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PurposeThe purpose of this study is to discover the learning mechanisms and temporal dynamics of implementing systems (Six Sigma) as it unfolds over time.Design/methodology/approachThe data come from a European engineering company that was implementing a Six Sigma-based quality management system (QMS) over a seven-year period. The analysis is based on an event-sequence reconstruction of the implementation process as it unfolded over time and discovers four different learning mechanisms that emerged: programmatic, persistent, adaptive and dialectical learning mechanisms. The research follows a process design study, where the authors study how the process unfolds over time.FindingsMuch of the literature on implementing management systems suggests that implementation follows a prescribed sequence of “turn-key” steps. However, the findings show that only 40% of all events were driven by prescribed “turn-key” generic practices, while 56% of events required constructing new practices via adaptive and dialectical learning. Moreover, the implementation process did not proceed in a linear programmatic fashion, but instead followed a punctuated equilibrium pattern, which alternated between periods of incremental change and major organizational change. The study also found that implementation required changing many complementary organizational structures and practices that were interdependent with the management system (i.e. Six Sigma). By understanding the implementation process, managers can better assess the time and effort involved, better adapt the system to their situated context and predict critical junctures where implementation could break down.Originality/valueThis research complements the few studies that have examined the process of implementing management systems. Most studies examine factors or conditions that result in implementation success (the what of implementing systems), but few examine the process of implementation and the learning that takes place during implementation (the how of implementing systems), which is a complex nonlinear process that involves different modes of learning.

PurposeThe purpose of this study is to theorize and test the relationships among lean operations and lean supply chain practices, learning- and innovation-oriented lean cultures and dynamic capabilities (DCs) microfoundations. Further, this study aims to assess the association of DCs microfoundations with process innovation.Design/methodology/approach The researchers combine primary data collected from 153 manufacturing firms located in five continents using a survey designed for the purpose of this study with archival data downloaded from the Bureau Van Dijk Orbis database and test the hypothesized relationships using structural equation modelling.FindingsResults support the contribution of lean operations and lean supply chain practices to the development of DCs microfoundations, which further lead to greater process innovation. Additionally, while a learning-oriented lean culture positively moderates the relationships between both lean operations and lean supply chain practices and DCs microfoundations, an innovation-oriented lean culture only moderates the relationship between lean operations practices and DCs microfoundations.Practical implicationsThis study identifies DCs microfoundations as the key mechanisms for firms implementing lean practices to achieve greater levels of process innovation and the important role played by lean cultures. This study provides direction for managers to put in place DCs through lean implementations, enabling their firms to be ready to respond to challenges and opportunities generated by environmental changes.Originality/valueWhile previous research has confirmed the positive effects of lean practices on efficiency, the role of lean practices and cultures in developing capabilities for reacting to environmental dynamism has received little attention. This study offers an empirically supported framework that highlights the potential of lean to adapt processes in response to environmental dynamics, thereby extending the lean paradigm beyond the traditional focus on operational efficiency.

To manage the risk of insurance companies, a reinsurance transaction is among the myriad risk management mechanisms the top ranked choice. In this paper, we study the design of optimal reinsurance contracts within a risk measure minimization framework and subject to the Vajda condition. The Vajda condition requires the reinsurer to take an increasing proportion of the loss when it increases and therefore imposes constraints on the indemnity function. The distortion-risk-measure-based objective function is very generic, and allows for, for example, an objective to minimize the risk-adjusted value of the insurer’s liability, and for heterogeneous beliefs regarding the loss distribution by the insurer and reinsurer. Under a mild condition, we propose a backward-forward optimization method that is based on a marginal indemnity function formulation. To show the applicability and simplicity of our strategy, we provide three concrete examples with the Value-at-Risk: one with the risk-adjusted value of the insurer’s liability, one with an objective function that follows from imposing Pareto optimality, and one with heterogeneous beliefs. We conclude this paper with an empirical application with Danish fire insurance losses and the Value-at-Risk and the Tail Value-at-Risk.

People often have to judge the social motives of others, for example, to distinguish truly prosocial people from those merely trying to appear prosocial. Gaze can reveal the motives underlying social decisions, as decision-makers dedicate more attention to motive-relevant information. We extend the use of eye-tracking and apply it as a communication device by providing (real-time) eye-tracking information of one participant to another. We find that untrained observers can judge the prosociality of decision-makers from their eye-tracked gaze alone, but only if there are no strategic incentives to be chosen for a future interaction. When there are such strategic incentives, the cues of prosociality are invalidated, as both individualistic and prosocial decision-makers put effort into appearing more prosocial. Overall, we find that gaze carries information about a person's prosociality, but also that gaze is malleable and affected by strategic considerations. published

