Corporate philanthropy, reputation risk management and shareholder value: A study of Australian corporate giving

This study examines the role of corporate philanthropy in the management of reputation risk and shareholder value of the top 100 ASX listed Australian firms for the three years 2011-2013. The results of this study demonstrate the business case for corporate philanthropy and hence encourage corporate philanthropy by showing increasing firms’ investment in corporate giving as a percentage of profit before tax, increases the likelihood of an increase in shareholder value. However, the proviso is that firms must also manage their reputation risk at the same time. There is a negative association between corporate giving and shareholder value (Tobin’s Q) which is mitigated by firms’ management of reputation. The economic significance of this result is that for every cent in the dollar the firm spends on corporate giving, Tobin’s Q will decrease by 0.413%. In contrast, if the firm increase their reputation by 1 point then Tobin’s Q will increase by 0.267%. Consequently, the interaction of corporate giving and reputation risk management is positively associated with shareholder value. These results are robust while controlling for potential endogeneity and reverse causality. This paper assists both academics and practitioners by demonstrating that the benefits of corporate philanthropy extend beyond a gesture to improve reputation or an attempt to increase financial performance, to a direct collaboration between all the factors where the benefits far outweigh the costs.

Student performance in field education placements: The findings of a 6-year Australian study of admissions data

This article reports on a 6-year study that examined the association between pre-admission variables and field placement performance in an Australian bachelor of social work program (N=463). Very few of the pre-admission variables were found to be significantly associated with performance. These findings and the role of the admissions process are discussed. In addition to the usual academic criteria, the authors urge schools to include a focus on nonacademic criteria during the admissions process and the ongoing educational program.

Studies on Binary Time Series Models with Applications to Empirical Macroeconomics and Finance

This thesis studies binary time series models and their applications in empirical macroeconomics and finance. In addition to previously suggested models, new dynamic extensions are proposed to the static probit model commonly used in the previous literature. In particular, we are interested in probit models with an autoregressive model structure. In Chapter 2, the main objective is to compare the predictive performance of the static and dynamic probit models in forecasting the U.S. and German business cycle recession periods. Financial variables, such as interest rates and stock market returns, are used as predictive variables. The empirical results suggest that the recession periods are predictable and dynamic probit models, especially models with the autoregressive structure, outperform the static model. Chapter 3 proposes a Lagrange Multiplier (LM) test for the usefulness of the autoregressive structure of the probit model. The finite sample properties of the LM test are considered with simulation experiments. Results indicate that the two alternative LM test statistics have reasonable size and power in large samples. In small samples, a parametric bootstrap method is suggested to obtain approximately correct size. In Chapter 4, the predictive power of dynamic probit models in predicting the direction of stock market returns are examined. The novel idea is to use recession forecast (see Chapter 2) as a predictor of the stock return sign. The evidence suggests that the signs of the U.S. excess stock returns over the risk-free return are predictable both in and out of sample. The new "error correction" probit model yields the best forecasts and it also outperforms other predictive models, such as ARMAX models, in terms of statistical and economic goodness-of-fit measures. Chapter 5 generalizes the analysis of univariate models considered in Chapters 2 4 to the case of a bivariate model. A new bivariate autoregressive probit model is applied to predict the current state of the U.S. business cycle and growth rate cycle periods. Evidence of predictability of both cycle indicators is obtained and the bivariate model is found to outperform the univariate models in terms of predictive power.

