a profile of new venture success and failure in an emerging industry abstract this study examined three types of factors 1 the characteristics of the lead entrepreneur 2 startup processes undertaken during the founding of the firm and 3 firm behaviors after start up including management practices and strategic behaviors associated with new venture success and failure the research involved a field study of 26 small young firms 13 successful and 13 less successful or failed each engaged in the distribution of fresh juices in eight metropolitan centers about 30 of the total market in the united states both quantitative and qualitative data were collected through field work at each firm location a statistical analysis of data collected in a structured questionnaire was the primary method for testing the factors case studies of all of the firms were developed to provide qualitative support for the quantitative findings of the study results from these analyses indicated significant differences between successful and unsuccessful firms in all three categories lead entrepreneurs in successful firms were more likely to have been raised by entrepreneurial parents have had a broader business and more prior startup experience and believed they had less control of their success in business than unsuccessful entrepreneurs successful entrepreneurs seek to reduce risk in their businesses they work long hours have a personal investment in the firm and are good communicators successful firms were those initiated with ambitious goals lead entrepreneurs had a clear broad business idea which provided the adaptive torque required to overcome adversity confrontation and often a troubled financial condition effective startup or purchase required broad planning efforts that considered all aspects of the industry and firm successful firms spent more time planning 237 hours than unsuccessful firms 85 hours the use of outside professionals and advisors for help in solving specific problems during startup was important for success as well as the advice and information provided by other industry participants particularly customers and suppliers most ventures did not have written business plans nearly all purchased firms failed buyers of competitively troubled firms were negatively displaced generally unemployed managers who lacked broad management experience and while often well educated had no prior experience in purchasing a business successful firms were found to be more flexible participative and adaptive organizations these firms had employees who could perform the work duties of others and were likely to be managed in a way that provided these workers with the flexibility to modify their jobs to adapt to changing industry and organizational conditions lead entrepreneurs of successful firms were likely to spend more time communicating with partners customers suppliers and employees than the lead entrepreneurs of unsuccessful firms successful firms sought to become larger firms and embarked upon sales to broad sectors of the market successful firms achieved high market shares with market shares came higher financial returns less successful firms were restricted to narrow market sectors consisting of smaller customers and those more difficult to service while customer service remained an important concern the commodity nature of fresh juices failed to support differentiation and the narrowly focused firm was typified by high product costs and unprofitable operations

capacity management in decentralized networks bottleneck analysis is a useful tool in capacity planning for centrally controlled network systems however under a decentralized network where individual users are allowed to select their own routes straightforward application of bottleneck analysis does not necessarily yield an optimal performance it may even hurt the system performance an aspect of braess s paradox we investigate the capacity expansion problem for a decentralized system with general network topology to this end we first discuss the short run problem and show that the externality pricing solves the joint problem of demand and routing control we then study the capacity expansion reduction problem for decentralized systems that may or may not be optimally controlled in the short run

a model of entry exit decisions and capacity choice under demand uncertainty abstract many investment decisions of agribusiness firms such as when to invest in an emerging market or whether to expand the capacity of the firm involve irreversible investment and uncertainty about demand cost or competition this paper uses an option value model to examine the factors affecting an agribusiness firm s decision whether and how much to invest in an emerging market under demand uncertainty demand uncertainty and irreversibility of investment make investment less desirable than the net present value npv rule indicates the inactive firm is more reluctant to enter the market when it takes into account demand uncertainty because it preserves the opportunity of making a better investment later the active firm is more reluctant to abandon the investment because there is an option value of keeping the operation alive there is a greater distance between the entry and exit thresholds under the option value approach than under the npv rule due to demand uncertainty the results have implications for agribusiness decision making

natural resources national income and economic growth in africa abstract because standard measures of aggregate income such as gross domestic product gdp do not account for natural resource depletion their use as gauges of economic performance tends to exaggerate the benefits of resource extraction accounting for natural resource depletion in 18 african countries indicates different patterns of growth than those suggested by gdp figures use of the revised measures in analyses of the link between exports and growth suggests that export expansion may generate increases in measured gdp without stimulating increased production in contrast real exchange rate alignment is correlated with growth in both conventional gdp and the revised accounts

the valuation of european options in uncertain environment abstract a new model on european options with uncertainty of both randomness and fuzziness in output is presented by introducing fuzzy logic to the stochastic financial model the randomness and fuzziness in the systems are evaluated by both probabilistic expectation and fuzzy expectation taking account of seller s buyer s subjective judgment prices of european call put options with uncertainty are given and their valuation and properties are discussed under a reasonable assumption this paper demonstrates black scholes formula to give rational expected price of the european options and buyer s writer s seller s permissible range of expected prices the meaning and properties of rational expected prices are discussed in a numerical example the hedging strategies are also considered for marketability of the european options for portfolio selection

a path dependent contingent claims approach to capacity investments this note presents a contingent claims approach to strategic capacity planning we develop models for capacity choice and expansion decisions in a single firm environment where investment is irreversible and demand is uncertain these models illustrate specifically the relevance of path dependent options analysis to planning capacity investments when the firm adopts demand tracking or average capacity strategies it is argued that asian average type real options can explain hysteresis phenomena in addition to providing superior control of assets in place

a note on the causality between export and productivity abstract in this paper we re examine the export led growth hypothesis through testing granger causality from exports to labor productivity using the methodology developed in toda and yamamoto 1995

