Productivity Trends in Europe: Implications for Real Exchange Rates, Real Interest Rates, and Inflation

The paper examines a long–run (neoclassical) framework in which differences in productivity growth across sectors and countries lead to inflation differentials. In a currency union, these inflation differentials imply cross–country differentials in real interest rates. The authors estimate the likely size of these differentials for European Union countries, discuss the potential costs of persistent inflation differentials, and comment on the conflicts they may cause within Economic and Monetary Union (EMU). The analytical framework is a variant of the Balassa–Samuelson "productivity hypotheisis," which relates sectoral productivity trends to trends in the relative price of home goods.     

Market competition,earnings management,and persistence in accounting profitability around the world

We examine how cross-country differences in product, capital, and labor market competition, as well as earnings management affect mean reversion in accounting return on assets. Using a sample of 48,465 unique firms from 49 countries, we find that accounting returns mean revert faster in countries where there is more product and capital market competition, as predicted by economic theory. Country differences in labor market competition and earnings management are also related to mean reversion in accounting returns—but the relation varies with firm performance. Country labor competition increases mean reversion when unexpected returns are positive but slows it when unexpected returns are negative. Accounting returns in countries with higher earnings management mean revert more slowly for profitable firms and more rapidly for loss firms. Thus earnings management incentives to slow or speed up mean reversion in accounting returns are accentuated in countries where there is a high propensity for earnings management. Overall, these findings suggest that country factors explain mean reversion in accounting returns and are therefore relevant for firm valuation.     

The time frames of entrepreneurs

This study investigated past and future temporal depths (distances into the past and future) of entrepreneurs. The results provide the first statistics describing these depths in a sample of entrepreneurs. A significant positive correlation was found between past and future temporal depths, and relationships were examined between both temporal depths and polychronicity, preference for working fast, perceived temporal flexibility of work, emphasis on schedules and deadlines, emphasis on punctuality, and general life stress. Entrepreneurs' ages, lengths of future temporal depth, and perceived temporal flexibility were all found to be negatively related to life stress in a hierarchical regression analysis.     

Higher risk,lower returns: What hedge fund investors really earn

The returns of hedge fund investors depend not only on the returns of the funds they hold but also on the timing and magnitude of their capital flows in and out of these funds. We use dollar-weighted returns (a form of Internal Rate of Return (IRR)) to assess the properties of actual investor returns on hedge funds and compare them to buy-and-hold fund returns. Our main finding is that annualized dollar-weighted returns are on the magnitude of 3% to 7% lower than corresponding buy-and-hold fund returns. Using factor models of risk and the estimated dollar-weighted performance gap, we find that the real alpha of hedge fund investors is close to zero. In absolute terms, dollar-weighted returns are reliably lower than the return on the Standard & Poor's (S&P) 500 index, and are only marginally higher than the risk-free rate as of the end of 2008. The combined impression from these results is that the return experience of hedge fund investors is much worse than previously thought.     

Brand experience as a moderator of the negative impact of promotions

While price promotions are generally believed to have a positive impact on immediate sales, their effects on attitude towards repurchase, quality perceptions, and repurchase are far less clear. We present a study that tests the effect of brand experience in moderating the negative impact of promotions. The results of the laboratory study indicate that the negative impact of a discount on perceptions of quality and subsequent intent to purchase at full price is eliminated among those who had tried the brand. The moderation of the negative impact of promotions has not been previously shown to occur despite its prediction by a variety of behavioral theories.     

What some recent research tells us about planned giving (legacy marketing) in North America

• The transformation of fundraising from an ‘emerging profession’ to a ‘true profession’ is contingent on the continual development of a formal body of knowledge based on theory and research. To further that goal, this paper, written from a Canadian perspective, reviews current and recent research studies in both Canada and the USA, focusing specifically on the areas of legacy marketing and bequest gifts.
• The aim of this paper is two-fold: first, to bring forward ‘established knowledge’ in this relatively new and burgeoning area of fundraising; and second, to draw attention to areas where there is a knowledge gap, thereby laying the groundwork for further research and progress in this area.