When pricing life annuity or insurance products issued to multiple lives, actuaries require a model for the survival of coupled lifetimes. For reasons of simplicity these multiple life premiums are often calculated under the assumption of independent lifetimes. In some circumstances this assumption is not realistic, and a number of correction methods based on bivariate survival data have been proposed in the actuarial literature. However, when we only observe the first occurring event time, the applicability of the models suggested for bivariate survival data turns out to be limited. The aim of this paper is to propose a copula-based analysis for bivariate survival data subject to left truncation and dependent censoring when only the first event time is observed. Our method is based on parametric marginals and parametric copulas. For this model, we show that the association between the survival and dependent censoring time is identifiable from the distribution of the observed data. The proposed model is estimated using maximum likelihood, which simultaneously estimates the marginal and dependency parameters. We also develop a goodness-of-fit test approach to examine the validity of the fitted copula model. Finally, our approach is illustrated on data from a large Canadian life insurance company. We hereby price joint and last-survivor annuities from data subject to left-truncation, administrative as well as dependent censoring.

To improve drinking water accessibility and safety in rural China, the Chinese government launched the rural drinking water program in the 1980s. As part of the program, tap water infrastructure has been constructed in rural areas to supply tap water to rural residents. This policy intervention provides a unique opportunity to examine the impact of early life exposure to tap water on children’s cognitive achievement in later life. Using data extracted from the China Family Panel Studies (CFPS), we find that one additional year of exposure to tap water in early life increases average cognitive test score by 0.109 standard deviations for a sample of rural children aged 10-15 in 2010. The effect is larger for children whose fathers are less-educated. Event study estimates confirm that the beneficial impacts are concentrated in early life with limited additional impact after the time window.

Bonus-Malus Systems traditionally consider a customer's number of claims irrespective of their sizes, even though these components are dependent in practice. We propose a novel joint experience rating approach based on latent Markovian risk profiles to allow for a positive or negative individual frequency-severity dependence. The latent profiles evolve over time in a Hidden Markov Model to capture updates in a customer's claims experience, making claim counts and sizes conditionally independent. We show that the resulting risk premia lead to a dynamic, claims experience-weighted mixture of standard credibility premia. The proposed approach is applied to a Dutch automobile insurance portfolio and identifies customer risk profiles with distinctive claiming behavior. These profiles, in turn, enable us to better distinguish between customer risks.

In this paper we use intraday government bond futures price changes around German and Italian Treasury auctions to identify unexpected shifts in the demand for public debt. Estimates show that positive demand shocks lead to large negative movements in Treasury yields. Evidence shows significant spillover effects into Treasury bond, equity, and corporate bond markets of other eurozone countries. We find interesting differences in the effects of demand shocks between the two countries, consistent with the “safe-haven” status of German bonds versus the “high-debt” status of Italian Treasuries. Results suggest that these effects are stronger during periods of high financial stress.

Fiscal restraint looks inevitable in the Eurozone following the pandemic, especially if the !scal rules are reinstated. How to match this with the need to !nance the climate transition? Two possible routes are explored. One is the adoption of a ‘green golden rule’, with the structural de!cit limit (or ‘Medi- um Term Objective’) increased by 1% of GDP. Alternatively, new borrowing capacity could be created at the centre through a ‘European Climate Fund’, involving some redistribution towards countries most in need of abatement. Either way, !nancing the energy transition – now more urgent than ever in view of the Ukrainian war – could be achieved within the con!nes of the 60% of GDP debt constraint.

Health insurance enrollment in many Sub-Saharan African countries is low, even with highly subsidized premiums and exemptions for vulnerable populations. One possible explanation is low service quality, which results in a low valuation of health insurance. Using a randomized control trial in 64 primary health care facilities in Ghana, this study assesses the impact of a community engagement intervention designed to improve the quality of healthcare and health insurance services on households living nearby the facilities. Although the intervention improved the medical-technical quality of health services, our results show that households' subjective perceptions of the quality of healthcare and insurance services did not increase. Nevertheless, the likelihood of illness and concomitant healthcare utilization reduced, and especially households who were not insured at baseline were more likely to enroll in health insurance. The results show that solely increasing the technical quality of care is not sufficient to increase households' subjective assessments of healthcare quality. Still, improving technical quality can directly contribute to health outcomes and further increase health insurance coverage, especially among the previously uninsured.

After a long period of relative neglect, the mental well-being and the mental health of researchers and employees in academia are increasingly entering the limelight. The growing body of evidence suggests that a high number of doctoral researchers work under elevated levels of stress and frustration, and that this has a significant impact not only on their personal health and research output, but also on their future career development. In this paper, therefore, we first discuss what a dystopian and a utopian learning journey of early career researchers may look like from a well-being perspective. Subsequently, and based on extensive dialogues with more than 250 researchers and professionals active in the researcher mental health domain, we highlight a number of key focal points that both early career researchers, their supervisors, and institutions alike should consider when it comes to planning and delivering mental health oriented educational activities for doctoral researchers.

