a game theoretic approach for optimal time of use electricity pricing demand for electricity varies throughout the day increasing the average cost of power supply time of use tou pricing has been proposed as a demand side management dsm method to influence user demands in this paper we describe a game theoretic approach to optimize tou pricing strategies gt tou we propose models of costs to utility companies arising from user demand fluctuations and models of user satisfaction with the difference between the nominal demand and the actual consumption we design utility functions for the company and the users and obtain a nash equilibrium using backward induction in addition to a single user type scenario we also consider a scenario with multiple types of users each of whom responds differently to time dependent prices numerical examples show that our method is effective in leveling the user demand by setting optimal tou prices potentially decreasing costs for the utility companies and increasing user benefits an increase in social welfare measure indicates improved market efficiency through tou pricing

estimating residential demand for electricity in greece abstract this paper examines the residential demand for electricity in greece the issues of structural stability price and income sensitivity of both long and short run residential demand for electricity in greece were examined employing monthly data over the period 1986 1999 the long run residential demand for electricity is estimated taking into account changes in weather conditions weighted by the size of the population employing multivariate framework analysis a long run residential demand function for electricity sensitive to real income price level and weather conditions is found to exist and the importance of short run deviations is presented using vector error correction model vecm estimation the empirical evidence suggests the presence of a stable residential demand for electricity in greece both in the long and short run periods and the policy implications of such a relationship are presented

the labour demand of firms an alternative conception based on the capabilities approach the aim of this paper is to offer a theoretical framework for the analysis of labour demand alternative to the neoclassical one taking as its starting point the conception of the firm that derives from the capabilities or competence based theories of the organization after briefly reviewing the essential elements of this approach to the firm we tackle a range of diverse aspects such as the link between labour demand decisions and the firm s strategic planning and its determinants the characterisation of labour demand as a demand for productive competencies the consequences that these competencies are embedded in human beings or the relative independence between labour demand decision making and the process of wage setting in general terms this conception of labour demand allows us to incorporate many of the main peculiarities of labour and the demand for it from a number of different areas of heterodox economics particularly from institutional and post keynesian economics and it fits in with the conventional literature on internal labour markets and labour market segmentation

reducing the mean supply delay of spare parts using lateral transshipments policies lateral transshipment has been studied lately as a promising policy for increasing the performances of multi echelon spare parts inventory system by lateral transshipment spare parts can be moved from one location with excess inventory to another location at the same echelon in shortage with the aim of reducing supply delays of spare parts this paper will examine the relative effectiveness of two lateral shipments approaches in reducing the mean supply delay msd of a non repairable item with respect to a classical policy of no lateral shipments a simulation model of a two echelon supply network has been implemented and an experiment has been performed by varying different parameters of the supply network such as the number of warehouses locations at the lower echelon the supply lead time from the central depot the spare parts demand uncertainty and the size variability of the warehouses results show appreciable reductions of msd when lateral shipments are allowed with respect to the classical policy in almost every network configuration

organisational and spatial determinants of the multi unit firm evidence from the french industry galliano d and soulie n organizational and spatial determinants of the multi unit firm evidence from french industry regional studies this article aims to analyse the factors internal characteristics spatial and industrial environments that determine the existence of multi unit firms and the intensity of their organizational fragmentation at a national scale the empirical models are based on individual data on all french industrial firms collected by the french national institute of statistics the results show the importance of internal characteristics scale economies specific assets as research and development and advertising skill level etc in organizational choice they also highlight the major role played by multi location and by the spatial profile of the firms on the intensity of their fragmentation galliano d and soulie n

towards a capability theory of innovating firms implications for management and policy author s teece dj abstract the author 2017 business enterprises lie at the core of ecosystems that drive economic development and growth in market economies yet until recently mainstream economics has mostly treated firms like homogeneous black boxes run by opportunistic managers the field of strategic management has developed a more nuanced approach to the understanding of how firms are created organized and grow how they innovate and compete and how managers manage one of the leading paradigms in the field is the dynamic capabilities framework in this paper contrasts and complementarities are drawn between dynamic capabilities and economic theories of the firm including transaction cost economics and agency theory connections to the cambridge school are highlighted including the duality between keynes s animal spirits and the dynamic capabilities entrepreneurial owner manager leibenstein s x inefficiency is juxtaposed here with d ineffectiveness knowledge based theories of the firm consistent with cambridge conventions emerge intellectual exchange between strategic management and economics is encouraged to help improve the intuition behind models of firms and the economy

evolutionary theorizing in economics modern economic analysis oriented toward understanding the workings of economies that make extensive use of markets came into existence with three guiding questions all central in adam smith s 1776 1937 the wealth of nations one question concerned order without any central authority guiding and commanding action how is economic activity coordinated the second question was the challenge of explaining the prevailing constellation of prices inputs and outputs what explains the price of labor and the rent of land the third question addressed the processes of economic progress or development smith and other early economists clearly were impressed by the inventiveness the energy and the growing productivity generated by the evolving market economy how to understand its dynamics the first two questions have defined continuing central concerns of the discipline of economics since they first were posed over two centuries ago when not posed in the context of an economy that is understood as in the process of developing they seem to pull the focus of theorizing toward equilibrium conditions the third question concerned with the processes driving economic progress pulls the theorizing toward an evolutionary orientation the question of economic development has waxed and waned in centrality to the discipline as has the importance of evolutionary theorizing during the first several decades of the twentieth century evolutionary thinking and language was widespread in economics but as one contrasts the economic

