AFTER THE INK DRIES: THE INTERACTION OF TRUST AND CONTROL IN US-BASED INTERNATIONAL JOINT VENTURES

This study empirically examines the moderating effects of age and partner trust on the relationship between control mechanisms and perceptions of performance in 129 US‐based international joint ventures (IJVs). A reliance on formal control mechanisms and general managers’ perceptions of IJV performance were found to be positively related in younger IJVs, but this relationship became negative in more mature IJVs. In addition, social control mechanisms and perceptions of IJV performance were positively related, but only in the presence of affect‐based trust between the parents.     

Examining the Effect of Expressing a Quantitative Goal on Consumer Savings

We examine the effectiveness of implementation intention plans for achieving regular savings with small-scale, exploratory field research. A series of surveys required participants in a community-based savings campaign to form implementation intentions concerning timing, mode, amount, and source of income for savings during the next month. Baseline and two follow-up responses from treatment and control groups showed implementation plans that require individuals to express discretionary quantitative savings goals are less effective than those that require a generalized, nonquantitative commitment to save. This result has implications for savings programs, many of which consider an expressed quantitative goal to be crucial for success.     

Race,Self‐Employment,and Labor Absorption

Past studies have argued that in the large cities of developing societies, unemployment is often alleviated when displaced workers are absorbed into the small‐scale entrepreneurial activities of the informal economy. The present study applies this argument to an analysis of women's self‐employment in the U.S. South during the Great Depression. Census data show that in large southern cities in 1940, the unemployment of black women was meaningfully reduced by the self‐employment of these women in domestic service. These data further suggest that dynamics of race, unemployment, and the self‐employment of women in domestic service can be represented by an inverted‐U‐shaped labor absorption curve. These results make several contributions to research on race, labor‐market disadvantage, and self‐employment in the informal sector.     

Hedge Fund Risk Dynamics: Implications for Performance Appraisal

Accurate appraisal of hedge fund performance must recognize the freedom with which managers shift asset classes, strategies, and leverage in response to changing market conditions and arbitrage opportunities. The standard measure of performance is the abnormal return defined by a hedge fund's exposure to risk factors. If exposures are assumed constant when, in fact, they vary through time, estimated abnormal returns may be incorrect. We employ an optimal changepoint regression that allows risk exposures to shift, and illustrate the impact on performance appraisal using a sample of live and dead funds during the period January 1994 through December 2005.     

IMAGES OF AN UNFOLDING DIVERSIFICATION PROJECT

This article studies a diversification-project in a medium-sized company from a cognitive perspective. Using a set of cognitive mapping techniques, it focuses on the images which the managers in this company have of the evolving diversification project in which they are involved. At the same time, it seeks to explore the organizational learning processes that arise during diversifying. It is suggested that a strict division of activities during the course of a diversification project may hamper organizational learning, as it excludes the possibility for acquiring shared experiences and thus of creating a common frame of reference. Consequently, it is argued that organizational learning during a diversification process may benefit from the active involvement (to some extent) of the various parties in each other’s activities.     

BENEFITS AND COSTS OF INTENSIVE FOSTER CARE SERVICES: THE CASEY FAMILY PROGRAMS COMPARED TO STATE SERVICES

The foster care system attempts to prepare children and youth who have suffered child maltreatment for successful adult lives. This study documents the economic advantages of a privately funded foster care program that provided longer term, more intensive, and more expensive services compared to public programs. The study found significant differences in major adult educational, health, and social outcomes between children placed in the private program and those placed in public programs operated by Oregon and Washington. For the outcomes for which we could find financial data, the estimated present value of the enhanced foster care services exceeded their extra costs. Generalizing to the roughly 100,000 adolescents age 12-17 entering foster care each year, if all of them were to receive the private model of services, the savings for a single cohort of these children could be about $6.3 billion in 2007 dollars. ( JEL D61, H75)     

STRATEGIC RESEARCH AND DEVELOPMENT POLICY: SOCIETAL OBJECTIVES AND THE CORPORATE WELFARE ARGUMENT

The article considers the optimal research and development subsidy regime in a two-firm two-country model where each firm is "located" in a specific country. Trade is intra-industry in that customers in both countries purchase from both firms. The article suggests that when both countries subsidize their local firm usually welfare increases compared to the case of zero subsidies. Making the same comparison, profit always falls in the symmetric game and falls about half the time in the asymmetric game. These results call into question some common notions about corporate welfare. ( JEL O38, H25, F23)