Do ownership and size affect the performance of water utilities? Evidence from Estonian municipalities

Concerns regarding rising water and sewerage prices have generated a renewed interest in measuring and assessing water utility performance. An efficiency analysis can serve as a basis for price setting decisions. This article examines the influence of ownership structure and corporate size on the efficiency of Estonian water companies, and assesses the empirical efficiency gaps through the lens of corporate governance and natural monopoly theories. To assess efficiency and the influence of ownership and corporate size on efficiency, we use a Data Envelopment Analysis and truncated regression with maximum likelihood estimation as well as an ANOVA test. The study sample consists of 43 water utilities, serving more than 68% of the Estonian population. One main finding of the study reveals that ownership structure does not affect the efficiency of Estonian water utilities, while efficiency does increase with corporate size: large water utilities outperform small utilities. An additional conclusion is that the Estonian water sector is too fragmented.     

Do Women Cause Unemployment? Evidence from Eight OECD Countries

ABSTRACT: In this paper the authors present the results of preliminary estimates on the effects of changes in the composition of labour forces throughout eight OECD countries during the period 1966-1986. The analysis proceeds in two steps. First, the effect of changes in the distribution of the labour force on group unemployment is computed. Second, the impact of this effect is combined with the direct effect of changes in the distribution of participation on total unemployment rates, to calculate a hypothetical unemployment rate which corresponds to what would have occured had there been no compositional changes. The paper challenges the thesis which sustains that alterations in the age-sex composition of the labour force have exerted an upward pressure on the aggregate unemployment rate.     

Do board characteristics and ownership structure matter for bank non-performing loans? Empirical evidence from US commercial banks

Journal of Management and Governance - This paper aims to study the ability of the corporate governance of banks to reduce non-performing loans. The dynamic panel GMM estimation is applied to 184...     

How does distance affect market entry mode choice? Evidence from French companies

The objective of this article is to examine the relevant dimensions of distance for foreign market entry mode choice. Based on a sample of 203 interfirm linkages formed by French multinationals with partners across the world, we analyze the impact of four dimensions of distance on the choice between cooperative alliances and mergers-acquisitions. The findings indicate that administrative and economic distance have a significant influence on market entry mode choice, whereas the impact of cultural and geographic distance is not significant. They further highlight the important role of the host country's government effectiveness for market entry mode decisions.     

Do colored cells in risk matrices affect decision-making and risk perception? Insights from randomized controlled studies

Risk matrices communicate the likelihood and potential impact of risks and are often used to inform decision-making around risk mitigations. The merits and demerits of risk matrices in general have been discussed extensively, yet little attention has been paid to the potential influence of color in risk matrices on their users. We draw from fuzzy-trace theory and hypothesize that when color is present, individuals are likely to place greater value on reducing risks that cross color boundaries (i.e., the boundary-crossing effect), leading to sub-optimal decision making. In two randomized controlled studies, employing forced-choice and willingness-to-pay measures to investigate the boundary-crossing effect in two different color formats for risk matrices, we find preliminary evidence to support our hypotheses that color can influence decision making. The evidence also suggests that the boundary-crossing effect is only present in, or is stronger for, higher numeracy individuals. We therefore recommend that designers should consider avoiding color in risk matrices, particularly in situations where these are likely to be used by highly numerate individuals, if the communication goal is to inform in an unbiased way.     

Does board gender diversity affect firm risk-taking? Evidence from the French stock market

Journal of Management and Governance - Drawing from a sample of French companies that made up the SBF 120 index over the period 2006–2010 (before the enactment of the...     

Do Compensation Consultants Drive Up CEO Pay? Evidence from UK Public Firms

Do compensation consultants drive up CEO pay for the benefit of managers, or do they design pay packages to benefit firm owners? Using a large sample of UK firms from the FTSE All‐Share Index over the 2003–2011 period, we show a positive correlation between the presence of compensation consultants and CEO pay. Importantly, isolating this effect is somewhat dependent on the endogenous selection of consultants and the statistical modelling strategy deployed. We find evidence that compensation consultants improve CEO compensation design when their expertise is of greater importance (e.g. during the post‐financial crisis period, or for firms that have particularly weak compensation policies). In addition, our findings show that compensation consultants increase CEO pay–performance sensitivity. The balance of evidence supports optimal contracting theory more than managerial power theory, but the authors caution the limits to this verification. We are careful to note that the more compelling evidence for the positive effect of pay consultants on CEOs is based on advanced methods (such as propensity score matching and difference‐in‐differences), and that more standard approaches (such as OLS and fixed effects) are unlikely to reveal the same level of causality of consultants on CEO pay.     