the economic theory of agrarian institutions introduction alternative approaches to the theory of institutions in economic development pranab bardhan rational peasants efficient institutions and a theory of rural organization methodological remarks for development economics joseph e stiglitz part 1 land and labour theories of sharecropping nirvikar singh a comparison of principal agent and bargaining solutions the case of tenancy contracts clive bell contracts with eviction in infinitely repeated principal agent relationships bhaskar dutta et al production relations in semi arid african agriculture hans binswanger et al part 2 credit and interlinked transactions rural credit markets the structure of interest rates exploitation and efficiency kaushik basu credit and agrarian class structure mukesh eswaran and ashok kotwal credit rationing tenancy productivity and the dynamics of inequality avishay braverman and joseph e stiglitz on choice among creditors and bonded labour contracts t n srinivasan some aspects of linked product and credit market contracts among risk neutral agents clive bell and t n srinivasan a note on interlinked rural economic arrangements pranab bardhan interlinkages and the pattern of competition debraj ray and kunal sengupta part 3 marketing and insurance agricultural institutions for insurance and stabilization david m newbery peasants risk aversion and the choice of marketing intermediaries and contracts a bargaining theory of equilibrium marketing contracts pinhas zusman part 4 co operatives technology and the state agricultural producer co operatives louis putterman institutional analysis of credit co operatives avishay braverman and j luis guasch agrarian structure technological innovations and the state alain de janvry et al

the regulatory treatment of utility diversification recent regulatory reform has gradually relaxed the constraints on vertical and horizontal diversification of public utilities after earlier strategies of conglomerate diversification utilities more recently started to expand into domestic and international activities more closely related to their core business sound diversification may improve corporate performance but raises complicated policy issues in firms operating in both regulated and unregulated markets the paper studies the problems of cross subsidization risk shifting and profit shifting that may result under conditions of partial regulation policy approaches that enable firms to pursue efficient diversification while reducing inefficient diversification incentives created by partial regulation are being analyzed

explaining the attacker s advantage technological paradigms organizational dynamics and the value network abstract understanding when entrants might have an advantage over an industry s incumbent firms in developing and adopting new technologies is a question which several scholars have explained in terms of technological capabilities or organizational dynamics this paper proposes that the value network the context within which a firm competes and solves customers problems is an important factor affecting whether incumbent or entrant firms will most successfully innovate in a study of technology development in the disk drive industry the authors found that incumbents led the industry in developing and adopting new technologies of every sort identified by earlier scholars at component and architectural levels competency enhancing and competency destroying incremental and radical as long as the technology addressed customers needs within the value network in which the incumbents competed entrants led in developing and adopting technologies which addressed user needs in different emerging value networks it is in these innovations which disrupted established trajectories of technological progress in established markets that attackers proved to have an advantage the rate of improvement in product performance which technologists provide may exceed the rate of improvement demanded in established markets this mismatch between trajectories enables firms entering emerging value networks subsequently to attack the industry s established markets as well

the competitive newsboy we consider a competitive version of the classical newsboy problem in which a firm must choose an inventory or production level for a perishable good with random demand and the optimal solution is a fractile of the demand distribution and investigate the impact of competition upon industry inventory a splitting rule specifies how initial industry demand is allocated among competing firms and how any excess demand is allocated among firms with remaining inventory we examine the relation between equilibrium inventory levels and the splitting rule and provide conditions under which there is a unique equilibrium our most general result is that if all excess demand is reallocated i e there is perfect substitutability then competition never leads to a decrease in industry inventory

on the diffusion of probabilistic investment appraisal and decision making procedures in the uk s upstream oil and gas industry a critical activity for companies involved in the upstream oil and gas industry is deciding whether or not to invest in developing hydrocarbon prospects decisions are characterised by combinations of uncertainty and incomplete information assembled by professionals with different but highly complementary areas of expertise this paper presents evidence of variation among companies in the industry in the extent to which formal appraisal and decision making procedures are adopted and where adopted in the manner of application an explanation is set out in which the importance of senior managers attitudes is tempered by limits to the adaptability of organisational routines of which appraisal and decision making processes are prominent

antecedents and performance implications of channel integration in foreign markets this study enhances our understanding of channel integration in foreign markets on two fronts first the eclectic approach to foreign entry mode proposed by hill hwang and kim 1990 and kim and hwang 1992 is used to examine transaction specific organizational capability and strategic factors that influence channel choices in foreign markets empirical results based on survey of u s firms support the combined relevance of these factors in predicting the degree of channel integration second the study empirically examines the performance consequences of channel integration the results suggest that although the degree of channel integration does not have a direct influence on channel performance a contingency model based on the fit between the contextual factors and the actual channel choice is significantly related to performance in foreign markets

alfred chandler and capabilities theories of strategy and management alfred d chandler s scholarship on the large industrial enterprise has deepened understanding of economic development and helped establish the field of strategic management research chandler s monumental work emphasized the importance of organizational innovation managerial acumen and business performance a particular contribution was the support provided for a capabilities theory of the business enterprise this article also looks at recent developments in industrial organization that are less well explained and appreciated in the chandler framework copyright 2010 the author 2010 published by oxford university press on behalf of associazione icc all rights reserved oxford university press

