Firm heterogeneity and immigrant wage assimilation

This article investigates the role of job mobility in immigrant wage assimilation. I use longitudinal linked employer–employee data for Portugal to estimate the immigrant wage catch-up in log wage regressions with both individual and firm fixed effects. I show that moving to firms with higher wage premiums accounts for approximately 30% of the immigrant wage catch-up in the first years.     

Central bank disclosure as a macroprudential tool for financial stability

The Basel Capital Accord (pillar 3) states that disclosure of information (transparency) is essential to financial stability. This study analyzes, through inflation reports, the disclosure of information from the Central Bank of Brazil concerning the credit market. We consider credit risk and capital buffers as measures of financial stability in this analysis. Furthermore, in order to measure the perception of the monetary authority on the credit market, we built two indices based on the central bank’s communication on credit development. We performed a panel data analysis based on a sample of 125 banks for the period from June 1999 to September 2014 (7000 observations). The findings suggest that central bank communication regarding expectations concerning the credit market contributes to financial stability. Therefore, this kind of communication of central banks (about credit development) may constitute an important macroprudential tool to improve financial stability.     

Raising Capital in an Insurance Oligopoly Market

We consider an oligopoly market where firms offer insurance coverage against a risk characterised by aggregate uncertainty. Firms behave as if they were risk averse for a standard reason of costly external finance. The model consists in a two-stage game where firms choose their internal capital level at stage one and compete on price at stage two. We characterise the subgame perfect Nash equilibria of this game and focus attention on the strategic impact of insurers capital choice. We discuss the model with regard to the insurance industry specificities and regulation.     

Nash-equilibria in a heterogeneous oligopoly with fuzzy information

We consider a model of an oligopolistic market with heterogeneous firms and products where neither the cost nor the demand functions are common knowledge. Instead, each firm only has some vague ideas about the price strategies adopted by its competitors which is modelled by a fuzzy set. In analogy to the notion of an "equilibrium of actions and beliefs" we define and characterize a generalized Nash-equilibrium and show its existence under general conditions. Furthermore, the impact of the fuzzy information on the equilibrium outcome is analyzed by means of a comparative static analysis within a particular model framework.Received: 28 May 2002, Accepted: 25 December 2002, JEL Classification: D43, D80, L13We wish to thank Bernhard F. Arnold, the editor Murat Sertel , and two anonymous referees for helpful comments. Of course, we are responsible for all remaining errors.     

Endorse or Not to Endorse: Understanding the Determinants of Newspapers’ Likelihood of Making Political Recommendations

This article investigates the determinants of newspapers’ provision for political opinion. I empirically examine the role of newspapers’ political preferences and market competition on newspapers’ decision to make endorsements. Regression results suggest that market competition turns newspapers more likely to make endorsements. Results from a simple model show that newspapers’ ideology determine their endorsements, making partisan papers more likely to make political recommendations and endorse challengers than non‐partisan newspapers.     

WHICH AGGLOMERATION EXTERNALITIES MATTER MOST AND WHY?

This paper revisits the ongoing discussion on the importance of agglomeration externalities – specifically specialization, diversity and competition effects – that may contribute to innovation, productivity and urban employment growth. Previous meta‐analyses suggested that the evidence on agglomeration externalities is strongly context‐specific. Expanding an earlier analysis of 31 articles, we seek to draw in this paper more robust conclusions by means of the statistical evidence for agglomeration externalities presented in 73 scientific articles, all building on the seminal work of Glaeser et al. (1992). Our results confirm that the heterogeneity among studies is huge and can only be partially accounted for by means of an ordered probit analysis. Additionally, some evidence of publication bias is found. We conclude that the conventional lines of inquiry in this literature may now have reached strongly diminishing returns. New lines of inquiry, using rich micro‐level data on firms and workers, dynamic general equilibrium models at the macro level, more attention for spatial and temporal variation in the impacts of agglomeration, and further investigations into the spatial scope of externalities are promising avenues for further research that can enhance our understanding of how agglomeration externalities continue to fuel our increasingly urbanized world.     

A dual‐sequence framework for B2C relationship formation: Moderating effects of employee communication style in online group chat

Past research on B2C relationships has typically focused on unidimensional constructs of satisfaction, trust, and commitment, ignoring underlying psychological dimensions. Although some studies have examined cognitive and affective dimensions of these relational constructs, dual sequential effects in relationship formation have not been investigated. This study proposes and finds (in the context of online group chat) that parallel cognitive and affective sequences of relationship formation take place, thus expanding scholarly understanding of underlying psychological processes and offering marketing practitioners two different ways to build relationships with consumers. The proposed dual‐sequence relational framework further advances theory by shedding light on counterintuitive findings in past research. The study also supports the proposed moderating effects of employee communication style, such that sequential effects of cognitive (affective) relational constructs are stronger with a task‐oriented (socially oriented) employee, thus offering insights to practitioners in hiring and training employees to match specific organizational goals for building relationships with consumers. © 2009 Wiley Periodicals, Inc.     

Learning, hubris and corporate serial acquisitions

Recent empirical research has shown that, from deal to deal, serial acquirers' cumulative abnormal returns (CAR) are declining. This has been most often attributed to CEOs hubris. We question this interpretation. Our theoretical analysis shows that (i) a declining CAR from deal to deal is not sufficient to reveal the presence of hubris, (ii) if CEOs are learning, economically motivated and rational, a declining CAR from deal to deal should be observed, (iii) predictions can be derived about the impact of learning and hubris on the time between successive deals and, finally, (iv) predictions about the CAR and about the time between successive deal trends lead to testable empirical hypotheses.