Copyright © 2005 John Wiley & Sons, Ltd.     

Uptake of organisational work–life balance opportunities: the context of support

This research examines the relationship between structural and cultural dimensions affecting managerial decision-making about work–life balance (WLB) opportunities. Through a top-down study of two contrasting Irish organisations, we identify how each of five dimensions of work–life culture: ‘managerial and organisational support’, ‘organisational time expectations’, ‘career consequences’, ‘gendered perception of policy use’ and ‘co-worker support’ are mediated through managers to affect availability and uptake of WLB opportunities and creating gaps between policy and practice. This study demonstrates how marked distinctions between the personal opportunities managers may wish to offer and the discretion available to them arise. Secondly, the concept of organisational work–life culture is advanced by elaborating the ‘context of support’, namely interdependencies between organisational culture and structure that affect the uptake of WLB opportunities. Implications for researchers and practitioners are also discussed.     

„Drum prüfe,wer sich bindet...” — eine empirische untersuchung zur wirkung von markenkooperationen

ZusammenfassungMarkenkooperationen sind en vogue, kaum ein Markenhersteller, der in der jüngsten Vergangenheit nicht an eine solche Form der Zusammenarbeit gedacht h?tte. Warum auch nicht? Die damit einhergehenden Nutzenm?glichkeiten sind vielseitig und reichen von der Halbierung der Marketingkosten, der Steigerung von Reichweite- und Bekanntheitsgrad bis hin zur übertragung von markenindividuellen Assoziationen. Das nachfolgende Fallbeispiel des FreshSurfer zeigt, dass man sich beim Aufbau von langfristigen Markenkooperationen jedoch nicht nur von kurzfristigen Opportunit?ten verleiten lassen sollte, sondern eine solche Zusammenarbeit vorab auf verschiedenen Dimensionen gewissenhaft abgekl?rt werden muss.     

Fairness in consumer pricing

Two case studies illustrate problems of fairness in consumer pricing. The May D&F case involves charges of deceptive advertising as a result of the retailer's high-low pricing; customers were allegedly deceived by artificially inflated regular prices and discounts promoted from these prices. The GDC case involves charges that 10,000 consumers were deceived into purchasing homes at prices higher than fair market value. Consumer policy and managerial issues are identified and analysis and recommendations provided. These cases are about fairness and trust within market exchange, and the responsibilities of sellers and consumers to provide and use information. Economic assumptions of nonfairness and caveat emptor are shown to be inadequate. The position that a fair price is the market price is questioned and an alternative suggested. Remedies which might be adopted by companies and pursued by policymakers are proposed. By creating more realistic consumer expectations, they would reduce problems of fairness in pricing.

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Fairneß bei der Festsetzung von Konsumgüterpreisen

