Antecedents of creative decision making in organizational crisis: A team-based simulation

Although it has been claimed that the devastation and complexities that characterize an organizational crisis may be addressed most effectively with creative solutions, theoretical and empirical research examining this challenge is scarce. We developed a theoretical model concerning creative decision making during organizational crisis for crisis management teams. To test this theory, we collected data from 191 individuals in 37 teams who participated in multi-hour, multi-phased organizational crisis simulations in the United States and Canada. Using regression analysis, we found that crisis management teams generated a creative decision when they were familiar with solutions, trusted their team members, and had creative intentions. This study supports organizational efforts to leverage education, training and accountability to reinforce creativity in crisis decision making.     

Dreaming of Flying When Grounded: Occupational Identity and Occupational Fantasies of Furloughed Airline Pilots

This article analyses the effects of job loss on the occupational identities of a group of United States pilots, laid off (or ‘furloughed’) twice by their employer in the decade following 9/11. Using a narrative methodology, the paper examines how the childhood dream of flying, referred to as the Phaëthon dream, serves as an identity anchor that sustained their occupational identities. When the circumstances of the aviation industry (restructuring, outsourcing, and downsizing) led to extensive lay‐offs, this identity anchor functioned in two contrasting ways. Some pilots moved on to retrain and start new careers, without abandoning their occupational identities or relinquishing the dream of flying. Another group of pilots, however, were stuck in occupational limbo waiting to be recalled by their employer, unwilling to forsake this dream and refusing to contemplate a move that would decisively take them out of their pilot seats. The paper's contribution lies in theorizing how a dream originating in childhood, linked to a long‐standing archetype of flying and subsequently hardened into a shared occupational fantasy, acts as an identity anchor and how this shapes responses to the trauma of job loss. The paper concludes by linking the Phaëthon dream to its mythological counterpart in order to highlight its enduring, shared, and unconscious character.     

The Positive Ethical Organization: Enacting a Living Code of Ethics and Ethical Organizational Identity

A vision of a living code of ethics is proposed to counter the emphasis on negative phenomena in the study of organizational ethics. The living code results from the harmonious interaction of authentic leadership, five key organizational processes (attraction–selection–attrition, socialization, reward systems, decision-making and organizational learning), and an ethical organizational culture (characterized by heightened levels of ethical awareness and a positive climate regarding ethics). The living code is the cognitive, affective, and behavioral manifestation of an ethical organizational identity. We draw on business ethics literature, positive organizational scholarship, and management literature to outline the elements of positive ethical organizations as those exemplary organizations consistently practicing the highest levels of organizational ethics. In a positive ethical organization, the right thing to do is the only thing to do. Amy Klemm Verbos is a Ph.D. candidate at the Sheldon B. Lubar School of Business, University of Wisconsin-Milwaukee, where she received a Chancellor’s Fellowship, Graduate Fellowship, Dissertation Fellowship, and C. Edward Weber Research Award. She co-authored ‚Positive Relationships in Action: Relational Mentoring and Mentoring Schemas in the Workplace’ in the forthcoming edited book, Positive Relationships at Work. Her work on positive organizing also has been presented at the Academy of Management Conference. Joseph A. Gerard is a Ph.D. student at the Sheldon B. Lubar School of Business at the University of Wisconsin-Milwaukee. He is a lecturer at the University of Wisconsin-Whitewater teaching organizational behavior, strategy, and accounting. He is a founding member of Ascent Organization Development LLC, which provides management consulting services to for-profit organizations in the areas of effectiveness and performance enhancement. Paul R. Forshey is a Ph.D. student in Organizations and Strategic Management at the Sheldon B. Lubar School of Business, University of Wisconsin-Milwaukee. His research interests include startup firms and firms in transition. Charles S. Harding is a Ph.D. student in Organizations and Strategic Management at the Sheldon B. Lubar School of Business at the University of Wisconsin-Milwaukee. Awarded a Chancellor’s Fellowship, his research interests include strategic decision-making and the role of value creation in strategy. Janice S. Miller is an Associate Professor at the Sheldon B. Lubar School of Business at the University of Wisconsin-Milwaukee where she has received the Business Advisory Council Award for Teaching Excellence. Her published work has appeared in Academy of Management Journal, Journal of Organizational Behavior, and Journal of Business Ethics among others. She received her Ph.D. in Human Resources Management from Arizona State University.     

