http://repub.eur.nl/res/col/9706/ List of Publications en http://repub.eur.nl/static-eur/img/logo.png http://repub.eur.nl http://repub.eur.nl/res/pub/32039/ 2012-07-01T00:00:00Z In almost all literature on inventory models with lost sales and periodic reviews the lead time is assumed to be either an integer multiple of or less than the review period. In a lot of practical settings such restrictions are not satisfied. We develop new models allowing constant lead times of any length when demand is compound Poisson. Besides an optimal policy, we consider pure and restricted base-stock policies under new lead time and cost circumstances. Based on our numerical results we conclude that the latter policy, which imposes a restriction on the maximum order size, performs almost as well as the optimal policy. We also propose an approximation procedure to determine the base-stock levels for both policies with closed-form expressions. Bijvank, M. Johansen, S.G. http://repub.eur.nl/res/pub/31355/ 2012-06-01T00:00:00Z This paper investigates how underwriters set the IPO firm’s fair value, an ex-ante estimate of the market value, using a unique dataset of 228 reports from French underwriters. These reports are issued before the IPO shares start trading on the stock market and detail how underwriters determined fair value. We document that underwriters often employ multiples valuation, dividend discount models and discounted cash flow (DCF) analysis to determine fair value but that all of these valuation methods suffer from a positive bias with respect to equilibrium market value.We also analyze how this fair value estimate is subsequently used as a basis for IPO pricing. We report that underwriters deliberately discount the fair value estimate when setting the preliminary offer price. Part of the intentional price discount can be recovered by higher price updates. We find that, controlling for other factors such as investor demand, part of underpricing stems from this intentional price discount. -------------------------------------------------------------------------------- Roosenboom, P.G.J. http://repub.eur.nl/res/pub/32040/ 2012-03-06T00:00:00Z Competitive retail environments are characterized by service levels and lost sales in case of excess demand. We contribute to research on lost-sales models with a service level criterion in multiple ways. First, we study the optimal replenishment policy for this type of inventory system as well as base-stock policies and (R, s, S) policies. Furthermore, we derive lower and upper bounds on the order-up-to level, and we propose efficient approximation procedures to determine the order-up-to level. The procedures find values of the inventory control variables that are close to the best (R, s, S) policy and comply to the service level restriction for most of the instances, with an average cost increase of 2.3% and 1.2% for the case without and with fixed order costs, respectively. Bijvank, M. Vis, I.F.A. http://repub.eur.nl/res/pub/30686/ 2012-03-01T00:00:00Z Abstract: Regulatory framework conditions have been identified as important factors influencing the innovation activities of companies, industries and whole economies. However, in the empirical literature, the impacts of regulation have been assessed as rather ambivalent for innovation. Different types of regulations generate various impacts and even a single type of regulation can influence innovation in various ways depending on how the regulation is implemented. The endogenous growth approach developed by Carlin and Soskice, 2006 W. Carlin and D. Soskice, Macroeconomics: Imperfections, Institutions & Policies, Oxford University Press, Oxford (2006). Carlin and Soskice (2006) and empirically applied by Crafts (2006), which determines endogenously the rate of technological progress and therefore innovation, allows a conceptual analysis of the influence of different types of regulation on innovation. In general, the negative effect of compliance costs should be compared with the more dynamic effect of regulations generating additional incentives for innovative activities. Based on this approach, we derive hypotheses on the impact of different specific regulations on innovation. We differentiate between economic, social and institutional regulations following the OECD taxonomy on regulations. Existing economic analyses are surveyed, which are characterised by rather heterogeneous approaches, data bases and results. The paper aims to apply a comprehensive and comparative approach to investigate quantitatively the innovation impacts in 21 OECD countries using panel data for the period between 1998 and 2004. In summary, the empirical results confirm the hypotheses derived from the conceptual theoretical framework determining technical progress and innovation endogenously and allowing a distinction between short-term and long-term effects. Consequently, the theoretical approach is an appropriate starting point for the empirical analysis of the influence of different regulations on innovation. Highlights: ► Modifications in regulatory and legal framework conditions have a significant influence on the dynamics of innovations OECD countries. ► Positive influence of general legal and regulatory framework conditions, of an efficient IPR regime and of unrestricted price setting. ► Also positive impact of product and service legislation deterring business activities and environmental laws hindering competitiveness. Blind, K. http://repub.eur.nl/res/pub/31265/ 2012-03-01T00:00:00Z An extensive body of literature documents that positioning is a central success factor for the launch and overall performance of new products in the marketplace. Under certain circumstances, however, the measurement of positioning success can be problematic. Specifically, the application of attribute‐based measurement methods, which are frequently used in practice for this