research notes characterizing environmental variation a hypothesized relationship between environmental variation and organizational actions is central to organization theory this study shows that conventional summary measures of instability do not c

inertia and creeping rationality in strategic decision processes in two earlier studies comprehensiveness a characteristic of rational strategic decision making processes exhibited a positive relationship with organizational performance in a stable environmen

the measurement and trend of inequality comment in a recent article in this review morton paglin proposes a measure of concentration which he claims will correct the gini ratio for overstatement in populations where each individual may be expected to vary his income or wealth over his life cycle the paglin measure suggests that the gini ratio overstates income concentration in the united states by a third and does not reveal a 23 percent decline in concentration which has occurred between 1947 and 1972 these results are based on an improper decomposition of the gini ratio in this note i decompose the gini ratio to derive the paglin measure it is shown to correct for neither demographic nor life cycle income effects and to understate intracohort income or wealth inequality if properly normalized the paglin measure shows that the gini overstates u s income concentration by 7 percent or less and indicates a decline in u s interfamily income concentration of less than 12 percent four percentage points of this decline are the result of demographic change while less than 7 points comparable to the 5 percent decline of the gini are the result of decreased income concentration within cohorts of family heads decomposition further reveals major changes in the division of income among cohorts and in concentration of income within cohorts these changes compensate each other in the paglin measure the use of which as a measure of income or wealth concentration is not recommended the gini concentration ratio

going the distance the pros and cons of expanding employees global knowledge reach while some scholars have suggested mnes to be superior to markets for managing knowledge across geographically distant boundaries how they actually accomplish this has not been fully considered we address this void by developing and testing a model that highlights the critical role of organizational incentives in enhancing employees internal search and use of knowledge data from 166 knowledge intensive projects support our argument that in contrast to process based incentives that influence more local search outcome based incentives motivate employee teams to reach well beyond their immediate location which in turn enhances performance at the same time we demonstrate that expanded reach also increases the likelihood of accessing more codifiable knowledge which can hurt performance our model examines the contradictory and previously unknown effects of global knowledge reach

what are the consequences of initiative taking in multinational subsidiaries the phenomenon of subsidiary initiative has received increasing attention in recent years but the consequences of initiatives and the associated dynamics of headquarters subsidiary relationships have received much less research attention building on resource dependence theory and self determination theory we argue that two basic goals subsidiary managers pursue are to achieve autonomy vis a vis corporate headquarters and influence over other units we investigate how a subsidiary s past initiatives contribute to its bargaining power and how headquarters response through granting attention or monitoring affects the realization of the subsidiary s goals using structural equation modeling our hypotheses are tested by drawing on a sample of 257 subsidiaries located in three different countries australia canada and the united kingdom our results show that subsidiaries are not able to increase their influence through initiatives unless they get headquarters attention we also find that subsidiary initiatives have a direct effect on subsidiary autonomy but the caveat is that initiatives also evoke headquarters monitoring which in turn decreases the subsidiary s autonomy in addition to providing insights into how subsidiaries can achieve their goals the paper also sheds light on the critical role headquarters plays in leveraging initiatives and the influence of individual subsidiaries in the multinational enterprise

a decomposition analysis of the trend in uk income inequality post war britain has experienced a number of dramatic demographic and social changes that have undoubtedly influenced the distribution of income there has been a rise in the number of pensioners whose incomes are relatively low a considerable increase in the number of young and old households living on their own and a remarkable expansion in the proportion of working wives the potential importance of these structural changes suggests that their impact on the income distribution needs to be examined systematically before any attempt can be made to interpret the observed trend in overall income inequality adequately the method usually adopted for this purpose attempts to create a comparable time series of distributions based on the structural characteristics pertaining in one particular year for example if we wished to investigate the effect of shifts in the age structure of the population this approach would disaggregate the distribution in one year tl and estimate what the distribution would have been like if the age structure had been the same as that observed in some other year to on the assumption that other distributional characteristics such as ageincome differentials and inequality within age groups remain invariant to this demographic change the comparison between the actual distribution at t1 and the constructed distribution at t1 with to s age structure is taken to indicate the impact of changes in the age structure over the period concerned this comparison can be presented in terms of quantile shares summary measures of inequality or the entire lorenz curves this approach known as shift share analysis or standardising the inequality series see semple i975 love and wolfson i976 dinwiddy and reed i977 royal commission i977 rowley and henderson i978 macleod and horner i980 is perfectly adequate for simple and straightforward structural changes when several changes are occurring simultaneously however it becomes difficult to identify the contribution of the individual factors and to assess their relative importance to the overall trend in inequality furthermore the combined impact of several structural influences will not in general sum up to the inequality change requiring explanation the purpose of this paper is to propose an alternative method of analysing

regional price level variations and real household incomes in the united kingdom 1979 80 1993 johnston r mckinney m and stark t 1996 regional price level variations and real household incomes in the united kingdom 1979 80 1993 reg studies 30 567 578 for the years 1979 80 to 1993 relative regional price indices rrpis are construced under a variety of definitions the base data are an amalgamation of figures from the reward group s cost of living comparisons and the family expenditure surveys the rrpis are then used to adjust regional household weekly incomes and the impact examined on the inequality of income inequality is decomposed into within region and between region components both components are seen to increase over the time period but both the level and increase in the former are substantially larger than the latter a general conclusion is that inequality within regions far exceeds that between regions johnston r mckinney m et stark t 1996 la variation du niveau des prix regional et les revenus menagers reels au royaume uni de 1979 80 a 1993 reg studies 30 567 578