stochastic programming for decentralized newsvendor with transshipment abstract this paper discusses a family of two stage decentralized inventory problems using a unifying framework taxonomy depicted as a multilevel graph this framework allows us to model and link different problems of competing retailers who independently procure inventory in response to uncertain demand and anticipated inventory decisions of other retailers in this family of problems in the ex post stage the retailers exercise recourse actions in response to the realized demand and competitors chosen procurement levels for example retailers could coordinate inventory transshipment to satisfy shortage with overage based on profit sharing agreements our framework provides a unifying parsimonious view using a single methodological prism for a variety of problems equally importantly as recourse options are laid out our framework clarifies and contributes a modeling connection between problems in a clear taxonomy of models this unifying perspective explicitly links work that appeared in isolation and offers future research directions

the price elasticity of electricity demand in south australia abstract in this paper the price elasticity of electricity demand representing the sensitivity of customer demand to the price of electricity has been estimated for south australia we first undertake a review of the scholarly literature regarding electricity price elasticity for different regions and systems then we perform an empirical evaluation of the historic south australian price elasticity focussing on the relationship between price and demand quantiles at each half hour of the day this work attempts to determine whether there is any variation in price sensitivity with the time of day or quantile and to estimate the form of any relationships that might exist in south australia

changing cognitive frames changing organizational forms an entrepreneurial theory of organizational development this paper discusses the notion of development in firm organizations on the basis of a comparison with ontogenetic phenomena in nature and offers a behavioral foundation that highlights in particular the impact of bounded rationality cognition and social learning on this basis the paper explores the role of entrepreneurship and its cognitive underpinnings particularly with regard to the nucleus multi person firm i e a newly started entrepreneurial business if the entrepreneurial venture is successful and grows the increasing business volume requires that the firm organization also be expanded its size then sooner or later reaches a stage where the cognitive underpinnings of the firm change qualitatively in a way that forces the firm into major restructuring at this point developmental paths can branch off in quite diverse directions some of which are briefly highlighted copyright 2000 by oxford university press

existence of coordinating transshipment prices in a two location inventory model we consider a two location production inventory model where each location makes production decisions and is subject to uncertain capacity each location optimizes its own profits transshipment at a cost is allowed from one location to another we focus on the question of whether one can globally set a pair of coordinating transshipment prices i e payments that each party has to make to the other for the transshipped goods that induce the local decision makers to make inventory and transshipment decisions that are globally optimal a recent paper suggests for a special case of our model that there always exists a unique pair of coordinating transshipment prices we demonstrate through a counterexample that this statement is not correct and derive sufficient and necessary conditions under which it would hold we show that in some conditions coordinating prices may exist for only a narrow range of problem parameters and explore conditions when this can happen finally we study the effects of demand and capacity variability on the magnitude of coordinating transshipment prices

influence of industry r d intensity on corporate product diversification interaction effect of free cash flow this study analyzes the effect of industry r d intensity on the degree of product diversification and examines the interaction effect of free cash flow on the previous relationship at the current time in large us firms using the s p 500 sample we found support for the hypothesis that industry r d intensity has a positive impact on the degree of product diversification on the contrary this study has found partial support for the hypothesis that free cash flow positively affects the previous relationship copyright 2006 oxford university press

repeated newsvendor game with transshipments under dual allocations abstract we study a repeated newsvendor game with transshipments in every period n retailers face a stochastic demand for an identical product and independently place their inventory orders before demand realization after observing the actual demand each retailer decides how much of her leftover inventory or unsatisfied demand she wants to share with the other retailers residual inventories are then transshipped in order to meet residual demands and dual allocations are used to distribute residual profit unsold inventories are salvaged at the end of the period while in a single shot game retailers in an equilibrium withhold their residuals we show that it is a subgame perfect nash equilibrium for the retailers to share all of the residuals when the discount factor is large enough and the game is repeated infinitely many times we also study asymptotic behavior of the retailers order quantities and discount factors when n is large finally we provide conditions under which a system optimal solution can be achieved in a game with n retailers and develop a contract for achieving a system optimal outcome when these conditions are not satisfied

a three stage model for a decentralized distribution system of retailers we present and study a three stage model of a decentralized distribution system consisting ofn retailers each of whom faces a stochastic demand for an identical product in the first stage before the demand is realized each retailer independently orders her initial inventory in the second stage after the demand is realized each retailer decides how much of her residual supply demand she wants to share with the other retailers in the third stage residual inventories are transshipped to meet residual demands and an additional profit is allocated our model is an extension of the two stage model of anupindi et al abz 2001 which implicitly assumes that all residuals enter the transshipment stage we show however that allocation rules in the third stage based on dual solutions which were used in the abz model may induce the retailers to hold back some of their residual supply demand in general we study the effect of implementing various allocations rules in the third stage on the values of the residual supply demand the retailers are willing to share with others in the second stage and the trade off involved in achieving an optimal solution for the corresponding centralized system

public knowledge private knowledge the intellectual capital of entrepreneurs this paper focuses on the innovative actions of entrepreneurs namely their tendency to reveal the intellectual capital that results from their research efforts either in the form of public knowledge publications or private knowledge patents using data collected by the national research council within the us national academies from their survey of firm s that received national institutes of health phase ii small business innovation research awards between 1992 and 2001 we find that entrepreneurs with academic backgrounds are more likely to publish their intellectual capital compared with entrepreneurs with business backgrounds who are more likely to patent their intellectual capital we also find that when universities are research partners their presence complements the tendencies of academic entrepreneurs but does not offset those of business entrepreneurs