Developmental origins of physiological stress reactivity

The model of developmental origins of health and disease proposes that organisms during fetal period utilize cues that enable their adaptation in the postnatal environment they are likely to live, having short-term advantages when trying to survive in environment but simultaneously in the long run have costs for health. A large body of epidemiological research has found that low birth weight, a marker of intrauterine conditions, is associated with cardiovascular (CV) disease. Since the reported associations of birth weight with normal variation in the resting blood pressure (BP), a major predictor of CV disease risk, have been modest, a key candidate mediating the link has been CV and hypothalamus-pituitary-adrenal axes (HPAA) reactivity to stress. In addition, not only weight at birth but also gestational age and early postnatal growth may have independent associations to stress reactivity. The aim of this thesis was to investigate whether pre- and postnatal growth and gestational age are associated with CV and HPAA activity before, during and after stress in childhood and in late adulthood. Altogether 287 men and women aged 60-70 and 299 boys and girls aged 7-9 underwent Trier Social Stress Test. Several indices of HPAA and CV were measured and birth size and gestational age were obtained from birth records. Results showed that low birth weight was associated with low HPAA activity during psychosocial stress, and rapid gain in BMI during years 7-11 was related to heightened stress reactivity to psychosocial stress. Size at birth in children and gestational age and early postnatal (0-2 years) gain in height in adults were associated with CV stress responses; however, in a sex-specific manner. Given that CV stress responses and HPAA activity are markers of CV disease vulnerability, our results may partly explain the associations between early environment and later CV disease.

Heme oxygenase-1 in cardiovascular diseases

Myocardial infarction (MI) and heart failure are major causes of morbidity and mortality worldwide. Treatment of MI involves early restoration of blood flow to limit infarct size and preserve cardiac function. MI leads to left ventricular remodeling, which may eventually progress to heart failure, despite the established pharmacological treatment of the disease. To improve outcome of MI, new strategies for protecting the myocardium against ischemic injury and enhancing the recovery and repair of the infarcted heart are needed. Heme oxygenase-1 (HO-1) is a stress-responsive and cytoprotective enzyme catalyzing the degradation of heme into the biologically active reaction products biliverdin/bilirubin, carbon monoxide (CO) and free iron. HO-1 plays a key role in maintaining cellular homeostasis by its antiapoptotic, anti-inflammatory, antioxidative and proangiogenic properties. The present study aimed, first, at evaluating the role of HO-1 as a cardioprotective and prohealing enzyme in experimental rat models and at investigating the potential mechanisms mediating the beneficial effects of HO-1 in the heart. The second aim was to evaluate the role of HO-1 in 231 critically ill intensive care unit (ICU) patients by investigating the association of HO-1 polymorphisms and HO-1 plasma concentrations with illness severity, organ dysfunction and mortality throughout the study population and in the subgroup of cardiac patients. We observed in an experimental rat MI model, that HO-1 expression was induced in the infarcted rat hearts, especially in the infarct and infarct border areas. In addition, pre-emptive HO-1 induction and CO donor pretreatment promoted recovery and repair of the infarcted hearts by differential mechanisms. CO promoted vasculogenesis and formation of new cardiomyocytes by activating c-kit+ stem/progenitor cells via hypoxia-inducible factor 1 alpha, stromal cell-derived factor 1 alpha (SDF-1a) and vascular endothelial growth factor B, whereas HO-1 promoted angiogenesis possibly via SDF-1a. Furthermore, HO-1 protected the heart in the early phase of infarct healing by increasing survival and proliferation of cardiomyocytes. The antiapoptotic effect of HO-1 persisted in the late phases of infarct healing. HO-1 also modulated the production of extracellular matrix components and reduced perivascular fibrosis. Some of these beneficial effects of HO-1 were mediated by CO, e.g. the antiapoptotic effect. However, CO may also have adverse effects on the heart, since it increased the expression of extracellular matrix components. In isolated perfused rat hearts, HO-1 induction improved the recovery of postischemic cardiac function and abrogated reperfusion-induced ventricular fibrillation, possibly in part via connexin 43. We found that HO-1 plasma levels were increased in all critically ill patients, including cardiac patients, and were associated with the degree of organ dysfunction and disease severity. HO-1 plasma concentrations were also higher in ICU and hospital nonsurvivors than in survivors, and the maximum HO-1 concentration was an independent predictor of hospital mortality. Patients with the HO-1 -413T/GT(L)/+99C haplotype had lower HO-1 plasma concentrations and lower incidence of multiple organ dysfunction. However, HO-1 polymorphisms were not associated with ICU or hospital mortality. The present study shows that HO-1 is induced in response to stress in both experimental animal models and severely ill patients. HO-1 played an important role in the recovery and repair of infarcted rat hearts. HO-1 induction and CO donor pretreatment enhanced cardiac regeneration after MI, and HO-1 may protect against pathological left ventricular remodeling. Furthermore, HO-1 induction potentially may protect against I/R injury and cardiac dysfunction in isolated rat hearts. In critically ill ICU patients, HO-1 plasma levels correlate with the degree of organ dysfunction, disease severity, and mortality, suggesting that HO-1 may be useful as a marker of disease severity and in the assessment of outcome of critically ill patients.