how do different designs of energy labels influence purchases of household appliances a field study in switzerland abstract energy labels are a key element of energy efficiency policies they provide information on appliances energy consumption and aim at increasing consumers attention to this characteristic a well known example is the eu energy label which is required by law to be displayed on most energy using durables in the eu as well as in switzerland in cooperation with a large online retailer in switzerland we assess the impact of the eu energy label and of a newly designed monetary lifetime oriented energy label in the field we analyze private purchases of household appliances especially freezers vacuum cleaners and tumble dryers we find that the display of any of the two energy labels increases the sales proportion of energy efficient appliances compared to the absence of any energy label at the same time we observe a volume effect for freezers the average size of purchased freezers is larger when any of the two energy labels is displayed compared to the absence of any energy label the influence of the two different energy labels is similar except for vacuum cleaners for which monetary information might have an adverse effect

patterns of control in u s uk and european multinational corporations this paper examines the type and level of control exercised by the parent headquarters of 50 u s uk and european multinational corporations over their foreign subsidiaries patterns of control in the 3 national groups differ in significant ways and these differences seem to have important implications for other characteristics of a company s organization design and managerial style

is there an energy efficiency gap many analysts have argued that energy efficiency investments offer an enormous win win opportunity to both reduce negative externalities and save money this overview paper presents a simple model of investment in energy using capital stock with two types of market failures first uninternalized externalities from energy consumption and second forces such as imperfect information that cause consumers and firms not to exploit privately profitable energy efficiency investments the model clarifies that only if the second type of market failure cannot be addressed directly through mechanisms such as information provision energy efficiency subsidies and standards may be merited this chapter therefore reviews the empirical work on the magnitude of profitable unexploited energy efficiency investments a literature which frequently does not meet modern standards for credibly estimating the net present value of energy cost savings and often leaves other benefits and costs unmeasured these problems notwithstanding recent empirical work in a variety of contexts implies that on average the magnitude of profitable unexploited investment opportunities is much smaller than engineering accounting studies suggest finally there is tremendous opportunity and need for policy relevant research that utilizes randomized controlled trials and quasi experimental techniques to estimate the returns to energy efficiency investments and the welfare effects of energy efficiency programs

the misleading effect of energy efficiency information on perceived energy friendliness of electric goods the european union energy label informs consumers at the point of sale about the energy efficiency and electricity consumption of various electric goods the label should enable consumers to purchase energy friendly products i e products with low energy consumption thereby making a significant contribution to the reduction of overall energy consumption this paper offers a systematic analysis of consumers interpretation of the energy label the results of a set of experimental studies revealed that consumers tend to base their estimates of a product s energy consumption mainly on the energy efficiency class e g a communicated on the energy label and largely ignore information about annual electricity consumption e g 120 kwh year thereby consumers potentially overestimate the energy friendliness of a product assigned a high energy efficiency rating this also holds true when consumers directly compare two products in terms of energy friendliness thus participants chose a higher consuming product because it had a high energy efficiency rating high energy efficiency ratings e g a can distort consumers perceptions of product categories that consume excessively e g freezers participants were seduced into thinking that a high energy efficiency rating e g a means the energy consumption of energy hogs is no longer problematic this paper provides evidence that the energy label could have a contrary effect than the one intended due to people s susceptibility to an energy efficiency fallacy this misinterpretation of the energy label could further explain why overall energy demand is increasing despite enhanced energy efficiency finally implications for policy makers and further research for enhancement of the energy label are discussed

revisiting between group inequality measurement an application to the dynamics of caste inequality in two indian villages standard approaches to decomposing how much group differences contribute to inequality rarely show significant between group inequality and are of limited use in comparing populations with different numbers of groups this study applies an adaptation to the standard approach that remedies these problems to longitudinal household data from two indian villages palanpur in the north and sugao in the west the authors find that in palanpur the largest scheduled caste group failed to share in the gradual rise in village prosperity this would not have emerged from standard decomposition analysis however in sugao the alternative procedure did not yield any additional insights because income gains applied relatively evenly across castes

two decades of income inequality in britain the role of wages household earnings and redistribution we study earnings and income inequality in britain over the past two decades including the period of relatively inclusive growth from 1997 to 2004 and the great recession we focus on the middle 90 where trends have contrasted strongly with the new inequality at the very top household earnings inequality has risen driven by male earnings although a catch up of female earnings did hold down individual earnings inequality and reduce within household inequality nevertheless net household income inequality fell due to deliberate increases in redistribution the tax and transfer system s insurance role during the great recession falling household worklessness and rising pensioner incomes

urban biased policies and rising income inequality in china since the start of economic reforms in 1978 china has experienced the largest increase in income inequality of all countries for which comparable data are available according to the world bank 1997 china s gini coefficient increased from 28 2 in 1981 to 38 8 in 1995 based on official survey data another study that used internationally standard definitions for incomes estimated china s gini ratio at 38 2 in 1988 and 45 2 in 1995 a level that already surpassed many developing economies in asia azizur khan and carl riskin 1998 are these income inequality changes the consequence of institutional reforms that replaced egalitarian rewards with work incentives employment contracts and labor mobility this paper uses household survey data collected by china s state statistical bureau ssb to investigate the sources and causes of this rising inequality by analyzing gini ratios and generalized entropy measures i decompose the overall inequality into three sectoral components i inequality within rural areas ii inequality within urban areas and iii sectoral disparity the data indicate that increases in rural urban income differentials have been the driving factor behind the rising overall inequality in china i argue that urbanbiased policies and institutions including labor mobility restrictions welfare systems and financial policies of inflation subsidies and investment credits to the urban sector are responsible for the long term rural urban divide and the recent increases in disparity

