Paralysis by analysis: Is your planning system becoming too rational?

Four processes occuring in and around organizations are causing strategic planning systems in many firms to become too rational. Excessive rationality is present when the entrepreneurial spirit essential for planning is replaced by rigidity, excessive quantification and formality. If a planning process becomes too rational, its capacity to ensure innovative adaptation is lost. With this loss comes a diminished capacity of an organization for achieving long-term competitive success. Both an alert executive group and certain administrative actions are necessary to prevent the onset of an overly rational planning process.     

Loss volatility,bankruptcy, and the demand for reinsurance

Insurers in our model reinsure to lower the risk of bankruptcy. In the conceptual part of the study, we show that given bankruptcy cost, reinsurance may be demanded even if the insurer is risk-neutral. The model allows us to assess how the insurer's surplus, size, and volatility of losses affect the amount of reinsurance the insurer purchases. As predicted by our comparative statics analysis, we find empirically that property/casualty and medical malpractice insurers with higher prereinsurance loss volatility, lower surplus-to-premium ratios, and smaller sizes demand more reinsurance.     

Hope and happiness: A comparison of some discrepancies

This paper presents a comparison of Canadian and American university students on happiness and satisfaction as measured by the Satisfaction and Happiness Survey (Michalos, 1985). For the American sample, the findings for other measures of satisfaction and happiness, as well as for hope as measured by the Hope Index (Staats and Stassen, 1986), are also reported. American students had slightly higher means on both overall satisfaction and happiness with life as a whole than the Canadian students. The greatest perceived gap for American students was between what one has now and expects to have in the future while for Canadian students it was between what one has and what one needs. Both Canadian and American students reported greatest satisfaction with health and lowest satisfaction with financial security and paid employment. For the American sample, of the other satisfaction, happiness, and hope measures, a global happiness measure had the highest correlation with both overall satisfaction (r=0.62, p<0.0001) and=" happiness=" with=" life=" as=" a=" whole=">r=0.55, p<0.0001). reasons=" for=" the=" observed=" differences=" between=" the=" two=" samples=" are=" suggested=" and=" future=" research=" directions=" are=">     

Hospital ownership and performance

This study compares the performance of three ownership forms of hospitals: for profit, private nonprofit, and public, further classified according to whether or not the hospital is run by a hospital chain. Data come from a 1979 national survey of U.S. hospitals. The authors find that hospital cost is quite similar among alternative ownership forms as is profitability. The results do not provide much empirical support for standard property rights theory. Several reasons are suggested why this may be so.     

The relationship between individual expectations and behaviors: Mortality expectations and smoking decisions

Using data from the Health and Retirement Study, we assess the accuracy of subjective beliefs about mortality and objectively estimated probabilities for individuals in the same sample. Overall, subjective beliefs and objective probabilities are very close. However, there are differences conditional on behaviors, with current smokers being relatively optimistic and never smokers relatively pessimistic in their assessments. In the aggregate, individuals accurately predict longevity, but at the individual level, subjective beliefs provide information in addition to the estimated objective probabilities in predicting actual events, which may arise from the effect of past or anticipated decisions on these beliefs.

HOW DO VOLUNTARY ORGANIZATIONS FOSTER PROTEST? THE ROLE OF ORGANIZATIONAL INVOLVEMENT ON INDIVIDUAL PROTEST PARTICIPATION

Prior research shows that members of voluntary organizations are more likely to protest than nonmembers. But why, among members, do some protest while others do not? I explore whether organizational involvement—the extent in which members engage in the “life” of their organizations—affects protest. I identify four dimensions of involvement—time and money contributions, participation in activities, psychological attachment, and embeddedness in interpersonal communication networks. Only the first dimension has robust effects on protest, and they are nonlinear: intermediate contributors have the highest protest rates. The three other dimensions substantially increase protest only under specific “involvement profiles.”