Very Low Birth Weight Infants as Young Adults : Focus on aspects of cognition, behavior and sleep

Major advances in the treatment of preterm infants have occurred during the last three decades. Survival rates have increased, and the first generations of preterm infants born at very low birth weight (VLBW; less than 1500 g) who profited from modern neonatal intensive care are now in young adulthood. The literature shows that VLBW children achieve on average lower scores on cognitive tests, even after exclusion of individuals with obvious neurosensory deficits. Evidence also exists for an increased risk in VLBW children for various neuropsychiatric disorders such as attention-deficit hyperactivity disorder (ADHD) and related behavioral symptoms. Up till now, studies extending into adulthood are sparse, and it remains to be seen whether these problems persist into adulthood. The aim of this thesis was to study ADHD-related symptoms and cognitive and executive functioning in young adults born at VLBW. In addition, we aimed to study sleep disturbances, known to adversely affect both cognition and attention. We hypothesized that preterm birth at VLBW interferes with early brain development in a way that alters the neuropsychological phenotype; this may manifest itself as ADHD symptoms and impaired cognitive abilities in young adulthood. In this cohort study from a geographically defined region, we studied 166 VLBW adults and 172 term-born controls born from 1978 through 1985. At ages 18 to 27 years, the study participants took part in a clinic study during which their physical and psychological health was assessed in detail. Three years later, 213 of these individuals participated in a follow-up. The current study is part of a larger research project (The Helsinki Study of Very Low Birth Weight Adults), and the measurements of interest for this particular study include the following: 1) The Adult Problem Questionnaire (APQ), a self-rating scale of ADHD-related symptoms in adults; 2) A computerized cognitive test battery designed for population studies (CogState®) which measures core cognitive abilities such as reaction time, working memory, and visual learning; 3) Sleep assessment by actigraphy, the Basic Nordic Sleep Questionnaire, and the Morningness-Eveningness Questionnaire. Actigraphs are wrist-worn accelerometers that separate sleep from wakefulness by registering body movements. Contrary to expectations, VLBW adults as a group reported no more ADHD-related behavioral symptoms than did controls. Further subdivision of the VLBW group into SGA (small for gestational age) and AGA (appropriate for gestational age) subgroups, however, revealed more symptoms on ADHD subscales pertaining to executive dysfunction and emotional instability among those born SGA. Thus, it seems that intrauterine growth retardation (for which SGA served as a proxy) is a more essential predictor for self-perceived ADHD symptoms in adulthood than is VLBW birth as such. In line with observations from other cohorts, the VLBW adults reported less risk-taking behavior in terms of substance use (alcohol, smoking, and recreational drugs), a finding reassuring for the VLBW individuals and their families. On the cognitive test, VLBW adults free from neurosensory deficits had longer reaction times than did term-born peers on all tasks included in the test battery, and lower accuracy on the learning task, with no discernible effect of SGA status over and above the effect of VLBW. Altogether, on a group level, even high-functioning VLBW adults show subtle deficits in psychomotor processing speed, visual working memory, and learning abilities. The sleep studies provided no evidence for differences in sleep quality or duration between the two groups. The VLBW adults were, however, at more than two-fold higher risk for sleep-disordered breathing (in terms of chronic snoring). Given the link between sleep-disordered breathing and health sequelae, these results suggest that VLBW individuals may benefit from an increased awareness among clinicians of this potential problem area. An unexpected finding from the sleep studies was the suggestion of an advanced sleep phase: The VLBW adults went to bed earlier according to the actigraphy registrations and also reported earlier wake-up times on the questionnaire. In further study of this issue in conjunction with the follow-up three years later, the VLBW group reported higher levels of morningness propensity, further corroborating the preliminary findings of an advanced sleep phase. Although the clinical implications are not entirely clear, the issue may be worth further study, since circadian rhythms are closely related to health and well-being. In sum, we believe that increased understanding of long-term outcomes after VLBW, and identification of areas and subgroups that are particularly vulnerable, will allow earlier recognition of potential problems and ultimately lead to improved prevention strategies.