distributive implications of an aging society abstract the paper reviews recent research on the impact of an aging population on the distribution of income after briefly discussing the demographic conditions responsible for population aging a short account is given of demographic trends in the industrialized world in order to disentangle the many potential channels by which an aging society affects the dispersion of income several levels of aggregation are distinguished the paper differentiates between intra and intergenerational issues between direct and indirect demographic inequality effects and between the distribution of current and lifetime income it emphasizes the critical role of age related redistributive tax transfer systems like public pension schemes and health care systems sources of distributional policy conflicts are identified at both the cross section level and the lifetime level of income inequality the institutional design of intergenerational burden sharing individual disincentive reactions shifts in age income profiles related to cohort size and politico economic repercussions are shown to drive the relation between population aging and income distribution in distinct and partially opposite ways

cognitive reflection and the valuation of energy efficiency abstract based on a stated choice experiment among about 3 600 german households heads on the purchase of electricity using durables this paper explores how cognitive reflection influences consumers valuation of energy efficiency and investigates the interaction with consumers response to the eu energy label our results indicate that consumers with low cognitive reflection value energy efficiency less furthermore we demonstrate that consumers with a low level of cognitive reflection primarily choose appliances based on grade like energy efficiency classes rather than detailed information on annual energy use

sharing the national cake in post reform new zealand income inequality trends in terms of income sources abstract using household economic survey hes data in unit record form this paper examines the trends of household income inequality in new zealand over the period 1984 96 a period that saw new zealand implement a wide range of economic and social policy reform the observed changes in the overall income inequality are then decomposed by income components to measure the contributions of the different sources of personal income to the overall inequality to our knowledge this is the first time that the methodology for disaggregating the gini co efficient including its more recent extensions by lerman and yitzhaki review of economics and statistics 63 1985 151 podder review of income and wealth 39 1993 51 and mookherjee and shorrocks economic journal 92 1982 886 has been applied to micro level new zealand data for computing income inequality and other related indices and measures reported in this study the findings which indicate a steady upward trend in income inequality are examined in the light of the reform policies used at the time their implications for policy are also addressed

ballot position choice fatigue and voter behaviour in this paper we examine the eect of choice fatigue on decision making we exploit a natural experiment in which voters face the same contest at dierent ballot positions due to dierences in the number of local issues on their ballot facing more decisions before a given contest signi cantly increases the tendency to abstain or rely on decision shortcuts such as voting for the status quo or the rst listed candidate we estimate that without choice fatigue abstentions would decrease by 8 and 6 of the propositions in our dataset would have passed rather than failed

changes in the distribution of housing wealth in great britain 1985 91 during which time sizeable real capital gains accrued to owner occupiers particularly those who were already owner occupiers at the start of this period the paper constructs housing wealth estimates disaggregated by household from the 1985 ghs and 1991 bhps wave 1 in order to explain the distributional consequences of the housing market experience the paper finds that there has been a modest increase in housing wealth inequality but one that is more pronounced for gross housing wealth compared with equity this growth has been offset by the growth in owner occupation and the benefits of the council house right to buy scheme

characterizing environmental variation a hypothesized relationship between environmental variation and organizational actions is central to organization theory this study shows that conventional summary measures of instability do not capture all dimensions of environmental variation this problem is addressed with frequency amplitude and predictability measures that characterize the pattern of environmental variation the hypothesis that there is a relationship between longitudinal environmental variation and organizational structures actions and outcomes is common to most of the major perspectives of organization theory child 1972 hannan freeman 1977 pfeffer salancik 1978 thompson 1967 although there has been little agreement across theories about the causal mechanisms linking environmental variation with organizational characteristics organizational theorists have generally agreed that there is some relationship between longitudinal environmental change and organizing problems as a result environmental variability is a central independent construct in models of processes as disparate as strategic choice firm failure and executive turnover organizations experience longitudinal environmental variation as variation in the availability of the resources required for organizational survival dess beard 1984 52 these resources include sales and knowledge about product design and manufacturing processes in private enterprises budget allocations in the public sector personnel and other production factors researchers have typically characterized variation in the availability of such resources over time with measures of volatility dynamism or instability that attempt to capture total environmental variation with a single dimension we propose a characterization of the pattern of longitudinal environ

economic growth income inequality and poverty in china under economic reforms china s gross domestic product gdp more than quadrupled between 1978 and 1996 under economic reforms per capita disposable incomes more than tripled in the cities and almost quadrupled in the rural areas however rapid economic growth brought about large income inequality which slowed down poverty reduction in 1995 there were still 70 170 million people living in poverty this article aims to assess the relationship between economic growth income inequality and poverty using both secondary and household survey data the main findings are 1 urban rural divide and spatial inequality are two major factors accounting for overall income inequality 2 non wage and non farm incomes are more unequally distributed than wage and farm incomes and 3 the incidence of poverty is very sensitive to the changes in per capita income and inequality

the measurement and trend of inequality comment in the september 1975 issue of this review morton paglin posits a new summary statistic the paglin gini which he uses to measure and analyze the level and trend of income inequality in the united states this measure intends to recognize only income differences among families unrelated to the observed age income profile as contributing to meaningful income inequality this is to be contrasted with the standard lorenz gini in which all differences in income among living units contribute to inequality paglin s measure indicates substantially less inequality in the united states than is indicated by the lorenz gini moreover paglin inequality falls considerably in the post world war ii period while other measures indicate very little change in inequality over this period paglin is addressing an important problem for the postwar period when the age distribution the length of time spent in school and the propensity of the young and the old to form their own households have all changed rapidly the trend in the conventional gini coefficient has no obvious normative interpretation however it is often given one unfortunately paglin s proposed index of inequality does not meet its objective and even if it did its normative content would be no clearer than that of the standard measure indeed no single indicator is sufficient to capture trends in normatively relevant inequality without further analysis like any other time series a time series of inequality must be approached with a well specified multivariate model after describing paglin s procedure in the next section we challenge his measure in section ii in section iii paglin s interpretation of policy relevant inequality is questioned and in section iv the implications of the paglin gini for the equity of the transfer system are analyzed section v is a summary of our critique