animal health inputs endogenous risk general infrastructure technology adoption and industrialized animal agriculture abstract this paper develops a microeconomic model of concentrated animal feeding operations that admits roles for all of animal health inputs genetic profile choices and the pertaining economic infrastructure the basic model emphasizes how time on feed feed density and biosecurity choices interact as well as how these choices respond to i input prices and ii attributes regarding animal productivity parameters that might be influenced by policy choices such as animal welfare strictures and restraints on use of medication we show that ostensibly substituting inputs in protecting against animal health risks may in fact be complements and that the model s production choices come as a complementary package we then extend the model to endogenize the choice of animal genetics a finding is that innovations in general infrastructure encourage herd owners to choose more feed efficient but less hardy animals higher feed conversion efficiency then induces the use of denser feed rations accelerated finishing and greater levels of biosecurity actions at farm perimeters our theory provides a coherent framework for explaining associations among inputs and outcomes that are linked with confined animal agriculture it also explains how animal protein supply chain technology adoption and performance can differ according to a region s state of infrastructure why responses to a change in infrastructure may be large and why public sector efforts to reduce production risk may beget private sector effort to do so

cluster versus firm specific factors in the development of dynamic capabilities in the pharmaceutical industry in ireland a study of responses to changes in environmental protection regulations hilliard r and jacobson d cluster versus firm specific factors in the development of dynamic capabilities in the pharmaceutical industry in ireland a study of responses to changes in environmental protection regulations regional studies this paper uses the evolutionary economic theory of the firm to examine the response of pharmaceutical manufacturing firms to changes in environmental regulations quantitative indicators of firms learning and problem solving are developed using data reported to the irish environmental protection agency epa these are used to look at differences in capability between firms that are part of a pharmaceutical agglomeration and firms that are stand alone analysis shows that spatial proximity may be a factor in firms ability to implement both cleaner technology and the mandated managerial processes but that the strength of problem solving routines is also associated with firm specific capabilities hilliard r et jacobson d les facteurs specifiques aux grappes par r

a coordinating contract for transshipment in a two company supply chain we study a supply chain with two independent companies producing an identical product and cooperating through transshipment previous studies of this chain show that only under certain conditions linear transshipment prices could be found that induce the companies to choose the first best production quantities moreover even if such transshipment prices do exist they result in a unique division of total expected profit and thus they cannot accommodate arbitrary divisions of the profit using the generalized nash bargaining solution we derive coordinating transshipment prices that always give rise to a coordinating contract for the chain this contract relies on an implicit pricing mechanism

time of use pricing in electricity markets under different market structures in this paper we propose variational inequality models for electricity markets with time of use tou pricing demand response is dynamic in the model through a dependence on the lagged demand different market structures are examined within this context with an illustrative example the welfare gains losses are analyzed after an implementation of tou pricing scheme over the single pricing scheme it is intended that the proposed models would be useful 1 for regulatory bodies in jurisdictions to assess market power 2 to forecast future tou prices and 3 to examine welfare changes in electricity markets that change to tou pricing from single pricing

reputation quality observability and the choice of quality assurance systems participants in a supply chain of agricultural value added products face significant challenges many of the costly distinctive traits desired by consumers are difficult if not impossible to observe even after consumption a complicating factor addressed here is that in some circumstances delivered quality can only be imperfectly learned and or affected stochastically by producers hence both symmetric and asymmetric informational imperfections may be present in order for markets for these classes of goods to arise firms touting the quality of the product need to be trusted a repeated purchases model is developed to explore the fundamental economic factors that lie behind the choice of different quality assurance systems and their associated degrees of stringency by firms differences in the quality discoverability of a sought after attribute attractiveness of a market and the value placed in the future are among the factors contributing to the implementation of widely diverse systems across participants in different markets close attention is paid to the role of reputations in providing the incentives for firms to deliver high quality goods in an environment of symmetrically imperfect information

the kinetics of capital formation and economic organisation we examine the inseparability of capital formation and economic organisation in capitalist economic systems capital possesses a complex multilevel micro meso macro structure that is always in the process of transformation levels of the capital structure are interdependent and interactive correspondingly economic organisation at these various levels is not an independent entity in itself it occurs as a by product and structural aspect of capital formation rather than the transaction our focal unit of analysis is a production notion the capital combination that emanates from the kinetic organisation of material by human agency we consider the behaviour of entrepreneurs as causal agents in specifying and appraising potential capital combinations reorganising production and scrapping capital entrepreneurs combinatorial actions often change existing materials to serve functions for which they were not originally designed thereby changing capital structures and the shape and boundaries of economic organisation at different levels of economic complexity capital is created in a dynamic knowledge generation process that depends on entrepreneurs perceptions of gaps in the capital structure copyright the author 2012 published by oxford university press on behalf of the cambridge political economy society all rights reserved oxford university press

genetic information in agricultural productivity and product development two prominent features of recent changes in agriculture have been the advent of precision breeding techniques and an increase in the level of information netputs in production this article identifies ways in which these features may complement in expanding the variety of processed products level of productivity and rate of change in productivity using a martingale concept of information we identify conditions under which information increases the incentives to invest and engage in product differentiation activities a theory on how genetic uniformity can enhance the rate of learning through process experimentation and so the rate of technical change is developed