Cystatin C, a measure of renal function, as prognostic risk marker in acute heart failure : Studies on the cardiorenal syndrome

Acute heart failure (AHF) is a complex syndrome associated with exceptionally high mortality. Still, characteristics and prognostic factors of contemporary AHF patients have been inadequately studied. Kidney function has emerged as a very powerful prognostic risk factor in cardiovascular disease. This is believed to be the consequence of an interaction between the heart and kidneys, also termed the cardiorenal syndrome, the mechanisms of which are not fully understood. Renal insufficiency is common in heart failure and of particular interest for predicting outcome in AHF. Cystatin C (CysC) is a marker of glomerular filtration rate with properties making it a prospective alternative to the currently used measure creatinine for assessment of renal function. The aim of this thesis is to characterize a representative cohort of patients hospitalized for AHF and to identify risk factors for poor outcome in AHF. In particular, the role of CysC as a marker of renal function is evaluated, including examination of the value of CysC as a predictor of mortality in AHF. The FINN-AKVA (Finnish Acute Heart Failure) study is a national prospective multicenter study conducted to investigate the clinical presentation, aetiology and treatment of, as well as concomitant diseases and outcome in, AHF. Patients hospitalized for AHF were enrolled in the FINN-AKVA study, and mortality was followed for 12 months. The mean age of patients with AHF is 75 years and they frequently have both cardiovascular and non-cardiovascular co-morbidities. The mortality after hospitalization for AHF is high, rising to 27% by 12 months. The present study shows that renal dysfunction is very common in AHF. CysC detects impaired renal function in forty percent of patients. Renal function, measured by CysC, is one of the strongest predictors of mortality independently of other prognostic risk markers, such as age, gender, co-morbidities and systolic blood pressure on admission. Moreover, in patients with normal creatinine values, elevated CysC is associated with a marked increase in mortality. Acute kidney injury, defined as an increase in CysC within 48 hours of hospital admission, occurs in a significant proportion of patients and is associated with increased short- and mid-term mortality. The results suggest that CysC can be used for risk stratification in AHF. Markers of inflammation are elevated both in heart failure and in chronic kidney disease, and inflammation is one of the mechanisms thought to mediate heart-kidney interactions in the cardiorenal syndrome. Inflammatory cytokines such as interleukin-6 (IL-6) and tumor necrosis factor-alpha (TNF-α) correlate very differently to markers of cardiac stress and renal function. In particular, TNF-α showed a robust correlation to CysC, but was not associated with levels of NT-proBNP, a marker of hemodynamic cardiac stress. Compared to CysC, the inflammatory markers were not strongly related to mortality in AHF. In conclusion, patients with AHF are elderly with multiple co-morbidities, and renal dysfunction is very common. CysC demonstrates good diagnostic properties both in identifying impaired renal function and acute kidney injury in patients with AHF. CysC, as a measure of renal function, is also a powerful prognostic marker in AHF. CysC shows promise as a marker for assessment of kidney function and risk stratification in patients hospitalized for AHF.