Zusammenfassung Gegenstand des Beitrages ist die Frage, ob Fairneß bei der Preisgestaltung eine ökonomisch angemessene Forderung ist, und die Frage, worin diese Fairneß eigentlich besteht. Als empirischer Hintergrund werden zunächst zwei US-amerikanische Fallstudien präsentiert, die die Schwierigkeiten der genaueren Bestimmung von Fairneß bei der Preisbildung in konkreten Fällen illustrieren. Im ersten Fall wurde einem Einzelhandelsunternehmen vorgeworfen, irreführende Werbung insofern betrieben zu haben, als mit Preisabschlägen von künstlich aufgeblähten regulären Preisen geworben wurde. Eine Gerichtsentscheidung fand dieses Verhalten nicht nur täuschend, sondern verlangte von dem Unternehmen auch die Offenlegung seiner Preisfestsetzungs-Methoden. Der Beitrag zeigt, daß diese Forderung nach Offenlegung unter verbraucherpolitischem Blickwinkel eine suboptimale Lösung ist.Im zweiten Fall wurde einer Immobiliengesellschaft vorgeworfen, in Florida 10,000 Konsumenten zu Kaufverträgen für Wohneigentum gebracht zu haben zu Preisen, denen vorgebliche Schätzwerte zugrundelagen, die 20% über dem eigentlichen Marktwert lagen. Die Käufer kamen überwiegend aus anderen amerikanischen Staaten und waren mit dem lokalen Immobilienmarkt nicht vertraut. Der Fall (und seine rechtliche Behandlung) weist deutlich auf ethische und rechtliche Probleme hin, denen Verantwortliche ausgesetzt sind, wenn sie Preise festsetzen.Die weiteren Folgerungen gehen über den Bereich des Einzelhandels und der Immobilienbranche hinaus. Bei beiden Fällen geht es um Fairneß allgemein und um Vertrauensschutz bei Kaufverträgen, sowie um die Verantwortlichkeiten des Verkäufers bei der Versorgung des Käufers mit Information und die des Käufers zur Aufnahme und Nutzung dieser Informationen. In Übereinstimmung mit sozioökonomischen Positionen wird dargelegt, daß Fairneß bei der Preisfestsetzung von beiden Marktparteien ein offenes und ehrliches Verhalten bei der Verständigung über den Preis verlangt, zu dem der Tausch stattfinden soll. Die Analyse stellt die traditionelle ökonomische Annahme in Frage, nach der der Marktpreis, den die Nachfrager freiwillig zahlen, ein fairer Preis sei. Diese Position ist insbesondere bei Vorliegen von Täuschung unbefriedigend. Das Prinzip caveat emptor stellt sich nicht nur in den Fallstudien als unzweckmäßig heraus, sondern allgemein dort, wo es begrenzte Suchaktivitäten und begrenzte Preisvergleiche durch Konsumenten gibt. Als empirisch gestützte Erklärungen für solche Begrenzungen werden genannt: Das Entscheidungsverhalten von Konsumenten ist häufig durch Anspruchsanpassung, Vereinfachung und Bequemlichkeit gekennzeichnet, zweitens sind Preisvergleiche schwierig, wenn die Informationen unzweckmäßig, unvollständig oder irreführend sind, und drittens vertrauen Konsumenten häufig den Aussagen der Verkäufer.Überhöhte Preise sollten nicht kriminalisiert werden — das wäre ökonomisch disfunktional. Konsumenten sind die besten Kenner ihrer Präferenzen und ihrer Nutzenvorstellungen. Jedoch sollten Anbieter bereit sein, freiwillig Principien der fairen Preisgestaltung zu befolgen, und die Verbraucherpolitik sollte sie in dieser Bereitschaft bestärken. Wenn es gelänge, die Verbrauchererwartungen an Produkte realistischer zu gestalten, würde sich das Problem mangelnder Fairneß bei der Preisgestaltung ohnehin reduzieren.

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Patrick J. Kaufmann is an Associate Professor at the College of Business Administration at Georgia State University, Atlanta, GA, USA. Gwen Ortmeyer is an Assistant Professor at the Graduate School of Business Administration, Harvard University, Boston, MA, USA. N. Craig Smith, to whom correspondence should be addressed, is a Visiting Associate Professor at the School of Business Administration at Georgetown University, Washington DC 20057, USA.     

Recruitment and retention in front‐line services: the case of childcare

This article highlights how problems of recruitment and retention in front‐line services create a particular challenge to traditional HRM models and solutions. Private day nurseries make an interesting example of the challenges facing managers in the service sector as the combination of a feminised workforce, a price‐sensitive service, public–private competition and state regulation create particular difficulties. We report on a study of 33 day nurseries involving interviews with managers and employees over an eight‐month period. Our findings show that childcare providers have to cope with recruitment and retention problems associated with high‐end interactive service provision compounded by gender segregation and small business characteristics. Our analysis of employer and employee perspectives examines labour market issues affecting recruitment, and categorises the reasons for staff turnover into internal ‘push’ factors, external ‘pull’ factors, outside factors and functional turnover.