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on Business Economics |
| By: | Cristini, Annalisa (University of Bergamo); Eriksson, Tor (Aarhus School of Business); Pozzoli, Dario (Aarhus University) |
| Abstract: | High-performance work practices are frequently considered to have positive effects on corporate performance, but what do they do for employees? After assessing the correlation between organizational innovation and firm performance, this article investigates whether high-involvement work practices affect workers in terms of wages, wage inequality and workforce composition. The analysis is based on a survey directed at Danish firms matched with linked employer-employee data and also examines whether the relationship between high-involvement work practices and employee outcomes is affected by the industrial relations context. |
| Keywords: | workplace practices, wage inequality, workforce composition, hierarchy |
| JEL: | C33 J41 J53 L20 |
| Date: | 2012–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6984&r=bec |
| By: | Paolo Polidori (Department of Law, University of Urbino “Carlo Bo”); Désirée Teobaldelli (Department of Law, University of Urbino “Carlo Bo”) |
| Abstract: | Corporate criminal liability legislation has been the subject of a widespread debate around the world in response to the financial scandals of the early 2000s. The existing legal regimes en- tail compliance requirements, such as internal monitoring mechanisms, with the aim of inducing firms to detect the wrongful conduct of their agents. We develop an analytical framework to address when and to what extent firms may find convenient to adopt these regulatory devices. We conclude that more productive firms and those operating in sectors where managers have more opportunities to undertake criminal activities are more likely to prevent such activities (through monitoring or the payment of e¢ ciency wages). When the potential returns of ille- gal activities are high or when the firms are large, implementing internal monitoring devices may be optimal, while smaller firms should generally prefer the payment of efficiency wages to prevent crimes by managers. |
| Keywords: | Corporate Governance, Law Enforcement, Compliance, Deterrence, Regulation. |
| JEL: | K22 K42 G34 G38 L50 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:urb:wpaper:12_16&r=bec |
| By: | Jindra, Jan (OH State University); Voetmann, Torben (Cornerstone Research); Walkling, Ralph A. (Drexel University) |
| Abstract: | Chinese reverse mergers (CRMs) claim to provide easy entry to the U.S. and international markets. Recently, a large number of Chinese firms using reverse merger transactions have been listed on the U.S. stock exchanges. We review the historical use and mechanics of these reverse mergers, and contrast them with initial public offerings (IPOs). We also explore settlements of securities class action lawsuits involving Chinese firms. Our analysis shows that larger, more reputable Chinese firms are significantly less likely to pursue reverse mergers. We also find that CRM firms are more likely to be subject to class action litigation in the U.S and that the settlement amounts are smaller for CRM firms than for Chinese IPO firms. Our analysis further indicates that CRM firms significantly underperform the Chinese IPO firms. Thus, the evidence suggests that CRMs are not substitutes for Chinese IPOs. |
| JEL: | G14 |
| Date: | 2012–10 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:ohidic:2012-18&r=bec |
| By: | Vladislav Damjanovic |
| Abstract: | We consider a model of financial intermediation with a monopolistic competition market structure. A non-monotonic relationship between the risk measured as a probability of default and the degree of competition is established. |
| Keywords: | Competition and Risk, Risk in DSGE models, Bank competition; Bank failure, Default correlation, Risk-shifting effect, Margin effect. |
| JEL: | G21 G24 D43 E13 E43 |
| Date: | 2012–10–24 |
| URL: | http://d.repec.org/n?u=RePEc:san:cdmawp:1210&r=bec |
| By: | Merlino, Luca Paolo (Free University of Brussels); Parrotta, Pierpaolo (Aarhus School of Business); Pozzoli, Dario (Aarhus University) |
| Abstract: | Exploiting the richness of the Danish register data on individuals and companies, we are able to provide an overall assessment of the assortative matching patterns arising in the period 1996-2005 controlling for firms and individual characteristics. We find strong differences between men and women in assortativity. While positive assortative matching in job-to-job transitions emerges for good female workers, good male workers are more likely to be promoted. These differences are not present in female friendly firms which have high profits and where good female workers tend to find jobs. Complementary analysis on job-to-unemployment and job-to-self-employment transitions reveals a lower employer's willingness to retain women. Overall, we find strong evidence of glass-ceilings in certain firms preventing women to climb the carrier ladder and pushing them to look for better jobs offered by more female friendly firms. |
| Keywords: | assortative matching, gender gap, glass ceiling, sticky floor |
| JEL: | J16 J24 J62 |
| Date: | 2012–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6983&r=bec |
| By: | Giacomo Ponzetto |
| Abstract: | This paper shows that intellectual property rights yield static efficiency gains, irrespective of their dynamic role in fostering innovation. I develop a property-rights model of firm organization with two dimensions of non-contractible investment: how much cost-minimizing effort to exert, and whether to direct it towards partnership or defection. In equilibrium, the first best can be attained if and only if property rights are as strong for intangible as for tangible assets. When IP rights are weaker, the structure of the firm is distorted and efficiency declines. An entrepreneur must either integrate her suppliers, which induces a fall in their investment; or else risk their defection, which entails a waste of her human capital. My model predicts greater prevalence of vertical integration in response to weaker IP rights. It also predicts a switch from integration to outsourcing over the product cycle. Both empirical predictions are consistent with evidence on the organization of multinational companies. As a normative implication, I …find that IP rights should be strong but narrowly defined, to protect one business opportunity without holding up its potential spin-offs. |
| Keywords: | intellectual property, organization, hold-up problem, property rights, vertical integration, outsourcing, product cycle, spin-off, licensing |