Consequences of Vertebral Fractures

Vertebral fractures occur due to forces applied to spinal structures. When the bone tissue is weakened, vertebral fractures can result from a minor trauma. Adult vertebral fractures are commonly considered to be an indication for osteoporosis. In children osteoporosis is a rare condition, and pediatric vertebral fractures are usually clearly trauma-related. The aims of this dissertation are to produce knowledge of the epidemiology of osteoporotic vertebral fractures and to analyse their association with total and cause-specific mortality, to find indicators with which to identify individuals who are at great risk of subsequent fractures, to study the incidence of pediatric vertebral fractures and need for their operative treatment and hospital care. The Mobile-Clinic and Mini-Finland Health surveys of the adult population were used as materials in this research. Record linkages to the Finnish Hospital Discharge Register and the Official Cause of Death register were used to study mortality and hospitalization in the same population group. These registers were also used to evaluate epidemiology, mortality, hospitalization and the need for operative management of pediatric vertebral fracture patients. The main findings and conclusions of the present dissertation are: 1. The presence of a thoracic vertebral fracture in adults is a significant predictor of cancer and respiratory mortality. In women, but not in men, vertebral fractures strongly predict mortality due to injuries. Most of these deaths in the study group were hip fracture related. 2. Severe thoracic vertebral fracture in adults was a strong predictor of a subsequent hip fracture, whereas mild or moderate fractures and the number of compressed vertebrae were much weaker predictors, 3. Pediatric spinal fractures were rare: The incidence was 66 per one million children per year. In younger children cervical spine was most often affected, whereas in older children fractures of the thoracic and lumbar spine were more common. Maturation of spinal structures seems to play a major role in the typical injury patterns in children. Thirty per cent of pediatric spinal fractures required surgical treatment. The current study focuses on consequences of vertebral fractures in general, without evaluating further the causation of the studied phenomena. Further studies are needed to clarify the mechanisms of association between vertebral fractures and specific causes of mortality. A severe vertebral fracture appears to indicate a substantial risk of a subsequent hip fracture. If such a fracture is identified from a chest radiograph, urgent clinical evaluation, treatment of osteoporosis and protective measures against falls are recommended.

Psychosocial processes of health behaviour change in a lifestyle intervention : Influences of gender, socioeconomic status and personality

Background: The onset of many chronic diseases such as type 2 diabetes can be delayed or prevented by changes in diet, physical activity and obesity. Known predictors of successful behaviour change include psychosocial factors such as selfefficacy, action and coping planning, and social support. However, gender and socioeconomic differences in these psychosocial mechanisms underlying health behaviour change have not been examined, despite well-documented sociodemographic differences in lifestyle-related mortality and morbidity. Additionally, although stable personality traits (such as dispositional optimism or pessimism and gender-role orientation: agency and communion) are related to health and health behaviour, to date they have rarely been studied in the context of health behaviour interventions. These personality traits might contribute to health behaviour change independently of the more modifiable domain-specific psychosocial factors, or indirectly through them, or moderated by them. The aims were to examine in an intervention setting: (1) whether changes (during the three-month intervention) in psychological determinants (self-efficacy beliefs, action planning and coping planning) predict changes in exercise and diet behaviours over three months and 12 months, (2) the universality assumption of behaviour change theories, i.e. whether preintervention levels and changes in psychosocial determinants are similar among genders and socioeconomic groups, and whether they predict changes in behaviour in a similar way in these groups, (3) whether the personality traits optimism, pessimism, agency and communion predict changes in abdominal obesity, and the nature of their interplay with modifiable and domain-specific psychosocial factors (self-efficacy and social support). Methods: Finnish men and women (N = 385) aged 50 65 years who were at an increased risk for type 2 diabetes were recruited from health care centres to participate in the GOod Ageing in Lahti Region (GOAL) Lifestyle Implementation Trial. The programme aimed to improve participants lifestyle (physical activity, eating) and decrease their overweight. The measurements of self-efficacy, planning, social support and dispositional optimism/pessimism were conducted pre-intervention at baseline (T1) and after the intensive phase of the intervention at three months (T2), and the measurements of exercise at T1, T2 and 12 months (T3) and healthy eating at T1 and T3. Waist circumference, an indicator of abdominal obesity, was measured at T1 and at oneyear (T3) and three-year (T4) follow-ups. Agency and communion were measured at T4 with the Personal Attributes Questionnaire (PAQ). Results: (1) Increases in self-efficacy and planning were associated with three-month increases in exercise (Study I). Moreover, both the post-intervention level and three-month increases (during the intervention) in self-efficacy in dealing with barriers predicted the 12-month increase in exercise, and a high postintervention level of coping plans predicted the 12-month decrease in dietary fat (Study II). One- and three-year waist circumference reductions were predicted by the initial three-month increase in self-efficacy (Studies III, IV). (2) Post-intervention at three months, women had formed more action plans for changing their exercise routines and received less social support for behaviour change than men had. The effects of adoption self-efficacy were similar but change in planning played a less significant role among men (Study I). Examining the effects of socioeconomic status (SES), psychosocial determinants at baseline and their changes during the intervention yielded largely similar results. Exercise barriers self-efficacy was enhanced slightly less among those with low SES. Psychosocial determinants predicted behaviour similarly across all SES groups (Study II). (3) Dispositional optimism and pessimism were unrelated to waist circumference change, directly or indirectly, and they did not influence changes in self-efficacy (Study III). Agency predicted 12-month waist circumference reduction among women. High communion coupled with high social support was associated with waist circumference reduction. However, the only significant predictor of three-year waist circumference reduction was an increase in health-related self-efficacy during the intervention (Study IV). Conclusions: Interventions should focus on improving participants self-efficacy early on in the intervention as well as prompting action and coping planning for health behaviour change. Such changes are likely to be similarly effective among intervention participants regardless of gender and educational level. Agentic orientation may operate via helping women to be less affected by the demands of the self-sacrificing female role and enabling them to assertively focus on their own goals. The earlier mixed results regarding the role of social support in behaviour change may be in part explained by personality traits such as communion.