venture management in japanese companies abstract this study based on a survey of reports on the subject published in japan since 1980 and an in depth analysis of 20 companies aims to understand the reasons why japanese firms have adopted western style venture management techniques and the organizational patterns they have created to implement them although they started relatively recently large japanese firms have adopted venture management methods in about the same proportion as their american counterparts the main reasons for this lie in the need to diversify out of mature industries to foster innovation to speed up new product development and to create an organizational vehicle permitting creative younger employees to develop their ideas the traditional characteristics of japanese firms have not been found suited to the latter two reasons the general pattern of organizing new venture activities was found to represent five different models ranging from company wide task forces to the creation of a separate new venture company these models constitute a decreasing order of integration of venture teams with other divisions and staff departments of the parent company the degree of integration of venture teams with the parent was found to be only partially related to the extent of diversification involved while task forces and new venture companies the two extreme categories represented increasing diversification the intermediate organizational forms were less uniformly related in separating the diversification variable into its technology and market components however a somewhat better explanatory link could be established companies in which new ventures drew upon the core technology tended to integrate their ventures with the parent more than others the other reasons for the weak link between diversification and integration was surmised to be the general trend toward encouraging entrepreneurship and speeding up the innovation process this was reflected in the authors interviews with companies and some overt behavior particularly the propensity to spin off new venture early and often the use of venture management methods in japan with its emphasis on youth and independence constitutes a partial renunciation of certain managerial policies and cultural traits that formed the strength of japanese companies in the past while certain aspects of traditional japanese management such as small group accountability shared division of labor and self organizing teams favor the implantation of venture management methods in japan others having to do with the seniority system and egalitarianism do not so far at least japanese managers have coped reasonably well with the organization frictions that one might have expected to arise partly because of the active interest and involvement of senior management the latter not only helped define the strategic context the domain of search but had venture teams report to them directly or indirectly in most cases

multi resource investment strategies operational hedging under demand uncertainty abstract consider a firm that markets multiple products each manufactured using several resources representing various types of capital and labor and a linear production technology the firm faces uncertain product demand and has the option to dynamically readjust its resource investment levels thereby changing the capacities of its linear manufacturing process the cost to adjust a resource level either up or down is assumed to be linear the model developed here explicitly incorporates both capacity investment decisions and production decisions and is general enough to include reversible and irreversible investment the product demand vectors for successive periods are assumed to be independent and identically distributed the optimal investment strategy is determined with a multi dimensional newsvendor model using demand distributions a technology matrix prices product contribution margins and marginal investment costs our analysis highlights an important conceptual distinction between deterministic and stochastic environments the optimal investment strategy in our stochastic model typically involves some degree of capacity imbalance which can never be optimal when demand is known

exports and economic growth evidence from 19th century europe abstract cointegration and granger causality tests on data for six european countries from around the middle of the 19th century to 1913 show that exports and gnp were cointegrated and granger causally related with export led growth in italy norway and sweden

is the export led growth hypothesis valid for canada empirical evidence linking exports to economic growth has been mixed and inconclusive this study re examines the export led growth elg hypothesis for canada by testing for granger causality from exports to national output growth using vector error correction models vecm and the augmented vector autoregressive var methodology developed in toda and yamamoto 1995 application of recent developments in time series modelling and the inclusion of relevant variables omitted in previous studies help to clarify the contradictory results from prior studies on the canadian economy the empirical results suggest that a long run steady state exists among the model s six variables and that granger causal flow is unidirectional from real exports to real gdp jel classification f43 c32 est ce que l hypothese de la croissance engendree par les exportations est valide pour le canada les resultats empiriques des etudes tentant de montrer le lien entre les exportations et la croissance economique sont mixtes et ne contiennent pas de resultats concluants cet article re examine l hypothese dans le cas du canada en testant la causalitea la granger pour les exportations et la croissance du produit national en utilisant les modeles vecm et la methodologie var developpes par toda et yamamoto 1995 l application de certains developpements recents dans l analyse des series chronologiques et l inclusion de variables pertinentes omises dans les etudes anterieures aident a mettre de l ordre dans les resultats contradictoires des etudes anterieures portant sur l economie canadienne les resultats empiriques suggerent qu un regime permanent existe entre les six variables du modele et que la causalitea la granger est unidirectionnelle des exportations reelles vers le pib reel

a comparison of japanese and u s firms completing initial public offerings abstract we set out to examine firms breaking into the top tier of for profit companies in the u s and japan to find differences across the two groups to accomplish this we conducted a questionnaire survey of companies that had recently undergone an initial public offering ipo in each country and compared them on characteristics frequently associated with new firms as we expected even when the different sizes of the two economies were taken into account there were considerably fewer listings in japan than in the u s one reason for this is that the listing requirements for young japanese firms although not stricter are much more strictly enforced hence fewer japanese firms are able to list our results show that the japanese firms were markedly different from their u s counterparts on several characteristics they tended to be older and larger which is consistent with more stringent listing requirements in japan they were also much more often led by their original founders this is a surprising result given that the japanese firms being older had longer to lose their founders when a successor to the founder was president it was much more often a relative of the founder than in the u s the japanese founders rated themselves higher on relatively emotional characteristics such as aggressiveness paternalism and charisma than did either the u s presidents or the japanese nonfounder presidents the japanese firms relied solely on the president for decision making prior to the ipo more often than the u s firms did however the japanese firms also moved in greater numbers to group decision making around the time of the ipo the post ipo investment strategies of the japanese firms were characterized by a focus on new product development an increase in r d spending and investment in the company s capital plant in contrast the u s firms reported more interest in exploiting their existing market and buying other companies usually leaving r d spending at its pre ipo level overall it is surprising that on many characteristics the japanese ipos tended to fall more to the extreme associated with new companies than did the u s firms they were dominated by founder influence the founders were apparently highly emotional their management style was initially autocratic and their strategies targeted innovation and internal development as avenues to growth this pattern is consistent with a prior hypothesis that the lack of structural support for new firms in japan results in only the most extreme personalities pursuing and succeeding in company formation for researchers a significant implication of this research is that japanese ventures may not behave according to the same rules as u s ventures research samples that fail to distinguish nationality may obscure cross regional variations for practitioners the major lesson is that a japanese venture is likely to be much different from one in the u s dealing with one is probably even more unlike dealing with an established company than working with a u s start up might be

optimal exit and valuation under demand uncertainty a real options approach this paper considers both the optimal exit strategy and the valuation of stochastic cash flows of a firm facing demand uncertainty and potential excess supply by relying on the standard theory of linear diffusions and ordinary nonlinear programming we derive the value of the rationally managed firm and state the necessary condition for optimal exit in contrast to the standard approaches in the real options literature our analysis is completely independent of both dynamic programming and the smooth fit principle i demonstrate that irreversible exit is optimal only when the value of the future productive opportunities becomes smaller than the value of irreversibly exercising the option to exit and in this way avoid further cumulative losses i also present the comparative static properties of the optimal exit threshold and demonstrate that increased uncertainty may increase or decrease the optimal exit threshold depending on the sign of the net convenience yield

