Strategic stances and programme performance: assessing outcomes of the US states’ delivery of the child support enforcement programme

Since being added as an amendment to the Social Security Act of 1975, the US child support enforcement (CSE) programme has provided services to both Temporary Assistance for Needy Families (TANF) and non-TANF families under the name of reducing expenditures on welfare programmes and securing children’s rights to be protected by their parents. The federal government mandates that states collect five performance measures in the CSE programme: (1) paternity establishment, (2) support order establishment, (3) current collection, (4) arrearage collection, and (5) cost-effectiveness. Implementing federal programmes does not give states full discretion, but there exists room for states to exercise discretion in developing their own strategies to effectively deliver services and improve performance. In this paper, using Miles and Snow’s strategic dimensions (1978) and Boyne and Walker’s later studies (2004), states’ strategic stances are categorized into Analyser, Prospector, and Defender, and the effects of states’ strategic stance and their internal implementation factors on the CSE performance are examined using models estimated with ordinary least square (OLS) regression and seemingly unrelated regression (SUR). The strategy classification is widely studied in private organizations, but it has relevance to current public organizations that seek to achieve improvement in performance. The results of the cross-sectional OLS and SUR models suggest that states having an Analyser stance have a positive relationship to two performance indicators (arrearage collection and Cost-Effectiveness) of the CSE programme, and states with Prospector and Defender stances are particularly significant in predicting high paternity establishment in the CSE programme, but no other performance indicator. Past performance is one of the strongest predictors of all five-performance indicators of the CSE programme. State internal implementation factors show mixed impacts in terms of significance and direction on the performance indicators of all the five models.     

Improving collaboration between large and small-medium enterprises in automobile production

ABSTRACT

Inter-organisational collaboration is important for achieving qualitative and quantitative performance improvement in the global competitive environment. In particular, the extent of collaboration between the mother company and its suppliers is important for the profitability and sustainability of a company in the automobile industry, which is carried out using a customisation and order production system. As a result of the empirical analysis in this study, the collaborative information sharing cycle is shortened and the collaborative information sharing scope is widened. Therefore, the level of collaboration is improved by constructing an IT collaboration system.     

Cognitive Dissonance as an Explanation of Goodwill Write-Offs

While agency theory has been an important part of accounting academic research, many researchers have suggested that other theories should also be considered. One such theory is the theory of cognitive dissonance. In this study, the authors develop competing hypotheses based on agency theory and the theory of cognitive dissonance regarding the decision to record an impairment of goodwill. Using an archival research methodology, they test the hypotheses on a sample of 2,274 firm-year observations. The results are consistent with the theory of cognitive dissonance even after controlling for variables that have been found to be significant under agency theory. The authors conclude that there is strong evidence to suggest that agency theory does not uniquely explain the results of management decisions as seen through financial reporting data.     

Transformational leadership behaviors,the empowering process,and organizational commitment: investigating the moderating role of organizational structure in Korea

Transformational leadership has received growing attention in leadership studies. However, open questions remain concerning its operationalization and its universal effectiveness. Drawing on transformational leadership theory and leadership contingency theory, this study explores these issues in an Asian context. Survey responses from 491 employees working for foreign subsidiaries in Korea were analyzed. Given their multi-dimensionality, transformational leadership behaviors were framed as a two-dimensional structure: organization-related behaviors (OBs) and person-related behaviors (PBs). Findings showed that both OBs and PBs were mediated by psychological empowerment to determine organizational commitment. More importantly, the findings indicated that the empowering process driven by both leadership behaviors is contingent on organizational structure. Specifically, centralization negatively moderated the empowering process of PBs. Formalization positively moderated the empowering process of OBs and negatively moderated that of PBs. These findings have noteworthy value by virtue of quantitatively revealing the organizational structure wherein the empowering process of transformational leadership behaviors is effectively induced in South Korea. Based on the results, significant theoretical and managerial implications are discussed.     