Consumer Evaluation of Hybrid Innovations (summary section only)

Hybrid innovations, or new products that combine two existing product categories into one, are increasingly popular in today’s marketplace. Despite this proliferation, few studies address them. The purpose of this thesis is to examine consumer evaluation of hybrid innovations by focusing on consumer categorization of such innovations and on factors contributing positively and negatively to their evaluation. This issue is examined by means of three studies. The first study addresses the proportion of consumers categorizing hybrid products as single- versus dual-purpose, what contributes to such a categorization, what differences can be found between the two groups, and if categorization can and should be included in models of innovation adoption. The second study expands on the scope by including motivation as a predictor of consumer evaluation and examines two cognitive and affective factors and their differential impact on innovation evaluation. Finally, the third study examines the product comparisons single- versus dual-purpose categorization induce. These three essays together build up a broader understanding of hybrid innovation evaluation. The thesis uses theories from both psychology and marketing to examine the issues at hand. Conceptual combination and analogical learning theories from psychology are used to comprehend categorization and knowledge transfer. From marketing, consumer behavior and innovation adoption studies are addressed to better understand the link between categorization and product evaluation and the factors contributing to product evaluation. The main results of the current thesis are that (1) most consumers categorize hybrid products as single- and not as dual-purpose products, (2) consumers that categorize them as dual-purpose find them more attractive (3) motivation has a significant effect on consumer evaluation of innovations; cognitive factors promote an emphasis on product net benefits, whereas affective factors induce consumers to consider product meaning in the form of categorization and perceived product complexity, (4) categorization constrains subsequent product evaluation, and (5) categorization can and should be included to models of innovation adoption. Maria Sääksjärvi is associated with CERS, the Center for Relationship Marketing and Service Management at the Swedish School of Economics and Business Administration