learning and the time interdependence of costa rican exports abstract exports may enhance learning through production induced learning by doing learning to export by doing and flows of information from customers we provide evidence on the learning effects of export destination for costa rica for 1955 through 1980 we examine granger causality results and export trends to determine relationships between exports to the central american common market cacm the rest of the south and the north increasing exports to the cacm appear to promote learning in machinery leather and intermediate manufactures we also find that the cacm redirects some exports away from northern markets probably with damaging consequences

investment and capacity choice under uncertain demand this paper extends the real options literature by discussing an investment problem where a firm has to determine optimal investment timing and optimal capacity choice at the same time under conditions of irreversible investment expenditures and uncertainty in future demand after the project is installed with a certain maximum capacity this capacity is fixed as an upper boundary to the output and cannot be adjusted later on it turns out that in the framework of this once and for all decision uncertainty in future demand leads to an increase in optimal installed capacity but on the other hand it causes investment to be delayed to an extent that even small uncertainty makes waiting and accumulation of further information the optimal decision for large ranges of demand limiting the capacity which may be installed weakens this extreme effect of uncertainty

export led growth and structural change evidence from malaysia many studies have tried to establish the causal link between export expansion and economic growth this contribution is to recognize that structural changes will change the sources of growth and this will affect the export growth relationship a country case study approach is used focusing on malaysia a country with one of the world s highest sustained growth rates and a long history of commodity trade we use var analysis of malaysian quarterly trade and gdp growth from 1965 to 1996 trade data are disaggregated into primary and manufactures exports and causality tests are applied to the entire period as well as two subperiods 150 the 1965 1501980 period when policy emphasis was on import substitution and the 1981 1501996 period when policies favoured export led growth statistical tests confirm export led growth for the full period and for the period to 1980 but tests on the 1981 1501996 period show growth causing exports primary exports had a stronger direct impact on economic growth than manufactu

a revisitation of the savings growth nexus in mexico by employing tests for long term causality contrary to sinha and sinha economic letters 1998 in mexico savings is shown to precede growth this paper further explores the complex dynamics of this inter relationship to lend clarity to this nexus

exports and growth is the export led growth hypothesis valid for provincial economies this paper re examines the export led growth hypothesis using provincial data unlike other studies that concentrate on country level data this study investigates the validity of the hypothesis for four largest provinces in korea seoul kyunggee kyungnam and pusan the causal implication of the export led growth hypothesis is generally supported for all provinces in the sample the framework of analysis is two and four variable autoregressive models that include provincial exports provincial output terms of trade and national output shocks granger causal orderings from exports to output growth are generally supported in bivariate causal models in multivariate models variance decompositions and impulse response functions further indicate that export growth has a significant impact on output growth for all provinces although a feedback effect from output to export growth appears in seoul and the kyungnam province

a dynamic migration model with uncertainty we study a dynamic version of the harris todaro migration model where a finite population of infinitely lived bayesian agents choose consumption and migration decision rules as a function of their histories the agents do not know the production functions in the two sectors and learn about them through wage draws that they receive from the stochastic production functions the government knows the true production functions but is uninformed about the agents beliefs and the actual wage draws they observe the government maximizes its welfare function using wage subsidies in the two sectors and a migration tax we solve the agents dynamic programming problem and then use the solution to solve the government s dynamic programming problem we study the effects of government policies on the population distribution and illustrate the model by numerically solving a particular parametric example

exports investment efficiency and economic growth in ldc an empirical investigation this study seeks to analyse the relationship between exports and growth for 19 less developed countries it utilizes multivariate causality analysis based on the error correction model to address several important hypotheses the results indicate that when exports have a causal influence in the development process that in general this is the result of their effect on both efficiency and accumulation in addition improvements in output and capital accumulation in an economy seem to have just as much of an influence on exports as exports have on output and capital accumulation finally the growth process in east asia seems to be quite different from that in southeast asia

collaboration in tool development and capacity investments in high technology manufacturing networks the procurement of capital intensive tools for hi tech industries is one of the most complex tasks astronomical amounts of capital are invested in the processing equipment further there is a large effort from the original equipment manufacturer oem in customizing the high capital intensive equipment to suit their production process this problem has received little attention from the quantitative decision making literature for the first time we analyze the problem of oem deciding on collaborating with the tool supplier via a special type of contract which we refer as collaboration options we show that there are benefits to both the oem and the tool suppliers from the collaboration we develop a two stage strategic model for collaborative tool development and optimal capacity investment in the first stage we solve an optimal collaboration problem faced by the oem we formulate this problem as a discrete time stochastic stopping problem for a finite horizon we use a policy iteration algorithm for deciding on optimal collaboration policy in the second stage we model the optimal investment decision of the oem in tool development and capacity acquisition using real options theory unlike the traditional options literature we consider the option value determined from the first stage model and decide on the optimal amount for investment

relationship between agricultural growth and farm imports in ldcs a sims causality test based on 35 countries abstract previous empirical studies on the relationship between agricultural growth and farm imports in the ldcs suffer from serious methodological defects which to some extent may invalidate their results and interpretations this study used sims causality test to examine interactions between agricultural output and agricultural imports for 35 ldcs individually it was found that there was no causality from agricultural output to agricultural imports for a majority of countries under study for countries where agricultural growth did have a causal effect on agricultural imports the effect was positive in some countries and negative in others

is corruption grease grit or a gamble corruption increases variance of productivity across countries the effect of corruption on economic growth has attracted interest in empirical development economics the conventional view of corruption as impediment for growth has been challenged by the grease on the wheels hypothesis we take a new perspective on the issue and suggest corruption as macro risk referred to as a gamble hypothesis using cross country data and two alternative indicators of corruption we find corruption to be a significant driver of heteroscedasticity in total productivity this supports the new gamble hypothesis we also note some misleading interpretations in the previously published frontier applications to avoid these shortcomings we apply a flexible semi nonparametric estimator

causality between export growth and industrial development empirical evidence from the nics a comment abstract in a recent article chow 1987 argued that his empirical evidence supports the hypothesis that export growth causes industrial development in this comment i point out several serious shortcomings of chow s analysis

export instability and the domestic economy questions of causality the conventional view concerning the impact of export instability on the domestic economies of developing countries is one of pessimism export instability is thought to adversely affect the short run stability and longer run growth of income empirical evidence on these matters is however inconclusive this article applies a granger sims reduced form approach to examining whether export instability generates short run instability in domestic income for each of a sample of 20 trade dependent countries the results obtained strongly support the contention that export instability induces short run macroeconomic instability