factoring the elasticity of demand in electricity prices as electricity markets are liberalized consumers become exposed to more volatile electricity prices and may decide to modify the profile of their demand to reduce their electricity costs this paper analyzes the effect that the market structure can have on the elasticity of the demand for electricity it then describes how the consumers behavior can be modeled using a matrix of self and cross elasticities it is shown how these elasticities can be taken into consideration when scheduling generation and setting the price of electricity in a pool based electricity market these concepts are illustrated using a 26 generator system

pleasures of cockaigne quality gaps market structure and the amount of grading the article explores under what circumstances high quality producers would not voluntarily submit to grading when low quality firms would readily do so and under what conditions high quality firms would have a lesser proportion of their output graded than would their low quality counterparts it also investigates how market structure affects the decison to grade establishing that a competitive industry carries out the optimal amount of grading when some firms have finite market shares the industry engages in excessive grading

optimal opt in residential time of use contract based on principal agent theory installation of smart meters is increasing world wide opening the possibility to implement time of use tou tariffs to moderate peak loads this study is focused on the design of an optimal opt in residential tou tariff residential consumers are assumed to act in their private interests and maximize utility in response to tariffs the regulated utility has a broader interest in maximizing societal welfare however the regulated utility cannot impose household behavior and cannot directly observe household type instead the regulated utility must offer contract options including both a tou tariff and current pricing to allow households to self select the plan best suited to their interests this paper proposes a simple flexible household utility function that can be calibrated with minimal data to describe diverse household behaviors and reveal household responses to different prices an optimal pricing model is designed for the regulated utility taking account of asymmetric information and potential household opportunistic behavior using economic constructs from principal agent theory the pricing model ensures participation among households most aligned with the regulated utility s desire the pricing model can also be extended for competitive markets a case study is performed to demonstrate the benefit the optional tou tariff can realize

imperfect product testing and market size we consider an imperfect test of product quality and ask how it interacts with adverse selection to affect market size although one might expect adverse selection to be mitigated there are scenarios where it is exacerbated also two counter intuitive comparative static results emerge first a small increase in the test cost can increase the equilibrium expected profits earned by sellers of higher quality units and so expand the market second the equilibrium expected profits earned by sellers with lower quality units can be increased by a small improvement in the accuracy of an imperfect test

newsvendor models for innovative products with one shot decision theory abstract in this paper newsvendor problems for innovative products are analyzed because the product is new no relevant historical data is available for statistical demand analysis instead of using the probability distribution the possibility distribution is utilized to characterize the uncertainty of the demand we consider products whose life cycles are expected to be smaller than the procurement lead times determining optimal order quantities of such products is a typical one shot decision problem for a retailer therefore newsvendor models for innovative products are proposed based on the one shot decision theory osdt the main contributions of this research are as follows the general solutions of active passive apprehensive and daring focus points and optimal alternatives are proposed and the existence theorem is established in the one shot decision theory a simple and effective approach for identifying the possibility distribution is developed newsvendor models with four types of focus points are built managerial insights into the behaviors of different types of retailers are gained by the theoretical analysis the proposed models are scenario based decision models which provide a fundamental alternative to analyze newsvendor problems for innovative products

the nature of the farm abstract using a model based on a trade off between moral hazard incentives and gains from specialization this paper explains why farming has generally not converted from small family based firms into large factory style corporate firms nature is both seasonal and random and the interplay of these qualities generates moral hazard limits the gains from specialization and causes timing problems between stages of production by identifying conditions in which these forces vary we derive testable predictions about the choice of organization and the extent of farm integration to test these predictions we study the historical development of several agricultural industries and analyze data from a sample of over 1 000 farms in british columbia and louisiana in general seasonality and randomness so limit the benefits of specialization that family farms are optimal but when farmers are successful in mitigating the effects of seasonality and random shocks to output farm organizations gravitate toward fa

the division of labor coordination costs and knowledge this paper considers specialization and the division of labor a more extensive division of labor raises productivity because returns to the time spent on tasks are usually greater to workers who concentrate on a narrower range of skills the traditional discussion of the division of labor emphasizes the limitations to specialization imposed by the extent of the market we claim that the degree of specialization is more often determined by other considerations especially emphasized are various costs of coordinating specialized workers who perform complementary tasks and the amount of general knowledge available

markets and firms transaction costs versus strategic innovation abstract this paper takes the view that the firm is a way of organizing learning and a source of capabilities for innovative moves this requires seeing the firm s problem as one not only of forming appropriate internal organizing structures but also of competing in an environment where new problems regularly emerge as a result of strategic outcompeting moves by rivals market and firm are shown to interact rather than being independent alternatives this altered perspective is given sharper definition by comparing and contrasting it with the results of transactions cost analysis the newer capabilities approach to the firm and the game theoretic literature on coordination and cooperation

the evolutionary firm and cournot s dilemma to transform this competence based approach into an evolutionary theory the con nection between the firm and veblen s concept of social knowledge is more fully devel oped once established the evolutionary theory of the firm is utilised to bypass marshall s reconciliation problem and solve cournot s dilemma