demographic change and income distribution this paper examines the interactions between demographic change and income distribution especially in the context of government starting from a simple descriptive life cycle model of individual income this paper established an explicit link between the age composition of a population and the personal distribution of incomes demographic effects on income inequality are derived next 2 income maintenance programs are introduced a redistributive tax transfer scheme and a pay as you go financed state pension system the resulting government budget constraints entail interrelations between fiscal and demographic variables causing an additional indirect demographic impact on the distribution this is shown not only to change but in some cases even to reverse the distributional incidence of demographic trends the superimposition of different age structures on populations of otherwise identical characteristics is non neutral with respect to income distribution disregarding state interventions population aging increases income inequality this result may no longer generally hold if redistribution policies are taken into account the paper provides an example of how indirect demographic effects may lead to a reversal of sign in the absence of any government program a higher ratio of pensioners to active workers raises income inequality in the presence of a redistributive tax transfer scheme and pay as you go financed state pension system a higher dependency ratio decreases income dispersion the restoration of government budget equilibrium induces unintended distributional effects which put the incidence of demographic shifts in a different light varying important aging indicator with realistic forecast bounds leads to inequality fluctuations up to 35 this illustrates the quantitative scale and hence the political importance of demographically caused inequality distortions

the gini multi decomposition and the role of gini s transvariation application to partial trade liberalization in the philippines this article proposes a unified technique of the gini decomposition the gini multi decomposition is a combination of the income source decomposition and the subgroup decomposition this technique is applied on reference situation and simulated scenarios for partial trade liberalisation in philippines and is extended to different orderings to capture a wide range of between group indicators we simulate variations in income source distributions for seven educational groups in the philippines in order to measure the inequality variations between a reference situation and a post simulation one with positive externalities due to public expenditures on the private sector productivity

accounting for inequality trends decomposition analyses for the uk 1971 86 eight explanations for uk income inequality trends between 1971 and 1986 are assessed by pooling evidence from inequality index decompositions by population sub group and by income source the principal causes of the aggregate trends were a mixture of changes in earnings inequality employment structure and unemployment but this mixture changed over time the impact of wage inequality changes on income inequality changes fell during the 1970s and 1980s reflecting the secular decline in the importance of employment earnings for household income packages unemployment changes had their largest impact at the start of the 1980s between 1981 and 1986 self employment income changes appear to have had the largest influence

behavioral economics and energy conservation a systematic review of non price interventions and their causal effects abstract research from economics and psychology suggests that behavioral interventions can be a powerful climate policy instrument this paper provides a systematic review of the existing empirical evidence on non price interventions targeting energy conservation behavior of private households specifically we analyze four nudge like interventions referred to as social comparison commitment devices goal setting and labeling in 44 international studies comprising 105 treatments this paper differs from previous systematic reviews by solely focusing on studies that permit the identification of causal effects we find that all four interventions have the potential to significantly reduce energy consumption of private households yet effect sizes vary immensely we conclude by emphasizing the importance of impact evaluations before rolling out behavioral policy interventions at scale

inequality in five countries in the 1980s the role of demographic shifts markets and government policies this paper uses luxembourg income study lis data to examine levels of and trends in income inequality in canada the netherlands sweden the united kingdom and the united states inequality increased in sweden the united kingdom and the united states but did not increase in canada and the netherlands increased inequality of household heads earnings and increased shares of spouses earnings in family income account for much of the observed increases in income inequality the public sector can in general be assigned a moderating effect on these changes demographic shifts are not assigned any major role in inequality changes excerpt

the coordination of manufacturing interdependence in multinational companies many companies have recently adopted global manufacturing rationalization programs in order to realize the full benefit of these internationally integrated manufacturing strategies however companies need to overcome the problem of coordinating operations where interdependence exists among subsidiaries this article which is based on a field study of 25 multinational companies provides insights on how manufacturing interdependence among country subsidiaries is coordinated specifically the study examined the relationships between increasing manufacturing interdependence with the use of 4 coordination modes impersonal methods use of organization members who have a system sensitive outlook executive compensation systems based on a subsidiary s performance and personal communication and with the use of 3 communication patterns communication between managers of different country subsidiaries communication with top management and communication with a central manufacturing staff group findings suggest that although there is an extensive use of impersonal methods of coordination with increasing interdependence there is a change in coordination mix towards greater use of system sensitive members and personal communication increasing interdependence is also significantly associated with greater communication among country subsidiary managers and greater communication with a central manufacturing staff group although the relationships between increasing interdependence and communication with top management through the formal hierarchy was not found to be statistically significant interviews with managers suggested the importance of this channel when communication among country subsidiary managers and communication with the central manufacturing staff group are inadequate for managing the manufacturing interdependence implications are drawn for companies planning to increase the international integration of their manufacturing operations

