An Arbitrage Pricing Model is estimated in which the risk premia vary in proportion to the conditional volatilities of the macroeconomic innovations which follow an autoregressive specification. The conditional volatilities of the macroeconomic innovations exhibit strong timevariation from month to month. For size‐ranked portfolios of all the shares traded on the Toronto Stock Exchange over the period from March 1962 through March 1988, five macrofactors (namely, the lag of industrial production, the Canadian index of 10 leading indicators, the U.S. composite index of 12 leading indicators, the exchange rate and the residual market factor) have time‐varying and priced risk premia. The small‐firm effect is absent in the risk‐adjusted returns, and a significant portion of the observed January seasonality is explained by the model with time‐varying risk premia.

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This paper discusses the role of managerial mental models (cognitive structures) in the framework of the firm's strategic marketing development. The conceptualisation is based on theories of cognition, learning and strategy development. The empirical part focuses on the exploration of mental models adopted by Greek entrepreneurs. The subjects are members of two formal business networks, founded to promote sector business growth. The qualitative study adopted semi-structured interviews of members of the operational networks of sectors of food and beverages (F&B) and construction materials (CM) in the region of Karditsa (Greece) and revealed the differences of the mental models adopted by respective members. The findings indicate that the mental models adopted by the members of the F&B network are mainly firm and competition centred, whereas the mental models of the members of the CM network are mainly customer and market centred. The findings are in accordance with the Karakaya and Yannopoulos (2010) classification and support the thesis that the adopted mental models often affect organisational learning and the intended knowledge management.