purpose, is subject to limitations in certain situations. For example, these methods can be problematic in product categories where products are evaluated as a whole or where they even lack attributes that create valuable differentiation. Their application can also be difficult in product markets in which the importance of product attributes is constantly shifting or in a cross‐national context where the importance of various attributes is likely to differ across countries. This paper introduces a new approach for measuring positioning effectiveness that helps overcome some key limitations of extant approaches and serves as a support tool for positioning‐related decisions. Positioning effectiveness is modeled as a customer‐based multidimensional construct capturing conceptually relevant dimensions of positioning success (namely dissimilarity, uniqueness, favorability, and credibility) at the holistic product level rather than the individual attribute level. Altogether seven studies show that the proposed positioning effectiveness measure is reliable, valid, and viable to be used across various types of branded products and distinct product categories. The results of the studies indicate the measure's ability to successfully predict important consumer behavior variables such as overall superiority or purchase intentions and demonstrate superior predictive performance compared with common attribute‐based approaches. The recognition of the relevance of different dimensions of positioning effectiveness should also enable new product managers to detect strengths and weaknesses of a product's current positioning, and thus serve as a tool to develop more effective product strategies. The general nature of the measurement instrument makes it particularly suitable for application in (1) longitudinal product‐tracking studies; (2) cross‐national studies involving comparisons of positioning effectiveness between products in different countries; (3) product categories characterized by technological turbulence (and hence attribute instability); and (4) studies aimed at comparing the positioning effectiveness of different products in a portfolio. Boundary conditions for the application of the measure and potential areas for further study are finally considered. http://repub.eur.nl/res/pub/31322/ 2012-03-01T00:00:00Z This paper examines the relationship between a firm's strategic framework and business environment and the probability of becoming the target of "copying", differentiated into (i) unauthorized reproduction of its technological product elements or insignia, and (ii) patent and trademark infringement. Based on bivariate and multivariate analyses of survey data, we show patterns of the links between being (legally or illegally) imitated and IP protection (e.g., defensive publishing), general strategy (e.g., selling products abroad or off-shoring R&D activities) and organizational factors (e.g., firm size). Management implications for successful strategies against the different types of being copied are derived. Berger, F. Blind, K. Cuntz, A.N. http://repub.eur.nl/res/pub/30981/ 2012-03-01T00:00:00Z This paper investigates the relationship between performance evaluation procedures and managerial perceptions of procedural justice. We examine two metric and two process characteristics. Metric characteristics are the diversity of metrics used by superiors and their reliance on outcome vs. effort metrics. Regarding process characteristics, we analyse the amount of subordinate's voice in the performance evaluation process, and the extent of formalization of the process. Using uncertainty management theory, we argue that justice effects of performance evaluation procedures may not be direct but are instead conditional on the amount of task uncertainty managers face in the their job context as well as on managers' tolerance for ambiguity. Using a sample of 178 managers from the banking industry, we find that all four performance evaluation characteristics are related to justice perceptions, yet their effect depends on the level of task uncertainty and tolerance for ambiguity. These findings explain some inconsistencies in extant studies on fairness of performance evaluation procedures. Hartmann, F.G.H. Slapničar, S. http://repub.eur.nl/res/pub/31989/ 2012-03-01T00:00:00Z Using accounting-based (residual income) valuations, this study examines the extent to which abnormal returns after insider share trades are explained by private information versus mispricing of public information. For a sample of insider trades in the Netherlands (1999- 2008), I find that managers’ share purchase decisions are associated with positive future abnormal returns as well as equity undervaluation. Even though undervaluation results in predictable price increases, positive abnormal returns following purchases persist after controlling for fundamental valuations. Thus, this study provides evidence on the sources of managers’ personal trading gains and suggests that positive abnormal returns after insider share purchases reflect both private information and managers’ responses to market mispricing of public information. Veenman, D. http://repub.eur.nl/res/pub/31357/ 2012-02-03T00:00:00Z A small but growing body of literature adds to our understanding of the role of team reflexivity (i.e., reflecting upon team functioning) in predicting team performance. Although many studies conclude that reflexivity is an asset for teams, the contingencies of team reflexivity have received far less research attention. In this respect, we argue that team reflexivity may be especially helpful for teams with relatively low performance. Teams that are reflexive tend to learn from previous mistakes, errors, and group processes, which in turn will improve the performance of the team. We propose that this relationship will most likely positively affect learning and final team