Ciència (GV06/196) and University of Alicante (GRJ06-03). This version has benefited from interesting comments made by Gonzalo Rubio, Belén Nieto, Natividad Blasco, Renata Herrerías and Carina Sponholtz, as well as by various anonymous referees. Any remaining errors are the sole responsibility of the authors.