Arjen van Witteloostuijn

Completion or abandonment of mergers and acquisitions: Evidence from the newspaper industry, 1981-2000

Regulatory and technological changes have resulted in a surge in merger and acquisition (M&A) activity in the newspaper industry since the 1980s. This study investigates the “success” of these activities focusing on a particular facet of acquisition performance. We study the completion likelihood of an announced transaction, using a sample of M&A announcements from the newspaper industry (1981–2000). Results show that although firm-level characteristics are relevant, transaction-specific and regulatory factors are even more important. Not surprisingly, the attitude of the transaction—whether hostile or friendly—is a key factor, as are the method of payment and the percentage of control sought by the acquirer. The latter in particular reaffirms the prevailing view on the importance of regulatory influences on media M&As.

Locus of control and learning to cooperate in a prisoner's dilemma game

Boone et al. (Boone, C., De Brabander, B., & van Witteloostuijn, A. (1999a). Locus of control and strategic behaviour in a prisoners dilemma game. Personality and Individual Differences, 27, 695-706; Boone, C., De Brabander, B., & van Witteloostuijn, A. (1999b). The impact of personality on behaviour in five Prisoners Dilemma games, Journal of Economic Psychology, 20, 343-377) showed that subjects with an internal locus of control were, on average, more cooperative in a prisoners dilemma (PD) game than subjects with an external locus of control. They conjectured that this finding should not be interpreted as evidence for stable differences in cooperative behaviour between internals and externals. Specifically, they suggested that it is the capacity to adapt to different circumstances over time that distinguishes internals from externals. In the present study we want to investigate the validity of this proposition. We argue that in a PD setting individuals gradually learn to understand the subtle interplay between cooperation and self-interest. Repetition and learning breed cooperation because people learn to understand that cooperation is instrumental in obtaining long-run profit. There is, however, good reason to believe that individuals differ as to the speed of learning to cooperate. We hypothesise that internals are more astute in learning to cooperate in a PD game because they are more endowed with the cognitive faculties necessary for quick learning than externals. Our empirical findings indeed reveal that externals play less cooperatively, on average, in the first part of a series of PD games. However, this difference gradually disappears. In fact, the experiment suggests that learning and repetition reduce the impact of individual differences. By way of appraisal, implications for further research are discussed.

Configurations of market environments, competitive strategies, manufacturing technologies and human resource management policies : A two-industry and two-country analysis of fit

In this paper an attempt is made to gain further insight into the environment-strategy-performance linkages. A framework is developed to relate managers perceptions of their market environment and competitive strategies to the (advanced) production technologies and human resource management (HRM) policies adopted by their firms. Data from 12 Dutch and 8 British companies in the chemical and food & drink industries reveals that firms with coherent environment-strategy-technology-HRM configurations outperform rivals with incoherent profiles. Further, refined typologies of manufacturing technologies and HRM policies are proposed.

Economic openness and trade linkages of China: An empirical study of the determinants of chinese trade intensities from 1993 to 1999

In the 1980s, the Chinese regime took a number of piecemeal steps toward economic liberalization. This process accelerated impressively in the 1990s. This paper reports an empirical study into the determinants of the emerging pattern of Chinese trade (export and import) intensities in the liberalization decade by exploring international trade statistics for 1993 and 1999. Four models are estimated that explain the shifts in the export and import intensities of the trade with different trade partners in the 1993–1999 period. The estimation results reveal differences for export vis-à-vis import trade intentities, as well as for 1993 compared to 1999. For example, the political determinants of trade intensities that were still very important in 1993 have been moved to the background by economic explanations in 1999. JEL no. F14

A Game-Theoretic Framework of Trust

The key argument of this article is that, in principle, orthodox economics--starting from the homo economicus assumption--may have a lot to offer to the multidisciplinary study of trust. To limit its scope to an area more manageable than economics at large, I explore what is probably the most powerful device of modern economics theory development--namely, game theory. In a way, a game emerges as soon as parties with conflicting interests start to interact. In the interorganizational world, conflicting interests are the rule rather than the exception, implying that games of trust abound. Whether or not such games of trust are associated with trustworthy behavior depends upon the players features and the games rules. Industrial organizations cartel theory, which is rooted in game theory, is very informative about the way in which the rules of the game impact upon the emergence and sustainability of competitive vis-à-vis cooperative behavior, which closely resembles the debate about trust. That is, trust in game theory indicates the conditions under which trustworthy behavior can be expected. In addition to that, the players characteristics are crucial. Although a game theory with trust is flourishing in the context of behavioral economics, one that deals with organizational rather than individual behavior is yet to be developed. In this context, the literature about game theory and trust may offer a source of inspiration, since here ample evidence has been collected as to the origins and consequences of trust heterogeneity.

Competitive and opportunistic behavior in a prisoner’s dilemma game: experimental evidence on the impact of culture and education

The experimental study presented in Cox et al. (1991) referred to henceforth as CLM, revealed that culture has a substantial impact on the cooperative or non-cooperative behavior of U.S.-born African, Anglo, Asian and Hispanic Americans in a Prisoners Dilemma setting. The present article complements CLMs study in three ways. First, CLMs experiment is replicated with a sample of Dutch undergraduates. This replication confirms the major finding of the CLM study that culture matters. Second, the role of uncertainty is included by introducing two different information regimes, indicating that uncertainty regarding the opponents future behavior facilitates cooperation. Third, CLMs study is extended by analyzing the influence of education -- particularly, knowledge of the competition or game theory of economics. It is found that knowledge of behavioral theories or soft economics does stimulate cooperative behavior, but that it has no impact on opportunism. The first point supports the claim in Holler et al. (1992) and Frank et al. (1993) that education plays a role in determining the cooperative or non-cooperative attitudes among managers and students, while the second underscores CLMs observation that culture does matter.

The ‘New’ Versus The ‘Old’ Economy Debate

This chapter critically discusses the recent New Economy debate by identifying five paradoxes. The key argument is that, contrary to New Economy beliefs, employee control may increase, scale economies may start dominating, transaction costs may be pushed up, competitive intensity may be hampered and business cycles may become increasingly volatile. So, this chapter evaluates the forces and counterforces that may operate in the New Economy of the next decade, indicating that the only economic phenomenon that is surely here to stay is uncertainty.