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This paper assesses the relative and joint impact of cultural and institutional factors on firms' use of “calculative” human resource management practices to determine their separate analytic power. To what extent do institutions and culture structure managerial choice? Previous research has been constrained by not having measures for both cultural and institutional distance. Employing data from 14 European countries taken from the Cranet survey, our findings indicate that institutional, and more specifically, labour relations factors, have more explanatory power than cultural factors.

The paper examines the management of traders in financial markets from the perspectives of agency and prospect theory. Using interview data from a sample of traders and managers in four investment banks, the paper argues that managers focus on avoiding losses rather than making gains. This focus emerges from the characteristics of managers and the nature of their role. The implications for agency and prospect theory, together with the policy issues for managers, are discussed.