Daylight saving effect

Kamstra et al. [Kamstra, M.J., Kramer, L.A., Levi, M.D., 2000. Losing sleep at the market: the daylight saving anomaly. The American Economic Review 90, 1005–1011] argue that the mean weekend return following the changes in daylight saving time is less than the mean weekend return throughout the rest of the year. Opposing studies, such as Pinegar [Pinegar, J.M., 2002. Losing sleep at the market: comment. The American Economic Review 92, 1251–1256), reason that the observed results depend upon methodology. We extend the ongoing discussions by providing further evidence for equity markets and bond markets in Germany and across Europe. We further demonstrate that the daylight saving effect does not serve as a potential rationale for the weekend effect.     

A welfare analysis of social security in a dynastic framework*

In this article, we study the welfare effects of unfunded social security in a general equilibrium model populated with overlapping generations of altruistic individuals that differ in lifetime expectancy and earnings ability. Contrary to previous research, our results indicate that steady‐state welfare increases with social security for most households, although by very different amounts. This result is mainly due to two factors. First, the presence of two‐sided altruism significantly mitigates the crowding out effect of unfunded social security. Second, ability shocks and uncertain lifetimes generate significant heterogeneity among households to yield different induced preferences for social security.     

MONETARY–FISCAL INTERACTIONS WITH A CONSERVATIVE CENTRAL BANK

We study macroeconomic stabilization when monetary and fiscal policies interact via their effects on output and inflation and the monetary authority is more conservative than the fiscal. We find that monetary–fiscal interactions result in poor macroeconomic stabilization. With both policies discretionary, the Nash equilibrium is suboptimal with higher output and lower inflation than optimal; the Nash equilibrium may be extreme with output higher and inflation lower than either authority want. Leadership equilibria are not second best. Monetary commitment is completely negated by fiscal discretion and yields the same outcome as discretionary monetary leadership for all realizations of shocks. But fiscal commitment is not similarly negated by monetary discretion. Optimal macroeconomic stabilization requires either commitment of both monetary and fiscal policies, or identical targets for both authorities – output socially optimal and inflation appropriately conservative – or complete separation of tasks.     

Familiness,business strategy and stakeholder engagement: The internationalisation of Spanish olive oil mills

Based on social capital theory and the family-firm context, this paper studies familiness' composition and the result of the overlap of the family and firm systems, analysing their influence on the internationalisation strategies of family firms. In this relationship, the stakeholder engagement becomes at the same time an antecedent and a result when developing family businesses' strategies, being one of the most relevant the internationalisation strategies. Prior research focused on familiness as the result of proxy variables such as the percentage of ownership and management in family hands, or business size, instead of as psychological variables resulting from shared organisational culture and social interactions. Through a qualitative study based on 12 interviews of general managers and/or export managers of Spanish family olive oil mills, this study asserts that the level of familiness influences internationalisation strategies, the reasons underlying a business becoming international and its commitment to activities abroad being the role of stakeholders crucial in those interactions. The higher the level of familiness, the more likely the family business internationalisation and the higher their levels of international commitment. Additionally, the higher the concern about their stakeholders, the higher their levels of international commitment. The family businesses' concern for their stakeholders and their international commitment share a reciprocal relationship. The results regarding the relevance of familiness as social capital resources in sustaining competitive advantages support the decision to promote, develop and nurture social capital when a family business goes international.     

Disaggregating operating and financial activities: implications for forecasts of profitability

Researchers, practitioners, and standard setters emphasize the importance of disaggregating financial statements into operating and financial activities. However, there is a lack of research demonstrating that this disaggregation improves forecasts of profitability. In this study, we consider whether and when the operating/financial disaggregation improves forecasts of profitability. Contrary to the use of an aggregate forecasting approach by most related prior research, we first show that the operating/financial disaggregation only provides forecast improvement over a benchmark model incorporating aggregate information when the components forecasting approach is used. We also compare the operating/financial disaggregation to the unusual/infrequent disaggregation required by US GAAP. We find that the operating/financial disaggregation yields less accurate forecasts than the unusual/infrequent disaggregation. However, when using the components forecasting approach, we find that the combination of both disaggregations improves forecasts of profitability. Finally, we document that the incremental usefulness of the operating/financial disaggregation relative to a benchmark model incorporating aggregate information is a function of growth and accounting conservatism. Overall, our study provides timely evidence concerning how analysts and investors might best use the operating/financial disaggregation for forecasting profitability.     

Raising the bar (6)

Raising the bar (6). Spatial Economic Analysis. This editorial summarizes and comments on the papers published in issue 12(4) so as to raise the bar in applied spatial economic research and highlight new trends. The first paper addresses the question of whether ‘jobs follow people’ or ‘people follow jobs’. The second paper develops a new methodology to determine functional regions. The third paper is a major contribution to the growing literature on new modelling approaches and applications of disaster impact models. The fourth paper focuses on the costs and benefits of higher education. The fifth paper develops a two-step procedure to identify endogenously spatial regimes in the first step using geographically weighted regression, and to account for spatial dependence in the second step. Finally, the sixth paper estimates a dynamic spatial panel data model to explain house prices and to show that restricted housing supply in the city of Cambridge, UK, has some undesirable labour market effects.     

Revisiting Tversky's Trail—How Money Makes a Subtle Difference in Similarity Effect Experiments

Recent findings in research on context effects indicate that, as opposed to choices under hypothetical settings, compromise effects are significantly attenuated in binding settings that include real payments for products. The present investigation examines to what extent this finding applies to yet another context effect, namely the similarity effect (SE). The SE stipulates that, compared with initial shares of two options A and B in a binary choice set, the introduction of an option C that is dissimilar to B but similar to A will hurt the latter more than the nonadjacent option B. The conducted online survey examines the SE in unforced choices of experienced consumers between real brands across three consumer good categories. The results confirm that the SE is evidently reduced under real payment conditions, hence confirming the hypothesis that the applied choice setting moderates the efficacy of the composition of choice sets.     

An analysis of e-business adoption and its impact on relational quality in travel agency–supplier relationships

This study analyzes how managers of retail travel agencies perceive the antecedents and consequences of adopting e-business in their supplier relationships. A comprehensive model integrating its antecedents and relational effects is developed and empirically tested using SEM. The study surveyed 101 travel agents in Spain. Research findings indicate that customer pressure has a strong influence on e-communication practices. E-communication with the travel agency's supplier and the pressure exerted by the sector are the main antecedents for e-procurement. Effects of e-business on relational quality are contradictory. E-procurement influences negatively on trust. Conversely, e-communication has a positive impact on trust, thus having a favorable impact on perceived reciprocity and travel agent's commitment to its supplier. Main findings indicate that the use of the Internet is largely driven by normative pressures, and this coercive power has a detrimental impact on trust. To avoid such negative consequences, perceived reciprocity is a prerequisite for committed supplier relationships.     

Project Management of Production Line Automation: A Comparative Analysis of Project Management in Brazil and Colombia

This article aims to evaluate the production line automation projects developed by Brazilian and Colombian companies from the Project Management perspective, through the analysis of the application degree of PMBOK processes, to understand how formal techniques are being employed in these countries and also to identify improvement opportunities, when necessary. Data were collected through a survey. The similarity index between the ten processes, with the highest application degree in the Brazilian and Colombian samples, was 70%. For the processes with the lowest application degree, the similarity index was 60%. No similar study was found in the literature.