we will be right with you managing customer expectations with vague promises and cheap talk delay announcements informing customers about anticipated service delays are prevalent in service oriented systems how delay announcements can influence customers in service systems is a complex problem that depends on both the dynamics of the underlying queueing system and on the customers strategic behavior we examine this problem of information communication by considering a model in which both the firm and the customers act strategically the firm in choosing its delay announcement while anticipating customer response and the customers in interpreting these announcements and in making the decision about when to join the system and when to balk we characterize the equilibrium language that emerges between the service provider and her customers the analysis of the emerging equilibria provides new and interesting insights into customer firm information sharing we show that even though the information provided to customers is nonverifiable it improves the profits of the firm and the expected utility of the customers the robustness of the results is illustrated via various extensions of the model in particular studying models with incomplete information on the system parameters allows us also to highlight the role of information provision in managing customer expectations regarding the congestion in the system further the information could be as simple as high congestion low congestion announcements or it could be as detailed as the true state of the system we also show that firms may choose to shade some of the truth by using intentional vagueness to lure customers

causality between exports productivity and financial support in european union agriculture morley b and morgan w causality between exports productivity and financial support in european union agriculture regional studies the aim of this paper is to investigate the causal relationship between exports and productivity and exports and agricultural support within the european union using the autoregressive distributed lag ardl approach to co integration and error correction models evidence is found of exports within the european union being determined by support in ireland and france as well as gains in productivity contributing to export growth in germany and the uk this finding may help explain why some countries within the european union such as france have large agricultural trade surpluses whilst others run large deficits morley b et morgan w les rapports de causalite entre les exportations la productivite et le soutien financier dans l agriculture de l eu regional studies cet article cherche a examiner les rapports de causalite entre les exportations et la productivite et

on the condition for export led growth in this paper the author explores the conditions under which favorable export shocks produce export led growth in a three sector three factor general equilibrium model that allows for endogenous capital accumulation the export shock takes the form of either a resource discovery or an increase in the world market price of the export good while surprisingly simple conditions define the outcome in many cases there is no general presumption that an export boom will act as an engine of growth much depends on the precise structural characteristics of the economy

dynamic pricing for network service equilibrium and stability consider a data communication network owned and operated by a single organization the network has an infinite number of small users and is managed by a system manager sm whose objective is to maximize the net value of the system as a whole the objective of this paper is to study pricing mechanisms that induce the optimal arrival rates when the sm has no full knowledge of the demand in advance we investigate the system behavior under three alternative dynamic pricing rules and users expectations models and characterize the equilibrium and its stability conditions

is the export led growth hypothesis valid for australia the relationship between exports and output is examined using australian annual data over the period 1900 1993 cointegration and causality testing fails to detect the existence of a long run or short run relationship between the two variables these results are explained by restoring to the structural time series modelling approach which shows that while the output series exhibits cyclical variation the exports series does not have this property it is concluded that the export led growth hypothesis is not valid for australia

new ventures and employment growth abstract the research studied the extent to which the employment size of a new firm is set the start how many subsequently grow and whether those that survive and grow have any identifiable characteristics answers to these questions would help to determine whether future assistance programs aimed at improving the performance of new firms should concentrate on the actual start up process or on the first few years of trading the study was pan of a series conducted in st joseph county indiana a county that had experienced the same economic decline as the rest of the midwest rust belt of the united states it formed part of a community effort named project future to develop a strategy for industrial regeneration the series first examined the characteristics of the new firm population during the years 1976 1982 birley 1985 1986 and two results emerged that were pertinent to this study first 92 of the firms that ceased trading in the first two years were the smaller ones employing less than 20 people second the entrepreneur in the county tended to use only the informal networks of family and friends when gathering the resources of the firm rather than the formal networks of accountants lawyers realtors and banks the question that remained therefore and which formed the basis of this article was the extent to which it was possible to identify and thus focus the strategy upon those firms or industrial sectors that exhibited growth characteristics three research questions were posed how many tended to grow during the first few formative years what was the rate of growth and on what dimensions did it occur and when did growth occur were there differences in the growth of firms of different ages the primary measure of growth used was that of employment for both the start of the firm and at the time the questionnaire was administered 1983 data were collected on the number of owners part time and full time and on the number of employees both part time and full time and on their level of skill financial data included sales level profits level and forecast sales trend indicators of possible change were either an altered legal structure or a move of premises control variables included incubator characteristics industry and supplier and customer geographic base the results of the study show that for the majority of the firms employment size was set at the start no aggregate growth occurred in either full time or part time jobs nor was there any apparent age effect during the six years studied firms that had increased the number of employees were of all ages those firms that grew sales during the early years did so by increasing the customer base and without generating further jobs analyzing growth by industry only one significant result emerged entrepreneurs from smaller companies tended to set up in competition with their incubator firm while those from larger firms tended to start firms with no apparent relationship to their previous employment the major inference from this study is that growth would appear not to be a primary objective of the entrepreneur further research to test these results is clearly necessary should they be replicated elsewhere however future strategies to improve the job generation capabilities of new firms would be most fruitful if directed at building a solid foundation for all firms rather than trying the impossible task of picking winners such assistance can only be provided at the time that the resources necessary for the successful launch of the firm premises equipment orders employees money are being assembled since almost all of these firms are local in nature strategies that devise specific schemes tailored to meet local needs and using local people are most appropriate by contrast the small number of high growth firms should be easily identifiable in the community and assisted individually

new firms societal contribution versus survival potential abstract new business firms are now considered a major source of new jobs economic growth technical innovation and economic flexibility they may provide a major strategic advantage for the united states in world competition a more complete precise understanding of the dynamics of new firm development their societal contributions and factors affecting their survival has considerable policy and managerial significance a study of new firm contributions and survival was completed to determine whether the same factors would account for both they do not the research began with a substantial body of descriptive information on 551 new firms initiated in minnesota between 1978 and 1984 the initial data were collected in the summer of 1984 a one year follow up was completed in 1985 to determine new firm survival the sample was representative of all major industry sectors and all regions of the state about 60 were located in the minneapolis st paul urban area attempts to predict current 1984 contributions indicated that age was not a significant factor older new firms did not contribute more than younger new firms the developmental pattern primarily the average annual growth rate was highly related to sales or jobs provided in 1984 next most significant was the industry of the new firm manufacturing distributive services and business producer service new firms provided more significant contributions the one year follow up was able to determine the survival status of 548 of the 551 firms slightly less than 10 48 had not survived major factors related to survival appeared to be age high death rates at 2 3 years and attention to financial matters