knowledge based approaches to the theory of the firm some critical comments it is argued that kogut and zander kogut b u zander 1992 knowledge of the firm combinative capabilities and the replication of technology organ sci 3 383 397 and conner conner k r 1991 a historical comparison of resource based theory and five schools of thought within industrial organization economics do we have a new theory of the firm j management 17 121 154 erred in the specific way in which they claimed that a distinct theory of the multi person firm can be constructed on the basis of a theory of organizational knowledge or from resource based insights it is not possible to tell very much of a story about why there should be firms in lieu of notions such as opportunism or moral hazard however properly interpreted knowledge based theories may help shed light on issues relating to the boundaries and internal organization of the firm

a conversation with sidney winter on the contributions of alfred chandler david j teece discusses with sidney g winter some of the major contributions of alfred d chandler jr topics discussed include path dependence and the organizational embeddedness of competences and capabilities the recent financial crisis and the electronic century in terms of chandler s priorities teece and winter also consider both the promise and limitations of the chandlerian approach to related matters in business and management theory copyright 2010 the author 2010 published by oxford university press on behalf of associazione icc all rights reserved oxford university press

estimation of urban residential electricity demand in china using household survey data abstract this paper uses annual urban household survey data of sichuan province from 2007 to 2009 to estimate the income and price elasticities of residential electricity demand along with the effects of lifestyle related variables the empirical results show that in the urban area of sichuan province the residential electricity demand is price and income inelastic with price and income elasticities ranging from 0 35 to 0 50 and from 0 14 to 0 33 respectively such lifestyle related variables as demographic variables dwelling size and holdings of home appliances are also important determinants of residential electricity demand especially the latter these results are robust to a variety of sensitivity tests the research findings imply that urban residential electricity demand continues to increase with the growth of income the empirical results have important policy implications for the multistep electricity price which been adopted in some cities and is expected to be promoted nationwide through the installation of energy efficient home appliances

the firm in the information age organizational responses to technological change in the processed foods sector the transformation of production processes that occurred across a range of manufacturing industries during the industrial age generated new and more complex requirements for the process of intermediation as well as for the production systems themselves the development of hierarchical organizations provided firms with the ability to oversee directly many of these new tasks and to create markets that supported them in contrast the advent of the information age has tended not so much to require the creation of markets de novo but has rather altered the nature of existing relationships of intermediation in ways that have facilitated a much wider collection of organizational forms

the root cause of economic growth under capitalism drawing on historical and other empirical evidence this paper provides a causal explanation of a central question why sustained per capita growth occurs in capitalist economies i e in what way capitalism differs from the market that gives it this property it describes an endogenous economic logic that is based on the institutional characteristics of capitalist firms in the non financial sector especially the flexibility of the inputs that they can call upon and of the size of the market that they can supply this perspective naturally generates a realistic theoretical account not only of the source of economic growth but also of the evolution of market structure the forces that produce divergence in for example profit rates a starting point for explaining price setting and a language for describing firms economic power it draws on previous traditions especially those based on the works of marx and schumpeter but differs from them in important respects copyright the author 2011 published by oxford university press on behalf of the cambridge political economy society all rights reserved oxford university press

measuring and explaining scale efficiency with the parametric approach the case of greek tobacco growers estimates of technical and scale inefficiencies of tobacco farms in greece during the period 1991 1995 are obtained by using the parametric approach the degree of technical efficiency was found to be lower than the degree of scale efficiency and thus a greater portion of overall inefficiency is due to producing below the production frontier than to producing at an inefficient scale in addition the vast majority of farms in the sample exhibited suboptimal scale implying that output should be expanded to reach the optimal scale empirical results are provided to determine the impact of various socioeconomic demographic and geoclimatic indicators on technical and scale efficiency

organizational capabilities and the economic history of the industrial enterprise in my book scale and scope 1990 i focused on the history of the modern industrial firm from the 1880s when such firms first appeared through world war ii i did so by comparing the fortunes of more than 600 enterprises the 200 largest industrial firms at three points in time world war i 1929 and world war ii in each of the three major industrial economies those of the united states britain and germany in this paper i first describe the similarities in the historical beginnings and continuing evolution of these enterprises and then outline my explanation for these similarities next i relate my explanation of these empirical regularities to four major economic theories relating to the firm the neoclassical the principal agent the transaction cost and the evolutionary finally i suggest the value of the transactions cost and evolutionary theories to historians and economists who are attempting to explain the beginnings and growth of modern industrial enterprises

organizations firms and institutions in the generation of innovation abstract the purpose of this paper is to develop the innovation system analysis by bringing together the institutional and organizational dimensions of the process of innovation at the firm level the objective is to start elaborating a systemic theory of innovation in firms the paper summons up the contributions and limits of organizational and institutional approaches to innovation this preliminary investigation leads to a series of relevant questions in a second section an attempt is made to overcome the dichotomy and make progress towards a more exhaustive and better articulated representation of the innovation process considered at the firm level

coupon incentive based demand response theory and case study this paper presents the formulation and critical assessment of a novel type of demand response dr program targeting retail customers such as small medium size commercial industrial and residential customers who are equipped with smart meters yet still face a flat rate enabled by pervasive mobile communication capabilities and smart grid technologies load serving entities lses could offer retail customers coupon incentives via near real time information networks to induce demand response for a future period of time in anticipation of intermittent generation ramping and or price spikes this scheme is referred to as coupon incentive based demand response cidr in contrast to the real time pricing or peak load pricing dr programs cidr continues to offer a flat rate to retail customers and also provides them with voluntary incentives to induce demand response theoretical analysis shows the benefits of the proposed scheme in terms of social welfare consumer surplus lse profit the robustness of the retail electricity rate and readiness for implementation the pros and cons are discussed in comparison with existing dr programs numerical illustration is performed based on realistic supply and demand data obtained from the electric reliability council of texas ercot

