To save content items to your account,
please confirm that you agree to abide by our usage policies.
If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account.
Find out more about saving content to .
To save content items to your Kindle, first ensure no-reply@cambridge.org
is added to your Approved Personal Document E-mail List under your Personal Document Settings
on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part
of your Kindle email address below.
Find out more about saving to your Kindle.
Note you can select to save to either the @free.kindle.com or @kindle.com variations.
‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi.
‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.
How should the lender of last resort provide liquidity to banks during periods of financial distress? During the 2008–2010 crisis, banks avoided borrowing from the Fed’s long-standing discount window but actively participated in its special monetary program, the Term Auction Facility, although both programs had the same borrowing requirements. Using an adverse selection model with endogenous borrowing decisions, we explain why the two programs suffer from different stigma costs and how the introduction of TAF incentivized banks’ borrowing. We discuss the empirical relevance of the model’s predictions.
[Banks] deliberately did not ask for the liquidity they needed for fear of damaging their reputation—the ‘stigma’ problem… I do not think we were conscious of this before the crisis started and I do not think central banks have a convincing answer to it… This is, I think, still a challenge in how to manage the process of central bank provision of liquidity support. This is one of the big intellectual issues that has not been fully resolved. (Governor Mervyn King, Bank of England (2016))
For various reasons, including the competitive format of the auctions, [Term Auction Facility] has not suffered the stigma of conventional discount window lending and has proved effective for injecting liquidity into the financial system… Another possible reason that [Term Auction Facility] has not suffered from stigma is that auctions are not settled for several days, which signals to the market that auction participants do not face an immediate shortage of funds. (Ben Bernanke, testimony to U.S. House of Representatives (2010))
We show theoretically that the usual estimated investment strategies will not achieve the optimal Sharpe ratio when the dimensionality is high relative to sample size, and the $ 1/N $ rule is optimal in a 1-factor model with diversifiable risks as dimensionality increases, which explains why it is difficult to beat the $ 1/N $ rule in practice. We also explore conditions under which it can be beaten, and find that we can outperform it by combining it with the estimated rules when $ N $ is small, and by combining it with anomalies or machine learning portfolios, conditional on the profitability of the latter, when $ N $ is large.
The social cost of greenhouse gases is important in many regulatory impact analyses. However, calculations of the social cost of greenhouse gases are highly complex and periodically revisited. We offer seven recommendations to improve current estimates. These include recommendations to use both country-level and global measures of the social cost of greenhouse gases, to use country-specific values for monetizing climate damages, to represent uncertainties by reporting distributions instead of using only central values, and to conduct a temporal distributional analysis that shows the magnitudes of climate damages across generations. We also provide recommendations for the discount rates that should be used when estimating the social cost of greenhouse gases, and the appropriate discount rates for regulatory impact analyses that include the social cost of greenhouse gases.
The Sustainable Development Goals (SDGs) are ambitious but in deep trouble. Benefit–cost analysis can help. This Special Issue highlights 12 of the most efficient interventions to speed up progress on the SDGs with Benefit–Cost Ratios (BCRs) above 15. The approaches cover tuberculosis, education, maternal and newborn health, agricultural R&D, malaria, e-procurement, nutrition, land tenure security, chronic diseases, trade, child immunization, and skilled migration. Spanning 2023–2030, these policy approaches are estimated to cost an annual average of $41 billion (of which $6 billion is non-financial). They will realistically deliver $2.1 trillion in annual benefits, consisting of $1.1 trillion in economic benefits and 4.2 million lives saved. The pooled benefit–cost ratio of all 12 investments is 52. By prioritizing these high-impact “best buy” interventions, decision-makers can enhance resource allocation and contribute most efficiently to the SDGs.