exports imports and economic growth in south korea and japan a tale of two economies this article investigates the relationship between exports imports and economic growth for south korea and japan by constructing a vector autoregression var model causality is examined between real gross domestic product gdp real exports and real imports several principal results emerge from the empirical work first the three variables are cointegrated for both countries implying that a long run steady state exists second there is evidence of bidirectional causality between imports and economic growth for both countries finally japan seems to experience export led growth while gdp growth in south korea has a negative effect on export growth these contrasting findings could result from export goods in japan exhibiting greater nonprice competitive aspects although their success fails to trigger a virtuous circle since growth fails to lead to increased exports while for south korea output growth leads to a decrease in export growth suggesting a strong domestic market

analysis and algorithm for the optimal investment times of new manufacturing technologies in a duopoly abstract on the basis of a dynamic and non cooperative game theoretic model the optimal timings of investments in new manufacturing technologies nmt is analysed under duopolistic competition non identical incumbents with time proportional demand always wait for some delay to invest in nmt the existence of silent timing equilibrium is addressed subsequently we show that cost reducing nmt diffuse over time within a duopoly the investments in strategic nmt however may be distributed through time or in a swarm economic interpretations of initial options and the comparative statics presented in this paper help decision makers develop strategies and make decisions under the situation they face finally a computational algorithm of optimal timings could verify this analysis and facilitate the real applications of game theoretic models

the long run impact of foreign shocks to the austrian economy an analysis at a sectoral level this paper investigates the long run impact of foreign shocks on the austrian economy which is an example of a small open economy with a fixed echange rate regime the analysis is done in a multisectoral vector autoregression framework foreign shocks involve inovations in gnp of european oecd countries oil prices effective echange rate and interest rates sectoral responses appear to be very different in particular shocks to european oecd gnp have a high long run impact on sectoral output especially in export dependent sectors this supports the hypothesis of export led growth

the validity of the elg hypothesis in the mena region cointegration and error correction model analysis the export led growth elg hypothesis is examined for nine middle east and north africa mena countries in three variable vector autoregressive and error correction models when considering total exports the results reject the elg hypothesis in almost all of these countries when only manufactured exports are examined no support is found for elg in countries with relatively low shares of manufactured exports in total merchandise exports but strong support in countries with relatively high shares these findings suggest that promoting exports may contribute to economic growth only after a certain threshold of manufactured exports has been reached

the valuation of american options for a class of diffusion processes we present an integral equation approach for the valuation of american style derivatives when the underlying asset price follows a general diffusion process and the interest rate is stochastic our contribution is fourfold first we show that the exercise region is determined by a single exercise boundary under very general conditions on the interest rate and the dividend yield second based on this result we derive a recursive integral equation for the exercise boundary and provide a parametric representation of the american option price third we apply the results to models with stochastic volatility or stochastic interest rate and to american bond options in one factor models for the cases studied explicit parametric valuation formulas are obtained finally we extend results on american capped options to general diffusion prices numerical schemes based on approximations of the optimal stopping time such as approximations based on a lower bound or on a combination of lower and upper bounds are shown to be valid in this context

unit roots and cointegration in estimating causality between exports and economic growth empirical evidence from the asean countries abstract this paper utilizes cointegration and error correction representation methodology in estimating the long run behavioral relationship between exports and economic growth in the asean countries

growth and exchange rate volatility a panel data analysis the aim of this article is to assess the role of real exchange rate rer volatility on long run economic growth for a set of 82 advanced and emerging economies using a panel data set ranging from 1970 to 2009 with an accurate measure for exchange rate volatility the results for the two step system generalized method of moments gmm panel growth models show that a more less volatile rer has a significant negative positive impact on economic growth the results are also robust for different model specifications

oil prices and financial stress a volatility spillover analysis this paper examines whether there is a volatility transmission between oil prices and financial stress by means of the volatility spillover test we employ wti crude oil prices and cleveland financial stress index for the period 1991 2014 and divide the sample into pre crisis in crisis and post crisis periods due to the downward trend in oil price in 2008 the volatility model estimations indicate that oil prices and financial stress index are dominated by long run volatility the volatility spillover causality test supports evidence on risk transfer from oil prices to financial stress before the crisis and from financial stress to oil prices after the crisis the impulse response analysis shows that the volatility transmission pattern has similar dynamics before and after the crisis and is characterized by higher and long lived effects during the crisis our results have implications for both policy makers and investors and for future work

international versus domestic entrepreneurship new venture strategic behavior and industry structure abstract international entrepreneurship is defined in this study as the development of international new ventures or start ups that from their inception engage in international business thus viewing their operating domain as international from the initial stages of the firm s operation one hundred and eighty eight new venture firms in the computer and communications equipment manufacturing industries are classified according to the percentage of their sales in the international market ventures with no sales derived from international activities are considered domestic new ventures and ventures with sales from international activities comprising greater than 5 of total sales are considered international new ventures the strategy and industry structure profiles of international new ventures are significantly different from domestic new ventures the internationals pursue much broader market based strategies seeking a strategy of broad market coverage through developing and controlling numerous distribution channels serving numerous customers in diverse market segments and developing high market or product visibility the internationals also emphasize a more aggressive entry strategy building on outside financial and production resources to enter numerous geographical markets on a large scale securing patent technology is also an important component of their strategy this suggests that the internationals compete by entering the industry on a large scale seeking to penetrate multiple markets with the recognition that external resources are necessary to support such an entry whereas both the domestics and the internationals characterize domestic competition as being relatively intense the international new ventures compete in industries with higher levels of international competition it is not clear from this research whether the new venture selects an industry with a high degree of international competition and therefore responds with an international orientation or because the new venture has an international orientation it perceives or recognizes a higher degree of international competition another industry structure difference is the internationals perceived higher degree of restrictiveness due to government regulation it is unclear whether this restrictiveness motivates new ventures to seek less regulated international environments or if it indicates that when competing internationally the new venture is confronted with increased regulatory requirements domestic new ventures are distinguished by their emphasis on a production expansion strategy and customer specialization strategy the production specialization strategy consists of focusing on limited geographical markets maintaining excess capacity and pursuing forward integration the customer specialization strategy incorporates the production of a specialty product that is purchased infrequently thus for both of the domestic strategies a consistent closeness between the producer and consumer is implied this may be an important basis underlining the new venture s decision to compete in an exclusive domestic context this study offers initial support for the notion of international entrepreneurship by its findings that there are significant differences between new venture firms competing domestically and new ventures choosing to also enter international markets