Precise asking-prices (e.g., $249,800), compared with round ones (e.g., $250,000), are stronger anchors, leading buyers to counter closer to the asking-price. This ‘precision effect’ is driven by (i) higher evaluation of the seller's competence, and (ii) buyers using a finer-grained numerical scale when the asking-price is precise compared with round. But are buyers more susceptible to precise anchors, the more they take the seller's perspective? If so, what are the underlying mechanisms leading to this increased susceptibility? We examine the potential moderating role of trait (Experiment 1) and manipulated (Experiment 2) perspective-taking on the price precision effect and its underlying mechanisms. We test the prediction that the more buyers take the seller's perspective, the more they will evaluate a precise-opening seller as competent, which in turn will increase buyers' susceptibility to precise prices (H1). We further test two competing predictions regarding the moderating role (H2a) of perspective-taking versus lack thereof (H2b) on buyers' use of a finer-grained numerical scale when countering a precise asking-price. Results revealed that precise asking-prices lead to counteroffers closer to the asking-price. This price precision effect was driven by the scale granularity, but not the perception of seller's competence mechanism. Further, perspective-taking did not moderate the price precision effect. Exploratory analyses revealed that perspective-taking leads to higher perception of seller's competence, which in turn leads to counteroffers that are closer to the asking-price. Overall, both price precision and perspective-taking shape counteroffers (but not in an interaction), making the two factors important in negotiation processes.

Overwaarde van woningen zit veelal vast in de woning. Dat is onhandig, want zo kan deze niet gebruikt worden om de vergrijzing en de verduurzaming en het levensloopbestendig maken van de woningvoorraad te bekostigen. Innovatie middels participatiehypotheken kan deze markt vlottrekken, en pensioenfondsen kunnen daarbij het voortouw nemen.

Nu de inkoopprijs van gas sterk is gedaald, zouden ook de kosten van het energieplafond voor de schatkist moeten afnemen. Maar de contractprijzen dalen nog maar nauwelijks mee. Daardoor pakken de kosten voor de overheid veel hoger uit dan de steeds lagere bedragen die in de media worden genoemd. De energie­bedrijven moeten worden aangezet tot verlaging van hun prijzen.

Gambling disorder (GD) is a behavioural addiction characterized by impairments in decision-making, favouring risk- and reward-prone choices. One explanatory factor for this behaviour is a deviation in attentional processes, as increasing evidence indicates that GD patients show an attentional bias toward gambling stimuli. However, previous attentional studies have not directly investigated attention during risky decision-making. 26 patients with GD and 29 healthy matched controls (HC) completed a mixed gambles task combined with eye-tracking to investigate attentional biases for potential gains versus losses during decision-making under risk. Results indicate that compared to HC, GD patients gambled more and were less loss averse. GD patients did not show a direct attentional bias towards gains (or relative to losses). Using a recent (neuro)economics model that considers average attention and trial-wise deviations in average attention, we conducted fine-grained exploratory analyses of the attentional data. Results indicate that the average attention for gains in GD patients moderated the effect of gain value on gambling choices, whereas this was not the case for HC. GD patients with high average attention for gains started gambling at less high gain values. A similar trend-level effect was found for losses, where GD patients with high average attention for losses stopped gambling at lower loss values. This study gives more insight into how attentional processes in GD play a role in gambling behaviour, which could have implications for the development of future treatments focusing on attentional training or for the development of interventions that increase the salience of losses.

Traditional non-life reserving models largely neglect the vast amount of information collected over the lifetime of a claim. This information includes covariates describing the policy, claim cause as well as the detailed history collected during a claim’s development over time. We present the hierarchical reserving model as a modular framework for integrating a claim’s history and claim-specific covariates into the development process. Hierarchical reserving models decompose the joint likelihood of the development process over time. Moreover, they are tailored to the portfolio at hand by adding a layer to the model for each of the events registered during the development of a claim (e.g. settlement, payment). Layers are modelled with statistical learning (e.g. generalized linear models) or machine learning methods (e.g. gradient boosting machines) and use claim-specific covariates. As a result of its flexibility, this framework incorporates many existing reserving models, ranging from aggregate models designed for run-off triangles to individual models using claim-specific covariates. This connection allows us to develop a data-driven strategy for choosing between aggregate and individual reserving; an important decision for reserving practitioners. We illustrate our method with a case study on a real insurance data set and deduce new insights in the covariates driving the development of claims. Moreover, we evaluate the method’s performance on a large number of simulated portfolios representing several realistic development scenarios and demonstrate the flexibility and robustness of the hierarchical reserving model. keywords: Individual claims reserving, Covariate shift, Model and variable selection, Moving window evaluation, Simulation machine ispartof: Insurance: Mathematics and Economics vol:104 pages:158-184 status: published

