The Influence of Environmental Knowledge and Values on Managerial Behaviours on Behalf of the Environment: An Empirical Examination of Managers in China

This study explores linkages between what Chinese managers generally know about environmental issues, how strongly they value environmental protection, and different types of behaviours/actions they may take within their organizations on behalf of the environment. From a sample of 305 managers in Guangzhou and Beijing, it was found that both environmental knowledge and values are more predictive of more personal managerial behaviours, such as keeping informed of relevant company issues and working within the system to minimize environmental impacts, than more overt behaviours. Moreover, for these more personal actions, environmental knowledge and values were found to have both main and interactive effects. By comparison, it was found that both environmental values and knowledge had additive effects on managerial tendencies to initiate new programs within their domain of responsibility. Only environmental values was found to have a modest influence environmental advocacy.     

Institutional ownership of stock and dimensions of corporate social performance: An empirical examination

Collectively, institutions own an increasing proportion of outstanding corporate equities. As an emergent force in shaping corporate America, the linkages between institutional ownership and corporate social performance (CSP) require empirical examination. Not only do corporate policy makers need to know those areas where social performance may lure or inhibit capital infusions, lawmakers also need a better understanding of the social forces guiding corporate policy. As anticipated, this study found a positive relationship between the amount of institutional ownership of corporate stock and a company's social responsiveness as measured by the representation of women on its board of directors; however, no statistically significant relationship with social responsibility as measured by charitable giving was found. The exemplar of social issues management — compliance with the Sullivan principles — showed an unexpected, negative relationship with the level of institutional ownership.Betty S. Coffey's research interests are in the area of strategic management, organizational change, and social issues.Gerald E. Fryxell is Assistant Professor of Management at the University of Tennessee, Knoxville. His current research interests are in the area of corporate culture, innovation, and strategic management.     

The role of small firms in the industrial development and transformation of Czechoslovakia

This article presents an analysis of the role of small firms in the formation and reform of the Czechoslovak manufacturing sector. It attempts to give an understanding of the industrial structure formed under the past regime within the framework of the mass production paradigm. As manufacturing productivity gradually declined over the past 25 years and small firms have been virtually eliminated, systemic preference has been given to the development of large monopolies. Consequently, a monolithic coalition structure of enterprise managers, state bureaucrats, and political nomenklatura has arisen and continues to present itself as a serious hindrance to economic transformation. While small firms have the potential to play a critical role in the democratic marketization of Czechoslovakia, current government preoccupation with the rapid privatization of the state sector risks damaging the development of a balanced distribution of firm size and, in turn, the revitalization of the society.     

Rate of return regulation and the Le Chatelier principle

This paper examines whether rate-of return regulation alters the input quantities firms use to produce their selected output level when the corresponding input prices change, in a manner similar to the Le Chatelier principle. More specifically, would the change in a rate regulated firm’s input quantity due to a change in its input price be less price elastic than the unregulated firm’s change in the input quantity due to a change in its input price. We follow Färe and Logan (1986), Nelson and Wohar (1983) in estimating a rate regulated cost function and capital input share system of equations. Using a 1992–2000 panel of 34 US major investor-owned electric utilities, empirical results indicate that the regulated own-input price elasticities of demand for labor and fuel are less price elastic than their corresponding unregulated own-input price elasticities of demand (a Le Chatelier principle type effect). Having a fuel clause (1) reduces the firm’s willingness to substitute from fuel to either non-fuel (capital, labor) input when the price of fuel rises, and (2) enhances the firm’s willingness to substitute from non-fuel inputs to fuel when the price of non-fuel inputs rises.     

Accounting Quality,Liquidity Risk,and Post‐Earnings‐Announcement Drift

Recent microstructure research finds that liquidity risk, in particular its information component, plays an important role in explaining the post‐earnings‐announcement drift (PEAD). We decompose liquidity risk into an accounting‐associated component and a nonaccounting‐associated component and examine their relative importance in explaining PEAD. Our research is motivated by recent findings that liquidity risk is a systematic risk and earnings quality is negatively associated with liquidity risk. We find that the accounting‐associated component is more strongly related to PEAD returns than is its nonaccounting‐associated counterpart. Further analyses reveal that the relation between accounting‐associated liquidity risk and PEAD returns is weaker for firms with greater analyst following. We also find that in a significant market downturn, the relation between accounting‐associated liquidity risk and PEAD returns becomes more pronounced. Our study is the first to document a liquidity risk‐based role of accounting quality in explaining the PEAD phenomenon. It parses out the PEAD risk premia associated with accounting versus nonaccounting sources and, by so doing, sheds light on the role of accounting quality in shaping the liquidity risk‐PEAD returns relation.     

Leadership and cooperation in growing teams

We study how the growth of teams affects leadership effectiveness and intragroup cooperation. We put experimental participants in two teams. In each team, the members voluntarily contribute to a club good. In one of the two teams, the members observe the contribution of a randomly chosen leader before they decide themselves. Two treatments allow for migration between the teams. In one of them, participants control access to their team with a voting process. By design, participants can achieve the efficient outcome only if they all move into one team. We compare the results with a leaderless setting as well as with four treatments which vary team size exogenously. The results show that high contributions of leaders encourage higher per-capita contributions of their followers which foster migration into their teams. In turn, larger teams experience even more courageous leadership and higher contributions, but the coordination effect diminishes. Nevertheless, the dismissal of potential newcomers in the treatment with voting suggests that team members see a trade-off between team size and contributions. They sacrifice economic benefits from potential entrants to maintain intrateam cooperation.