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Small businesses are dominant in most economies and their owners likely experience high levels of distress. However, we have not fully explored how these common businesses meaningfully differ with respect to the stress process. Understanding the meaningful variations or subgroups (i.e., heterogeneity) in the small business population will advance occupational health psychology, both in research and practice (e.g., Schonfeld, 2017; Stephan, 2018). To systematize these efforts, the author identifies five commonly appearing “heterogeneity factors” from the literature as modifiers of stressors or the stress process among small business owners. These five heterogeneity factors include: owner centrality, individual differences, gender differences, business/ownership type, and time. After synthesizing the research corresponding to each of these five factors, the author offers specific suggestions for identifying and incorporating relevant heterogeneity factors in future investigations of small business owners’ stress. The author closes by discussing implications for advancing occupational health theories.

The authors use a reduced form state-dependent labor participation decision model to illustrate that parameter stability is achieved only if a model properly takes account the observed sample heterogeneity and unobserved sample heterogeneity provided (external) conditions of a model stay constant. Our analysis of the dynamic response path to a health shock using Australian HILDA panel data from 2002 to 2009 shows that experiencing an event by itself can only have a temporary effects. The long-run equilibrium condition is independent of initial conditions or shocks that do not last. In other words, if experiencing an event does not lead to changes in the response parameters such as the real business cycle (Kydland & Prescott, 1977, 1982) or dynamic stochastic general equilibrium model (DSGE, e.g., Sbordone et al., 2010) assumed, policy change may only change the short-run response path. There is no long-term impact for a policy change. On the other hand, if a policy change leads to changes in the decision rules (e.g., the recent US–China trade friction) as the Lucas critique (1976) implies, then there is no other way to evaluate the impact of a policy except to explicitly model how agents respond to the policy change.

The authors argue that organization design needs to play a more active role in the explanation of differential performance and outline a set of ideas for achieving this both in theoretical and empirical research. Firms are heterogeneous in terms of (1) how well they do things, capturing persistent productivity differences, and (2) how they do things – and both reflect firms’ organization design choices. Both types of heterogeneity can be persistent, and are interdependent, although they have typically been studied separately. The authors propose a simple formal framework – the “aggregation function framework” – that aligns organization design thinking with the emphasis on performance heterogeneity among firms that is characteristic of the strategy field. This framework allows for a more precise identification of how exactly organization design may contribute to persistent performance differences, and therefore what exactly are the assumptions that strategy and organization design scholars need to be attentive to.

Purpose – Study the impact of the heterogeneity of institutional investors, evident in their investment horizon, on firm credit ratings.

Methodology/approach – Use a large sample of U.S. firms over the period from 1985 to 2006 (20,670 U.S. firm-year observations) to empirically investigate the relationship between institutional investment horizon and firm credit ratings. Test whether institutional investors with long-term investment horizon are associated with important monitoring and informational roles and thus higher credit ratings.

Findings – Stable shareholdings and relationship investing of institutional investors contribute to their monitoring and informational roles and result in higher firm credit ratings. Namely, ownership stakes of long-term institutional investors are associated with higher firm credit ratings than those of short-term institutional investors. In addition, the predominance and number of institutional investors with a long-term investment horizon affect firm's agency costs and information quality.

Social implications – Institutional monitoring incentives seem to be susceptible to the heterogeneity of institutional investors. The results point to the benefits of the long-term investment horizon of institutional investors (beyond their shareholdings) that seem to be associated with more efficient monitoring and thus reduced managerial myopia and opportunism.

Originality/value of the chapter – This is the first work to provide evidence on the extent to which the heterogeneity of institutional investors, evident in their investment horizon, alters firm's credit ratings.

Many organizations around the world currently are facing board diversity issues and challenges. Hence, this empirical paper investigates the relationship between board diversity and firm’s financial performance. We use a sample of 35 companies from five countries in Southeast Europe (Macedonia, Croatia, Serbia, Bosnia and Herzegovina, and Greece) for the period between 2008 and 2012 to find that, on average, companies with well-educated board members are more profitable and overvalued on the market. When running the regression again to test the levels of heterogeneity, we also find that the companies with more women on board tend to be overvalued on the market, while those with more foreigners on board are subject of undervaluation. The paper mostly contributes to the literature on corporate governance and board diversity. First, we postulate the impact of each of the board diversity variables on the financial performance and then show the extent of this impact and its economic interpretation. Our findings have important practitioners’ implications for corporate regulators and policy-makers since the demonstrated positive impact of the well-educated board members on firm’s financial performance gives a new impetus in building a corporate strategy that will intend to engage more people holding PhD on board.

