SEC product-line reporting and market efficiency

This study tests the efficiency of the securities market with respect to non-public segment earnings data for 1967–1969 which was first made public by many firms in 1970 SEC 10-K reports. Trading rule strategies are proposed in which segment-based earnings forecasts are compared to consolidated-based forecasts to anticipate ‘unexpected’ changes in earnings. Using the ‘market model’ to eliminate market related movements in security prices, average monthly abnormal returns conditional on this segment-based strategy are estimated for 1968, 1969, and 1970 for two groups of firms: (1) ‘Non-disclosure’ firms that did not publicly report either segment revenue or profit data prior to 1970, and (2) ‘partial disclosure’ firms that publicly reported segment revenue information, but no segment profits, prior to 1970.The results suggest that the market was not efficient with respect to the non-public segment revenue and profit data of non-disclosure firms for 1968–1969. However, this finding could not be replicated for 1970. The average monthly abnormal returns conditional on the segment-based trading rule strategy were found to be relatively small for the partial disclosure firms. This suggests that segment revenue data can be used to successfully anticipate changes in total entity earnings which would otherwise be ‘unexpected’ if only consolidated data were available.     

Lateral influences and vertical authority in organizational buying

Eight hypotheses are developed to guide research on the prediction of two structural dimensions of organizational buying behavior. The structural dimensions examined are: (1) the extent of lateral influence on buying decisions; and (2) the distribution of vertical authority for buying decisions. Predictor variables include organizational size, environmental diversity, environmental uncertainty, and the scope, complexity, and newness of the purchases themselves. Some implications of the hypotheses for industrial marketing management are also developed.     

Corporate social responsibility and competitive advantage: A developing country perspective

Corporate social responsibility (CSR) has attracted wider research interests over recent decades. While some studies have examined the impact of CSR activities on firm competitive advantage (CA), the findings so far remain contradictory. Moreover, the role of export orientation, firm strategy, and structure on the association between CSR and CA has not been explicitly examined. Thus, the purpose of this study is to examine the moderating role of export orientation, firm strategy, structure, and firm size on the association between CSR and CA. Using a sample of 179 responses from management staff in organizations across five sectors in a developing country context of Ghana, the study found positive effects of CSR on CA. The study contributes to the resource‐based view (RBV) scholarship by confirming the important complementary effect of export orientation and organizational structure as important resources and capabilities on the CSR–competitiveness relationship. However, no evidence of a moderating effect of firm strategy, or firm size on the CSR–CA relationship was found. These findings are instructive, impactful, and enrich the existing literature on CSR and strategy. Implications for theory and practice are also discussed.     

Equally Weighted Strategic Allocation and Balanced Funds in Brazil

This article analyzes equally weighted strategic asset allocation portfolios in Brazil between 2004 and 2016 and shows that their average returns are not always statistically greater than those of balanced funds, with significance changing in sub-periods. Fixed-income portfolios frequently outperform balanced funds, whose active management underperforms their declared benchmark portfolios. Balanced funds underperformed probably because they deviated from their investment policy. Transaction costs and other rebalancing frequencies do not change the conclusions. Robustness tests indicate that this evidence is valid out-of-the-sample. Investors can mimic balanced-fund policy and possibly do better by means of indexing according to this policy.     

Sunkist Growers: Refreshing the Brand

The objective of this case is to introduce students to what is possibly the most complex agricultural cooperative in the United States and learn more about the economic issues involved in citrus production globally. Students are asked to analyze a strategy built around brand loyalty with higher costs and an inability to dictate to growers what varieties are most valuable to retailers.     

Integrating Religious Principles and Human Resource Management Activities

Many ethical problems faced by organizations concern human resource management. This paper shows how some religious principles can be integrated into a human resource management course. First, it presents a discussion of employee responsibilities and rights in Judaism, Christianity, and Islam. Next, it suggests how various principles can be applied to human resource management activities. Do to others as you would have them do to you is applied to equal opportunity. Thou shall not commit sexual impropriety (or in positive terms, respect and love) is the basis for no sexual harassment. Thou shall not steal (or in positive terms, deal fairly) is related to fair pay in exchange for excellent employee performance. Thou shall not lie (or in positive terms, be truthful) is needed for due process in employee disputes. Thou shall not kill (or in positive terms, respect life) is applied to employee safety and health, plus health care benefits. A list of potential readings is included for instructors to consider for their own courses.     

Infrastructure and Industrial Development: The Case of Central Java

Industrial development does not take place in all regions at the same speed. This paper seeks explanations for regional differences in the development of manufacturing industry in Central Java. Special attention is paid to the impact of infrastructure (roads, telecommunications, electricity) on industrial development. The spatial distribution of manufacturing industry is analysed by means of both secondary data at the kabupaten level and primary data on 274 firms in various parts of Central Java. In addition to demand side factors, infrastructure does indeed play an important role, but local government bureaucratic procedures for obtaining land and permits are also important.     

Understanding the Limitations of Maastricht

Intereconomics - “The unspoken, implicit assumption was that financial instability can only arise alongside inflation and that the stability of financial markets should remain a national...     

The aesthetic fidelity effect

Product aesthetics is a powerful means for achieving competitive advantage. Yet most studies to date have focused on the role of aesthetics in shaping pre-purchase preferences and have failed to consider how product aesthetics affects post-purchase processes and consumers' usage behavior. This research focuses on the relationship between aesthetics and usage behavior in the context of durable products. Studies 1A to 1C provide evidence of a positive effect of product aesthetics on usage intensity using market data from the car and the fashion industries. Study 2 corroborates these findings and shows that the more intensive use of highly aesthetic products may lead to the acquisition of product-specific usage skills that form the basis for a cognitive lock-in. Hence, consumers are less likely to switch away from products with appealing designs, an effect that is labeled as the ‘aesthetic fidelity’ effect. Study 3 addresses an alternative explanation for the ‘aesthetic fidelity effect’ based on mood and motivation but finds that the ‘aesthetic fidelity’ effect is indeed determined by usage intensity. Finally, Study 4 identifies a boundary condition of the positive effect of product aesthetics on product usage, showing that it is limited to durable products. In sum, this research demonstrates that the effects of product aesthetics extend beyond the pre-consumption stage and have an enduring impact on people's consumption experiences.