Experts against adverse selection: A note on the existence of equilibrium with costly appropriable information

The existence of competitive equilibrium in Laffont's (J. Econ. Theory10 (1975)) model of adverse selection with costly information is studied. The existence of an equilibrium with finite prices is demonstrated without unusual restrictions on preferences or the technology of information production. This is made possible by changing the way in which the behaviour of information producing agents is modelled, and allowing for some public information.     

Private information in currency markets

Using daily abnormal currency returns for the universe of countries with flexible exchange rates, we show local currency depreciations ahead of unscheduled, public sovereign debt downgrade announcements. Consistent with the private information hypothesis, the effect is stronger in lower institutional quality countries and holds after we control for concurrent public information and for publicly available rumors about the forthcoming downgrades. Our results persist when abnormal currency returns are adjusted for global carry and dollar risk factors, world equity and bond returns, as well as local stock market returns. Finally, the currency depreciations are permanent, providing evidence for a link between fundamentals and currency markets.     

The effect and moderation of gender identity congruity: Utilizing “real women” advertising images

The present article examines the predictive ability of gender identity congruity in explaining women's responses to advertising appeals. The contributions of the article are twofold: (1) to demonstrate whether advertisements that are congruent with female consumers' gender identities elicit strong positive responses and (2) to identify the factors that moderate/mediate the impact of gender identity congruity on consumer responses to advertisements. The research findings provide evidence of the ability of gender identity congruity to elicit positive responses to advertising appeals. The relationship between gender identity congruity and responses to the advertisement is mediated by advertising involvement. The moderating roles of national culture, physical concern, and physical view are also supported. Overall, the congruity theory provides a powerful framework to examine consumer responses to gender portrayals in advertising. ©2009 Wiley Periodicals, Inc.     

AN AXIOMATIZATION OF QUANTILES ON THE DOMAIN OF DISTRIBUTION FUNCTIONS

In an environment in which the primitive is the space of distribution functions, we characterize the quantile functions by the axioms ordinal covariance, monotonicity with respect to first-order stochastic dominance, and upper semicontinuity. We show how to characterize the VaR in a similar manner.     

"Proxy Power" and Corporate Democracy:

A bstract . Separation of corporate ownership from control has permitted the rise of a self perpetuating managerial elite , which operates businesses in its own self interest. The attempt of the corporate democracy and corporate responsibility movements to curb unbridled management power through stockholder proxy proposals has been highly publicized. Analysis of stockholder initiated resolutions contained in the proxy statements of 626 corporations indicates that relatively few companies receive even one resolution, that proposers are usually small shareholders operating independently or in loose coalitions with limited resources and divergent interests, that managements use massive resources to oppose virtually all proposals and defeat most overwhelmingly, and that the handful of management concessions to stockholder activists is actually cosmetic mollification. We conclude the proxy power is structurally weak and is not a realistic agent of corporate change, in that management structure and policy-making power remain intact.     

MNEs and development: a review and reconceptualization

In this paper, we review and critique two prominent theories in the international business and international economics literatures regarding the role of multinational enterprises (MNEs) in host country development: the “spillovers” perspective on the impact of MNE investment in host countries and the liabilities of foreignness (LOF) view that specifies the constraints MNEs must overcome to succeed in local, developing country markets. We then propose an alternative conceptualization of MNE-host country relations in which MNEs and local nongovernmental organizations (NGOs) pursue collaborative relationships that make a positive, collective contribution to host country development and to MNE and NGO strategic goals in ways that neither sector is positioned to do alone.     

The future of the uplands

Upland areas provide UK society with many important functions, goods and services, but have experienced a number of disturbing trends and face an uncertain future. This paper outlines historic, current and future drivers of environmental, economic, socio-cultural and policy change in UK uplands, and assesses how these have affected or are likely to affect ways in which land is used and the provision of ecosystem services. Information is synthesised into scenarios summarising a range of possible futures anticipated for UK uplands to 2060 and beyond. Finally, innovations in science, technology, governance and policy are evaluated that could enable uplands to continue providing key ecosystem services under a range of scenarios. The paper concludes that many upland areas will need to be prepared for significant reductions in grazing and prescribed burning. Conversely, other areas could experience agricultural intensification, for example significant increases in grazing or an expansion of arable or bioenergy crops into upland valleys, due to anticipated increases in global demand for food and energy. These scenarios will take place in the context of climate change. Many may take place together and may interact with each other, with complex and unpredictable implications for the upland environment, economy and society. In this context, a number of advances are needed in science, technology and policy to maintain viable upland communities and the future provision of ecosystem services. These may include funding for ecological and hydrological restoration via carbon offsetting or other means. It may also involve advances in ecosystem service modelling, mapping and valuation, which through stakeholder participation could facilitate more integrated rural planning. New forms of environmental governance need to be explored that can empower those interested in developing upland economies to maintain thriving upland communities, while managing the ecosystem services they provide as efficiently as possible.     

Assessing supply chain risks with the analytic hierarchy process: Providing decision support for the offshoring decision by a US manufacturing company

This paper reports the process used by a US manufacturing company to assess supply chain risks within the context of an offshore sourcing decision. The case study company was faced with the objective of finding a new supplier for two of its major product lines. Five alternatives were considered: (1) sourcing finished goods from Mexico; (2) sourcing finished goods from China; (3) sourcing parts from China and assembly in the US; (4) sourcing parts from China, assembly in a Maquiladora in Mexico with investment; and (5) sourcing parts from China, assembly in a Maquiladora in Mexico with no investment in the venture. To find the best solution, action research methodology was combined with the application of the analytic hierarchy process (AHP). Through iterative and structured discussions, 17 risk factors were identified, which were subsequently grouped into main and sub objectives. AHP was then used to evaluate the importance of each risk factor, and to determine the best alternative. This study makes several contributions to the field of purchasing and supply management. First, it provides a comprehensive framework of empirically derived risk factors to be considered in an international sourcing context. Second, it shows how AHP can be used to assess these risk factors and alternatives as part of the framework to facilitate and support the final offshoring decision. And third, it illustrates the successful application of the approach by a US manufacturing company. As such, this paper contributes to the research streams of offshoring and risk management in purchasing and supply, as well as to decision-making under uncertainty and AHP. In addition, it serves as a practical methodology for firms in similar situations.