Ethics and the Networked Business

Pushing through a logical continuum of closed- to open-system views of organizations necessarily changes the conceptualization of a firm from a strongly bounded entity to a configuration of networks and sub-networks, which exists and operates in a larger systemic network configuration. We unfold a classification of management processes corresponding to views of the firm along the closed/open-systems continuum. We examine ethical issues that are likely to devolve from these classes of management processes, and we suggest typical means by which managers will attempt to control their firms’ exposure to such issues. The final class of management processes examined focuses on the achievement of outcomes that are mutually satisfactory in the set of networks and sub-networks that constitute the focal firm, and that support the sustainability of the whole system. The article contributes to organizational theory, business ethics, and computer and information ethics by providing a comprehensive analysis of the impact of managerial views of the firm and of networks – virtual, social, informational – on managerial processes and on our understanding of how business ethics issues are linked to perceptions of what a firm is, does, and can do.     

The Effects of Compensation Structures and Monetary Rewards on Managers’ Decisions to Blow the Whistle

Recent research indicates that compensation structure can be used by firms to discourage their employees from whistleblowing. We extend the ethics literature by examining how compensation structures and financial rewards work together to influence managers’ decisions to blow the whistle. Results from an experiment indicate that compensation with restricted stock, relative to stock payments that lack restrictions, can enhance the likelihood that managers will blow the whistle when large rewards are available. However, restricted stock can also threaten the effectiveness of whistleblowing systems without the presence of large financial rewards for whistleblowing. Thus, the large potential rewards for whistleblowing enacted by the Dodd–Frank Act appear timely as firms are moving toward compensation agreements that include greater proportions of restricted stock.     

Testing for Regime Changes in Greek Sovereign Debt Crisis

This paper examines whether the efficiency market hypothesis for the Greek sovereign debt holds. As in Blanco et al. (2005) we test the theoretical equivalence of credit default swap (CDS) and spreads that dictates a CI relationship between the two. The main innovation of the present analysis is the use of a threshold vector error-correction (TVECM) model, thus allowing thresholds within the sample covering the period 1990 to 2010. Moreover, by employing this methodology we are able to evaluate the degree and dynamics of transaction costs resulting from various events due to external market imperfections but also domestic factors. The main hypothesis we test is to what extent spreads and CDS are indeed integrated that may result in an efficient and integrated segniorage capital market. Our findings support the gradual integration hypothesis. We find that spreads and CDS are cointegrated, though threshold effects are also revealed in terms of events that have impacted on markets.     

Evolutionary dynamics on infinite strategy spaces

Summary. The study of evolutionary dynamics was so far mainly restricted to finite strategy spaces. In this paper we show that this unsatisfying restriction is unnecessary. We specify a simple condition under which the continuous time replicator dynamics are well defined for the case of infinite strategy spaces. Furthermore, we provide new conditions for the stability of rest points and show that even strict equilibria may be unstable. Finally, we apply this general theory to a number of applications like the Nash demand game, the War of Attrition, linear-quadratic games, the harvest preemption game, and games with mixed strategies. Received: June 25, 1999; revised version: January 31, 2000     

Growth of born globals: the role of the entrepreneur’s personal factors and venture capital

This paper examines to what extent the human capital of entrepreneurs and the receipt of venture capital (VC) financing affect the growth of born globals (BGs). The study analyzes a sample of 242 BGs resulting from a survey on high-tech start-ups operating in the ICT and electronics sectors, located in different countries throughout the world. A multivariate explorative analysis controlling for the endogenous nature of VC is conducted. The results indicate that the experience of the entrepreneur in having previously established another entrepreneurial firm positively affects the growth of BGs. A negative effect is associated with the presence of heterogeneity in the management team in terms of education background. With regard to the linkage between financial capital and growth, it is found that both VC financing and the number of founders (a proxy for the availability internal capital) positively influence the growth of BGs.