are risk aversion and impatience related to cognitive ability is the way that people make risky choices or tradeoffs over time related to cognitive ability this paper investigates whether there is a link between cognitive ability risk aversion and impatience using a representative sample of the population and incentive compatible measures we conduct choice experiments measuring risk aversion and impatience over an annual time horizon for a randomly drawn sample of roughly 1 000 german adults subjects also take part in two different tests of cognitive ability which correspond to sub modules of one of the most widely used iq tests interviews are conducted in subjects own homes we find that lower cognitive ability is associated with greater risk aversion and more pronounced impatience these relationships are significant and robust to controlling for personal characteristics educational attainment income and measures of credit constraints we perform a series of additional robustness checks which help rule out other possible confounds

distribucion salarial y educacion en lima metropolitana 1970 1984 this paper evaluates tbe effects of educational expansion on the wage distribution in metropolitan lima from 1970 to 19i34 the analysis is based on the dynamic decomposition of the second inequality measured proposed by theil the theil l and makes use of peruvian household surveys the main results suggest that such effects depend on the kind of educational expansion that takes place and that they not necessarily contribute to improve the distribution

a sparsity based model of bounded rationality this article defines and analyzes a sparse max operator which is a less than fully attentive and rational version of the traditional max operator the agent builds as economists do a simplified model of the world which is sparse considering only the variables of first order importance his stylized model and his resulting choices both derive from constrained optimization still the sparse max remains tractable to compute moreover the induced outcomes reflect basic psychological forces governing limited attention the sparse max yields a behavioral version of basic chapters of the microeconomics textbook consumer demand and competitive equilibrium i obtain a behavioral version of marshallian and hicksian demand arrow debreu competitive equilibrium the slutsky matrix the edgeworth box roy s identity and so on the slutsky matrix is no longer symmetric nonsalient prices are associated with anomalously small demand elasticities because the consumer exhibits nominal illusion in the edgeworth box the offer curve is a two dimensional surface rather than a one dimensional curve as a result different aggregate price levels correspond to materially distinct competitive equilibria in a similar spirit to a phillips curve the arrow debreu welfare theorems typically do not hold this framework provides a way to assess which parts of basic microeconomics are robust and which are not to the assumption of perfect maximization jel codes d01 d03 d11 d51

a matrix approach to the gini index decomposition by subgroup and by income source the literature offers two main ways of decomposing the gini index decomposition by population subgroup and by income source this article proposes merging the two decomposition dimensions by suggesting a matrix formula for the gini index which permits the simultaneous decomposition by subgroup and by income source using this multi decomposition one can investigate the role of the interaction between the subgroup and the source components in determining the overall inequality we apply the methodology to sample data on italian household incomes collected in 2008

global strategy implementation at the business unit level operational capabilities and administrative mechanisms the study examines the impact of internationally strategy on organizational design and the influence of the organizational design on effectiveness at the business unit level the empirical findings are based on survey responses from eighty two business units competing in global industries the findings are supportive of the contingency notion which suggests that business unit effectiveness is a function of the fit between the international strategy and the organizational design

managing foreign subsidiaries agents of headquarters or an interdependent network in this study two different theoretical perspectives are used to develop sets of hypotheses regarding the mechanisms used to manage foreign subsidiaries of multinational corporations first agency theory serves as the basis for a model that predicts the use of monitoring mechanisms and incentive compensation then it is argued that these mechanisms are insufficient for managing subsidiaries characterized by high levels of intra firm international interdependence the management of which is critical to many of today s complex global firms a second set of hypotheses is argued linking international interdependence to several social control mechanisms primary and secondary data from u s based multinational corporations were used to test both sets of hypotheses the results indicate that agency theory although a useful foundation for studies of control within mncs is limited in its ability to explain fully the phenomenon of foreign subsidiary control however the model based on intra firm interdependence had much greater predictive ability copyright 2000 john wiley sons ltd

how unification and immigration affected the german income distribution abstract the german economy is not only affected by unification of germany but by a significant influx of immigrants from abroad and huge migration from east to west germany around the date of unification data from the german socio economic panel study gsoep allows one to disentangle those effects by decomposition of the theil i 0 index of inequality in addition the paper offers insights into the transition from a socalist economy into a market oriented one

firm and industry as determinants of executive perceptions of the environment this study examines variation in top executives environmental perceptions within firms and within industries more specifically we investigate how industry and organizational membership affect top executives perceptions of five environmental attributes results indicate that significant homogeneity of perceptions exists within firms and also within industries approximately 40 percent of the variance in individual top level executives perceptions of aspects of their respective organization s environment is explained by their organizational and industry membership implications of the findings for strategic management and organization theory and for future research are presented 1998 john wiley sons ltd commonality of views about a firm s environment among a firm s top managers is frequently discussed but there is little empirical evidence to validate the notion we do not know whether homogeneity of perceptions within top management teams tmts is more imaginable than real an assumed executive team property corresponding to what common sense says should be the case further if there is within firm commonality of views concerning the environment we do not know whether this might not actually be an industry effect the purpose of the research reported here is to assess the degree of homogeneity in executives perceptions within firms and within industries and to compare organizational vs industry membership as explanations of the relative proportion of agreement about organizational environments one of the most compelling reasons to examine the homogeneity of top managers environmental perceptions within firms and within industries

how multinational subsidiary mandates are gained and lost a subsidiary mandate is a business or element of a business in which the subsidiary participates and for which it has responsibilities beyond its national market this research studied thirty one mandates in six canadian subsidiaries of u s owned multinational corporations a life cycle framework was proposed and used to explore the factors associated with the gain development and loss of mandates by subsidiaries two key findings emerged first it was shown that there is a risk in having a full scope world product mandate because it is possible to become marginal to the corporate strategy second it was observed that the engine of subsidiary growth is its distinctive capabilities and that for a mandate to be effective it must be built on those capabilities implications for mandate sustainability are proposed on the basis of these two insights