What factors contribute to the differences in foreign direct investment (FDI) levels in environments characterized as high risk? While research shows that armed conflict influences foreign investment decisions, it remains unclear how conflict dynamics, specifically the relative power capabilities of warring parties, affect FDI. This study explores the effects of rebel strength relative to government forces on FDI. We argue that there is a reduction in foreign investments in civil conflict countries as rebels gain a military advantage relative to the government. Stronger insurgents send a signal that the government is losing its strength in the conflict, creating uncertainty regarding conflict outcomes and posing economic and security risks for investors. To avoid facing economic and property losses due to increasing rebel strength, investors are incentivized to decrease their investment in the conflict state. Using data on insurgent troop size relative to government forces and FDI, our findings show that higher military capabilities of rebel forces relative to the government are associated with less FDI inflows in conflict-affected countries.
The rate of technological change within organizations has been fast-tracked by the recent global health crisis and shifting workplace dynamics. As many organizations decide how to best manage the implementation of new technologies, they must also consider the human response, which can facilitate the success of the overall implementation. Complementing the focus of this book (how is change perceived by recipients?), we focus on what is known about how employees respond to technological changes. In this review, we provide a retrospective account of the body of work on this topic. First, we review the types of technological changes that have been studied in relation to broader dimensions of organizational change. Second, we elaborate on theoretical perspectives that have been used, including comparing technology-specific models with broader theoretical approaches. Third, we summarize the antecedent-response relationships that have been examined. We hope that this bird’s-eye view of the field allows scholars to span disciplines and consider aspects related to the design and type of the technology, which have been largely treated as a setting, in future research.
Employee resistance is often seen as the major force against the enactment of change. The literature has privileged the view that resistance, for the most extent, is the resistors’ own fault. As Ford and Ford put it, “the assumption is that they resisted a perfectly logical move.” I build on the approach that resistance to change is a form of feedback, to argue that, if organizations and their agents examine the underlying reasons, they will be better equipped to deal with the challenges related to resistance. In light of Uncertainty Reduction Theory, I also suggest that we need to move beyond the viewpoint that examines change as a one-off phenomenon and interpret it as grounded in the broader organizational life. Finally, and building on recent empirical evidence, I put forth a framework on anticipating intentions to resist future change that integrates the organization’s history of change, individual characteristics, leadership factors, and organizational factors, alongside important boundary conditions that influence the sensemaking process underlying the development of intentions to resist future changes.
Organizational identification might become weaker when confronted with organizational changes, such as mergers and acquisitions (M&As). Identification change in M&As has received significant attention from scholars, but the extant theoretical evidence might not apply to employees involved in Chinese M&As. Indeed, cultural characteristics (e.g., dialectical thinking, collectivism, power distance) might make Chinese employees more tolerant of contradictions and ambivalence than employees in the Western hemisphere. To address this gap, we will refer to the social identity theory and the extant knowledge on identification change in cross-border M&As. We will present a framework of organizational identification change for Chinese employees after acquisition together with factors that contribute to the success of M&As. We illustrate it with the case of a Chinese acquisition in Europe: ChinaCorp and EuroMall. We theorize on the role of identity leadership wherein a leader’s behavior has a particularly strong impact on identification processes in high power distance and collectivist cultures. We will show how acts of identity leadership matter for the transfer from pre-merger to post-merger identification in the case of Chinese acquirers.
Frontline crisis teams are typically very cohesive, characterized by strong bonds between members. Cohesion ensures that team members look out for each other in dangerous work environments, operate resiliently in crisis contexts, and can rapidly coordinate in stressful situations. This explains why many crisis organizations are total institutions. Yet, cohesion may also produce dysfunctional group dynamics, as open debate about the crisis and the required response is avoided. Contestation in crisis teams is often deplored and might escalate into conflict, but it does ensure a thorough analysis of the situation from diverse viewpoints and thus facilitates the adoption of a well-considered, mindful response. The simultaneous need for cohesion and contestation creates a dilemma. To deal with this dilemma, it is important to note that team tensions are varied. Crisis organizations, particularly those with complex tasks, can pursue task-related contestation, while upholding relationship-related cohesion. This requires an investment in mutual trust and respect, so that team develops a safe space for open interactions without risking hostility or disintegration.