Perceived Value of Mobile Service Use and its Consequences

The thesis is positioned in the services marketing field. Previous mobile service research has identified perceived value or relative advantage as a stable predictor of use of services. However, a more detailed view of what customers value in mobile services is needed for marketing diverse types of mobile content and attracting committed customers. The direct relationships between multidimensional value and loyalty constructs have received limited attention in the previous literature, although a multidimensional view is needed for differentiating services. This thesis studies how perceived value of mobile service use affects customer commitment, repurchase intentions, word-of-mouth and willingness to pay. The doctoral thesis consists of three journal articles and one working paper. The four papers have different sub-aims and comprise individual empirical studies. Mixed methods including both personal interviews and survey data collected from end-users of different types of mobile content services are used. The conceptual mobile perceived value model that results from the first explorative empirical study supports a six- dimensional value view. The six dimensions are further categorized into two higher order constructs: content-related perceived value (emotional, social, convenience and monetary value) and context-related (epistemic and conditional value) perceived value. Structural equation modeling is used in the other three studies to validate this framework by analyzing the relationships between context- and content-related value, and how the individual perceived value dimensions affect commitment and behavioral outcomes. Analyzing the direct relationships revealed differences in the effect of perceived value dimensions between information and entertainment mobile service user groups, between effects on commitment, repurchase intentions and word-of-mouth intentions, as well as between effects on commitment to the provider and to the mobile channel as such. This thesis contributes to earlier perceived value literature by structuring the value dimensions into two groups. Most importantly, the thesis contributes to the value and loyalty literature by increasing understanding of how the different dimensions of perceived value directly affect commitment and post-purchase intentions. The results have implications for further theory development in the electronic services field using multidimensional latent constructs, and practical implications for enhancing commitment to content provider and for differentiated marketing strategies in the mobile field. The general conclusion of this thesis is that differentiated value-based marketing of mobile services is essential for attracting committed customers who will use the same providers’ content also in the future. Minna Pihlström is associated with the Centre for Relationship Marketing and Service Management (CERS) at Hanken.

The impact of stock option incentives on investment and firm value

This paper analyzes the relations among firm-level stock option portfolio incentives, investment, and firm value based on a sample of Finnish firms during the time period 1987 – 2000. Utilizing exact and complete information regarding stock option portfolio characteristics, we find some evidence that firm investment is increasing in the incentives to increase stock price (delta) and risk (vega). Furthermore, we find strong evidence of a positive relation between both incentive effects and firm value (Tobin’s Q). In contrast, when we allow for stock option incentives, investment, and firm value to be simultaneously determined, we find no evidence that investment is increasing in incentives. However, even after controlling for endogeneity, we find that both incentive effects arising from stock option compensation display a positive and significant effect on firm value. Finally, in contradiction to earlier findings, we observe that neither Tobin’s Q nor investment drives incentives.

Customer Energy in Relationships

All companies have a portfolio of customer relationships. From a managerial standpoint the value of these customer relationships is a key issue. The aim of the paper is to introduce a conceptual framework for customers’ energy towards a service provider. Customer energy is defined as the cognitive, affective and behavioural effort a customer puts into the purchase of an offering. It is based on two dimensions: life theme involvement and relationship commitment. Data from a survey study of 425 customers of an online gambling site was combined with data about their individual purchases and activity. Analysis showed that involvement and commitment influence both customer behaviour and attitudes. Customer involvement was found to be strongly related to overall spending within a consumption area, whereas relationship commitment is a better predictor of the amount of money spent at a particular company. Dividing the customers into four different involvement / commitment segments revealed differences in churn rates, word-of-mouth, brand attitude, switching propensity and the use of the service for socializing. The framework provides a tool for customer management by revealing differences in fundamental drivers of customer behaviour resulting in completely new customer portfolios. Knowledge of customer energy allows companies to manage their communication and offering development better and provides insight into the risk of losing a customer.

Direct numerical simulation of autoignition in a non-premixed, turbulent medium

In this paper, direct numerical simulation of autoignition in an initially non-premixed medium under isotropic, homogeneous, and decaying turbulence is presented. The pressure-based method developed herein is a spectral implementation of the sequential steps followed in the predictor-corrector type of algorithms; it includes the effects of density fluctuations caused by spatial inhomogeneities ill temperature and species. The velocity and pressure field are solved in the spectral space while the scalars and density field are solved in the physical space. The presented results reveal that the autoignition spots originate and evolve at locations where (1) the composition corresponds to a small range around a specific mixture fraction, and (2) the conditional scaler dissipation rate is low. A careful examination of the data obtained indicates that the autoignition spots originate in the vortex cores, and the hot gases travel outward as combustion progresses. Hence, the applicability of the transient laminar flamelet model for this problem is questioned. The dependence of autoignition characteristics on parameters such as (1) die initial eddy-turnover time and (2) the initial ratio of length scale of scalars to that of velocities are investigated. Certain implications of new results on the conditional moment closure modeling are discussed.

