Labor unemployment risk and firm risk

This paper examines the effect of labor unemployment risk on firm risk. Using unemployment insurance benefits as a proxy for unemployment risk, we find an economically significant positive relation between unemployment risk and firm risk. This positive relation is more pronounced for firms that are more labor-intensive, have a higher layoff propensity and are more financially constrained. While existing literature that employs corporate policy measures such as debt and cash holdings suggests an opposite relationship, our paper presents evidence that the effects stemming from earnings management, earnings quality and reporting quality appear to dominate.     

From the Tribal to the Open Society: The Role of Medieval Craft Guilds in the Emergence of a Market Order

The emergence of a legally constituted State in 16th century western societies represents the final lap of a process extending the sphere of the indivudal freedoms necessary for the emergence of the market order. A peculiar stage of this process came in the form of guilds. They materialised into a need for emancipation from the values of the archaic society and became the keepers of a peace and a justice on the market by ensuring the respect of new rules of conduct (1). This analysis of the behaviour of craft guilds will illustrate the question of the possibility of rational economic activity in medieval society (2).     

The Impact of Career Capital on Expatriates' Perceived Marketability

We examine how the development of three types of career capital (knowing how, knowing whom, and knowing why) during an international assignment affects the perceived marketability of organizational expatriates. Using the perceived marketability perspective and long‐term follow‐up data, we show that knowing how is seen as the most transferable type of career capital, while the development of other aspects of career capital has little impact on perceived marketability. We also show that career capital development is more recognized in the external market than by current employers. Our findings expand our understanding of long‐term career marketability among people who have completed international assignments. © 2015 Wiley Periodicals, Inc.     

Why do parents make their children work? A test of the poverty hypothesis in rural areas of Burkina Faso

It is often argued that child labour is caused by poverty. However,much child labour takes place in rural areas characterized bysubstantial labour market imperfections. A model of rural householdlabour supply is developed that provides testable implicationsfor two versions of the poverty hypothesis: that child labouris due to a binding subsistence constraint and that child leisureis a luxury good. We find that in rural Burkina Faso childrendo not provide labour to meet households' subsistence needsand that child leisure is a normal good. The evidence suggeststhat labour market imperfections are a main reason for usingchild labour.     

Does transparency in central bank intervention policy bring noise to the FX market?: The case of the Bank of Japan

This paper empirically investigates the induced effect of a more and less transparent central bank intervention (CBI) policy on rumors that can emerge. Using the case of Japan, we estimate a dynamic-probit model that explains the main determinants of false reports (i.e. falsely reported interventions) and anticipative rumors (i.e. rumors about future interventions) with reference to the intervention strategy adopted by the central bank for actual and oral interventions, and the uncertainty climate of the market captured by two volatility measures. Our results suggest that the induced effect of a transparent CBI policy on market rumors critically depends on the type of speeches made by officials.     

Elective Stock Dividends and REITs: Evidence from the Financial Crisis

In response to the recent financial crisis, the U.S. Government introduced new rules which allow Real Estate Investment Trusts (REITs) to issue elective stock dividends (ESDs), i.e., noncash dividends, to satisfy their distribution requirements. The purported goal of these rules was to provide temporary relief to REITs facing cash flow problems. We investigate how the introduction of these rules affects dividend policy of REITs. Surprisingly, we document that only 17 REITs chose to issue elective stock dividends. We examine the characteristics of these REITs and find that their cash flows are similar to REITs that do not select these dividends. This suggests that cash flow problems are unlikely to be the primary determinant of the ESD issuance decision. Instead, our findings indicate the decision to pay ESDs is related to the level of loans that are close to maturity, REIT size, growth prospects and poor performance during the financial crisis. Furthermore, we find that the same factors determine the ratio, amount and frequency of stock dividends issued by these REITs. We also examine the response of shareholders to ESDs announcements and find positive abnormal returns surrounding these dividend announcements.     

The Learning Transfer System Inventory (LTSI) translated into French: internal structure and predictive validity

The Learning Transfer System Inventory (LTSI, Holton et al., 2000 ) considers 16 factors likely to influence the transfer of training to the workplace. The purpose of this study is to translate the Learning Transfer System Inventory into French and to examine (1) the internal structure of the translated instrument; and (2) its predictive validity. The Learning Transfer System Inventory was administered to 328 participants from six companies during the week following the end of a training program. The transfer questionnaire was filled in by 106 of those participants 1–3 months later. The results showed that a principal component analysis reveals a factor structure very similar to the original structure: the 16 original factors are replicated. Second, seven factors display statistically significant correlations with transfer: learner readiness, motivation to transfer, transfer design, opportunity to use, transfer‐performance expectations, performance‐outcomes expectations and performance self‐efficacy. Comparisons with four similar previous studies allow us to draw directions for future research on the instrument.     

The relationship between principals’ configuration of a bundle of HR practices for new teachers and teachers’ person–organisation fit

Abstract

Based on studies in the private sector showing the positive effects of strategic human resources management (SHRM) on performance, many stress the value of adopting SHRM in the public sector. However, until now, the argument for applying SHRM in the public sector remains largely theoretical. Especially in educational contexts, it is unclear through which mechanisms SHRM affects performance. Therefore, this paper zooms in on the relationship between the configuration of a bundle of human resources (HR) practices and person–organisation (P–O) fit. A mixed methods design was used to collect both qualitative and quantitative data from principals and teachers in 56 Flemish primary schools. The qualitative data, which provides insight into principals’ configuration of HR practices, were converted into numerical scores and analysed, together with the quantitative teacher data, using multilevel analysis. The results show that both principals’ strategic and HR orientation are associated with teachers’ P–O fit. This study contributes to the research field of SHRM in education by studying a bundle of HR practices and how this relates to the fit of teachers’ own values with the school culture. The practical implications for schools are discussed.     

Do firms lease to hedge? CEO risk-taking and operating lease intensity

Operating leases are used extensively for financing, but their ability to separate ownership and use also creates hedging opportunities. We investigate whether firms recognize such opportunities by examining the relation between chief executive officer (CEO) risk-taking incentives and the use of operating leases. Consistent with firms using operating leases to hedge, we find higher CEO risk-taking incentives lower operating lease intensity. To address endogeneity, we use the adoption of Statement of Financial Accounting Standards 123R as an exogenous shock to option compensation, dynamic panel generalized method of moments, simultaneous equations, and change regressions. Our results are robust to placebo and alternative tests.     

Efficiency and Market Power Gains in Bank Megamergers: Evidence from Value Line Forecasts

This paper examines whether gains in bank megamergers occur due to efficiency improvements or the exercise of market power using financial statement line item forecasts from Value Line to infer the effect of the merger on prices and quantities. The average megamerger is associated with cost‐efficiency improvements. In the cross‐section, efficiency gains are limited to market expansion mergers while market overlap mergers and Too‐Big‐To‐Fail (TBTF) mergers exhibit monopoly gains. Efficiency gains dissipate when the resulting megabank size exceeds $150 billion in assets or 1.5% of gross domestic product indicating that banks thought to be TBTF are likely to be “Too‐Big‐To‐Be‐Efficient.”