Corporate aging and investment decisions

Paper I: Corporate aging and internal resource allocation Abstract Various observers argue that established firms are at a disadvantage in pursuing new growth opportunities. In this paper, we provide systematic evidence that established firms allocate fewer resources to high-growth lines of business. However, we find no evidence of inefficient resource allocation in established firms. Redirecting resources from high-growth to low-growth lines of business does not result in lower profitability. Also, resource allocation towards new growth opportunities does not increase when managers of established firms are exposed to takeover and product market threats. Rather, it seems that conservative resource allocation strategies are driven by pressures to meet investors’ expectations. Our empirical evidence, thus, favors the hypothesis that established firms wisely choose to allocate fewer resources to new growth opportunities as external pressures force them to focus on efficiency rather than novelty (Holmström 1989). Paper II: Corporate aging and asset sales Abstract This paper asks whether divestitures are motivated by strategic considerations about the scope of the firm’s activities. Limited managerial capacity implies that exploiting core competences becomes comparatively more attractive than exploring new growth opportunities as firms mature. Divestitures help stablished firms free management time and increase the focus on core competences. The testable implication of this attention hypothesis is that established firms are the main sellers of assets, that their divestiture activity increases when managerial capacity is scarcer, that they sell non-core activities, and that they return the divestiture proceeds to the providers of capital instead of reinvesting them in the firm. We find strong empirical support for these predictions. Paper III: Corporate aging and lobbying expenditures Abstract Creative destruction forces constantly challenge established firms, especially in competitive markets. This paper asks whether corporate lobbying is a competitive weapon of established firms to counteract the decline in rents over time. We find a statistically and economically significant positive relation between firm age and lobbying expenditures. Moreover, the documented age-effect is weaker when firms have unique products or operate in concentrated product markets. To address endogeneity, we use industry distress as an exogenous nonlegislative shock to future rents and show that established firms are relatively more likely to lobby when in distress. Finally, we provide empirical evidence that corporate lobbying efforts by established firms forestall the creative destruction process. In sum, our findings suggest that corporate lobbying is a competitive weapon of established firms to retain profitability in competitive environments.

Looking too Old? How First Impressions of Older-looking Candidates Contribute to Unfavorable Selection Decisions

Building on theories of impression formation based on faces, this research investigates the impact of job candidates’ facial age appearance on hiring as well as the underlying mechanism. In an experiment, participants decided whether to hire a fictitious candidate aged 50 years, 30 years or without age information. The candidate’s age was signaled either via chronological information (varied by date of birth) or via facial age appearance (varied by a photograph on the résumé). Findings showed that candidates with older-appearing faces—but not chronologically older candidates—triggered impressions of low health and fitness, compared to younger-appearing candidates. These impressions reduced perceptions of person-job fit, which lowered hiring probabilities for older-appearing candidates. These findings provide the first evidence that trait impressions from faces are a determinant of age discrimination in personnel selection. They call for an extension of current models of age discrimination by integrating the effects of face-based trait impressions, particularly with respect to health and fitness.

A common mechanism underlying food choice and social decisions

People make numerous decisions every day including perceptual decisions such as walking through a crowd, decisions over primary rewards such as what to eat, and social decisions that require balancing own and others’ benefits. The unifying principles behind choices in various domains are, however, still not well understood. Mathematical models that describe choice behavior in specific contexts have provided important insights into the computations that may underlie decision making in the brain. However, a critical and largely unanswered question is whether these models generalize from one choice context to another. Here we show that a model adapted from the perceptual decision-making domain and estimated on choices over food rewards accurately predicts choices and reaction times in four independent sets of subjects making social decisions. The robustness of the model across domains provides behavioral evidence for a common decision-making process in perceptual, primary reward, and social decision making.

Guidance of treatment decisions in risk-adapted primary radiotherapy for prostate cancer using multiparametric magnetic resonance imaging: a single center experience.