Laboratory evidence shows that when people have to argue for a given position, they persuade themselves about the position’s factual and moral superiority. Such self-persuasion limits the potential of communication to resolve conflict and reduce polarization. We test for this phenomenon in a field setting, at international debating competitions that randomly assign experienced and motivated debaters to argue one side of a topical motion. We find self-persuasion in factual beliefs and confidence in one’s position. Effect sizes are smaller than in the laboratory, but robust to a one-hour exchange of arguments and a tenfold increase in incentives for accuracy. (JEL C93, D12, D72, D83, D91, I23)

We study nascent project-based enterprises (PBEs) through the lens of upper echelons and institutional theory. We analyse the interplay between the different role-congruent reputations of their project entrepreneurs and the institutional endorsement of their project idea, theorizing how these affect PBEs’ ability to attract private investments. In the context of the Italian film industry, we find that the commercial reputation of the project entrepreneur in the producer role is crucial for attracting investors, while the artistic reputation of the project entrepreneur in the creative director role is crucial for attaining institutional endorsement of the project idea. Finally, we find that the effect of the commercial reputation of the project entrepreneur in the producer role on attracting investments is mediated by the institutional endorsement. We contribute to the literature on PBEs by demonstrating how specific combinations of project entrepreneurs’ roles and (role-congruent) reputations can directly and indirectly attract investments.

Some credit booms result in financial crises. While excessive risk-taking could plausibly explain the boom-to-bust cycle, many investors do not anticipate increasing risk. We show that credit booms may be misunderstood as being driven by high productivity because opaque bank assets disguise risk incentives. Balanced funding relative to productive prospects can sustain prudent lending (good boom), whereas funding imbalances may induce high risk exposure and boost asset prices (bad boom) or lead to asset underpricing and insufficient lending (missed boom). Rational agents drawing inference from prices make mistakes that can amplify the effect of funding imbalances and propagate risk. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.

As competition among CPG brands intensifies in both emerging and developed markets, brand managers increasingly focus on price as the weapon-of-choice. This calls for an assessment of not only their own price response, but also of their competitive pricing power, and its antecedents. The authors propose a set of universally applicable ('etic') and country-specific ('emic') drivers of brand price elasticity, clout, and vulnerability, for the world’s largest emerging market (viz., China). Leveraging a unique and large-scale data set from this market, they find that high price response is not necessarily indicative of high clout, nor does it signal high vulnerability. Hence, all three price response metrics matter. They also uncover marked differences in the impact of brand- and category-level drivers on these three metrics. Established etic factors such as line length, distribution intensity, and stockpilability have a substantial effect on one or more price response metrics. Among the emic factors, Chinese embeddedness, and especially social demonstrance play an important role: it strongly drives down brands’ price elasticity, but also reduces the intensity of price competition in the category and makes brands less vulnerable to rival actions. Foreign brands, in contrast, exhibit higher price response, and do not enjoy higher clout nor lower vulnerability than their domestic counterparts. Hence, they neither benefit from the aura, nor suffer from the liability, of foreignness. Overall, the study adds to empirical generalizations on the impact of price, and helps managers improve the effectiveness of their pricing strategies.

Equity concerns in antitrust could justify market power in return for a fairer allocation by weighing the consumer welfare of certain disadvantaged groups more heavily. A simple example of an equity-justified agreement illustrates how seeking distributive justice through relaxed antitrust enforcement is ineffective and inefficient. Permitting competitors to jointly set prices gives them the power to price discriminate, which they could use to redistribute wealth by overcharging the rich and giving lower than competitive prices to the poor. Provided society values redistribution enough, such a ‘Robin Hood cartel’ is profitable, despite losing money on the poor and creating deadweight losses. Yet the poor will be given only what is minimally required in return for permission to take from the rich. Without conditions, the joint-profit maximizing wealth redistribution is nothing more than alms for the poor. They receive more under a full-payout plan, but total deadweight losses remain high. In essence, assigning a larger relative consumer welfare weight to the poor discounts the inefficiencies on the rich.

This paper develops a unified analysis of the impacts of production delays on aggregate price fluctuations in a continuous-time cobweb-type model. We find that the time inconsistency between demand and supply due to production delays inherently generates an overshooting effect in prices. Large production delays give rise to price fluctuations, even with a low intensity of choice. We also provide results consistent with the rational route to randomness of Brock and Hommes (1997) in a continuous-time infinite-dimensional economy.

The high cost of many new anticancer medicines significantly impedes breakthrough discoveries from reaching patients. A commonly heard refrain is that high prices are necessary to compensate for the high costs of research and development (R&D). Yet, there are promising policy proposals aimed at improving affordability without compromising innovation. In seeking new policy solutions, we argue for a shift away from entrenched opinion toward an evidence-based discourse that is grounded in experiments and real-world pilot studies. We offer a novel perspective and practical recommendations on how empirical evidence could and should be gathered to inform evidence-based policy interventions that lead to sustainable medicine prices in oncology. See related article by Franzen et al. (Cancer Res Commun 2022;2:39–47) .