Do We Need Computer Skills to Use a Computer? Evidence from Britain

Abstract. Using cross‐section data from the 1997 Skills Survey of the Employed British Workforce, we examine the labour‐market returns to self‐assessed computer skills in Britain. Many researchers, using information on computer technology use, have concluded that wage differentials between computer users and non‐users might, among others, be due to differences in the embodiment of computer skills. Using unique information on the importance, level of sophistication, and effectiveness of computer technology use, we show that computer skills do not yield significant labour‐market returns for most types of use. Examining the returns to computer skills at different levels of sophistication of use yields estimates suggesting returns to computer skills at the highest level of sophistication of use only.     

Do stakeholders’ demands matter in environmental disclosure practices? Evidence from Australia

Journal of Management and Governance - Previous studies on the relationship between environmental performance and environmental disclosure have found mixed results. This exploratory qualitative...     

Do Benefit Hikes Damage Job Finding? Evidence from Swedish Unemployment Insurance Reforms

Abstract. In 2001 and 2002, Sweden introduced several unemployment insurance reforms. A major innovation in the first reform was the introduction of a two‐tiered benefit structure for some unemployed individuals. This system involved supplementary compensation during the first 20 weeks of unemployment. The 2002 reform retained the two‐tiered benefit structure but involved also substantial benefit hikes for spells exceeding 20 weeks. This paper examines how these reforms affected transitions from unemployment to employment. We take advantage of the fact that the reforms had quasi‐experimental features where the ‘treatments’ differed considerably among unemployed individuals. We find that the reforms had strikingly different effects on job finding among men and women. The two reforms in conjunction are estimated to have increased the expected duration of unemployment among men but to have decreased the duration of unemployment among women. The overall effect on the duration of unemployment is not statistically different from zero. However, the reforms reduced job finding among men who remained unemployed for more than 20 weeks.     

Do auditors’ perceptions actually help fight against fraudulent practices? Evidence from Tunisia

The purpose of this paper is focused on investigating empirically how Tunisian Auditors perceive their status regarding fraud fighting issue. In this respect, a set of auditor-associated mental representations will be expressed in terms of their respective roles as relevant governance models (legal versus ethical ones), via the cognitive mapping technique. The findings reveal that corporate governance can be globally depicted within these particular representations, indicating the supremacy of the legal governance approach over the ethical one with regard to the Tunisian case. .     

Do ‘soft law’ board gender quotas work? Evidence from a natural experiment

In a new era of “open governance”, in which societal and corporate change is taking place, 15 predominantly European countries, including Spain, enacted board gender quotas to increase the share of women on boards. In this paper, we explore the effectiveness of the European Union’s first “soft” quota – the 2007 Spanish Gender Equality Act recommending all large public and private Spanish firms to appoint a target of 40 percent of each gender to serve as board directors by 2015. The Act provides an incentive in that quota compliant firms may receive a preference for the tendering of public contracts. We draw on institutional and resource dependency theories to motivate the first empirical test of a “soft” quota which is distinct from Norway’s “hard law” board gender quota, and more similar to the proposed EU-wide quota. Using a large novel panel of 767 Spanish firms and 2786 firm-year observations from 2005 to 2014, we exploit the Spanish Act as a natural experiment and employ a difference-in-differences model. We find that less than nine percent of targeted firms fully comply with the quota. Firms that depend on public contracts are significantly more likely to increase female representation, although quota compliant firms do not actually benefit from the Act’s potential incentive. The results highlight the Spanish government’s lack of commitment to the quota, and that the quota’s normative obligations did not trigger the adoption of gender-balanced boards.     

Can organizational change be planned and controlled? Evidence from Russian companies

This study explores limits of applicability of a planned change approach in Russian companies. The data on change management programmes in 59 Russian companies of various industries, regions and sizes was gathered with the help of questionnaires filled by management consultants. The study found that resulted changes often did not coincide with initial plans of change agents. Two groups of organizational elements were identified: ‘uncontrollable’ (those elements that changed outside of the planned change) and ‘unmanageable’ (those elements that did not change despite forming part of the planned change). The findings also indicate that the efficiency of the change programme was unaffected by whether the change programme plans were executed or not. The results suggest that the applicability of a planned change approach is dependent upon the organizational elements at which change interventions are targeted and that change content has to be incorporated into contingency models of change.     

