SelectedWorks @ Melbourne Business School (The University of Melbourne)
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Inertia and Managerial Intentionality: Extending the Uppsala Model
No full text· The Uppsala Internationalization Process Model is the most cited model within the field of international business. However, even with its most recent formulation, the model is predicated on a key set of assumptions about the limiting and releasing mechanisms in a \u27change of state\u27 decision. · The model assumes that uncertainty, risk, lack of trust, and lack of awareness of opportunities are the main constraints, and that the accumulation of experiential knowledge, trust, and market commitment are the main releasing factors that allow a firm to overcome those constraints and progress to a higher state of commitment. · We argue that the preceding view may be excessively narrow, and that inertia and managerial intentionality may also play a role as critical limiting and releasing mechanisms respectively. This development implies that the passage of time and experiential learning may not always have a positive impact on firm internationalization. · The extended model proposed in this paper highlights the role of the manager, and brings a contingent element to the model, thus broadening its applicability by providing new insights on issues typically considered outside the realm of the Uppsala model, such as rapidly internationalizing firms, regionalization, mode inertia and mode skipping
The Social Context of Compensation Design: Social Norms and the Impact of Equity Incentives
No full textDrawing on arguments from institutional theory, this study examines how social norms—specifically, local religious social norms—affect the motivational impact of equity-based incentives. We test our model using longitudinal data on local religious norms, CEO equity incentives and firm value. Consistent with our theoretical predictions, we find that local religious social norms attenuate the impact of CEO option incentives upon firm value. Furthermore, we find that the attenuating impact of local religious social norms increases with managerial discretion. These findings provide valuable insight for human resource professionals aiming to design compensation contracts for employees that are aligned with firm goals. Our findings also contribute to research on the motivational effect of equity incentives by demonstrating importance of considering the social context in which executives are embedded
Implicit Copulas from Bayesian Regularized Regression Smoothers
No full textWe show how to extract the implicit copula of a response vector from a Bayesian regularized regression smoother with Gaussian disturbances. The copula can be used to compare smoothers that employ different shrinkage priors and function bases. We illustrate with three popular choices of shrinkage priors --- a pairwise prior, the horseshoe prior and a g prior augmented with a point mass as employed for Bayesian variable selection --- and both univariate and multivariate function bases. The implicit copulas are high-dimensional and unavailable in closed form. However, we show how to evaluate them by first constructing a Gaussian copula conditional on the regularization parameters, and then mixing over these using numerical or Monte Carlo methods. This greatly simplifies computation of the implicit copula compared to direct evaluation. The copulas are combined with non-parametric margins to extend the regularized smoothers to non-Gaussian data. Efficient Markov chain Monte Carlo schemes for evaluating the copula are given for this case. Using both simulated and real data, we show how such copula smoothing models can improve the quality of resulting function estimates and predictive distributions
The combined role of conscientiousness, social networks, and gender diversity in explaining individual performance in self-managed teams
No full textDespite the prevalence and value of self-managed teams, questions remain about the factors that influence how team members perform in contexts where there is no formal leader to give advice and provide support. Drawing on social network, diversity and personality theories, this study enhances our understanding of the role of individual and group factors in shaping individuals\u27 performance in these teams. Based on three time-lagged data collections, including two surveys from 70 self-managed project teams, we found that conscientious team members perform better because they have more instrumental network ties (i.e., they provide task advice). We also found that having more expressive ties (i.e., being liked) compensates when a team member is not able to give advice, most likely because s/he provides more socio-emotional support to team members. Finally, expressive ties are more important in gender homogenous teams, possibly because socio-emotional support has greater value when from similar team mates. * authors in alphabetical order denoting equal contribution
The relationship between corporate social responsibility, financial misstatements and SEC enforcement actions
No full textThis study explores the relationship between corporate social responsibility (CSR), financial misstatements and SEC enforcement actions. We find that firms with higher CSR are less likely to receive SEC enforcement actions for financial misstatements. Drawing on insights from stakeholder theory and the reputational literature, we identify two channels underpinning this relationship: (i) firms with higher CSR are less likely to engage in financial misstatements and (ii) the reputational effect of CSR reduces the likelihood of SEC enforcement actions. We find empirical evidence consistent with both channels
The Relationship Between Socioemotional and Financial Wealth: Re-visiting Family Firm Decision Making
No full textA growing volume of family rm literature has argued that the preservation of family socioemotional wealth takes precedence over the pursuit of financial goals. The purpose of this paper is to develop a conceptual framework that builds knowledge regarding the two-way relationship between socioemotional and financial forms of wealth, to develop a more complete theory of wealth concerns that may inform family rm decision-making
Born Globals and Accidental Internationalists: Has Hennart (2014) Opened a Can of Worms?