This paper addresses investment and spending policies of endowment funds aiming to generate a stable income stream in perpetuity. The standard academic approach to the design of such policies is based on optimization of utility aggregated over time. However, the explicit purpose of many funds to serve current and future generations ‘in equal measure’ suggests incorporation of a suitable notion of neutrality. The utilitarian and neutralitarian approaches are compared in two settings: one in which the preferences of individual generations are described by a standard CRRA utility function, and one in which these utility functions are modified by the introduction of a saturation level. Results are expressed in terms of the implied assumed interest rate (AIR), which reflects the apportionment of initially available capital to the time-0 values of individual future benefits. Under CRRA preferences, the neutralitarian point of view can be seen as a way of determining the discount factor that is used in the utilitarian method. When a saturation level is added, the neutralitarian and utilitarian policies are essentially different. The introduction of saturation generally induces a shift of value from earlier to later generations.

We exploit some specific features of a peculiar online selling mechanism, the so-called price reveal auctions, to empirically investigate how consumers’ behaviour changes in response to an item’s ‘social attributes.’ We document a significant effect of the item’s brand and portability in influencing consumers’ willingness to pay. We show that, although both characteristics have some explanatory power when considered in isolation, it is their interaction that really matters.

Because they exert cross-border spillover effects, fiscal policies of individual EU member states are a common concern for the entire EU.

Cross-section average-augmented panel regressions introduced by Pesaran (2006) have been a popular empirical tool to estimate panel data models with common factors. However, the corresponding common correlated effects (CCEs) estimator can be sensitive to the number of cross-section averages used and/or the static factor representation for observables. In this paper, we show that most of the corresponding problems documented in the literature can be solved once cross-section averages are appropriately regularized, thus extending the applicability of the CCE setup. As the standard plug-in variance estimators are not able to account for all sources of estimation uncertainty, we suggest the use of cross-section bootstrap to construct confidence intervals. The proposed procedure is illustrated both using real and simulated data.

National statistical institutes currently investigate how to improve the output quality of official statistics based on machine learning algorithms. A key issue is concept drift, that is, when the joint distribution of independent variables and a dependent (categorical) variable changes over time. Under concept drift, a statistical model requires regular updating to prevent it from becoming biased. However, updating a model asks for additional data, which are not always available. An alternative is to reduce the bias by means of bias correction methods. In the article, we focus on estimating the proportion (base rate) of a category of interest and we compare two popular bias correction methods: the misclassification estimator and the calibration estimator. For prior probability shift (a specific type of concept drift), we investigate the two methods analytically as well as numerically. Our analytical results are expressions for the bias and variance of both methods. As numerical result, we present a decision boundary for the relative performance of the two methods. Our results provide a better understanding of the effect of prior probability shift on output quality. Consequently, we may recommend a novel approach on how to use machine learning algorithms in the context of official statistics.

Andrade et al. analyze the data from a large panel of firms and show how sector-specific shocks erroneously influence firms’ outlooks about the aggregate economy. This paper is part of a broader research agenda that has extensively documented the existence of information rigidities using data from large-scale surveys of households and firms. This comment discusses the implications of this research agenda for central banking in light of a complementary empirical method, namely laboratory experiments, and their use in informing macroeconomic policies.

We propose a method for monitoring proportions when the in-control proportion and the sample sizes vary over time. Our approach is able to overcome some of the performance issues of other commonly used methods, as we demonstrate in this paper using analytical and numerical methods. The derivations and results are shown mainly for monitoring proportions, but we show how the method can be extended to the monitoring of count data. Published version

This study investigates the relationship between leaders’ neuroticism and their evaluation of the desirability of followers’ proactive behaviour. We argue that leaders high in neuroticism are likely to evaluate follower proactivity as less desirable and that this relationship is amplified when followers are low in conscientiousness and agreeableness. Based on trait activation theory, we further propose that worry and threat act as underlying mechanisms of the interaction between these traits. We hypothesize that leaders high in neuroticism feel more threatened by the proactive behaviours shown by followers’ low in conscientiousness and agreeableness and rate the proactive behaviours of these followers as less desirable. In a field study with 205 leader–follower dyads (Study 1), we found the expected interaction effect. Leaders’ neuroticism interacted with their followers’ conscientiousness and agreeableness to predict their evaluation of the desirability of followers’ proactive behaviour. Study 2, an experimental vignette study, suggests a moderated indirect effect through the experience of threat, but not worry. We found no direct effects of leader neuroticism on the desirability ratings of followers’ proactive behaviour. This research emphasizes the value of investigating the interplay between leader and follower traits and the underlying cognitive-emotional processes for leader evaluations of followers’ proactivity.

