The Independent Impact of Credit Rating Changes – The Case of Moody's Rating Refinement on Yield Premiums

On April 26, 1982, Moody's Investors Service refined its rating system for the first time in its seventy-three year rating history. We examine the information content of the rating refinement in the study. We find a statistically significant change in the yields on bonds whose ratings were downgraded. The detection of the impact of refinement on bond prices implies that rating agencies perform an important function in financial markets, that is they provide information to investors.     

Endogenous formation of coops and cooperative leagues

The labor-managed Mondragon cooperatives in the Basque country, and La Lega coops concentrated in North Central Italy, are grouped into leagues that enable them to reap economies of scale in key services such as R&D, marketing and finance. These leagues are relatively rare and there are fewer than a dozen of them globally. We develop a game-theoretic model of league formation to capture some of the strategic incentives behind the formation of labor-managed cooperatives (coops) and their agglomeration into a league. We then compare these incentives with those of conventional profit-maximizing firms to organize into a league. The main result of this paper shows that a divergence in these incentives stemming from their organizational differences may lead to the formation of a league of firms but not one of coops. This turns out to be true even though the coop has lower costs of production and the existence of a coop league would have been socially efficient. Anticipating the non-existence of a coop league then creates a disincentive for individual agents to form coops in the first place. This explains the relative rarity of coops, competing individually or as a part of a league, with conventional firms in imperfect markets.     

Changes and trends in alcohol consumption patterns in Europe

Consumer behaviourists and consumer policy-makers are interested in the degree to which global convergence is occurring for various consumer behaviour dimensions, the extent to which the consumption patterns in different parts of the world are becoming similar and the extent to which these trends may be influenced and/or influence consumer policy. With increasing internationalization and cultural cross-fertilization, the industrialized societies of the world are converging in many ways. Shifts in alcohol consumption patterns in Europe over the past 50 years represent a case in point. As traditional cultural boundaries become blurred, consumer preferences for alcoholic beverages appear to be driven less by long-standing local and regional traditions and more by growing acceptance of a wider choice. The disparity in total alcohol consumption among the 15 countries studied has also decreased. Other powerful forces are likely to accelerate the pace of convergence in the future.     

The Reassertion of Economics: 1990s Gentrification in the Lower East Side

This article utilizes property tax arrears data to trace the contraction of gentrification at the end of the 1980s and its resurgence in the 1990s in New York City’s Lower East Side. Contrary to the claims made during the recession about the end of gentrification, this article provides an important historical record of the resurgence of gentrification in the 1990s. The paper also argues that this new ‘third round’ gentrification has to be seen as a dramatic reassertion of economics in the central urban land market. That this shift is also expressed within the popular cultural discourses accompanying the process reveals an altered relationship between economics and culture in fin de siècle gentrification. Cet article utilise les données sur les arriérés des impôts sur la propriété pour retracer le déclin de l’embourgeoisement á la fin des années quatre-vingt et son renouveau dans les années quatre-vingt-dix dans le Lower East Side de New York City. Contrairement á ce qui fut dit sur la fin de l’embourgeoisement durant la récession, cet article fournit un dossier historique important qui montre le renouveau de l’embourgeoisement dans les années quatre-vingt-dix. Cet article soutient aussi que ce nouveau ‘troisième tour’ d’embourgeoisement doit ? tre regardé comme une réaffirmation dramatique de l’économie politique dans le marché foncier urbain central. Le fait que ce changement est aussi perceptible dans les discours de la culture populaire qui accompagnent ce processus révèle une relation changée entre l’écomonie politique et la culture dans l’embourgeoisement de fin de siècle.     

Social learning in a changing world

Summary. In the social learning model of Banerjee [1] and Bikhchandani, Hirshleifer and Welch [2] individuals take actions sequentially after observing the history of actions taken by the predecessors and an informative private signal. If the state of the world is changing stochastically over time during the learning process, only temporary informational cascades – situations where socially valuable information is wasted – can arise. Furthermore, no cascade ever arises when the environment changes in a sufficiently unpredictable way. Received: December 5, 1996; revised version: February 11, 1997     

Ethical Behavior of Marketing Managers and MBA Students: A Comparative Study

The ethical tendencies of graduate business students from the United States were examined by analyzing their reactions to ethical dilemmas in a replicated study, which presented a set of ethical problem situations. These dilemmas dealt with coercion and control, conflict of interest, physical environment, paternalism and personal integrity. A comparison of these findings with the previous study of marketing managers indicates that the MBA students exhibited a greater degree of sensitivity to the ethical dimensions of business decision-making. Implications are drawn for business education and further research.     

Cultural Readjustment After Crisis: Regulation and Learning from Crisis Within the UK Soccer Industry*

abstract Challenging Turner's (1976 , 1978 ) implicit assumption that cultural readjustment typically follows a crisis, this paper examines the evolution of the regulation of safety management within the UK soccer industry since 1946. Employing a longitudinal case study approach, the industry's response to four crises is examined. This study explores the industry's response to changes in the regulatory framework, through the lens of Gouldner's (1954 ) patterns of industrial bureaucracy and institutional theory. The persistence of indulgent and mock patterns of behaviour, following a series of disasters, challenges Turner's implicit assumption. Although a move towards a punitive approach to regulatory behaviour effected some changes, there was limited evidence of cultural readjustment due in part to a ‘mindset of invulnerability’ ( Wicks, 2001 ). This included the fixed belief that hooligan behaviour was the primary problem facing the industry. Our findings suggest that more participative forms of regulation encourage more effective learning from crisis because they challenge core organizational and individual assumptions.     

Book Reviews

Books reviewed in this issue:

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  New Product Launch: 10 Proven Strategies

       

Book Reviews

Books reviewed in this issue:

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  Getting It Right the First Time: How Innovative Companies Anticipate Demand