No full textPurpose: This paper is a response to Hennart\u27s (2014) challenge to the existing born global literature. In his challenge, Hennart proposes a simpler explanation of why some firms internationalize earlier and more aggressively than others. However, such a parsimonious model of born global firms raises the awkward question of whether born global firms are indeed any different from firms that internationalize more gradually.Design: Using two extensive surveys of Australian exporters, this paper first explores the degree to which a set of six \u27facilitating factors\u27 that Hennart puts forward are different across born global and non-born global firms. Next, it tests the second aspect of the debate highlighted above – i.e. whether born global firms behave differently from non-born global firms. This is done by testing for differences in the patterns of early market selection for born global and non-born global firms.Findings: Support is found for both the role of facilitating factors, and for the view that born global firms behave differently from non-born global firms. As a result it is proposed that the Hennart and the RBV-oriented explanations of born global firms need to be viewed as complementary, rather than competing. Each may represent a necessary but not sufficient condition with respect to born global firms.Originality: A systematic testing for differences in facilitating factors and market selection patterns across born global and non-born global firms are both issues that have major implications for the born global literature, and yet have been left largely unexplored to date
The Interactive Effect of Monitoring and Incentive Alignment on Agency Costs
No full textThe effectiveness of monitoring and incentive alignment as mechanisms for controlling agency costs have been explored separately and in combination, with monitoring substituting for weaknesses in incentive alignment and vice versa; this equates to positive substitution when describing how monitoring and incentive alignment interact to influence shareholder agency costs. We draw upon behavioral agency theory and findings from finance research to offer further theoretical insight into how these mechanisms interact to influence agency costs. Our results suggest that CEO earnings management aimed at preserving their equity wealth (an incentive alignment mechanism) is accentuated by higher levels of concentrated institutional ownership, thereby imposing agency costs on less informed investors. Thus, in addition to being substitutes in controlling agency costs, as previously suggested, monitoring may accentuate the perverse effects of incentive alignment, equating to negative reinforcement, rather than positive substitution. Yet this effect is negated in the absence of CEO power due to dual occupation of the board and CEO roles. We discuss implications of these findings for theory and practice
Are We at a Turning Point for Distance Research in International Business Studies?
No full textIn this chapter I argue that the distance research in international business studies is at a turning point, not in terms of its popularity, nor the quantity of articles published; but rather, in terms of the types of issues that are explored. Past distance research has largely been conducted at the level of the firm and/or the market – i.e. linking national-level measures of distance with specific firm behaviours and outcomes. However, the seminal paper by Shenkar (2001) represents a shift in focus that is only just beginning to gain traction. This shift involves stepping back and beginning to unpack the black box we call ‘distance’ by exploring the micro-level mechanisms involved. In essence, it is about digging deeper in multiple aspects, to understand when, why and how distance matters in the IB context. These are issues that until now have typically been neglected. A metaphor borrowed from the social psychology literature, known as Coleman\u27s Boat, is used as a vehicle to explain the key issues involved in this shift, and the opportunities for future research
microfinance-raising-village-2017-02-10.pdf
No full textThis paper provides new insight into the question of why we have not seen microfinance pro- grams lift beneficiary regions out of poverty. We suggest that the explanation may lie in the industry choice of microfinance participants: if borrowers tend to enter imperfectly competitive sectors, such as retail, there may be a “business-stealing” effect that reduces incomes of existing businesses. Our model shows that microfinance may lower total incomes at the village level. The result is related to the classic [Mankiw and Whinston, 1986] result on excess entry. The results imply that microfinance organizations may want to steer recipients away from the petty retail sector, in some markets