We find that an option-based equity tail risk factor is priced in the cross section of currency returns; more exposed currencies offer a low risk premium because they hedge against equity tail risk. A portfolio that buys currencies with high equity tail beta and shorts those with low beta extracts the global component in the tail factor. The estimated price of risk of this novel global factor is consistently negative in currency carry and momentum portfolios, and in portfolios of other asset classes, suggesting that excess returns of these strategies can be partially understood as compensations for global tail risk.

Triggered by budgetary challenges and growing awareness of social needs, recent years have seen increasing entrepreneurial behaviour in the nonprofit sector, of which collaboration with for-profit organizations is a case in point. Yet, while extant research has extensively studied the entrepreneurial orientation (EO) of for-profit organizations, scant attention has been paid to its manifestations in the cross-sector collaboration context and from the nonprofit perspective, even though numerous nonprofit organizations’ idiosyncrasies point to the need for a reconceptualization of the EO dimensions in that domain. Thus, taking the nonprofit perspective, our research aims to explore the dynamics and nature of EO in the context of nonprofit–business collaboration (NBC), examining how the EO core dimensions manifest themselves when nonprofit organizations (NPOs) proactively engage in NBC. We unpack the meaning of EO through two complementary empirical studies. Our work nuances the rather overlooked entrepreneurial posture of so-called ‘active-in-collaboration’ NPOs, exposes new meanings of collaborative EO dimensions (relational proactiveness, relational innovativeness and relational risk management), discusses their underpinning mechanisms and suggests promising areas for further research and implications for practice.

We study the effects of the investment horizon on asset price volatility using a Learning to Forecast laboratory experiment. We find that, for short investment horizons, participants coordinate on self-fulfilling trend-extrapolating predictions. Price deviations are then reinforced and amplified, possibly leading to large bubbles and crashes in asset prices. For longer investment horizons such bubbles do not emerge and price volatility tends to be lower. This is due to the fact that, for longer horizons, there is more dispersion in participants’ forecasts, and participants extrapolate trends in past prices to a lesser extent. We also show that, independent of the investment horizon, if the initial history of asset prices is already relatively stable before participants start their prediction task, price volatility remains small, with prices close to their fundamental values for the duration of the experiment.

De implementatie van het energieprijsplafond kost bestuurlijk Nederland heel wat hoofdbrekens. Omzetcompensatie van energie­leveranciers leidt tot hogere prijzen en overwinsten. Kostencompensatie blijkt bestuurlijk onuitvoerbaar. Maar toch kunnen prijszekerheid en marktwerking samen onder één energieplafond bestaan. Een voorstel voor prijszekere kortingen.

Vanaf januari geldt een vaste lage prijs voor een groot eerste deel van het gas- en elektraverbruik. Voor het verbruik daarboven moet wél de marktprijs worden betaald. Het gekozen systeem dreigt de energieprijzen nog verder te verhogen.

The reliability of tests on the risk premia in linear factor models is threatened by limited sample sizes and weak identification of risk premia frequently encountered in applied work. We, therefore, propose novel tests on the risk premia that are robust to both limited sample sizes and the identification strength of the risk premia as reflected by the quality of the risk factors. These tests are appealing for empirically relevant settings, and lead to confidence sets of risk premia that can substantially differ from conventional ones. To show the latter, we revisit two high-profile empirical applications.

Using an amended Gneezy’s cheap-talk game with multiple decisions, we test whether gender differences in lying depend on the magnitude of gains, as hypothesized in the literature. We find that women may have a greater aversion to lying for small monetary gains; this effect disappears with increased gains.

We present the results of a randomized control trial on the effect of the introduction of formalized property rights on individuals’ moral judgments and, in particular, on utilitarian morality. We show that institutions shape morality: being exposed to private property institutions makes individuals more utilitarian when confronted with moral dilemmas. Our results shed light on a possible institutional determinant of the variation of moral judgments across the globe and its geographical patterns, and have implications for the consequences of major institutional reforms—both intended, such as land-titling programs, and unintended, such as those following from recent historical events—on moral attitudes. We discuss two possible channels stemming from the inherent features of property rights: the loosening of social ties and the commodification of rights (JEL codes: K11; O13; Z10; Z13). Marco Fabbri gratefully acknowledges financial support from the Marie Curie Research Grants scheme, grant H2020-MSCA-IF-2017-789596. Giuseppe Dari-Mattiacci gratefully acknowledges research support from Columbia Law School.

Organizational researchers collect and generate text data. Since text data are abundant and likely to generate knowledge, they often reveal aspects of and therewith contribute to our understanding of organizations. As compared with more reductionistic quantitative approaches, text captures richer context and may reveal the nuances of individuals and organizations. Analyzing huge amounts of text from varied textual sources may eliminate bias, permit triangulation, and enhances the validity of the outcomes. Moreover, the analysis of text which come from myriad of sources are expected to generate knowledge about jobs and people (e.g., what people need to know to be able to perform their jobs) that are necessary to serve HR practices of recruitment, training, and development. For this dissertation I developed models and/or analyzed large text data. The primary goal is to extract information and produce deeper insights about jobs and people. This dissertation addresses research questions relevant to organizational research using text analytics and furnishing new analytical strategies that can be useful for job analysis, career, and HR research in general. The insights have implications not only for making practical HR decisions but also for advancing knowledge in the HR field (e.g., understanding career path and physical job mobility). In summary, our contributions are the following: create models that are of interest primarily to job analysis and career researchers, derive knowledge from the models that can be useful for theory validation and building, and demonstrate the practicability of the models to job recommendation and recruitment.