performance under conditions of relatively poor prior performance. When a team is doing relatively well, the relationship between reflexivity and final team performance will be less clear, as reflexivity and learning is less needed. In a longitudinal study (N = 73 teams), we found support for this idea. As predicted, results indicated that this interaction between team reflexivity and initial team performance on future performance was mediated by team learning. We outline how these findings are important for our understanding of the contingencies of team reflexivity and team performance dynamics. Schippers, M.C. Homan, A.C. Knippenberg, D.L. van http://repub.eur.nl/res/pub/31326/ 2012-02-01T00:00:00Z This article addresses companies’ filing behaviour in respect of patents relevant for standard-setting (“essential patents”). We discuss applicants’ incentives to achieve conformity of patent applications with technology standards under development. Based on these incentive structures, we hypothesise that the claims of essential patents are amended more often than those of comparable patents. Additionally, we argue that applicants have incentives to delay the grant decision. As a result, essential patents are hypothesised to have longer pendency times than comparable patents. This implies more possibilities for applicants to exploit the flexibility within the patent application process to amend the claims of pending patent applications. For empiric validation, we use procedural patent data from the European patent application process. We adopt a one-to-one matching approach, pairing essential patents in telecommunications with control patents on the matching criteria of technology class, filing date and applicant name. Additionally, we compare these essentials with patents from companies that do not hold standards-relevant patents. We detect higher numbers of claims and amendments to claims as well as other relevant characteristics for the essential patents. Using survival analysis, we show that the higher numbers of amendments and claims and the higher share of X references are responsible for higher pendency times, since they significantly decrease hazard rates in the survival analysis. We discuss the general implications for the functioning of the patent system and address the detrimental effects caused by the high degree of uncertainty generated by these filing strategies. Possible solutions such as better co-ordination are devised. -------------------------------------------------------------------------------- Berger, F. Blind, K. Thumm, N. http://repub.eur.nl/res/pub/31356/ 2012-02-01T00:00:00Z This study explored whether accountability influences the relationship between power and leader self-serving behavior. Across three studies, using both experimental manipulations and individual difference measures, we found that accountability mitigated the effects of power on leader self-serving behavior. Specifically, we found that powerful accountable leaders acted less self-servingly than their non-accountable counterparts. Moreover, as expected, low power leaders' behaviors were not affected as strongly by the explicit presence of accountability constraints. Overall, these results suggest that holding powerful leaders accountable for their actions could serve as a powerful tool to prevent potential self-serving actions on their part. Rus, D.C. Knippenberg, D.L. van Wisse, B. http://repub.eur.nl/res/pub/31450/ 2012-02-01T00:00:00Z The development of adequate shared understanding of the task is of critical importance to group functioning. Group leaders play an important role in this respect, as a key function of leadership is to shape group members' understanding of their job. In the present study we focus on decision making groups with distributed information and examine how group leaders shape members' mental representations of the group decision task through leadership behavior rooted in their own representations of the task. We propose that the extent to which the group leader has task representations that emphasize information exchange and integration affects group members' task representations, group information elaboration, and decision quality. We tested these hypotheses in an experiment (N = 94 three-person groups) in which we manipulated whether a group leader was present and whether this leader held representations emphasizing information elaboration. Results supported the hypotheses, and suggest that team leaders may play an important role in creating a socially shared understanding of team tasks. Ginkel, W.P. van Knippenberg, D.L. van http://repub.eur.nl/res/pub/25743/ 2012-02-01T00:00:00Z We consider the NP-hard problem of scheduling n jobs in m two-stage parallel flow shops so as to minimize the makespan. This problem decomposes into two subproblems: assigning the jobs to parallel flow shops; and scheduling the jobs assigned to the same flow shop by use of Johnson's rule. For m = 2, we present a 32-approximation algorithm, and for m = 3, we present a 127-approximation algorithm. Both these algorithms run in O(n log n) time. These are the first approximation algorithms with fixed worst-case performance guarantees for the parallel flow shop problem. Zhang, X. Velde, S.L. van de http://repub.eur.nl/res/pub/31358/ 2012-02-01T00:00:00Z We develop and test an incentive-compatible Conjoint Poker (CP) game. The preference data collected in the context of this game are comparable to incentive-compatible choice-based conjoint (CBC) analysis data. We develop a statistical efficiency measure and an algorithm to construct efficient CP designs. We compare incentive-compatible CP to incentive-compatible CBC in a series of three experiments (one online study and two eye-tracking studies). Our results suggest that CP induces respondents to consider more of the profile-related information presented to them compared with