a note on dynamic monopoly pricing under consumption externalities we analyze dynamic monopoly pricing under consumption externalities focusing on pricing under negative externalities we also attempt to generalize models in the previous literature which encompass both negative and positive externalities by incorporating a consumer s discount factor for past sales as a parameter analyzing our model reveals oscillation as the optimal price path in the presence of negative externalities

optimal internal pricing and capacity planning for service facility with finite buffer abstract an economic model is developed for exploring optimal internal pricing and capacity planning for service facility with finite buffer capacity because of the limited buffer capacity jobs finding the system full upon their arrival would be rejected such rejections create a gap between the value collectively perceived by users and the actual achievement of the organizational value this gap called a loss externality has never been studied before and plays an important role for designing optimal pricing scheme in general the underlying economic structure may involve multiple equilibria and it is unclear whether or not the system can be controlled through internal pricing in this regard a sufficient condition is given under which the system administrator can find two separate prices for accepted and rejected users at any demand level to be desired so that the desired demand level becomes the unique equilibrium of the system for a short run problem it is shown that the optimal pricing scheme can be expressed as the sum of the congestion and the loss externalities for a long run problem the optimal pricing scheme is expressed in a unified manner so that a structural relationship between the short run problem and the long run problem at optimality can be readily observed a necessary and sufficient condition is also given for the marginal capacity pricing to be optimal i e the optimal long run pricing consists of the marginal cost for processing capacity and the marginal cost for buffer capacity without involving any externality at all

revisiting corporate growth options in the presence of state dependent cashflow risk abstract given a non trivial market price of risk we study the impact of state dependent cashflow risk on the optimal investment policy and on the ensuing value of an unlevered firm that holds the option of scaling up cashflows from its assets in place upon incurring an irreversible cost the firm s investment decision and value are studied as a function of the market price of risk and of the degree of state dependence in cashflow risk

an empirical investigation of the causal relationship between openness and economic growth in china this study investigates the causal relationship between openness and economic growth in china the integration and cointegration properties of the data are analysed and the models of granger sims geweke and hsiao are used to identify a bi directional causal relationship between gnp and exports plus imports this bi directional causation is consistent with china s development strategy of protected export promotion

the effect of firm formation and growth on job creation in the united states abstract this paper demonstrates the importance of new firm formation to economic growth it begins by providing data that describe the united states as having had greater employment growth than most developed nations of the world over the last 25 years and focuses upon why job growth in the united states has exceeded that of other nations job creation by firm size we first examine the data on the relative contribution of small and large firms to u s job growth by summarizing research that is uniformly expressed in two year periods and defines small firms as those with less than 100 employees conclusive evidence emerges that small firms are the major sources of net new creation firm entry exit rates and economic growth further understanding of small firm job creation is obtained when we examine firm entry and exit data here we find that firm entry rates vary considerably from period to period range 10 4 12 5 whereas exit rates remain relatively stable from period to period range 9 6 10 4 thus variation in entrepreneurial activity the formation of new firms is the major cause of net increases in the number firms in both the united states and the united kingdom net firm increases are positively related to overall economic activity firm entry exit and job creation further exploration of this correlation can be conducted by examining job creation and loss defined by source entries expansions exits and contractions the data for 1976 through 1984 shown here demonstrate that new entries account for 74 0 of the 50 8 million new jobs created expansions of existing firms accounted for 26 0 small firms less than 500 employees produced 54 6 of the entry jobs and 56 8 of the expansion jobs on the other hand job losses totaled 33 8 million 79 0 due to exits and 21 0 to contractions small firms account for 53 6 of the jobs lost from exits and 47 8 of those lost from contractions overall small firms account for 60 5 of the 17 0 million net new jobs given the data that show correlation between net firm formation rates and economic growth the finding that entry rates vary more than exit rates and the finding that new entries create most of the new jobs it can be concluded that firm formation especially small firm formation is a significant factor in economic growth increases in small firm formation rates have a significant effect on net job creation schumpeter s model and observed market turbulance another finding from this data on job creation by entry expansion exit and contraction is the large amount of job creation and destruction activity taking place for the period studied three jobs were created and two jobs destroyed for each net new job created this describes a turbulent job market with many workers moving from job to job the labor markets are much less stable that normally envisioned this observed phenomenon fits well with schumpeter s theory of capitalism he proposes that capitalistic growth occurs because entrepreneurs use innovations to form new firms which enter existing markets when successful these growing new firms destroy existing market structures causing decline of established firms while creating increased demand and producing overall economic growth if schumpeter is correct one would expect to find high rates of firm formation and failure and large numbers of jobs created by new firms while many jobs are lost by exits and contractions of established firms the findings reported here show this government policy affects on entry exit our results also show that formation of small new firms is a necessary requirement for economic growth historically however government policy has not considered small firm entry as a central issue thus government policies can and have had a negative effect on entry rates and therefore upon economic growth rates furthermore high rates of new firm formation cause a great deal of turbulence in labor markets with three jobs created and two lost for every one net new job such labor turbulence may be seen by policy makers as undesirable as it entails considerable worker movement from job to job as such policy makers have recently proposed policies to protect workers from job loss due to contractions and exits however such protection policies as demonstrated in recent european experience will also construct barriers to entrepreneurial entry the result may be a decline in small firm entry and a decline in economic growth instead of protecting specific jobs appropriate policies are those that facilitate movement of workers from job to job adequate unemployment compensation for short term unemployment fully vested and portable pension plans and retraining programs are examples of policies that allow the labor market to remain flexible while reducing the negative effect on those who lose jobs