efficiency gains within firms under voluntary environmental initiatives this paper focuses on efficiency gains that voluntary environmental initiatives may achieve within the firm current debate concerning the extent and significance of inefficiencies within firms is critically important to the progress of energy and environmental policies several recent lines of inquiry in microeconomics help explain the persistence of inefficiencies within firms in addition two of the most prominent new approaches in the field of business strategy resource based strategy and the capabilities perspective focus on the heterogeneity among firms and the resulting pockets of inefficiency within firms they suggest at least three generic strategies for voluntary environmental initiatives challenging outdated organizational routines creating opportunities for differentiation or complementing firms resource investment trajectories these generic approaches suggest that there is considerable scope for further experimentation with voluntary environmental initiatives

optimal policies for inventory systems with lateral transshipments using lateral transshipments can be beneficial in order to improve service levels and to reduce system costs this paper deals with a single echelon inventory system with two identical locations demands are generated by stationary and independent poisson processes in general if a demand occurs at a location and there is no stock on hand the demand is assumed to be backordered or lost however in this paper lateral transshipments serve as an emergency supply in case of stock out in this paper the rule for lateral transshipments is given while the ordering policies for normal replenishments are optimized the transshipment rule is to always transship when there is a shortage at one location and stock on hand at the other first we assume that the locations apply r q policies for normal replenishments and show that the optimal policies are not necessarily symmetric even though the locations are identical this means that one cannot in general assume that the optimal policy is symmetric under symmetric assumptions second we relax the assumption of r q policies and derive the optimal replenishment policy using stochastic dynamic programming

implications of nash bargaining for horizontal industry integration this article shows how horizontal industry integration can arise from transferable asymmetry of technologies and endowments the nash bargaining solution suggests that greater technological diversity among coordinating parties yields greater gains from horizontal integration the framework fits the case where a firm with a superior technology franchises the technology by horizontal integration the results appear to fit hog production where integration has been primarily horizontal and in part broiler production where integration has been both vertical and horizontal specifically technology has been shared through uniform genetic traits fine tuned feed rations and veterinary services specified in grower contracts

product development cost seasonality region marginalization and a more demanding consumer agricultural production is becoming more like manufacturing in the routinization of processes the extent to which raw materials are processed capital intensity and its emphasis on throughput some ascribe the changes to demand side factors while others look to technological innovations emphasizing cost seasonality as a reference indicator for nature s role in agricultural production this paper develops a simple model that includes both supply and demand sides we show how cost seasonality can impede product development to meet consumer needs and find that there may be a ceiling level of cost seasonality below which a non seasonal equilibrium production profile occurs price seasonality is decreasing in cost seasonality an increase in demand for more processed products induces a shift toward non seasonal production regions with strongly seasonal cost advantages will produce lower value products while less seasonal regions will produce higher value products if a region with high cost seasonality has a non seasonal cost disadvantage then an increase in demand for processing can reduce the region s competitiveness

the simplicity of competitive repertoires an empirical analysis this research explores the notion of competitive simplicity a tendency of some firms to concentrate intensely on just a few central activities our focus here is the simplicity inherent in the repertoire of concrete market oriented actions used by companies to compete these actions include product introductions pricing or advertising decisions and changes in market scope the simplicity of a competitive repertoire can be assessed by its range of actions and its degree of concentration on one or a few dominant types of actions we argue that competitive simplicity is largely a function of organizational and environmental properties that attenuate managerial search or restrict knowledge of competitive alternatives these properties include good performance munificent homogeneous or certain markets a lack of breadth in competitive experiences and the complacency that may accompany age and size paradoxically although good past performance may contribute to simplicity simplicity can hurt subsequent performance especially during periods of uncertainty and growth many of these ideas were borne out in a study of the major carriers of the post deregulation domestic airline industry

business groups and the natural state abstract recent revisionist accounts of corporate governance in both business history and finance are challenging the tradition narrative associated with berle and means 1932 and chandler 1977 in which the american model of diffuse ownership and coherent diversification is both an inevitable outcome of economic development and perhaps a normative standard for the world to follow this essay is an attempt to rethink that narrative in light of the continued significance of the pyramidal business group as a governance structure around the world i argue that business groups arise in response both to inadequacies in arm s length markets and to the needs of what north et al 2009 call the natural state in this view the quality of markets and the demands of the state are tightly interconnected phenomena such a perspective explains the emergence of business groups in developing countries as well as their persistence even in wealthy and sophisticated polities apart from the u s and the u k in the end moreover i endorse the view that the much discussed and oft misunderstood exceptionalism of the u s in corporate governance arises not only from the sophistication of american markets but also importantly from government policies toward corporate taxation and securities regulation policies that arose from the unique public choice problem posed by the differential effect on the u s of the collapse of globalization during the middle years of the twentieth century

the organisational factor and the growth of firms the paper analyses the role played by the managerial factor in conditioning the rhythm and intensity of firms growth it argues that growth has to be intended as a measure of the capability of the firm to successfully cope with the problems arising from increasing complexity according to a penrosean perspective such a capability may be bounded at any given time by a lack of those internal managerial resources which provide the firm with a set of uniquely valuable services and which create a differential advantage over its competitors in a dynamic capabilities view such advantages need to be continuously modified through a process of search and selection this has assumed peculiar relevance in the face of the hyper competition regime characterising the more recent phase of industrial development asking firms executives to develop an increasing ability to find creative solutions to continuously moving targets therefore making the management function a key driver to change

