An Analysis of the Determinants and Shareholder Wealth Effects of Mutual Fund Mergers

This study examines the determinants of mutual fund mergers and their subsequent wealth impact on shareholders of target and acquiring funds. Results indicate significant improvements in postmerger performance and a reduction in expense ratios for target fund shareholders. In contrast, acquiring fund shareholders experience a significant deterioration in postmerger performance. The net asset flows continue to remain negative for the combined fund in the year following the merger. The likelihood of a fund merger is inversely related to fund size for both within- and across-family mutual fund mergers. However, poor past performance is a significant determinant for only within-family mergers.     

Product quality: Impact of interdepartmental interactions

The authors examine the role of organizational factors affecting interdepartmental interactions and their subsequent effects on product quality. Results from a national study suggest that product quality is affected by interdepartmental conflict and connectedness. Importantly, the linkage between interdepartmental conflict and product quality appears to be robust across varying levels of market turbulence and technological turbulence. In contrast, interdepartmental connectedness appears to be more important for product quality under conditions of high market and technological turbulence. The results also indicate that interdepartmental interactions are influenced by leadership characteristics (risk aversion of top managers), reward system orientation, and organization structure (centralization, departmentalization, and hierarchical levels). Managerial implications and directions for future work are proposed. His research interests focus on marketing strategy, marketing management, and new product management. His work has appeared in theJournal of Marketing, Journal of Business Research, and other journals. His research focuses on implementing and controlling marketing, market/environmental orientation, and customer responses to advertising. His work has appeared in theJournal of Marketing, Journal of Marketing Research, Review of Marketing, and other journals. His research interests include market orientation, marketing strategy, sales management, and industrial marketing. His work has appeared in a number of journals including theJournal of Marketing, Journal of Marketing Research, andStrategic Management Journal.     

Double Moral Hazard,Monitoring, and the Nature of Contracts

generalized double-sided moral-hazard model, with risk-averse parties who mutually monitor each other (to get a reasonable idea of outcome/effort). The model considers trade-off between monitoring costs and moral hazard costs, which are endogenously determined by the extent of monitoring. Using this model, we formally prove a generalized version of Coase's conjecture – that the optimal contract minimizes the agency and risk costs. We then show how varying assumptions about the feasibility or cost of monitoring of the outcome or the worker's effort lead to different contracts being optimal. The analysis is then used to explain the nature of contracts observed in practice under many different situations. We will give an explanation as to why industrial workers typically work under wage contracts, while share contracts are common in agriculture and will explain why profit sharing is more common for senior managers than for the production workers. Received September 19, 2000; revised version received October 30, 1997     

Public policy relating to consumer comprehension of television commercials: A review and some empirical results

The utility of disclosure supers in television commercials in providing consumers with useful information is investigated. First the role of the various regulatory agencies in monitoring disclosure supers is reviewed. Next we review the role of consumer behavior theory in explaining how consumers process disclosure information. Then we develop and test hypotheses relating to four format aspects of disclosure supers. The findings supported the hypotheses. Viewers demonstrated lower levels of comprehension for disclosure information relative to information in the body copy of the commercials. Comprehension of disclosure information increased when typeface of disclosure was larger and when a voice-over accompanied the disclosure, but decreased when volume of information in disclosure supers increased. The implications of the findings for public policy are discussed.

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Verbraucherpolitische Einflunahme auf das Verbraucherverständnis von Werbebotschaften im Fernsehen: Ein überblick und einige empirische Befunde

Zusammenfassung Der Beitrag befa\t sich mit dem Nutzen von Informationsauflagen bei Werbespots im Fernsehen, die dem Konsumenten nützliche Informationen zur Verfügung stellen sollen. Zunächst werden die verschiedenen Institutionen geschildert, die die Befolgung von Informationsauflagen überwachen. Als nächstes wird die Bedeutung der Theorie des Konsumentenverhaltens behandelt, wenn es darum geht, die Verarbeitung des Inhaltes von Informationsauflagen durch die Konsumenten zu erklären. Anschlie\end entwickeln die Autoren einige Hypothesen über die Wirkung unterschiedlicher Gestaltungsbedingungen auf die Informationsübermittlung. Diese Hypothesen werden durch die Befunde im wesentlichen bestätigt: Der Inhalt von Informationsauflagen wird insgesamt weniger gut verstanden als der eigentliche Inhalt der Werbebotschaft. Das Verständnis der Informationsauflage ist höher bei grö\erem Schriftgrad. Es ist auch höher, wenn ihr Inhalt nicht allein in Schriftform bezeichnet wird, sondern wenn er zusätzlich auch noch gesprochen wird. Es ist allerdings geringer bei grö\erer Informationsmenge. Abschlie\end werden einige verbraucherpolitische Empfehlungen gegeben.

     

The impact of the net percentage growth rate in the number of small firms on differential state-level employment growth rates in the US: an exploratory empirical note

This brief exploratory empirical note seeks to identify key determinants of geographic differentials in the percentage growth rate of state-level employment in the US, with the primary focus being on the percentage net growth rate in the number of small firms (i.e., those with fewer than 20 employees) in each state, where this variable serves as a de facto reflection of ‘entrepreneurship’. In the interest of identifying other key factors that influence state-level employment growth rates, the effective income tax rate in each state, quality of life elements and labour market considerations are also included in the analysis. The study period runs from the year 2000 to the year 2007, ending just prior to the ‘Great Recession’. The estimation results imply that the state-level employment growth rate in the US was an increasing function of the percentage net growth rate in the number of small firms in each state. Thus, it appears that the small firms growth rate may in fact be a significant source.     

The impact of all-star analyst job changes on their coverage choices and investment banking deal flow

Using a sample of all-star analysts who switch investment banks, we examine (1) whether analyst behavior is influenced by banking relationships and (2) whether analyst behavior affects investment banking deal flow. Although the stock coverage decision depends on the relationship with the client firms, we find no evidence that analysts change their optimism or recommendation levels when joining a new firm. Investment banking deal flow is related to analyst reputation only for equity transactions. For debt and M&A transactions, analyst reputation does not matter. There is no evidence that issuing optimistic earnings forecasts or recommendations affects investment banking deal flow.     

Managing growth: Human resource management challenges facing the Indian software industry

Indian software industry has had a phenomenal growth in the last two decades and is expected to sustain this momentum in the foreseeable future. Based on content analysis of 25 cases, the paper identifies several human resource management challenges: managing human resources in globally distributed team, shortage of software professionals having sufficient knowledge and competencies, low-skilled nature of the work, lack of well-developed HR systems and processes, high employee turnover, lack of work-life balance, and the problems associated with the use of contract employees. The paper develops a model for managing growth linking the various variables emerging from the study.     

Buyer-supplier relational characteristics and joint decision making

This paper explores propositions dealing with the influence of buyer-supplier relational characteristics on their joint decision making. Specifically, the proposed conceptual framework focuses on the link between three relational constructs (trust, commitment, relationship maturity) and two types of joint decision making (strategic and tactical). Strategic decisions are those that “expand the pie” for both parties (integrative decisions), and tactical decisions are those that “divide the pie” between the two parties (distributive decisions). We propose that the effect of relational characteristics on joint decision making is likely to be moderated by the characteristics of the supplier organization (such as team orientation) and its environment (such as competitive intensity). We conclude with a brief discussion of the implications and possible extensions of the theoretical model.