the economic case for international labour standards this paper explores the economic case for international labour standards granting workers rights of free association and collective bargaining confers both static and dynamic economic efficiencies static efficiencies refer to one time gains from improvements in economic practice dynamic efficiencies refer to gains from improvements to the growth path resulting from a shift away from a low road development path to a high road path these efficiencies raise wages employment and output in developing countries and they can also benefit workers in developed countries labour standards are an institutional mechanism for raising the quality of growth in both developing and developed countries in this sense they are a win win institution

the structure of interdependence in international stock markets abstract this study investigates the dynamic structure of nine major stock markets using an error correction model and directed acyclic graphs dag the dag representation provides a structure of causality among these markets in contemporaneous time building on this contemporaneous structure and the estimated error correction model innovation accounting techniques are applied the results show that the japanese market is among the most highly exogenous and the canadian and french markets among the least exogenous in our nine market study the us market is highly influenced by its own historical innovations but it is also influenced by market innovations from the uk switzerland hong kong france and germany the us market is the only market that has a consistently strong impact on price movements in other major stock markets in the longer run

cointegration causality and export led growth in mexico 1895 1992 abstract cointegration and granger causality tests show that real exports and real gdp in mexico over 1895 1992 were cointegrated and there was a significant and positive granger causal relationship running from exports to economic growth

marketing control and performance in early growth companies this article examines the relationship between market performance and marketing control systems used by early growth electronic component and instrument manufacturers essentially marketing control means keeping things on track long pushed aside by the excitement of planning and organizing business ventures controlling operations particularly marketing operations has received little attention this is regrettable because control is the only mechanism which ensures that resources are allocated efficiently and that strategic objectives are met also for the early growth high tech company which is already in a state of flux developing an appropriate marketing control system is essential to its ability to meet and respond to the recurring challenges brought about by the pace at which change is occurring in this article the author examines the issue of marketing control from a theoretical as well as an empirical perspective first the author presents a framework for evaluating the marketing control system within a company the core of the framework presents the essential elements of marketing control feedback and corrective action bounding the core is 1 1 the formal marketing organization delimits the company s capability to enact the control processes 2 2 marketing culture the subjective interpretive aspect of organizational life which determines what control components and marketing structure are valued in the company the framework is used to analyze the marketing control systems of 20 early growth high tech manufacturing companies four hierarchical configurations of the control system elements are identified and the companies assigned to one of the following configurations 1 i seeking some sales 2 ii making good on sales 3 iii seeking profitable sales 4 iv making profitable sales four companies possessed none of the elements of control there were merely operations which produced results as a consequence the companies were judged to be generally unsuccessful in focusing their resources on the markets that they wished to serve in addition the market performances of these firms relative to others in the sample were poor ten stage ii companies in their attempts to expand sales and to remedy logistical problems associated with making deliveries on sales had developed formal sales departments unlike the four companies which were placed in stage iii these companies put little emphasis on the financial accountability of sales and marketing consequently their abilities to evaluate or steer profit performances mitigated against their achieving high levels of market performance only two companies were judged sufficiently different from other companies to warrant placement in stage iv these companies focused on developing marketing structures and reporting procedures which provided real time feedback on market performances because of this they appeared able to identify market opportunities that were defensible in the long run and in which they could exercise control over profits in conclusion the findings indicate that greater control of marketing operations correlates with stronger market performances when performance is measured in terms of absolute sales sales growth cumulative cashflow and profitability companies with more evolved marketing control systems perform noticeably better than do others in the sample

causality between exports and economic growth abstract this paper utilizes granger causality tests in investigating the relationship between exports and national income from a consistent data set for 47 developing countries in africa new empirical results as well as suggestions for future research are presented

pricing and capacity decisions for a service facility stability and multiple local optima we consider a model for optimal pricing and capacity for a service facility the problem is formulated as one of optimal design of a single server queueing system in which the design variables are the service rate and the arrival rate equivalently the price charged for admission the model is a variant of one introduced by dewan and mendelson we allow for an upper bound on the arrival rate and consider slightly more general user value functions we show that an optimal solution may not lie in the interior of the feasible region and thus may not be characterized by the first order differential conditions moreover the first order conditions typically have several solutions some of which may be relative minima and produce a negative value of the objective function customer value minus the sum of expected delay cost and capacity cost per unit time we also examine the stability of the equilibrium arrival rate and the convergence of a dynamic adaptive algorithm for finding the optimal service rate in the context of a model in which the distribution of customers value of service is uniform we show that the equilibrium arrival rate is stable if and only if the service rate is above a threshold value which depends on the price charged for admission and the parameters of the uniform distribution of value of service the dynamic adaptive algorithm always converges to a relative maximum of the objective function if the service rate can be adjusted every time the arrival rate changes otherwise the algorithm will start to diverge if and when the service rate ever falls below the threshold value associated with stability of the equilibrium arrival rate

causality between export growth and industrial development empirial evidence from the nics abstract this paper investigates the causal relationship between export growth and industrial development in eight newly industrializing countries nics results of sims causality test show that for most of the nics there is a strong bidirectional causality between the growth of exports and industrial development these findings support the export led growth strategy in that expansion in exports not only promote the growth of national income but also lead to structural transformation of the developing countries

factors influencing japanese entrepreneurs in high technology ventures abstract in this study reporting on a survey of the founders of japanese high technology firms various factors affecting the entrepreneurial event are examined the sample was drawn from the nikkei press group which publishes in japanese an annual directory of over 1 700 high technology venture business firms a close examination of this directory reveals that there are only between 100 and 200 firms that are both high technology and less than 10 years old from this list 100 firms were selected for a single mailing of a japanese language questionnaire forty six completed questionnaires were returned the survey consisted of eight questions six of where were multipart questions while the push of a displacing event seems to be relatively unimportant among japanese high technology entrepreneurs there appears to be a strong relationship between social marginality and entrepreneurs with a perception that they had no alternative but to form a new venture the pull of opportunity was mostly related to a specific deal or a niche ignored by former employers the importance of friends in the decision to launch a venture appears to be quite strong reflecting the strong group spirit of japanese society the dominant element in the motivation of high technology entrepreneurs in japan seems to be related to a drive for self actualization the following five variables generated the strongest affirmative reactions create an opportunity for myself create an organization that reflects my values reached a critical point in my life create an opportunity to grow and develop my talent unable to exercise my full creativity in previous position this may reflect that basic human needs are well met by the japanese economy and the centuries of japanese social and ethnic continuity it is not entirely clear from this study where japanese high technology entrepreneurs find role models only a few had fathers who were entrepreneurs although 43 had fathers who were either entrepreneurs farmers or otherwise self employed observing colleagues or others form companies played only a limited role however 83 of the founders acknowledged that their firm was a spin off from their previous employer the founders of these spin off ventures were predominantly employed in r d and sales and marketing holding a position of authority was strongly associated with spin off ventures in japan about as many high technology entrepreneurs came from large companies over 1 000 employees as from small 250 employees or less firms while it is commonly perceived that the cultural environment of japan restrains entrepreneurship most of these entrepreneurs saw their environment as favorable which may reflect the japanese will to endure hardship or a universal optimism among entrepreneurs