BACKGROUND Magnetic resonance imaging (MRI) of the prostate is considered to be the most precise noninvasive staging modality for localized prostate cancer. Multiparametric MRI (mpMRI) dynamic sequences have recently been shown to further increase the accuracy of staging relative to morphological imaging alone. Correct radiological staging, particularly the detection of extraprostatic disease extension, is of paramount importance for target volume definition and dose prescription in highly-conformal curative radiotherapy (RT); in addition, it may affect the risk-adapted duration of additional antihormonal therapy. The purpose of our study was to analyze the impact of mpMRI-based tumor staging in patients undergoing primary RT for prostate cancer. METHODS A total of 122 patients admitted for primary RT for prostate cancer were retrospectively analyzed regarding initial clinical and computed tomography-based staging in comparison with mpMRI staging. Both tumor stage shifts and overall risk group shifts, including prostate-specific antigen (PSA) level and the Gleason score, were assessed. Potential risk factors for upstaging were tested in a multivariate analysis. Finally, the impact of mpMRI-based staging shift on prostate RT and antihormonal therapy was evaluated. RESULTS Overall, tumor stage shift occurred in 55.7% of patients after mpMRI. Upstaging was most prominent in patients showing high-risk serum PSA levels (73%), but was also substantial in patients presenting with low-risk PSA levels (50%) and low-risk Gleason scores (45.2%). Risk group changes occurred in 28.7% of the patients with consequent treatment adaptations regarding target volume delineation and duration of androgen deprivation therapy. High PSA levels were found to be a significant risk factor for tumor upstaging and newly diagnosed seminal vesicle infiltration assessed using mpMRI. CONCLUSIONS Our findings suggest that mpMRI of the prostate leads to substantial tumor upstaging, and can considerably affect treatment decisions in all patient groups undergoing risk-adapted curative RT for prostate cancer.

Adapting a driving simulator to study pedestrians' street-crossing decisions: A feasibility study

The decision when to cross a street safely is a challenging task that poses high demands on perception and cognition. Both can be affected by normal aging, neurodegenerative disorder, and brain injury, and there is an increasing interest in studying street-crossing decisions. In this article, we describe how driving simulators can be modified to study pedestrians' street-crossing decisions. The driving simulator's projection system and the virtual driving environment were used to present street-crossing scenarios to the participants. New sensors were added to measure when the test person starts to cross the street. Outcome measures were feasibility, usability, task performance, and visual exploration behavior, and were measured in 15 younger persons, 15 older persons, and 5 post-stroke patients. The experiments showed that the test is feasible and usable, and the selected difficulty level was appropriate. Significant differences in the number of crashes between young participants and patients (p = .001) as well as between healthy older participants and patients (p = .003) were found. When the approaching vehicle's speed is high, significant differences between younger and older participants were found as well (p = .038). Overall, the new test setup was well accepted, and we demonstrated that driving simulators can be used to study pedestrians' street-crossing decisions.

Decision strategies for policy decisions under uncertainties: The case of mitigation measures addressing methane emissions from ruminants

Decision strategies aim at enabling reasonable decisions in cases of uncertain policy decision problems which do not meet the conditions for applying standard decision theory. This paper focuses on decision strategies that account for uncertainties by deciding whether a proposed list of policy options should be accepted or revised (scope strategies) and whether to decide now or later (timing strategies). They can be used in participatory approaches to structure the decision process. As a basis, we propose to classify the broad range of uncertainties affecting policy decision problems along two dimensions, source of uncertainty (incomplete information, inherent indeterminacy and unreliable information) and location of uncertainty (information about policy options, outcomes and values). Decision strategies encompass multiple and vague criteria to be deliberated in application. As an example, we discuss which decision strategies may account for the uncertainties related to nutritive technologies that aim at reducing methane (CH4) emissions from ruminants as a means of mitigating climate change, limiting our discussion to published scientific information. These considerations not only speak in favour of revising rather than accepting the discussed list of options, but also in favour of active postponement or semi-closure of decision-making rather than closure or passive postponement.

Outcome discrepancies and selective reporting: impacting the leading journals?

BACKGROUND Selective outcome reporting of either interesting or positive research findings is problematic, running the risk of poorly-informed treatment decisions. We aimed to assess the extent of outcome and other discrepancies and possible selective reporting between registry entries and published reports among leading medical journals. METHODS Randomized controlled trials published over a 6-month period from July to December 31st, 2013, were identified in five high impact medical journals: The Lancet, British Medical Journal, New England Journal of Medicine, Annals of Internal Medicine and Journal of American Medical Association were obtained. Discrepancies between published studies and registry entries were identified and related to factors including registration timing, source of funding and presence of statistically significant results. RESULTS Over the 6-month period, 137 RCTs were found. Of these, 18% (n = 25) had discrepancies related to primary outcomes with the primary outcome changed in 15% (n = 20). Moreover, differences relating to non-primary outcomes were found in 64% (n = 87) with both omission of pre-specified non-primary outcomes (39%) and introduction of new non-primary outcomes (44%) common. No relationship between primary or non-primary outcome change and registration timing (prospective or retrospective; P = 0.11), source of funding (P = 0.92) and presence of statistically significant results (P = 0.92) was found. CONCLUSIONS Discrepancies between registry entries and published articles for primary and non-primary outcomes were common among trials published in leading medical journals. Novel approaches are required to address this problem.