The general purpose of a dynamic factor model (DFM) is to summarize a large number of time series into a few common factors. Here we explore a number of DFM specifications applied to 80 granular, non-overlapping indexes of commercial property prices in the US, quarterly from 2001 to 2017. We examine the nature and the structure of the factors and the index forecasts that can be produced using the DFMs. We consider specifications of 1, 2, 3 and 4 common factor trends. As a major motivation for the use of DFMs is their ability to improve out-of-sample forecasting of systems of numerous related series, we apply the DFM estimated factor returns in an Autoregressive Distributed Lag (ARDL) model to forecast the individual real estate price series. We compare the forecasted residuals to a conventional Autoregressive (AR) forecast model as a "benchmark" for two markets: Boston apartments and Dallas commercial. The results show that the ARDL model predicts the crisis and subsequent recovery really well, whereas the "benchmark" model typically follows the previous price trend. We find that the DFM forecasts are most precise with only one or two factors. The two prominent factors may reflect general economic conditions and the rental housing market, respectively.

A recent body of work has shown that quality of national institutions that enforce written contracts plays an important role in shaping a country’s comparative advantage. The current paper contributes to this literature by providing a comprehensive analysis of the mechanisms through which institutional frictions affect the pattern of aggregate trade flow by distinguishing its effect on the intensive and extensive margins. We find that better contracting institutions not only increase the probability of exporting (the extensive margin) but also enhance the export sales after entry (the intensive margin), particularly in industries where relationship-specific investments are most important. With around two-third to three-fourth share (depending on the definition used), the contribution of institutions along the intensive margin dominates that along the extensive margin. The benefits of improved institutions, particularly via the intensive margin, favor the less developed countries over the more developed ones. In addition, better contracting institutions increase the probability of survival of export products in more contract-intensive industries in particular. These findings are robust to measuring the intensive and extensive margins using a more granular export data based on firm-level aggregates, as well as the variety and destination based definitions.

We conduct a field and an online classroom experiment to study gender differences in self-set performance goals and their effects on performance in a real-effort task. We distinguish between public and private goals, performance being public and identifiable in both cases. Participants set significantly more ambitious goals when these are public. Women choose lower goals than men in both treatments. Men perform better than women under private and public goals as well as in the absence of goal setting, consistent with the identifiability of performance causing gender differences, as found in other studies. Compared to private goal setting, public goal setting does not affect men's performance at all but it leads to women's performance being significantly lower. Comparing self-set goals with actual performance we find that under private goal setting women's performance is on average 67% of goals, whereas for men it is 57%. Under public goal setting the corresponding percentages are 43% and 39%, respectively., Brandts thanks the Spanish Ministerio de Ciencia e Innovación (Grant number PID2020-114251GB-I00), the Spanish Agencia Estatal de Investigación (AEI), through the Severo Ochoa Programme for Centres of Excellence in R&D (Barcelona School of Economics CEX2019-000915-S) and the Generalitat de Catalunya (Grant: 2017 SGR 1136) for financial support.

As top management teams (TMTs) become progressively more diverse, an important question arises: how does greater TMT diversity affect a company’s ability to innovate its business model? To examine this, we draw on the upper-echelons literature and on research on business models as activity systems to theorize that cognitive and ideological diversity in TMTs will affect teams’ attention to business model innovation (BMI) and companies’ BMI intensity. Analysis of longitudinal data from firms in the US printing and publishing industry provides support for the theory that, over time, TMT cognitive and ideological diversity have a positive influence on BMI. Whereas cognitive diversity expands TMT’s BMI attention-scope, both cognitive and ideological diversity increase BMI intensity. However, too much ideological diversity has a negative effect. We furthermore find that TMT longevity moderates the effects of TMT diversity positively, suggesting that the benefit of diversity grows as team members work together longer as a team. We discuss the study’s contributions to the literature on diversity, BMI, and the upper echelons.

Over the past decade, scholars and practitioners have increasingly paid attention to sustainable business models (SBM). How to upscale SBMs is a key question in transition research, but current research has rarely adopted a firm-level perspective to discuss the scaling strategies that initiators of SBMs can use. Collaboration with other actors is one of these scaling strategies, but its adoption by firms hinges on different factors. Considering the type of initiator of the SBM (newcomer vs. incumbent firm) and the differentiation of the SBM's value proposition (high or low), we propose a framework which distinguishes four ‘scaling-through-collaboration’ strategies that firms can use. We explain each strategy with illustrative examples and discuss the array of potential partners and the incentives to pursue collaboration with them. Our work shows how firms can contribute to sustainability transitions by leveraging collaboration to scale their SBM.