implementing global strategy characteristics of global subsidiary mandates implementing a global strategy requires coordinating subsidiary activities across country locations the assumption often made is that such coordination must be managed at headquarters however an alternate approach is decentralized centralized responsibilities in which different subsidiaries within the multinational are given worldwide mandates to manage specific products or products lines this study identifies subsidiary characteristics that are associated with receiving a global mandate by examining foreign subsidiaries located in france germany japan u k u s and canada

an empirical analysis of the integration responsiveness framework in global industries in this study businesses competing in global industries were categorized into three groups according to the integration responsiveness framework for conceptualizing industry pressures confronting business competing internationally using this framework contextual conditions associated with each group were examined competitive attributes distinguishing each group were then identified to clarify alternate business level strategies for competing within a global industry context beyond providing additional insight into the nature of competition in global industries several broad extensions to the integration responsiveness framework are suggested

management and ownership effects evidence from five countries despite the growing recognition in the corporate governance literature that the relationship between ownership concentration and profitability is context dependent this issue has not yet been subjected to direct empirical investigation using a single cross national sample this study empirically examines the ownership concentration performance relationship across the nations of canada france germany the united kingdom and the united states essentially we argue that the correlation if any between ownership concentration and firm profitability differs across countries in a systematic way determined by the national system of corporate governance results indicate that important and statistically significant differences do in fact exist across the countries studied 1998 john wiley sons ltd

true world income distribution 1988 and 1993 first calculation based on household surveys alone the paper derives world income or expenditure distribution of individuals for two years 1988 and 1993 it is the first paper to calculate world distribution for individuals based entirely on household survey data from 91 countries and adjusted for differences in purchasing power parity between the countries measured by the gini index inequality increased from an already very high 63 in 1988 to 66 in 1993 the increase was driven more by rising differences in mean incomes between the countries than by rising inequalities within countries the most important contributors were rising urban rural differences in china and slow growth of rural incomes in south asia compared to several large developed market economies

accounting for the recent decline in global income inequality following nearly two centuries of growth global income inequality declined in the last decades of the 20th century to determine the causes of that historic decline we focus on income inequality across nations and find that the major equalizing force is faster than world average income growth in china and south asia industrializing regions where 40 of the world s people live apparently what matters most about economic globalization thus far is its role in the spread of industrialization throughout populous poor regions of the world if so then globalization most likely has reduced global income inequality this decline is anticipated to continue over the next few decades first because of the continued industrialization of poor regions and second because most of the growth in the world s working age population will occur in poor regions

aspects of inequality in greece abstract inequality in the distribution of consumption expenditure per equivalent adult is measured and decomposed using the primary data of two greek household expenditure surveys 1974 1982 among the factors included in the decomposition analysis only education accounts for a relatively large part of aggregate inequality between 1974 and 1982 inequality declined substantially both within groups and between groups although changes in the structure of the population had an adverse effect on inequality

effects of cultural ethnicity firm size and firm age on senior executives trust in their overseas business partners evidence from china we investigate trust relationships between senior business executives and their overseas partners drawing on the similarity attraction paradigm social categorization theory and the distinction between cognition and affect based trust we argue that executives trust their overseas partners differently depending on the partners cultural ethnicity in a field survey of 108 chinese senior executives we found that these executives have higher affect based trust in overseas partners of the same cultural ethnicity as themselves cognition based trust is associated with affect based trust differently when overseas partners are of the same or different cultural ethnicity we also examine the role of relative firm size and age in shaping intra and intercultural trust relative firm size has a stronger negative effect on executives cognition based trust if their partners are of a different cultural ethnicity although firm age does not have a negative effect on executives affect based trust as hypothesized we found firm age to be positively associated with affect based trust for partners of the same cultural ethnicity we discuss theoretical and practical implications of this pattern of inter and intra cultural trust on international business and networking guanxi dynamics in china

rational decision making and firm performance the moderating role of environment this study investigates the moderating roles of environmental munificence and dynamism in the relationship between process rationality and organizational performance based on a sample of 62 manufacturing firms the study found that environmental munificence and dynamism moderate the relationship between rationality and performance further the study found that rationality is strongly associated with performance in environments high in munificence and dynamism 7997 by john wiley sons ltd the relationship between rationality in strategic decision processes and firm performance has been a subject of continuing controversy in the strategic management field one school of thought favors the rational comprehensive approach ansoff 1965 another feels that an incremental political approach offers better descriptive accuracy and normative validity quinn 1980 in recent years the emphasis has moved away from a search for universal relationships that juxtapose these two ideal types to a focus on the context specificity of the rationality performance relationship empirical research on the perfonnance implications of the comprehensiveness of decision processes has yielded confiicting results in a recent review of this literature rajagopalan rasheed and datta point out that most previous studies have focused on one aspect of the

older or wealthier the impact of age adjustment on wealth inequality differences in individual wealth holdings are widely viewed as a driving force of economic inequality however as this finding relies on cross sectional data a concern is that older is confused with wealthier we propose a new method to adjust for age effects in cross sections which eliminates wealth inequality due to age yet preserves inequality arising from other factors using a new cross country comparable database we examine the impact of age adjustments on wealth inequality across countries and over time we find that the most widely used method yields a substantially different picture of age adjusted wealth inequality than our method 2011 the editors of the scandinavian journal of economics

a critical assessment of the eclectic theory of the multinational enterprise the paper critically deals with the electric theory of the multinational enterprise it examines firstly the theoretical redundancy of the ownership advantage secondly the inseparability of the ownership advantage from the location advantage thirdly the conceptual ambiguity of the location advantage and lastly possible methodological dangers of a multi factor analysis under the three headings of the eclectic theory