Associations of interleukin-1 (IL-1) gene variation and IL-1 receptor antagonist phenotypes with immunological responses, metabolic dysregulation and type 2 diabetes

The upstream proinflammatory interleukin-1 (IL-1) cytokines, together with a naturally occurring IL-1 receptor antagonist (IL-1Ra), play a significant role in several diseases and physiologic conditions. The IL-1 proteins affect glucose homeostasis at multiple levels contributing to vascular injuries and metabolic dysregulations that precede diabetes. An association between IL-1 gene variations and IL-1Ra levels has been suggested, and genetic studies have reported associations with metabolic dysregulation and altered inflammatory responses. The principal aims of this study were to: 1) examine the associations of IL-1 gene variation and IL-1Ra expression in the development and persistence of thyroid antibodies in subacute thyroiditis; 2) investigate the associations of common variants in the IL-1 gene family with plasma glucose and insulin concentrations, glucose homeostasis measures and prevalent diabetes in a representative population sample; 3) investigate genetic and non-genetic determinants of IL-1Ra phenotypes in a cross-sectional setting in three independent study populations; 4) investigate in a prospective setting (a) whether variants of the IL-1 gene family are predictors for clinically incident diabetes in two population-based observational cohort studies; and (b) whether the IL-1Ra levels predict the progression of metabolic syndrome to overt diabetes during the median follow-up of 10.8 and 7.1 years. Results from on patients with subacte thyroiditis showed that the systemic IL-1Ra levels are elevated during a specific proinflammatory response and they correlated with C-reactive protein (CRP) levels. Genetic variation in the IL-1 family seemed to have an association with the appearance of thyroid peroxidase antibodies and persisting local autoimmune responses during the follow-up. Analysis of patients suffering from diabetes and metabolic traits suggested that genetic IL-1 variation and IL-1Ra play a role in glucose homeostasis and in the development of type 2 diabetes. The coding IL-1 beta SNP rs1143634 was associated with traits related to insulin resistance in cross-sectional analyses. Two haplotype variants of the IL-1 beta gene were associated with prevalent diabetes or incident diabetes in a prospective setting and both of these haplotypes were tagged by rs1143634. Three variants of the IL-1Ra gene and one of the IL-1 beta gene were consistently identified as significant, independent determinants of the IL-1Ra phenotype in two or three populations. The proportion of the phenotypic variation explained by the genetic factors was modest however, while obesity and other metabolic traits explained a larger part. Body mass index was the strongest predictor of systemic IL-1Ra concentration overall. Furthermore, the age-adjusted IL-1Ra concentrations were elevated in individuals with metabolic syndrome or diabetes when compared to those free of metabolic dysregulation. In prospective analyses the systemic IL-1Ra levels were found as independent predictors for the development of diabetes in people with metabolic syndrome even after adjustment for multiple other factors, including plasma glucose and CRP levels. The predictive power of IL-1Ra was better than that of CRP. The prospective results also provided some evidence for a role of common IL-1 alpha promoter SNP rs1800587 in the development of type 2 diabetes among men and suggested that the role may be gender specific. Likewise, common variations in the IL-1 beta coding region may have a gender specific association with diabetes development. Further research on the potential benefits of IL-1Ra measurements in identifying individuals at high risk for diabetes, who then could be targeted for specific treatment interventions, is warranted. It has been reported in the recent literature that IL-1Ra secreted from adipose tissue has beneficial effects on glucose homeostasis. Furthermore, treatment with recombinant human IL-1Ra has been shown to have a substantial therapeutic potential. The genetic results from the prospective analyses performed in this study remain inconclusive, but together with the cross-sectional analyses they suggest gender-specific effects of the IL-1 variants on the risk of diabetes. Larger studies with more extensive genotyping and resequencing may help to pinpoint the exact variants responsible and to further elucidate the biological mechanisms for the observed associations. This would improve our understanding of the pathways linking inflammation and obesity with glucose and insulin metabolism.