behavioural and material determinants of production relations in agriculture in this essay we develop a framework for analysing the major institutions governing the production and exchange of output and the primary factors of production in rural areas the analysis incorporates general considerations of risk and information constraints jointly with the principal material attributes of agriculture and of agricultural production factors the framework is used to analyse barriers to the existence of the major intertemporal and factor markets it is applied specifically to land scarce environments for which it provides an internally consistent explanation for many of the well documented institutional features of such settings in addition the analysis provides new implications for among other phenomena the inter relationships among ownership holdings operational scale family size and factor productivity for the scarcity of animal rental markets and use of animals as collateral for the renting out of land by small landowners and for the existence of plantations for certain crops

explaining state bans on corporate farming state laws banning corporate farming present a puzzle for a rent seeking explanation of political outcomes since family farmer proponents may receive no direct benefit from these bans an explanation developed here is that these farmers benefit indirectly forestalling corporate entry preserves the farm political coalition structured around those cooperatives patronized by family farmers and so indirectly preserves federal subsidies and supply restrictions that the incidence of state bans is positively related to the importance of federal farm programs the importance of cooperatives and the homogeneity of farmers within a state is consistent with this indirect rent seeking explanation

food insecurity income inequality and the changing comparative advantage in world agriculture i would like to argue in this article that in the process of economic development in land poor countries in asia agriculture faces three distinctly different problems food insecurity sectoral income inequality and the declining food self sufficiency associated with the declining comparative advantage in agriculture at the high income stage massive imports of food grains to asia if they occur will aggravate the world food shortage which will have significant implications for the poverty incidence in the world i argue that in order to avoid such a tragedy asia should expand farm size to reduce labor cost by adopting large scale mechanization sub saharan africa should realize a green revolution in grain production and latin america should further expand its grain production capacity

the vanishing hand the changing dynamics of industrial capitalism alfred chandler s portrayal of the managerial revolution of the late nineteenth and early twentieth centuries does not extend well into the late twentieth century when widespread vertical disintegration began replacing the classical multi unit managerial enterprise this paper attempts to explain the new economy in a manner consistent with chandler by providing an enlarged theoretical account of industrial evolution in this account clusters of chandlerian firms appeared as a temporary episode within a larger smithian process of the division of labor

incentives information systems and competition we show how dierent competitive regimes aect the ability to provide incentives based on noisy information systems reduced com petition facilitates incentive provision this may rationalize both ver tical integration and horizontal integration as seen in many agricul tural markets with uncertain quality grading moreover if trading terms are settled before the information is observed a noisy infor mation system su ces to give proper incentives this may rationalize the use of long term conditional price contracts in the trading of many agricultural products

information asymmetry as a reason for food industry vertical integration three trends that have been subject to recent discussion are a movement away from undifferentiated agricultural commodities toward more specialized products reduced reliance on open markets for raw agricultural products and a movement toward agricultural industrialization recent research suggests that demographic trends may be causing the first trend while the other two are closely related phenomena this research suggests that information externalities arising from uncertainty concerning the nature of food quality and problems in detecting quality may be reasons why vertical coordination is being used to circumvent the marketplace

estimation of japanese price elasticities of residential electricity demand 1990 2007 abstract this paper estimates elasticities of japanese residential price electricity from 1990 to 2007 the first difference generalized method of moment estimator is employed to avoid dynamic panel bias which is not considered in most previous studies the results show that while short run elasticities are similar to those in previous studies long run elasticities are significantly lower in our study we also find that the price elasticity of japanese residential electricity consumption is notably affected by income inequality and severe weather based on these results we provide some insights to tailor environmental taxation so as to effectively attain the kyoto protocol

insecure land rights and share tenancy evidence from madagascar most studies of tenurial insecurity focus on its effects on investment this paper studies the hitherto unexplored relationship between tenurial insecurity and land tenancy contracts based on distinct features of formal law and customary rights in madagascar this paper augments the canonical model of sharecropping by making the strength of the landlord s property right increasing in the amount of risk she bears within the contract using data on landlords subjective perceptions in rural madagascar empirical tests support the hypothesis that insecure property rights drive contract choice but offer little support in favor of the canonical risk sharing hypothesis

capital rationing and organizational slack in capital budgeting this paper reconciles three stylized facts about capital budgeting in firms and shows that they are tied to the presence of asymmetric information among the several members of the firm each with his or her own objectives and decisions the facts of interest are 1 the existence of organizational slack 2 the rationing of resources within organizations 3 the stated cut off rate for accepting capital projects in firms is often greater than the market rate of interest organizational slack is defined as the excess of resources allocated over the minimum necessary to accomplish the tasks assigned resource rationing is defined as the under allocation of resources i e an increase in the amount allocated would generate revenues in excess of its costs rationing and slack are both manifestations of ex post inefficiencies an lp model is used to show that these inefficiencies can occur in ex ante efficient organizational designs when asymmetric information is present the optimal allocation policy involves a hurdle rate criterion in which the hurdle rate is strictly in excess of the cost of capital thus inducing rationing in some states of the world typically resources are optimally allocated such that slack exists in other states the optimal allocation policy trades off these two inefficiencies