the role of expatriates in the management of interdependence complexity and risk in multinational corporations a multilevel analysis of environmental country and organizational affiliate factors is used to explain the differential utilization rates of u s nationals in overseas professional positions of a major u s bank with 84 branches in 43 countries the research suggests that to the extent that the affiliates of a multinational corporation operate in environments with differing levels of political risk cultural distance and competition and have operations with different levels of complexity and interdependence a single staffing policy may be inappropriate

financial deepening inequality and growth a model based quantitative evaluation we propose a coherent unified approach to the study of the linkages among economic growth financial structure and inequality bringing together disparate theoretical and empirical literature that is we show how to conduct model based quantitative research on transitional paths with analytical and numerical methods we calibrate and make tractable a prototype canonical model and take it to an application namely thailand 1976 96 an emerging market economy in a phase of economic expansion with uneven financial deepening and increasing inequality we look at the expected path generated by the model and conduct robustness experiments because the actual path of the thai economy is imagined here to be just one realization of many possible histories of the model economy we construct a covariance normalized squared error metric of closeness and find the best fit simulation we also construct a confidence region from a set of simulations and formally test the model we broadly replicate the actual data and identify anomalies robert m townsend is a professor at the university of chicago and a consultant at the federal reserve bank of chicago kenichi ueda is an economist at the international monetary fund the views expressed in this paper are those of authors and do not necessarily represent those of the frb chicago the federal reserve system or the imf we thank the national statistics office of thailand for permission to use the ses data we received helpful comments from robin brooks fabio canova marco cagetti larry christiano angus deaton paul evans jess gaspar hyeok jeong ashok mody tomoyuki nakajima hajime takizawa chris udry annette vissing jorgensen and the participants of the nber general equilibrium conference at new york university the conference honoring rolf r mantel in argentina seminars at cornell university grips hitotsubashi university ohio state university oxford university and the imf as well as the imf conference on macroeconomic policy and poverty reduction we are especially indebted to the editors and referees townsend acknowledges financial support from the nsf and nichd we thank natalia ramondo for excellent research assistance

china s income distribution 1985 2001 we employ a new method to estimate china s income distribution using publicly available interval summary statistics we examine rural urban and overall income distributions from 1985 to 2001 we show how the distributions change directly and we examine trends in inequality using an intertemporal decomposition of aggregate inequality we determine that increases in inequality within rural and urban sectors and the growing rural urban income gap have been equally responsible for the growth in overall inequality over the last two decades however the rural urban gap has played an increasingly important role in recent years we also show that the urban consumption inequality rose considerably

extending the internationalization process model increases and decreases of mne commitment in emerging economies the internationalization process model suggests that firms internationalize by building positions in foreign markets and networks following iterative cycles of learning and changes in commitment however as subsidiaries evolve commitments may be decreased as well as increased a phenomenon that has rarely been studied moreover it remains an open question why strategic intentions at the outset of an investment project differ from the actual operations established we address these questions by extending the model and combining it with mintzberg and waters framework of strategy formation specifically we suggest that commitment decisions correspond to statements of intended strategy while network positions correspond to realized strategies the processes of learning opportunity creation and trust building triggered by commitment decisions are however moderated by institutional influences that lead to divergences between realized and intended strategies we test propositions derived from this framework on a survey data set of subsidiaries of multinational enterprises in hungary lithuania and poland and find that institutional voids and institutional uncertainty affect subsidiary strategy implementation but in opposing directions under high institutional uncertainty investors prefer low commitment but flexible modes that enable later commitment increases whereas institutional voids increase up front information search and adaptation costs that reduce the likelihood of early post entry adjustments our analysis reinforces the need for more differentiated theoretical analyses of how institutions affect business strategies over time

a picture of wage inequality and the allocation of labor through a period of trade liberalization the case of brazil this paper constructs a picture of the labor market impact of trade liberalization in brazil we examine the level and dispersion of wages the skilled wage premium and employment composition before and after trade liberalization after trade reform there was a rise in the returns to college education which since the share of college workers also rose is attributable to rising demand this change did not increase overall wage dispersion because of the small share of college educated workers and because of decreasing returns to intermediate levels of education

project escalation and sunk costs a test of the international generalizability of agency and prospect theories previous north american research suggests that aspects of agency theory and prospect theory may explain decisions to escalate commitment to failing projects this study explores the universality of these theories in this context the willingness of north american and asian managers to escalate commitment to losing projects was measured using four go no go decision cases we hypothesized that asian managers would be less willing to act in their self interest a lower agency effect and would be more willing to escalate a decision in the face of negative framing a stronger framing effect we found that agency theory had strong explanatory power for project in our asian sample framing effects were significant in both but they were not significantly different

regional earnings inequality in great britain a decomposition analysis this paper investigates the degree of earnings inequality in great britain over the period 1975 96 using individual based data it finds that the contribution of within group inequality to both earnings inequality cross sectionally and to its trend over time is substantially more important than the contribution of between group inequality thus the primary source of increasing inequality in the overall earnings distribution is increasing inequality within regions and not differences in average earnings between regions a decomposition of the gini coefficient is also adopted to illustrate how regional convergence in average earnings has been accompanied by increasing overall earnings inequality in the uk a partir des donnees aupres des particuliers cet article cherche a examiner l importance de l inegalite des revenus regionaux en grande bretagne de 1975 a 1996 il en resulte que la contribution de l inegalite a l interieur du groupe a l inegalite des revenus par echantillon et sur le temps s avere nett