CBC. Toubia, O Jong, M.G. de Stieger, D Fuller, J.H. http://repub.eur.nl/res/pub/31262/ 2012-01-27T00:00:00Z In this article, we investigate whether environmental capabilities influence firms' corporate strategies, a topic that has received little attention to date. We hypothesize that firms are more likely to acquire facilities when ownership facilitates the transfer of capabilities either to or from the facility. Using a panel from the U.S. government's Toxics Release Inventory Program, we find firms with superior environmental capabilities are significantly more likely to acquire physically proximate facilities with inferior environmental capabilities and vice versa. Our results extend theories of both corporate and environmental strategy. Berchicci, L. Gowell, G. King, A.A. http://repub.eur.nl/res/pub/32160/ 2012-01-27T00:00:00Z We use earnings forecasts from a cross-sectional model to proxy for cash flow expectations and estimate the implied cost of capital (ICC) for a large sample of firms over 1968-2008. The earnings forecasts generated by the cross-sectional model are superior to analysts' forecasts in terms of coverage, forecast bias, and earnings response coefficient. Moreover, the model-based ICC is a more reliable proxy for expected returns than the ICC based on analysts' forecasts. We present evidence on the cross-sectional relation between firm-level characteristics and ex ante expected returns using the model-based ICC. Hou, K. Dijk, M.A. van Zhang, Y. http://repub.eur.nl/res/pub/31309/ 2012-01-25T00:00:00Z The allocation of scarce health care service resources often requires trade-offs between individual and collective outcomes (e.g., when some individuals benefit more strongly from a given policy than others). Based on construal level theory, one would expect that consumers cognitively represent the individual and collective outcomes of an allocation policy at different levels of abstraction and that they evaluate allocation policies more positively when there is congruency between the cognitive representation of the policy’s focal outcome and the spatial and temporal distance inherently present in the policy’s decision context (e.g., allocation decisions on a future policy). However, we hypothesize that this congruency effect can be overruled by a high vested interest mindset that is activated by an individual’s recent personal experience with a health care service provider. Since a high vested interest mindset increases the relevance of the allocation policy implementation for the individual because s/he perceives strong personal consequences, we propose that for consumers with recent experience the evaluation of an allocation policy that focuses on individual outcomes is higher than that of a policy that focuses on collective outcomes irrespective of the spatial and temporal distance in the decision context. Results of a hypothetical experiment among a representative sample of the general population confirm the congruency effects in the new domain of health care service allocation policies, and provide support for the proposed overruling effect of the activation of a high vested interest mindset by recent personal experience on spatial and temporal distance. Benning, T.M. Dellaert, B.G.C. http://repub.eur.nl/res/pub/30776/ 2012-01-01T00:00:00Z Integrating self-uncertainty management and thwarted needs perspectives on leader mistreatment and workplace deviance, we examine when and why leader mistreatment is associated with workplace deviance. We propose that competence uncertainty strengthens the relationship between leader mistreatment and workplace deviance and that hostility mediates this interactive effect. Four field studies and one experiment support the hypotheses. The first two studies provide evidence for the predicted interaction between leader mistreatment and competence uncertainty, and the next three studies demonstrate that hostility mediates this interactive effect. We discuss an extended social exchange explanation of workplace deviance and highlight the psychological interplay between motives, cognition, and affect in reciprocating leader mistreatment. Mayer, D.M. Thau, S. Workman, K.M. Dijke, M.H. van Cremer, D. de http://repub.eur.nl/res/pub/30883/ 2012-01-01T00:00:00Z Research on teams has prompted the development of many alternative taxonomies but little consensus on how to differentiate team types. We show that there is greater consensus on the underlying dimensions differentiating teams than there is on how to use those dimensions to generate categorical team types. We leverage this literature to create a conceptual framework for differentiating teams that relies on a dimensional scaling approach with three underlying constructs: skill differentiation, authority differentiation, and temporal stability. Hollenbeck, J.R. Beersma, B. Schouten, M.E. http://repub.eur.nl/res/pub/31292/ 2012-01-01T00:00:00Z We examine cooperative behavior when large sums of money are at stake, using data from the television game show Golden Balls. At the end of each episode, contestants play a variant on the classic prisoner's dilemma for large and widely ranging stakes averaging over $20,000. Cooperation is surprisingly high for amounts that would normally be considered consequential but look tiny in their current context, what we call a “big peanuts” phenomenon. Utilizing the prior interaction among contestants, we find evidence that people have reciprocal preferences. Surprisingly, there is little support for conditional cooperation in our sample. That is, players do not seem to be more likely to cooperate if their opponent might be expected to cooperate. Further, we replicate earlier findings that males are less cooperative than females, but this gender effect reverses for older contestants because men become increasingly cooperative as their age increases. Assem, M.J. van den Dolder, D. van Thaler, R.H.