Psychological ownership as a crisis management advertising appeal – antecedents,outcomes, and moderators

In a crisis communication context, this work examines the impact of Psychological Ownership (PO) appeals on Ad message recipients’ development of feelings of PO. It demonstrates that increased levels of PO influence the managerially relevant outcomes attitude toward the company and purchase intentions. In doing so, it finds new application for the construct. In order to better understand the factors that may contribute to or mitigate PO, this research also investigates environmental consciousness as an additional antecedent and gender, persuasion knowledge, and geographic distance as moderators of individuals’ response to such appeals. Managerial and theoretical implications are discussed.     

Access (Not) Denied: The Impact of Financial, Human, and Cultural Capital on Entrepreneurial Entryin the United States

Entrepreneurship contributes to business dynamics in all economies, and the individual benefits of starting a business are clear. Nonetheless, access to business start-ups may not be available to all people because of resource constraints. Using a unique new data set for the United States, we examine the relative importance of three forms of resources in pursuing start-up ventures: financial, human, and cultural capital. Our analysis of the Panel Study of Entrepreneurial Dynamics shows that neither financial nor cultural capital resources are necessary conditions for entrepreneurial entry. By contrast, potential entrepreneurs gain significant advantages if they possess high levels of human capital. Specifically, advanced education and managerial experience are significantly positively associated with entrepreneurial entry. Our findings suggest that attempts at entering entrepreneurship, at least in the short-term, may be increasing, as opportunities to acquire human capital are becoming more widespread.     

Pension Contributions and Firm Performance: Evidence from Frozen Defined Benefit Plans

We study the impact of freezing defined benefit (DB) pension plans and replacing them with defined contribution (DC) plans on liquidity, financial leverage, investment, and market value of a sample of firms over 2001‐2008. We find evidence that the pension freeze tends to attenuate the drain on corporate liquidity and relieve the pressure to borrow to pay for mandatory contributions (MCs) associated with underfunded DB plans. Although investors seem to favor the pension freeze as evidenced by positive announcement abnormal stock returns, there is little reliable evidence that the freeze increases investment efficiency and long‐term stock performance.     

Agency costs,corporate governance mechanisms and ownership structure in large UK publicly quoted companies: A panel data analysis

This paper examines the impact of governance and ownership variables on agency costs for a panel of large UK quoted companies. We use three measures of agency costs: the ratio of sales-to-total assets, the interaction of free cash flows and growth prospects and the number of acquisitions. We employ a range of techniques to analyse the data: fixed-effects, instrumental variables, and Tobit regressions. We find that the changes in board structures that have occurred in the post-Cadbury period have not, generally, affected agency costs. This suggests a range of mechanisms is consistent with firm value maximisation. We also find that having a nomination committee increases agency costs, which indicates that there are costs associated with certain governance mechanisms. Increasing board ownership also helps to reduce agency costs. We also find that debt reduces agency costs. Our results raise questions about the usefulness of the information sent to shareholders when firms adopt a recommended governance framework.     

Recent evidence on the relationship between anonymity and response variables for mail surveys

Although most marketing researchers and texts recommend guaranteeing respondents anonymity in mail surveys, emirical evidence on this issue is dated, and often is based on results from student or occupational samples. The present study examines the impact of anonymity on item omission, response bias, and response quality. Based on a representative sample of respondents from a Southern SMSA, it was found that lack of anonymity had minor effects on response variables. Anonymous respondents provided slightly less information to complex questions, and lower-income respondents, nonwhites, and homeowners were more likely to identify themselves on the return envelope. Yet, the responses of these groups did not differ substantively from answers of other respondents on the range of questionnaire items examined.     

Multi-lateral trade negotiations and the Most Favored Nation clause

This paper considers the interaction between private information and the Most Favored Nation clause in trade negotiations. It demonstrates that by aggregating uncertainty over a number of trading partners, the Most Favored Nation clause may offer a welfare improvement over a set of bilateral trade negotiations. This improvement is shown to be most pronounced when a large number of countries are involved in negotiations.     

Foreign direct investment and intellectual property rights: evidence from Hollywood's global distribution of movies and videos

Traditional thinking about intellectual property rights (IPR) suggests that as a country strengthens its IPR standards, firms will move their governance structures away from equity based institutions such as foreign direct investment (FDI) towards more market-based relations such as licensing agreements. This hypothesis is explored by examining the behavior of Hollywood studios in both the feature film and video markets in 40 foreign countries. The analysis reveals that the behavior of Hollywood studios is more complex than this: although moderate IPRs are associated with a high degree of licensing, both high and low standards of IPR encourage more integrated governance structures.     

Practice makes perfect: Entrepreneurial-experience curves and venture performance

This study tackles the puzzle of why increasing entrepreneurial experience does not always lead to improved financial performance of new ventures. We propose an alternate framework demonstrating how experience translates into expertise by arguing that the positive experience–performance relationship only appears to expert entrepreneurs, while novice entrepreneurs may actually perform increasingly worse because of their inability to generalize their experiential knowledge accurately into new ventures. These negative performance implications can be alleviated if the level of contextual similarity between prior and current ventures is high. Using matched employee–employer data of an entire population of Swedish founder-managers between 1990 and 2007, we find a non-linear relationship between entrepreneurial experience and financial performance consistent with our framework. Moreover, the level of industry, geographic, and temporal similarities between prior and current ventures positively moderates this relationship. Our work provides both theoretical and practical implications for entrepreneurial experience—people can learn entrepreneurship and pursue it with greater success as long as they have multiple opportunities to gain experience, overcome barriers to learning, and build an entrepreneurial-experience curve.     

Auditors' Fee Premiums and Low‐Quality Internal Controls*

We examine the relation between low‐quality internal controls and audit fee premiums. Using a novel data set of audit hours and audit fees we find, consistent with the audit risk model, that auditors increase their effort (hours) owing to low internal control quality. We find that auditors also charge a significant fee premium to clients with internal control weaknesses. This premium is observed for severe internal control weaknesses and companies with low‐quality alternative governance mechanisms. The results are robust to multiple methods to address endogeneity, including company fixed effects, difference‐in‐differences design, and a propensity score‐matched sample. Taken as a whole, low internal control quality leads to fee premiums, which are a deadweight loss to client companies.