trade liberalization and the self employed in mexico summary this paper examines the trend in income inequality and poverty among the self employed workers in mexico during 1984 2002 a period of rapid trade liberalization in the decade following the liberalization inequality and poverty among the self employed increased as the economy stabilized inequality started to go down but poverty kept increasing to understand the observed changes the inequality and poverty indices are decomposed into within and between group components rising returns to skilled labor regional differences in impact of liberalization and sectoral shifts in employment are important factors in explaining the trends in both inequality and poverty

measuring the effects of socio economic variables on the income distribution an application to the east german transition process this paper develops a discrete variant of the semiparametric methodology of dinardo fortin and lemieux 1996 dfl to measure the effects of socio economic variables on the income distribution although the proposed method is also based on the calculation of hypothetical income distributions by reweighting the original population it is much easier to implement the framework is applied to examine the distributional effects of rising unemployment decreasing female labor market participation and widening income structure in east germany following the reunification with west germany in 1990 the empirical results suggest that both these tendencies contributed considerably to the recent increase in income inequality in east germany

environmental scanning behavior in a transitional economy evidence from russia we examined the effects of perceived strategic uncertainty in seven environmental sectors on the scanning behavior of russian executives strategic uncertainty was highest in sectors influenced by

calm after the storms after rising during most but not all ofthe 1960 85 period inequality in chile seems to have stabilized since around 1987 following the stormy period of economic and political reforms of the 197

sourcing patterns of foreign owned multinational subsidiaries in europe tavares a t and young s 2006 sourcing patterns of foreign owned multinational subsidiaries in europe regional studies 40 583 599 this paper investigates the determinants of the international sourcing propensities of foreign owned multinational mne subsidiaries in four european union host countries major findings concern the impact of subsidiary roles and economic integration on international sourcing patterns regional and global integration are leading to a greater import orientation among mne subsidiaries including product mandate firms that are assumed to be strongly embedded within host economies the results cast doubts on existing criteria for inward foreign direct investment fdi attraction policy implications are developed relating to the attraction of inward fdi and to corporate development policies tavares a t et young s 2006 la distribution des sources d approvisionnement des filiales multinationales a capital etranger en europe regional studies 40 583 599 cet article che

the energy efficiency gap what does it mean abstract as renewed attention has been given by policy makers to energy conservation issues it has frequently been asserted that an energy efficiency gap exists between actual and optimal energy use the critical questions is how to define the optimal level of energy efficiency this paper seeks to disentangle some confusing strands of argument that are frequently brought to bear on this question by identifying the major conceptual issues that determine the set of feasible answers we identify five separate and distinct notions of optimality the economists economic potential the technologists economic potential hypothetical potential the narrow social optimum and the true social optimum each of these has associated with it a corresponding definition of the energy efficiency gap our analysis demonstrates that necessary preconditions for identifying the right measure of the energy efficiency gap include understanding and disentangling market failure and non market failure explanations for the gradual diffusion of energy efficient technologies

wage inequality and the distribution of education abstract this paper analyzes the relationship between education and wage inequality in metropolitan brazil the study is based on data from ten brazilian annual household surveys pnads which are available for the period 1976 1986 the universe of analysis is limited to occupied prime age males the inequality measure used was theil s second measure which is analytically convenient for a study of the determinants of inequality it is shown that there exist sharp differences in wage inequality across metropolitan areas to identify whether these large regional differences in inequality are directly associated with differences in educational levels or with differences in the steepness of the wage education profiles some simulations are conducted the results indicate that regional differences in the distribution of education are not able to explain much of the regional differences in wage inequality as a matter of fact the differences in wage inequality were shown to be intrinsically associated with differences in the steepness of the wage education profiles

linking yitzhaki s and dagum s gini decompositions in this article we show that the gini coefficient is simultaneously decomposable both by sources of income and by populations of income receivers for nonoverlapping income distributions the so called first best gini multi decomposition we show that this multidimensional decomposition is useful for many reasons i it is related to the degree of inequality aversion of the decision maker ii it is especially well suited to study inequalities between poor and nonpoor people iii it enables one to measure the impact of marginal tax reforms on within and between group inequalities respectively

economic consequences of an aging population pip europe and japan are experiencing the aging of their populations aging implies a restructuring of the economy political issues which arise in an aging society include 1 a voting majority for the interests of the elderly 2 a voting majority of females 3 the domination of the decision power in corporate and similar ruling bodies and 4 unemployment or a long wait for promotion for younger people economic issues of an aging society include 1 population aging often occurs under reduced rates of growth of per capita national income 2 the relative economic status of the elderly very much depends on the currently existing tax transfer systems and 3 the income of families whose head is over age 65 has generally been more unequally distributed than the income for younger families issues concerning the labor supply of the elderly include 1 the availability of pension income and health limitations strongly influence decisions to retire and 2 older workers become disheartened and choose early retirement when facing bad reemployment prospects in general population aging is likely to have its most substantive effect on the overall level of productivity in an economy where technical knowledge is changing rapidly and strong competition necessitates a high degree of adaptability of the labor force

inequality among world citizens 1820 1992 this paper investigates the distribution of well being among world citizens during the last two centuries the estimates show that inequality of world distribution of income worsened from the beginning of the 19th century to world war ii and after that seems to have stabilized or to have grown more slowly in the early 19th century most inequality was due to differences within countries later it was due to differences between countries inequality in longevity also increased during the 19th century but then was reversed in the second half of the 20th century perhaps mitigating the failure of income inequality to improve in the last decades jel d31 f0 n0 o0