How does information sharing affect first-tier suppliers’ flexibility? Evidence from the automotive industry in Sweden

This study addresses the critical research issue of how supplier delivery performance can be enhanced by integrating information sharing into volume and delivery flexibility. This study developed a research model to relate information sharing on demand forecasts and inventory data between original equipment manufacturers (OEMs) and first-tier suppliers. Based on a sample of 52 suppliers from automotive industry in Sweden, partial least squares structural equations modelling (PLS-SEM) was used to assess the model. The results confirm that sharing demand forecasts is a key enabler of supplier volume and delivery flexibility while sharing inventory data is not. The study contributes to enlarging the knowledge about supply chain management from the suppliers’ perspective. It also contributes to knowledge by validating the conceptual model and operationalisation of constructs. The study also has practical contribution in which management should focus on improving communication and collaboration practices with OEMs for effective sharing of demand forecasts.     

How does globalization affect corporate governance and accountability? A perspective from MNEs

This paper addresses how the global activities undertaken by multinational enterprises (MNEs) in international settings impact corporate governance mechanisms and accountability systems. International corporate governance and accountability research, whether from a political science, economics, finance, or accounting perspective, has thus far predominantly focused on the comparison of corporate governance schemes in different countries and on the investigation of institutional parameters that determine these schemes. Straying from this line of inquiry, this article discusses how globalization at the firm level affects governance and accountability systems at parent- and subsidiary-levels. It emphasizes how an MNE's globalization attributes such as globalization scale, foreign adaptation, global competition, and international experience influence the design of governance mechanisms such as board size, board composition, executive compensation, market discipline, interlocking directorate, ownership concentration, duality and inbreeding, as well as the design of accountability systems such as accounting information, auditing standards, and financial and non-financial disclosures. This article bases its conjectures on information processing and agency theories.     

How Do Regulations Affect SMEs? A Review of the Qualitative Evidence and a Research Agenda

The effects of regulations on small and medium‐sized enterprises (SMEs) have garnered significant political attention internationally, yet, in the academic literature, these effects remain contested. This article presents findings from a systematic literature review of qualitative evidence on the effects of regulation on SMEs. It sets out the strengths of qualitative approaches in relation to more prominent and influential quantitative approaches. It conducts a thematic synthesis of the qualitative research to develop a conceptual framework that provides a processual, embedded understanding of the effects of regulations on SMEs. The conceptual framework highlights four key, interconnected processes: identification–interpretation; strategization; negotiation; and adaptation. This conceptual framework generates insights into dynamic and potentially indirect effects of regulations in relation to a complex array of influences external to and within the business. On the basis of these insights a new research agenda is proposed.     

How Much Does Hiring and Firing Cost? Survey Evidence from a Sample of Italian Firms

We analyse the Italian labour market, which is typically considered to be highly regulated. We focus on the costs imposed on firms by the institutional environment in which they operate, and on the adjustment strategies that they pursue as a result. We have followed two complementary approaches: the analysis of the development of the laws relating to hiring and firing, together with a set of interviews of 61 manufacturing firms. This also allows us to quantify the extent of turnover costs on the total labour costs. Hiring costs, which include recruiting and training, range between 2.0 and 2.6 months of labour costs; firing costs range from less than half a monthly labour cost to 20 months of labour costs in cases of conflict.     

Why perceived organizational and supervisory family support is important for organizations? Evidence from the field

Review of Managerial Science - The relationship between perceived organizational support and its work-outcomes were usually based on social exchange theories. By keeping the social exchange...     

How can MNEs benefit from internationalizing their R&D across countries with both weak and strong IPR protection?

Although MNEs internationalize their R&D not only in developed countries but also in emerging economies that typically feature weak protection of intellectual property rights (IPR), it remains unclear how this strategic decision affects their productivity performance. This limitation has resulted in a rather incomplete understanding of why some MNEs become more productive through R&D internationalization while others do not. This study develops a new explanation, suggesting that R&D internationalization does not affect the productivity of all MNEs equally because of differences in the idiosyncratic way in which MNEs geographically distribute their R&D units across weak and strong IPR protection countries. In advancing this explanation, the study challenges the view that weak IPR protection is disadvantageous for MNEs by showing that (and specifying how) it: 1) increases the efficacy of MNEs' internal R&D, 2) strengthens the advantages of accessing globally dispersed knowledge, and (3) improves MNEs' ability to exploit cross-country differences in IPR protection. The study enhances understanding of the complex role of IPR protection, shifts scholarly attention from the degree of R&D internationalization to how MNEs should internationalize their R&D, and clarifies how the IPR context of their location choices matters.