Intellectual property rights and foreign direct investment

This paper develops a product cycle model with endogenous innovation, imitation, and foreign direct investment (FDI). We use this model to determine how stronger intellectual property rights (IPR) protection in the South affects innovation, imitation and FDI. We find that stronger IPR protection keeps multinationals safer from imitation, but no more so than Northern firms. Instead, the increased difficulty of imitation generates resource wasting and imitation disincentive effects that reduce both FDI and innovation. The greater resources absorbed in imitation crowd out FDI. Reduced FDI then transmits resource scarcity in the South back to the North and consequently contracts innovation.     

Are Production Decisions Decoupled under a Bond Scheme? Experimental Evidence

Experimental economics procedures were used to investigate impacts of a proposed bond scheme on production decisions. As expected, production with subsidy payments tied to a support price was substantially higher than with no policy. A shift from the support price to equivalent annual or lump-sum payments not tied to price resulted in production at or near no-policy levels, providing empirical evidence to support the theoretical prediction that bond schemes would not result in production distortions. Potential extensions to the basic model used in this study also are presented.     

A Decade of Service-learning: A Review of the Field Ten Years after JOBE’s Seminal Special Issue

This article reviews developments in the field of service-learning, both in terms of general management education and business ethics specific courses, over the past 10 years. Using the 1996 Journal of Business Ethics special issue on service-learning as a benchmark, numerous accomplishments are presented and continued barriers are discussed. Finally, three issues are raised as next steps for service-learning authors and practitioners as we move forward into the next decade: (1) designing effective and sustainable university/community partnerships, (2) addressing problems stemming from the conspiracy of courtesy, and (3) optimizing the intersection between online learning and service-learning.     

Minimum standards, insurance regulation and adverse selection: evidence from the Medigap market

This paper examines the implications of minimum standards for insurance markets. I study the imposition of binding minimum standards on the market for voluntary private health insurance for the elderly. The central estimates suggest that the introduction of the standards was associated with an 8 percentage point (25%) decrease in the proportion of the population with coverage in the affected market, with no evidence of substitution toward other, unregulated sources of insurance coverage. To explore possible factors contributing to the impact of the minimum standards, I develop comparative static predictions of the impact of imposing minimum standards in an insurance market with adverse selection. The observed changes in market equilibrium associated with the minimum standards are broadly consistent with these predictions, providing evidence of the existence of adverse selection in this insurance market. More importantly, they suggest that the presence of adverse selection—which in principle may provide an economic rationale for minimum standards—in practice may have exacerbated the declines in insurance coverage associated with the minimum standards.     

Insider Trading after Repurchase Tender Offer Announcements: Timing versus Informed Trading

Abnormally high net insider selling is commonly observed after repurchase tender offer (RTO) announcements although, on average, firms experience positive abnormal returns in the years after the repurchases. We explore two potential explanations: liquidity trade timing and informed trading. Consistent with the notion that fixed price RTOs are more likely than Dutch-auction RTOs to signal undervaluation, the results suggest that insider selling after fixed price RTO announcements are driven largely by insiders who time their trades with the repurchase announcements. In contrast, selling after Dutch-auction RTOs seems to be driven primarily by informed traders who exploit mispricing associated with the repurchase announcements.     

Short selling in initial public offerings

Short sale constraints in the aftermarket of initial public offerings (IPOs) are often used to explain short-term underpricing that is subsequently reversed. This paper shows that short selling is integral to aftermarket trading and is higher in IPOs with greater underpricing. Perceived restrictions on borrowing shares are not systematically circumvented by “naked” short selling. Short sellers, on average, do not appear to earn abnormal profits in the near term and our findings are not driven by market makers. Short selling in IPOs is not as constrained as suggested by the literature, implying that other factors may be responsible for underpricing.     

Opaque financial reports, R, and crash risk

We investigate the relation between the transparency of financial statements and the distribution of stock returns. Using earnings management as a measure of opacity, we find that opacity is associated with higher R²s, indicating less revelation of firm-specific information. Moreover, opaque firms are more prone to stock price crashes, consistent with the prediction of the Jin and Myers [2006. R² around the world: new theory and new tests. Journal of Financial Economics 79, 257–292] model. However, these relations seem to have dissipated since the passage of the Sarbanes-Oxley Act, suggesting that earnings management has decreased or that firms can hide less information in the new regulatory environment.