The role of debt and bankruptcy statutes in facilitating tacit collusion

Using a two‐period model this paper examines the quantity decisions of leveraged duopolists that are vulnerable to bankruptcy in the first period. When the firms have symmetric costs, a bankrupt firm reorganizes under Chapter 11. If a Chapter 11 firm experiences marginal cost relief, each firm produces a collusive output in period one in order to prevent its rival's financial demise. When the firms have asymmetric costs, the less efficient firm is liquidated under Chapter 7 upon bankruptcy. A predatory equilibrium exists, whereby the inefficient firm is driven from the market. Copyright © 1999 John Wiley & Sons, Ltd.     

Environmental Performance Focus in Private Family Firms: The Role of Social Embeddedness

The macro-level business ethics in Scholasticism contrasts with modern Anglo-Saxon Capitalism, which is very influential worldwide. Scholasticism, developed between the thirteenth and the mid-seventeenth centuries, deals with key elements of free market morality, including private property, contracts, profits, prices, and free competition. For over 500 years Scholasticism tried to understand economic phenomena and business activities and reflected on them from an ethical perspective. Scholasticism offered the crucial lesson of the centrality of justice and the role of practical wisdom in considering market morality. Justice is seen as both a virtue and a principle, and commutative justice (justice in exchanges) with the common good of society as the reference for the Scholastics, is regarded as being especially important.     

Concentration and decentralization: The new geography of freight distribution in US metropolitan areas

This paper examines the suburbanization of warehousing and trucking activity within US metropolitan areas between the 1980s and the present using Gini indices as a measure of concentration. While historical work exists on the relocation of transportation and warehousing activity to suburban locations, there has been little to document the most recent shifts in warehousing and logistics. This research does so via spatial analysis of Economic Census data, finding that while most US metropolitan areas have experienced decentralization in the spatial distribution of freight-related activity, there is also some growth in core counties, indicating that a more complex process is going on than simple suburbanization.     

How consumer shopping orientation influences perceived crowding, excitement, and stress at the mall

While a few researchers have started to chip away at the notion that retail density is always negative, extant studies do not empirically address the question of why some shoppers respond negatively to a specific level of density while others respond positively. We examine this issue by drawing upon field theory (Lewin 1939) to shed light on how shoppers vary in terms of deeper motives (McClelland 1953) to seek control or intimacy with others in retail mall settings, and whether these motives influence shopping orientations. Shopping orientation is then hypothesized to affect perceptions of crowding, and, in turn, subsequent affective responses to the mall shopping experience. Moreover, we examine whether individual differences (gender and age) can help retailers segment those with different shopping orientations and the motives that influence these orientations. We found that task and social shopping orientations were influenced by deeper motives for control and intimacy. The causal relationships between shopping motive, shopping orientation, and consumers?? affective responses of stress and excitement were also discovered. Finally, we address theoretical and managerial implications of our results.     

Perspectives on evaluation in financial education: Landscape,issues, and studies

This review discusses the heterogeneity in the effectiveness of financial education programs that occurs because of the unique conditions for programs and methods to evaluate them. The authors define six groups served by financial education: children, youth, college students and young adults, working adults, military personnel, and low-income consumers. They then discuss research and evaluation literature for each group with a critical eye on program purpose, content, and evaluation. They also present findings affecting multiple groups on four issues: student loans, homeownership, retirement planning, and financial advising. The accumulated evidence on the effectiveness of financial education is positive, although the results are nuanced and sometimes limited. The authors argue that understanding this broad landscape in studying financial education is critical for future research and evaluation.     

Incorporating innovation subsidies in the CDM framework: empirical evidence from Belgium

ABSTRACT

This paper integrates innovation input and output effects of R&D subsidies into a modified Crépon–Duguet–Mairesse (CDM) model. Our results largely confirm insights of the input additionality literature, i.e. public subsidies complement private R&D investment. In addition, results point to positive output effects of both purely privately funded and subsidy-induced R&D. Furthermore, we do not find evidence of a premium or discount of subsidy-induced R&D in terms of its marginal contribution on new product sales when compared to purely privately financed R&D.     

Earnings Attribution and Information Transfers

Managers frequently attribute the news in their earnings forecasts to various economic events. Using textual analysis, we identify the economic factors underlying earnings news from press releases. We document a wide range of industry‐wide shocks and firm‐specific actions to which the earnings news in management forecasts is attributed. As expected, earnings attributions significantly affect peer firms’ price reactions to the earnings news. Specifically, earnings news attributed to industry‐wide trends or firm structural changes leads to positive information transfers but earnings news attributed to firm competitive moves triggers negative information transfers. Information transfers are much stronger when each economic factor is mentioned the first time in a given industry‐year. Further analysis reveals that the strength of information transfers varies with firm‐level rivalry within the industry (i.e., similar business strategies, market position, and level of competition).     

How foreign firms achieve competitive advantage in the Chinese emerging economy: Managerial ties and market orientation

As China experience unprecedented changes in its social, legal, and economic institutions, on what should foreign firms focus more to overcome this challenge, managerial ties or market orientation? This study investigates how managerial ties and market orientation affect competitive advantage and, consequently, firm performance in China. On the basis of a survey of 179 foreign firms in China, we find that both managerial ties and market orientation can lead to firm success—but in different ways. Market orientation enhances firm performance by providing differentiation and cost advantages, whereas managerial ties improve performance through an institutional advantage (i.e., superiority in securing scarce resources and institutional support). Institutional advantage, in turn, leads to differentiation and cost advantages and consequently superior performance.