Cost efficiency among credit card banks

Credit card banks produce a single, relatively homogeneous output, permitting exceptionally clean empirical tests of cost efficiency. The high net interest margins and fees on credit card loans also suggests a large potential for managerial slack or expense preference behavior, possibly fostering a wider range of cost efficiency than observed for general-purpose banks. This paper presents estimates of cost efficiency for a sample of monoline credit card banks over the period 1984–1993; the findings are similar to those previously reported for general-purpose banks. We also explore empirical correlates of the estimated cost efficiency.     

Structure,conduct, performance,and welfare

This paper extends previous analysis of weaknesses of the structure-conduct-performance paradigm and of the price-cost margin as a measure of performance. Sufficient conditions are established under which monotonic linkages may not exist between virtually any two of social welfare, its individual components, structure, conduct, or performance.     

Annuities and inflation

This paper embodies the views of the author and does not represent the views or policy of the Federal Reserve Bank of New York or the Federal Reserve System.     

Hedging Multiperiod Forward Commitments: The Case of Period-by-Period Quantity Uncertainty

This article considers the hedging problem of a producer with along-term forward commitment to deliver a commodity at multiple futurepoints in time. The aggregate quantity to be delivered over time is knownwith certainty; however, the period-by-period quantity is determined bythe customer and is unknown to the producer. A minimum-variancemultiperiod futures position that considers both price uncertainty andperiod-by-period quantity uncertainty is derived. The following resultsare obtained: The individual effects of price uncertainty and quantityuncertainty on the multiperiod minimum-variance are separable. In thetwo-period case, if the spot price is expected to decrease over time, therisk-minimizing hedge considering both price and quantity uncertaintiesis greater than that which considers price uncertainty only. If the spotprice is expected to increase over time, then the hedger would beover-hedged if only price uncertainty were considered. Convenience yieldpromotes a larger risk-minimizing futures position, whereas storage costsand financial costs reduce the size of the risk-minimizing futuresposition. In the multiperiod case, if forward prices are unbiasedestimators of future spot prices, or if spot prices are expected todecrease over time, then quantity uncertainty increases the size of therisk-minimizing hedge. If spot prices are expected to increase, then theeffect of period-by-period quantity uncertainty isindeterminate.     

The Effects of Multilevel Signals on Sex Discrimination Experiences Among Female Employees

In this study, we examine the effect of organizational‐level and individual‐level signals on sex discrimination experiences, job satisfaction, and turnover intentions in a sample of South Korean female employees and organizations. Results indicate that the percentage of women employed in organizations was negatively associated with sex discrimination experienced by women. The number of family‐friendly policies was also negatively associated with sex discrimination in a panel design but not in a cross‐sectional design. We also found that the relationship between individual participation in development activities (e.g., leadership development course, academic degree) and sex discrimination experiences was moderated by organizational‐level participation in development activities. Specifically, the negative impact of participation in development activities on sex discrimination is stronger for individuals in organizations with lower compared to higher levels of overall participation. The same was true for the individual educational level. The negative impact of individual educational level on sex discrimination is stronger for individuals in organizations with high educational level than for those in low organizational educational level. Further, experienced sex discrimination influences individual turnover intention via job satisfaction. © 2016 Wiley Periodicals, Inc.     

Apple's agency model and the role of most‐favored‐nation clauses

The agency model used by Apple and other digital platforms delegates retail‐pricing decisions to upstream content providers subject to a fixed revenue‐sharing rule. Given competition both upstream and downstream, we consider how, under the agency model, retail prices depend on the firms' revenue‐sharing splits and the degrees to which consumers view the platforms and the goods sold on the platforms to be substitutes. We show that the agency model may not be universally adopted even if adoption would mean higher profits for all firms. Use of most‐favored‐nation clauses in these settings can ensure industry‐wide adoption and increase retail prices.     

Industrialization and Values Evolution: The Case of Hong Kong and Guangzhou, China

This field study evaluated the convergence, divergence, crossvergence, and multi-crossvergence perspectives of value system evolution in industrializing regions. Value differences were identified among graduating business university students in the People's Republic of China, Hong Kong, and the United States. Specific value dimensions in this study reflected the primary influence of either industrialization or regional culture. Thus, our overall results suggest that both industrialization and culture influence the combination of values held in Hong Kong. This finding could be interpreted as supporting the crossvergence perspective of value system evolution. A more precise interpretation, however, is that some value dimensions converge with increasing industrialization, while others remain divergent.