Measurement invariance: Review of practice and implications

A review of efforts to assess the invariance of measurement instruments across different respondent groups using confirmatory factor analysis (CFA) is provided for the years since the Vandenberg and Lance [Vandenberg, R. J., & Lance, C. E. (2000). A review and synthesis of the measurement invariance literature: Suggestions, practices, and recommendations for organizational research. Organizational Research Methods, 3, 4–69.] review. Investigators are more frequently reporting tests of scalar invariance and tests for differences in latent factor means and partial invariance. Efforts have been made to assess, the impact of the choice of a referent indicator in multi-group studies, the appropriateness of forming partials as indicators of a latent construct, the degree of convergence of item response theory and CFA analyses of measurement differences across groups, and the implications of findings of invariance. In this context, a demonstration of the impact of partial invariance on estimated group differences in reliability and means is provided and discussed.     

Moral hazard and adverse selection in the originate-to-distribute model of bank credit

Bank credit has evolved from the traditional relationship banking model to an originate-to-distribute model. We show that the borrowers whose loans are sold in the secondary market underperform their peers by about 9% per year (risk-adjusted) over the three-year period following the initial sale of their loans. Therefore, either banks are originating and selling loans of lower quality borrowers based on unobservable private information (adverse selection), and/or loan sales lead to diminished bank monitoring that affects borrowers negatively (moral hazard). We propose regulatory restrictions on loan sales, increased disclosure, and a loan trading exchange/clearinghouse as mechanisms to alleviate these problems.     

Why parallel trade may raise producers' profits

This paper shows that a manufacturer may benefit from parallel trade. In addition to an intuitive condition about the effect of demand shocks, this occurs when competitive retailers must order inventories before they know the realization of demand and for products whose sale value drops at the end of the demand period. For these types of products, letting retailers trade unsold inventories generally results in larger orders placed with the manufacturer and higher manufacturer profit. The model provides a simple explanation as to why the volume of parallel trade is now very large and accepted by manufacturers for some products such as automobiles, clothes, toys, consumer electronics, musical recordings, cosmetics and perfumes.     

Contextualized representations of brand extensions: Are feature lists or frames the basic components of consumer cognition?

According to the common view in consumer behavior, consumers represent brands and product categories mentally as lists of independent product features and engage in feature matching when they evaluate brand-product category compounds such as brand extensions. However, we demonstrate that brand extension concepts are subject to context effects and largely contextually organized — empirical evidence which suggests that they are represented by more flexible mental structures than independent feature lists. As an alternative, brand extensions (e.g., McDonald's Theme Park) may be viewed as conceptual combinations in which the original brand or company name (e.g., McDonald's) acts on the head concept of the extension category (e.g., theme parks) as a modifier. Moreover, we suggest that the contextual and relational structure of brand extensions may be explained more adequately by mental frames than feature list representations.     

A simple model of brain circulation

This paper analyzes the allocation of two types of individuals differentiated by talent between two countries where they choose to be workers or entrepreneurs. An equilibrium with international migration exists when countries' talent endowments are sufficiently different. It is consistent with one-way or two-way migration whether individuals are entrepreneurs or workers. Although allowing migration increases domestic welfare in one country and decreases it in the other, it is always supported by majority voting in both countries.     

Western popular music consumption by highly involved Chinese music fans

This paper explores the development of Western popular music consumption for highly involved Chinese consumers. This research is exploratory and uses semi-structured online interviews. The consumption of Western popular music in China is deeply embedded in the changing political and social context. In the late 1980s and early 1990s, an underground culture of ‘dakou’, cut tapes and CDs, developed, which was a decisive and formative influence for many of our respondents. Later this was supplemented by counterfeit tapes/CDs, and by Internet downloads, which also increased access to Western music. However, both recorded and live music are still censored in China. Our respondents agreed that the political restrictions on music have prevented China from developing a 'normal' music market, and created a market which is almost entirely based on illegal downloading. As the lifestyle choices of our respondents were deeply influenced by the consumption of Western music, many of them ultimately decided to leave China and live abroad.     

A cost-minimization approach to the international transfer of HRM/IR practices: Anglo-Saxon multinationals in the Federal Republic of Germany

The existence of host-country and country-of-origin effects is analysed by using the concept of fiscal federalism as a theoretical analogy. It is argued that multinationals try to minimize the costs of centralization and decentralization associated with cross-national personnel policy. The higher the costs of decentralization, the more likely is the existence of country-of-origin effects. The opposite holds true for increasing costs of centralization. This is tested empirically by comparing the human resource management and industrial relations (HRM/IR) practices of US and British subsidiaries operating in Germany with those of native German firms. Based on 297 valid cases, it is shown that the existence of decentralization costs is associated with country-of-origin effects in various areas of personnel management, such as the use of variable compensation, employee ownership and initial vocational training. In contrast, in the field of industrial relations (co-determination, compliance with collective bargaining), there are strong pressures to adapt to local norms, leading to host-country effects. These results indicate that a rationalistic cost-minimization approach is well suited to explaining the patterns of host- and home-country effects in regard to the HRM/IR practices of multinational enterprises.     

Rechtsnatur und Zuordnung der Alterungsrückstellungen in der PKV

Discussions about the inclusion of the previously privately insured into the statutory government health insurance abound. Specifically, questions regarding the transfer of specific rights under the private contract persist. In particular this article addresses the ageing reserve into which the insured contributed as part of their original policies. Since contractual claims are protected by fundamental property rights, it was first investigated whether the ageing reserve would allow the insured to claim a reimbursement. However, this disbursement cannot be supported as long as the ageing reserve is still being accrued and has not yet been dissolved since the monies paid into the reserve cannot be traced to their individual sources. The legal principles of trust (Treuhand) and reversion (Anwartschaftsrecht) are also not applicable to this situation as they are based on different factual premises. While the expectation of a constant premium throughout old age is not protected by German Basic Constitutional Law, the insured’s right to expect a continuance of the contract is protected; in addition, required services and remuneration in case of a claim are guaranteed by article 14.