HEADS I WIN,TAILS YOU LOSE: INSTITUTIONAL MONITORING OF EXECUTIVE PAY RIGIDITY

Agency theory argues that pay for performance alleviates the conflict of interest between managers and shareholders. Furthermore, the literature finds that institutional monitoring tends to promote the performance–pay linkage, thus aligning the two parties’ incentives. We find that executive compensation rigidity is negatively and significantly associated with firm value. Moreover, ownership by long‐term institutional investors reduces the pay rigidity of top managers in underperforming firms, thus decreasing the value‐destroying effect of the rigidity. Overall, these results reaffirm the role of institutional monitoring in mitigating managerial rent extraction.     

An analysis of the factors affecting the turnover intention of non-managerial clerical staff: a Singapore study

This study examines the factors affecting turnover intention and attempts to construct a turnover prediction model. Sixteen demographic, job satisfaction and job attitude factors are considered in the study. From the three-hundred questionnaires administered, a usable response rate of 36 per cent (i.e., 108 usable questionnaires) was obtained.

Correlation analyses, t-tests and multiple regression were used to analyse the data. The results show that demographic and job attitude factors are not significantly associated with turnover intention. In contrast, job satisfaction factors affect turnover intention significantly. In particular, satisfaction with career future, company identity, kind of work and financial rewards were found to be statistically significant. These four variables are thus included in the final turnover prediction model.     

The regional and global competitiveness of multinational firms

International competitiveness ultimately depends upon the linkages between a firm’s unique, idiosyncratic capabilities (firm-specific advantages, FSAs) and its home country assets (country-specific advantages, CSAs). In this paper, we present a modified FSA/CSA matrix building upon the FSA/CSA matrix (Rugman 1981). We relate this to the diamond framework for national competitiveness (Porter 1990), and the double diamond model (Rugman and D’Cruz 1993). We provide empirical evidence to demonstrate the merits and usefulness of the modified FSA/CSA matrix using the Fortune Global 500 firms. We examine the FSAs based on the geographic scope of sales and CSAs that can lead to national, home region, and global competitiveness. Our empirical analysis suggests that the world’s largest 500 firms have increased their firm-level international competitiveness. However, much of this is still being achieved within their home region. In other words, international competitiveness is a regional not a global phenomenon. Our findings have significant implications for research and practice. Future research in international marketing should take into account the multi-faceted nature of FSAs and CSAs across different levels. For MNE managers, our study provides useful insights for strategic marketing planning and implementation.     

Model Predictions and Auditor Assessments of Going Concern Status

This paper compares the predictions of a bankruptcy prediction model and the assessments of auditors on the going concern status of a sample of 165 bankrupt companies and 165 matched non-bankrupt companies. Data from US companies for the period 1978 to 1985 were used. Probit analysis (with the weighted exogenous sampling maximum likelihood procedure) was applied to estimate the model parameters. The Lachenbruch U method hold-out accuracy rates of the model are 85.45% for bankrupt firms, 100.00% for non-bankrupt firms, and 99.91% overall. The corresponding accuracy rates of the auditors based on their audit reports are 54.37% for bankrupt firms, 100.00% for non-bankrupt firms, and 99.73% overall. The sensitivity of optimal cut-off points to misclassification costs of Type I and Type II errors was also considered. Results of the study suggest that bankruptcy prediction models can be useful to auditors in making going concern assessments. Further, such models can serve as analytical tools and defensive devices.     

Interference of Picture and Brand Name in a Multiple Linkage Ad Context

This study investigates the superiority effects of picture incongruency and brand name suggestiveness on recall of target benefit claims. Depending on the juxtaposition of the picture and brand name with these claims, a relevant picture can interfere with and inhibit recall of a brand name claim under selected conditions. Specifically, recall of brand name claim was higher under an irrelevant rather than a relevant picture condition. Similarly, a suggestive brand name interfered and diminished recall of a picture claim compared to a nonsuggestive brand name. Additionally, the recall patterns of the picture (source) versus the picture claim (target) under various incongruency conditions showed that the effectiveness of picture incongruency on traditional picture recall measure cannot be extended to picture-related claim recall performance. Explanations based on theoretical extensions to the associated network model and interference theory are furnished together with the managerial implications regarding the effective use of picture incongruency and brand name suggestiveness.     

General-equilibrium implications of international product-market competition for jobs and wages

This paper extends the insight that trade increases internationalproduct-market competition to show that in a world with an endogenousnatural rate of unemployment, countries can benefit througha decline in the natural rate. When the number of firms in theintegrated world market is greater than the number of firmsin each economy in autarky, all trading nations in a world ofidentical factor proportions experience a decline in equilibriumunemployment. When factor proportions differ, equilibrium unemploymentmust fall in the labour-abundant country but may rise or declinein the capital-abundant country.     

Price discrimination via information provision

We study price discrimination where different prices are offered as a bundle with different levels of information about a product. The seller’s price discrimination induces high valuation buyers to purchase a good without information and low valuation buyers to purchase with information. Our analysis highlights several interesting results about price discrimination: (i) the seller’s choice of information provision is the combination of full information and no information, (ii) products can be cheaper without information provision than with information provision, (iii) as a result of price discrimination, prices can be more dispersed as buyers’ valuations become largely similar, and (iv) the high valuation buyers purchase a damaged good and may earn negative surplus. Furthermore, we investigate under which circumstances price discrimination is more profitable than uniform pricing. We show that a decline in transportation costs which facilitate price discrimination can be welfare reducing.