This chapter investigates the impact of the COVID-19 pandemic on economic stimulus policies. Based on data from 156 economies, empirical results show that in the medium term, cumulative effect of COVID-19 pandemic is positively correlated with the economic stimulus policies but not in the short term. Heterogeneity tests show that while economic policies are used in developed economies more often, restrictive measures in developing countries are likely used as a substitution; deaths have a positive impact on economic stimulus policies but confirmed cases not. The results suggest that the pandemic may reinforce economic inequality due to potential stimulus policy capabilities, requiring international coordination and assistance to low-and-middle income countries in various aspects.

This chapter describes how to use popular software programs (Hierarchical Linear Modeling, LISREL) to analyze multiwave panel data. We review prevailing methods for panel data analyzes in strategic management research and identify their limitations. Then, we explain how multilevel and latent growth modeling provide more rigorous methodologies for studying dynamic phenomena. We present an example illustrating how firm performance can initiate temporal change in the human and social capital of members of Board of Directors, using hierarchical linear modeling. With the same data set, we replicate this test with first-order factor latent growth modeling (LGM). Next, we explain how to use second-order factor LGM with panel data on employee cognitions. Finally, we review the relative advantages and disadvantages of these new data-analytical approaches.

Most traditional research on work groups has studied groups and teams that are homogeneous with respect to culture. To alleviate the dearth of material on culturally heterogeneous teams, this chapter provides an overview of the impact of cultural diversity on groups and teams in today’s workforce. First, we focus on the problems involved in defining the constructs of “teams” and “culture.” Second, we provide a brief review of the cultural factors that have been identified as affecting human performance. This review serves as the basis for the third section of this chapter, which investigates if – and how – cultural heterogeneity affects team performance. Finally, we conclude with how culturally diverse workplaces can be managed and how to improve performance when faced with cultural diversity.

This chapter examines the effects that airports have had on economic development in cities from 1950 to 2010. It uses a novel dataset consisting of previously unexploited data on the origins and history of the aviation system in the United States. Applying the method of synthetic controls to a set of medium and small airports, I examine both the overall impacts and the heterogeneity within the outcomes of various airports. Then, I use regression analysis to determine key factors differentiating successful airports from less successful ones, as it pertains particularly to population and employment growth. I find that, first, on average, cities have benefited from airports over this period. Airports, overall, provided a causal contribution of 0.2– 0.6% per year on population and employment growth over the time period. Second, I show that city-level factors contributing to airport success include: (1) closer proximity to a major research university, (2) a capital city location, and (3) climate factors, particularly higher January mean temperatures and/or hours of sunshine. City size is a consideration as well; cities in larger metropolitan areas, with larger shares of employment in nontradables in the 1950s, were also better positioned to reap the benefits that airports provided on city growth. Significant differences were not found across regions, airport governance structures, or other factors.

Purpose – In this chapter, we examine individual- and country-level differences in 4 work attitudes (work centrality, work commitment, job satisfaction, and autonomy) among 31 European countries in 1999 using a multilevel framework.

Design/methodology/approach – We utilize the 1999/2000 European Values Study to investigate individual- and country-level determinants of work values and job rewards. Our analysis contains 17 traditionally capitalist and 14 post-socialist countries. At the country level, we consider 11 institutional processes as possible explanations for variations in work values and job rewards: post-socialist status, continuous democracy, contentious politics, state capacity, socialist ideology, union density, economic integration, service employment, income inequality, linguistic heterogeneity, and population density.

Findings – We find that traditionally capitalist countries tend to score lower on work values and higher on job rewards than post-socialist countries. Our analyses show that each of the 11 institutional processes, especially continuous democracy and economic integration, has statistically significant effects on the four dependent variables.

Research limitations/implications – Of the 44 hypotheses we made, 23 were supported by statistically significant effects in the predicted direction, 16 were not significant, and 5 were statistically significant in a direction unanticipated by our theory. We discuss possible reasons for the results that did not conform to our expectations.

Originality/value – The study is one of the most comprehensive multination studies of work values and job rewards in that it examines the impact of 11 institutional processes on four different work attitudes among 31 European countries. It is the only study of this scope to rigorously examine the differences between traditionally capitalist and post-socialist countries.