The Role of the Business Press in Creating and Disseminating Information around Earnings Announcements

This paper investigates the role of the business press in creating and disseminating information around earnings announcements by examining different motivations of trading volume. We find that press coverage is positively associated with trading activity motivated by differential interpretation and by differential belief revision, consistent with the press playing both an information creation and information dissemination role around earnings announcements. When we divide press coverage into full articles with additional editorial content and news flashes merely repeating verbatim of firm-disclosed press releases, we find that trading volume motivated by both differential interpretation and differential belief revision increases as coverage by full articles increases, and trading volume motivated by differential belief revision increases as coverage by news flashes increases. We also report that the differential interpretation effect of full articles is more pronounced when information users’ sophistication is high. Overall, we provide new evidence to the literature by showing that each type of press coverage plays an informational role in different motivations of trading activity.     

Uncertainty and risk premium puzzle

This paper provides a theory and evidence that the risk premium puzzle may be viewed mainly as a phenomenon pertaining to the unstable foreign exchange market. In an unstable market, errors uncompensated by an initial risk premium accrue due to consumer expectation revision about the ex ante uncertainty of the exchange rate. These revision errors are different from the forecasting errors, depending on the frequency of the consumer expectation revision and the degree of risk aversion. A simulation was discussed on how the risk premium actually deviates from an initial premium in the unstable market. Using the monthly data of the U.K., Japan, Australia, Korea, Malaysia, and Thailand from January 1994 to December 2008, it is shown that revision errors for risk premium were statistically significant and were non-trivial in magnitude and that the degree of absolute risk aversion went up during the Asian currency crisis as well as the recent financial crisis periods.     

Economic and capital market antecedents of venture capital commitments (1960–2010)

Using vector autoregression technique, we examine the interrelation between venture capital flows, economic development, capital market fund-raising activities, and capital market valuation, based on annual data of the United States over the past half-century. We find that venture capital commitments appear to be correlated with GDP and capital market valuation. While capital market fund-raising activities (Initial Public Offerings and Seasoned Equity Offerings) are also correlated with venture capital flows, these effects are subsumed by GDP, indicating that the overall economy drives both venture capital flows and capital market financing activities. Analyses from impulse response functions suggest that shocks to GDP have a permanent effect on venture capital flows, while the impact of capital market valuation (Standard & Poor 500 returns) on venture capital flows is rather short lived. Overall, both economy-wide development and financial market fluctuations seem to impact venture capital flows.     

THE EXTENDED ECONOMETRIC INPUT–OUTPUT MODEL WITH HETEROGENEOUS HOUSEHOLD DEMAND SYSTEM

This paper proposes an extension to the regional econometric input–output model (REIM) [Conway, R.S. (1990) The Washington Projection and Simulation Model: A Regional Interindustry Econometric Model. International Regional Science Review, 13, 141–165; Israilevich, P.R., G.J.D. Hewings, M. Sonis and G.R. Schindler (1997) Forecasting Structural Change with a Regional Econometric Input–Output Model. Journal of Regional Science, 37, 565–590]. We integrate a demand system with age and income parameters into the REIM. The extended model thus addresses concerns about the effects of household heterogeneity. The initial testing is conducted with a model for the Chicago metropolitan area. First, using aggregate expenditure data by income and age groups, the almost ideal demand system with group fixed effects is constructed. Next, the estimated demand system is linked to the REIM to reflect long-term changes in the age and income distribution of households. The long-range simulation from the extended model takes into account structural changes in expenditure type stemming from changing demographic composition. The extended model further broadens the scope of impact analysis under various scenarios associated with age and income changes.     

Purchasing Power Parity and the Taylor Rule

It is well known that there is a large degree of uncertainty around Rogoff's consensus half‐life of the real exchange rate. To obtain a more efficient estimator, we develop a system method that combines the Taylor rule and a standard exchange rate model to estimate half‐lives. Further, we propose a median unbiased estimator for the system method based on the generalized method of moments with non‐parametric grid bootstrap confidence intervals. Applying the method to real exchange rates of 18 developed countries against the US dollar, we find that most half‐life estimates from the single equation method fall in the range of 3–5 years, with wide confidence intervals that extend to positive infinity. In contrast, the system method yields median‐unbiased estimates that are typically shorter than 1 year, with much sharper 95% confidence intervals. Our Monte Carlo simulation results are consistent with an interpretation of these results that the true half‐lives are short but long half‐life estimates from single‐equation methods are caused by the high degree of uncertainty of these methods. Copyright © 2014 John Wiley & Sons, Ltd.