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.     

Guest Editorial

The Journal of Real Estate Finance and Economics -     

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.     

Minimum wage and restaurant hygiene violations: Evidence from Seattle

We study the association between the minimum wage and food establishment hygiene violations between Seattle (the treated city) and Bellevue (the control city), both cities located in King County and sharing the same health inspection department. An increase in the real minimum wage of $0.25 is associated with an increase of at least 8% in total and less severe (blue) hygiene violation scores for food establishments in Seattle. We find mixed support for the increase in more severe (red) violations. A decline in employment with an increase in minimum wage could be driving the increases in hygiene violations.     

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 B Corp certification on financial stability: Evidence from a multi-country sample

B Corps are firms certified by the non-profit B Lab for pursuing both economic and non-economic goals. Whether B Corps realize a higher financial performance has met mixed evidence. Drawing on the stability-change framework, we ask whether B Corp certification is associated with the level and volatility of financial performance. Also, expecting a greater focus on non-economic activities after certification, equity ratio may decline as shareholders may question the increased non-economic focus. Using nearest neighbor propensity score matched pair method, we draw on a multi-country sample of 355 B Corps and 623 non-B Corps. Our findings are not encouraging. B Corp certification does not provide financial gains nor financial stability, and equity ratio declines and becomes more volatile following certification. Our findings paint a gloomy picture of limited economic benefits and declining participation of equity holders following B Corp certification.     

Pay dispersion among the top management team and outside directors: Its impact on firm risk and firm performance

Two key groups central to improving firm performance are the top management team (TMT) and the board of directors. Executives undertake strategic actions, whereas board members fulfill their resource provision and monitoring roles. Drawing on tournament theory and equity theory, we propose that high pay dispersion among outside directors and the TMT is positively associated with strategic risk, whereas high (low) TMT pay dispersion and low (high) outside director pay dispersion are positively associated with firm performance. Our predictor is the unexplained component of horizontal pay dispersion, or the residual of pay dispersion resulting from regressing pay on observable firm, industry, period, and individual characteristics. Our results highlight the importance of unexplained pay dispersion for TMTs, but not for boards of directors, in improving firm performance.     

The economic burden of tuberous sclerosis complex in UK patients with renal manifestations: a retrospective cohort study in the clinical practice research datalink (CPRD)

Background: Tuberous sclerosis complex (TSC) is a multi-system genetic disorder in which renal manifestations occur in ～50% of children and 80% of adults. Since these often present alongside other manifestations, renal TSC is likely to incur significant costs. This study aims to quantify healthcare resource use (HCRU) and costs for renal TSC patients in the UK.

Methods: TSC patients in the Clinical Practice Research Datalink (CPRD) linked to Hospital Episodes Statistics were identified from January 1987–June 2013. Clinical data were extracted over the entire history and costs were reported over the most recent 3-year period. HCRU was compared with a matched comparator cohort. Incremental costs were reported and the key cost drivers by primary manifestation category were identified by regression modeling.

Results: A total of 79 renal TSC patients were identified with manifestations including chronic kidney disease stage 3–5 (with prevalence increasing with age) and renal angiomyolipoma. Renal TSC patients consistently reported greater HCRU than the comparator. Inpatient hospitalizations were more frequent for renal TSC patients (3.2 vs 1.6), but length of stay was comparable; however, 70.9% of renal TSC patients recorded no kidney-related procedures ever and averaged <1 test per year in the 3-year period. Average costs for renal TSC patients were nearly 3-fold greater than the comparator (£15,162 vs £5672). Costs increased with additional manifestation categories (£3600: only renal; £27,531: renal with ≥4 additional manifestation categories [25% of patients]). Additional nervous system and dermatology/psychiatric manifestations significantly (p?Conclusions: Renal TSC patients have greater HCRU than the general CPRD population, likely to result from progression of renal disease and additional manifestations; however, surveillance for disease progression appears to be deficient. Inadequate monitoring may contribute to a lack of co-ordinated care and increased healthcare-associated costs. Efforts should be made to follow the TSC guidelines to effectively monitor and treat patients.     

How broad-based is broad-based black economic empowerment?

Common perceptions about broad-based black economic empowerment (BBBEE) have been that it is nothing more than a tool for the already affluent to access further wealth and has limited potential to address the economic exclusion of the most marginalised. An analysis was conducted of data on black economic empowerment (BEE) deals between 2004 and 2009. The findings demonstrate that although the elite continue to benefit from deals, broad-based beneficiaries, particularly employees and women, are also beginning to benefit to some extent. This suggests that empowerment policies have some potential to promote private sector involvement in addressing the state's social transformation agenda. However, a closer analysis of the BEE transactions shows that the BEE landscape is far more complex and nuanced than commonly thought. Further research is necessary to understand the real impacts of BEE on the ground.