Rethinking ERP-Outsourcing Decisions for Leveraging Technological and Preserving Business Knowledge

During the selection, implementation and stabilization phases, as well as the operations and optimization phase of an ERP system (ERP-lifecycle), numerous companies consider to utilize the support of an external service provider. This paper analyses how different categories of knowledge influence the sourcing decision of crucial tasks within the ERP lifecycle. Based on a review of the IS outsourcing literature, essential knowledge-related determinants for the IS outsourcing decision are presented and aggregated in a structural model. It will be hypothesized that internal deficits in technological knowledge in comparison to external vendors as well as the specificity of the synthesis of special technological and specific business knowledge have a profound impact on the outsourcing decision. Then, a classification framework will be developed which facilitates the assignment of various tasks within the ERP lifecycle to their respective knowledge categories and knowledge carriers which might be internal or external stakeholders. The configuaration task will be used as an example to illustrate how the structural model and the classification framework may be applied to evaluate the outsourcing of tasks within the ERP lifecycle.

Is the sedimentation sign associated with spinal stenosis surgical treatment effect in SPORT?

STUDY DESIGN Subgroup analysis of the lumbar spinal stenosis (LSS) without degenerative spondylolisthesis diagnostic cohort of the Spine Patient Outcomes Research Trial multicenter randomized clinical trial with a concurrent observational cohort. OBJECTIVE To determine if sedimentation sign on magnetic resonance image can help with LSS treatment decisions. SUMMARY OF BACKGROUND DATA LSS is one of the most common reasons for surgery in the US elderly, but there is a dearth of reliable diagnostic tools that give a clear indication for surgery. Recent studies have suggested that positive sedimentation sign on magnetic resonance image may be a possible prognostic indicator. METHODS All patients with LSS in both the randomized and observational cohorts had imaging-confirmed stenosis, were surgical candidates, and had neurogenic claudication for at least 12 weeks prior to enrollment. Patients were categorized as "mild," "moderate," or "severe" according to stenosis severity. Of the 654 patients with LSS enrolled in Spine Patient Outcomes Research Trial, complete T2-weighted axial and sagittal digitized images of 115 patients were available for retrospective review. An independent orthopedic spine surgeon evaluated these deidentified Digital Imaging and Communications in Medicine files for the sedimentation sign. RESULTS Sixty-six percent (76/115) of patients were found to have a positive sedimentation sign. Those with a positive sedimentation sign were more likely to have stenosis at L2-L3 (33% vs. 10% P=0.016) or L3-L4 76% vs. 51%, P=0.012), and to have severe (72% vs. 33%, P<0.0001) central stenosis (93% vs. 67% P<0.001) at 2 or more concurrent levels (57% vs. 18%, P=0.01). In multivariate models, the surgical treatment effect was significantly larger in the positive sedimentation sign group for Oswestry Disability Index (-16 vs. -7; P=0.02). CONCLUSION A positive sedimentation sign was associated with a small but significantly greater surgical treatment effect for Oswestry Disability Index in patients with symptomatic LSS, after adjusting for other demographic and imaging features. These findings suggest that positive sedimentation sign may potentially be a useful adjunct to help guide an informed treatment choice regarding surgery for LSS. LEVEL OF EVIDENCE 2.

Training primary care physicians to offer their patients faecal occult blood testing and colonoscopy for colorectal cancer screening on an equal basis: a pilot intervention with before-after and parallel group surveys.

OBJECTIVES Primary care physicians (PCPs) should prescribe faecal immunochemical testing (FIT) or colonoscopy for colorectal cancer screening based on their patient's values and preferences. However, there are wide variations between PCPs in the screening method prescribed. The objective was to assess the impact of an educational intervention on PCPs' intent to offer FIT or colonoscopy on an equal basis. DESIGN Survey before and after training seminars, with a parallel comparison through a mailed survey to PCPs not attending the training seminars. SETTING All PCPs in the canton of Vaud, Switzerland. PARTICIPANTS Of 592 eligible PCPs, 133 (22%) attended a seminar and 106 (80%) filled both surveys. 109 (24%) PCPs who did not attend the seminars returned the mailed survey. INTERVENTION A 2 h-long interactive seminar targeting PCP knowledge, skills and attitudes regarding offering a choice of colorectal cancer (CRC) screening options. OUTCOME MEASURES The primary outcome was PCP intention of having their patients screened with FIT and colonoscopy in equal proportions (between 40% and 60% each). Secondary outcomes were the perceived role of PCPs in screening decisions (from paternalistic to informed decision-making) and correct answer to a clinical vignette. RESULTS Before the seminars, 8% of PCPs reported that they had equal proportions of their patients screened for CRC by FIT and colonoscopy; after the seminar, 33% foresaw having their patients screened in equal proportions (p<0.001). Among those not attending, there was no change (13% vs 14%, p=0.8). Of those attending, there was no change in their perceived role in screening decisions, while the proportion responding correctly to a clinical vignette increased (88-99%, p<0.001). CONCLUSIONS An interactive training seminar increased the proportion of physicians with the intention to prescribe FIT and colonoscopy in equal proportions.