Here I comment on the chapters that have formed the contribution of this volume. I note that this second edition makes contributions considerably beyond those of the first edition, in particular by devoting attention to the dynamics of planned organizational change, not simply its instigators and outcomes. In particular, the chapters contribute to several important themes associated with dynamics of planned change. These include ways of classifying types of organizational change, the importance of change leaders and the development of change leadership, the importance of both affective and cognitive processes (especially sensemaking) in change, the roles of several types of identity processes in change, and the recognition of temporal processes in change. The chapters show the salience of these dynamics, whether they are recognized or not, to sensitize scholars to look for them. I conclude by suggesting some possible new directions for future investigations of change. These include the use of process as well as variance theorizing, attention to change emergence, and attention to changes that extend beyond individual organizations.
By integrating the fragmented research on emergency services, armed forces, and humanitarian organizations, this book identifies the components of a new theory on frontline crisis response. To begin with, the work of responders is characterized by persistent operational dilemmas. Since there are no universal solutions, they need to adapt their approaches and decisions to the situational contingencies of a crisis. These adaptations continue throughout the crisis response process as the situation evolves. Responders usually pragmatically act their way through operational dilemmas in the crisis response process. These experiences nevertheless have an existential effect on their identities and lives. Thus, the new theory comprises operational dilemmas, situational contingencies, response processes, pragmatic principles, and existentialist ideas. This theory offers a basis for crisis response improvements and contributes to the literature on strategic crisis management, frontline work in organizations, reliable organizing in risky contexts, and post-crisis operations. The chapter ends with a research agenda and a call for more academic engagement with frontline crisis response.
New technologies hold great promises of making crisis response better. These technologies may improve information positions and enable faster communication as well as produce more rapid and targeted responses in crises. As such, technological progress boosts effectiveness and efficiency, while reducing risks to frontline responders. Still, the reality does not always match these great expectations due to technical failures and implementation difficulties as well as persistent social problems that cannot be resolved by new tools or systems. There are often even undesirable side effects. The dilemma for frontline responders revolves around finding the right attitude toward new technologies. Technological progress is a historical inevitability, but new innovations should only be adopted if these match a recognized problem in the response and not just for their own sake. There are guiding principles, based on earlier experiences, that offer useful insights in how to best incorporate modern tools and systems. This requires a prudent approach that considers new technology with a mix of hesitation and curiosity.
We offer in this chapter an overview of the state of research on organization members’ responses to organizational change since the publication of the first edition of the book. We also review this edition’s structure and content.
Non-judicial remedies for corporate human rights abuses have a viable and complementary role to judicial remedies in mature jurisdictions, although in Ukraine the ‘bouquet’ of effective remedies is more of a still-life. The national mediation community is gaining momentum and the authors argue that mediation may take place within state-based non-judicial remedies when institutionalized by the office of the Ombudsman. The objective of this article is to scrutinize the rule of law, access to justice, and the effectiveness criteria of the UNGPs with regard to mediation. The authors conclude that mediation can meet all of the effectiveness criteria requirements and special effort should be devoted to addressing the challenges of power imbalances between parties, the confidential nature of mediation and the public demand for transparency, to ensure that mediation outcomes are in accord with internationally recognized human rights. Based on the findings, the authors suggest that a state-based business and human rights mediation scheme, in line with the UNGPs’ effectiveness criteria, should have its own three pillars, namely, accessibility, availability and awareness, with quality assurance as its cornerstone.
Leadership in crisis response has traditionally been strongly centralized and hierarchical. Top-down command and control is popular, because a strict hierarchy and clear lines of command enable rapid decision-making and coordinated actions. Critics, however, have argued that centralization is both impossible and undesirable during crises, because leaders lack situational awareness and cannot control frontline responders from a distance. They argue that operational personnel should take charge to ensure an adaptive frontline response, potentially at the cost of efficiency and speed. The operational dilemma of crisis leadership revolves therefore around the tension between centralization and decentralization. To deal with this dilemma, it is useful to study how influence is exercised and power circulates during crises. Rather than a static authority structure, different types and phases of crises require different forms of leadership. Authority structures have to be tested and adjusted throughout the response, so they can be continuously co-constructed by frontline responders and operational leaders, as the complex and dynamic crisis situation evolves.