| JEL: | D23 D86 K11 L22 L24 O34 |
| Date: | 2012–10 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:668&r=bec |
| By: | Bilotkach, Volodymyr; Hüschelrath, Kai |
| Abstract: | We examine the issue of market foreclosure by airline partnerships with antitrust immunity. Overlapping data on frequency of service and passenger volumes on non-stop transatlantic routes with information on the dynamics of airline partnerships, we find evidence consistent with the airlines operating under antitrust immunity refusing to accept connecting passengers from the outside carriers at respective hub airports. Following the antitrust immunity, airlines outside the partnership reduce their traffic to the partner airlines' hub airports by 4.1-11.5 percent. We suggest regulators should take possible market foreclosure effects into account when assessing the competitive effects of antitrust immunity for airline alliances. -- |
| Keywords: | air transportation,alliances,antitrust immunity,foreclosure |
| JEL: | L41 L93 K21 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:10083r&r=bec |
| By: | Romain Aeberhardt (CREST); Ines Buono (Bank of Italy); Harald Fadinger (University of Vienna) |
| Abstract: | Using French firm-level trade data, we provide empirical support for a heterogeneous firm model in which exporting requires finding a local partner in each market: contracts are incomplete, exporters must learn the reliability of their partners through experience, and export behaviour is state-dependent due to matching frictions. As predicted by our theoretical model, we find that better legal institutions ease contracting frictions especially in sectors with serious contracting problems. This increases state dependence by more in those sectors. Finally, hazard rates depend on the quality of local legal institutions and decline with the age of the relationship, as unreliable partners are weeded out. |
| Keywords: | trade dynamics, learning, institutions, state dependence, firm-level trade data. |
| JEL: | F12 F14 L14 |
| Date: | 2012–10 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:wptemi:td_883_12&r=bec |
| By: | Lora R. Todorova (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg); Bodo Vogt (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg) |
| Abstract: | This paper experimentally examines the relationship between self-reporting risk preferences and behavioral choices in the subsequently played dictator, ultimatum and investment games. The results from these experiments are used to discern the motivational bases of behavioral choices in the ultimatum and investment games. The focus is on investigating whether strategic considerations are important for strategy selection in the two games. We find that self-reporting risk preferences does not alter the dictators' offers and trusters' investments, while it significantly decreases the proposers' offers and leads to a substantial decrease in the amount trustees give back to their partners. We interpret these results as evidence that the decisions of proposers in the ultimatum game and trustees in the investment game are strategic. |
| Keywords: | coordination game, dictator game, ultimatum game, investment game, questionnaire, risk scale, risk preferences |
| JEL: | C7 C91 D8 |
| Date: | 2012–09 |
| URL: | http://d.repec.org/n?u=RePEc:mag:wpaper:120021&r=bec |
| By: | Siegfried K. Berninghaus (Institute for Economic Theory and Statistics, Karlsruhe Institute of Technology); Lora R. Todorova (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg); Bodo Vogt (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg) |
| Abstract: | This paper presents the results of an experiment designed to study the effect produced on strategy choices when a subject reports risk preferences on a risk scale before engaging in a 2x2 coordination game. The main finding is that the act of stating one's own risk preferences significantly alters strategic behavior. In particular, subjects tend to choose the risk dominant strategy more often when they have previously stated their attitudes to risk. Within a best-response correspondence framework, this result can be explained by a change in either risk preferences or beliefs. We find that self-reporting risk preferences does not induce a change in subjects' beliefs. We argue that the behavioral arguments of strategy selection, such as focal points, framing and uncertain preferences can explain our results. |
| Keywords: | coordination game, questionnaire, risk scale, risk preferences, beliefs, focal points, framing, uncertain preferences |
| JEL: | D81 C91 C72 |
| Date: | 2012–09 |
| URL: | http://d.repec.org/n?u=RePEc:mag:wpaper:120020&r=bec |
| By: | Kremp, E.; Sevestre, P. |
| Abstract: | This paper focuses on the access of independent French SMEs to bank lending and analyzes whether the observed evolution of credit to SMEs over the recent period was "demand driven" as a result of the decrease in firms' activity and investment projects or was "supply driven" with an increase in credit "rationing" stemming from a more cautious behavior of banks. Based on a sample of around 60,000 SMEs, we come to the conclusion that, despite the stronger standards used by banks when granting credit, French SMEs do not appear to have been strongly affected by credit rationing since 2008. This result goes against the common view that SMEs suffered from a strong credit restriction during the crisis but is perfectly in line with the results of several surveys about the access to finance of SMEs recently conducted in France. |
| Keywords: | Credit rationing, disequilibrium model, SME. |
| JEL: | E51 G21 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:bfr:banfra:405&r=bec |
| By: | Jong-Hee Hahn (school of economics, Yonsei Uneversity); Sang-Hyun Kim (Department of Economics, Michigan State University) |
| Abstract: | This paper shows that firms producing homogeneous goods (e.g. Bertrand competitors) can achieve supernormal profits using interfirm bundled discounts, which connect their product with a specific brand of other firm with market power. By committing to a price discount exclusively to buyers of a particular brand of another good, the firms create a sort of artificial switching costs and attain a semi-collusive outcome. In fact, the discount scheme allows the firms with no market power to avoid Bertrand trap by leveraging other firms' market power. Consumers are worse off due to higher prices under bundled discounts. |
| Keywords: | Brand-specific discounts, bundling, co-branding, co-promotion |
| Date: | 2012–07–13 |
| URL: | http://d.repec.org/n?u=RePEc:yon:wpaper:2012rwp-47&r=bec |