This research explores how the strategy of firms evolves as a result of the imitation of several reference groups. In particular, it analyzes the extent to which firms replicate the strategic behaviors of successful firms, direct rivals and firms from the same category. Additionally, it examines potential variations in the speed of imitation depending on the reference group that is considered. Using a sample of firms of the Spanish retail banking sector from 1994 to 2009, our results show that, over time, firms tend to imitate the strategies of the three reference groups considered. The results also reveal significant variations in the speed of imitation depending on the reference group. We find that imitation to firms from the same category is faster than imitation to successful firms and direct rivals.

This paper examines the impact of two elements of the client's control environment on auditor's assessment of the risk of material misstatement: audit committee strength and CEO narcissism, the latter of which is a component of management philosophy, operating style, and tone at the top. We predict and find that auditors' risk assessments are adequately responsive to both elements; however, importantly, a strong audit committee decreases perceived risk assessments only when the client has a CEO with less narcissistic characteristics. In other words, our findings suggest that the presence of narcissistic CEOs' attitudes weakens the perceived audit committee effectiveness, leading auditors to rely less on a strong audit committee. Our findings contribute to the auditing literature by exploring auditors' responses to the complex dynamics between management boards and those charged with governance. From a practical perspective, our results suggest that auditing standards and practice guidance should consider making such complexities and the role of management attitudes and styles even more explicit.

PurposeThis article aims to introduce the special issue entitled “the role of career shocks in contemporary career development,” synthesize key contributions and formulate a future research agenda.Design/methodology/approachThe authors provide an introduction of the current state-of-the-art in career shocks research, offer an overview of the key lessons learned from the special issue and present several important avenues for future research.FindingsThe authors discuss how the special issue articles contribute to a better understanding of career shocks' role in contemporary career development, focusing on (1) conceptual clarity of the notion of career shocks, (2) career outcomes of career shocks, (3) mechanisms that can explain the impact of career shocks and (4) interdisciplinary connectivity.Originality/valueThis article offers a synthesis of the critical contributions made within this special issue, thereby formulating key ways to bring the field of career shocks research forward. It also provides new avenues for research.

PurposeThe purpose of this paper is to examine the career shocks of Red Cross (RC) of Serbia staff and volunteers providing aid during the 2016 migrants’ influx. Specifically, the authors explore what the volatile environment in which RC staff and volunteers work can teach us about career shocks, and what makes a career shock for people whose everyday work entails stressful events.Design/methodology/approachThis study examined a number of anecdotes that reflect the career shock construct to a greater or lesser extent. These anecdotes were developed by RC staff and volunteers as part of a communications training storytelling exercise.FindingsThe authors analyzed these events from the perspective of recent developments in career shocks research and examined whether the anecdotes contained elements that would enable us to differentiate between career shocks and stressors. Those anecdotes found to be the most prototypical of career shocks, as opposed to stressors, were found to instigate in-depth reflection about the career, were identity related, and had a tangible career impact. Shocking events in the eyes of RC people entailed work demands that go beyond expectations, excessive media scrutiny, and conflicting values. The authors discuss how organizational values, fostering person–organization fit, providing organizational and collegial support, and deploying “weathered” staff, could comprise the “vaccine” that makes the organization immune to career shocks.Originality/valueBy taking a data before theory approach to the study of career shocks, this paper provides a novel perspective on the lived experiences of RC people, and how such experiences may be classified into career shocks or stressors.

There are many situations where resources are distributed between two parties and where the deciding party has information about the initial distribution and can change its outcome, for example, the allocation of budget for funds or bonuses, where the deciding party might have self-interested motives. Although the neural underpinnings of distributional preferences of resources have been extensively studied, it remains unclear if there are different types of distributional preferences and if these types underlie different disposing neural signatures. We used source-localized resting EEG in combination with a data-driven clustering approach to participants' behavior in a distribution game in order to disentangle the neural sources of the different types of distributional preferences. Our findings revealed four behavioral types: Maximizing types always changed initial distributions to maximize their personal outcomes, and compliant types always left initial distributions unchanged. Disadvantage-averse types only changed initial distributions if they received less than the other party did, and equalizing types primarily changed initial distributions to fair distributions. These behavioral types differed regarding neural baseline activation in the right inferior frontal gyrus. Maximizing and compliant types showed the highest baseline activation, followed by disadvantage-averse types and equalizing types. Furthermore, maximizing types showed significantly higher baseline activation in the left orbitofrontal cortex compared to compliant types. Taken together, our findings show that different types of distributional preferences are characterized by distinct neural signatures, which further imply differences in underlying psychological processes in decision-making.