exports growth and causality in ldcs abstract using akaike s optimal lag criterion in a granger causality test the causal relationship between export growth and economic growth and vice versa is re examined for 20 countries it is argued that earlier analyses which ignore optimal lags in granger or sims causality tests suffer from certain shortcomings which are overcome by the present approach the results suggest some support for the export promotion hypothesis especially in the case of well known nics and thus differ from previous applications of granger test which did not adopt an optimum lag criterion and which showed no causality from export growth to economic growth in such cases however they are inconclusive in evaluating competing hypotheses

exports export composition and growth cointegration and causality evidence for malaysia this paper comprehensively tests the export led growth elg hypothesis for malaysia for the period 1955 90 using cointegration and causality testing based on hsiao s synthesis of the granger test and akaike s minimum final prediction error criterion the results provide support for the elg hypothesis aggregate exports granger cause real gdp and non export gdp this relationship is found to be driven by manufactured exports rather than by traditional exports

exports and economic growth in industrialized countries the prima facie causal relationships between growth exports and factor inputs capital and labour are investigated in five industrialized countries germany itlay japan united kingdom and united states over the period 1960 87 by analysing a four variable vector autoregressive var model for each country our results indicate that germany and japan experienced export led growth reverse causality between exports and growth is found in the case of the us and uk while to causal relationship between exports and output is found for itlay

the informational role of commodity prices in formulating monetary policy a reexamination abstract this paper reexamines the issue of whether commodity prices provide useful information for formulating monetary policy through the application of a recent development in time series methodology developed by toda and yamamoto j econometrics 66 1995 225 250 we found that commodity prices signal the future direction of the economy

cointegration causality and export led growth in portugal 1865 1985 abstract this paper considers the relationship between cointegration and causality and uses tests of cointegration as pre tests for granger tests of causality such methods are utilized on portuguese data 1865 1985 where the export led growth hypothesis is rejected in favour of reverse causality

a contract and balancing mechanism for sharing capacity in a communication network we propose a method for determining how much to charge users of a communication network when they share bandwidth our approach can be employed either when a network owner wishes to sell bandwidth for a specified period of time to a number of different users or when users cooperate to build a network to be shared among themselves our proposed contract and balancing mechanism can mediate between rapidly fluctuating prices and the longer time scales over which bandwidth contracts may be traded an advantage of the process is that it avoids perverse incentives for a capacity provider to increase congestion

a discrete time model of american put option in an uncertain environment abstract a discrete time mathematical model for american put option with uncertainty is presented and the randomness and fuzziness are evaluated by both probabilistic expectation and fuzzy expectation defined by a possibility measure from the viewpoint of fuzzy expectation taking account of decision maker s subjective judgment an optimality equation for the optimal stopping problem in a fuzzy stochastic process is derived and an optimal exercise time is given for the american put option it is shown that the optimal fuzzy price is a solution of the optimality equation under a reasonable assumption the permissible range of the writer s seller s optimal expected price in the american put option is presented and the meaning and properties of the optimal expected prices are discussed in numerical examples in a numerical example the discrete time approximation model is discussed for the continuous time model

manufacturing exports mining exports and growth cointegration and causality analysis for chile 1960 2001 this study examines the export led growth hypothesis using annual time series data from chile in a production function framework it addresses the problem of specification bias under which previous studies have suffered and focuses on the impact of manufactured and mining exports on productivity growth in order to investigate if and how manufactured and mining exports affect economic growth via increases in productivity the study uses johansen cointegration technique the estimation results can be interpreted as evidence of productivity enhancing effects of manufactured exports and of productivity limiting effects of mining exports

are there efficiency gains from the removal of natural resource export restrictions evidence from british columbia log export bans lebs are a popular development tool utilised by developing nations with sizable endowments of timber however the actual impact of these policies is debatable british columbia has a developed forestry sector and still maintains a leb this trade restriction continually creates conflicts with canada s international trade partners including the united states this paper examines the efficiency implications of a hypothetical removal of roundwood export restrictions in british columbia using roundwood price and quantity data from 1995 to 2008 a time series econometric approach is utilised to determine supply and demand elasticities for british columbia s roundwood empirical results from a vector error correction model suggest that a removal of export restrictions will generate an overall increase of approximately 347 91 million us dollars per year to british columbia s forest economy

agricultural exports and economic growth in less developed countries this article examines the contribution of agricultural exports to economic growth in less developed countries ldcs a sources of growth equation is developed from a dual economy model where agricultural and nonagricultural sectors are both divided into export and nonexport subsectors this is then estimated using panel data for 62 ldcs for 1974 1995 results provide evidence that there are significant structural differences in economic growth between low lower middle and upper income ldcs investment in the agricultural export subsector has a statistically identical impact on economic growth as investment in the nonagricultural export subsector the marginal productivities in nonexport subsectors are over 30 lower than those in respective export subsectors from a policy perspective the results suggest that export promotion policies should be balanced

export expansion and economic growth testing for cointegration and causality this paper develops a multivariate error correction model to test the causality between exports and growth in 15 asian countries 1967 91 the underlying series are tested as non stationary in levels but stationary in first differences the causal factors are cointegrated in five of these countries only causality test results indicate that export expansion causes growth in two third of these countries corrected for simultaneity between the causal factors a country with a large public sector higher level of economic development and which is less vulnerable to external economic shocks is more likely to reap the benefits of export promotion strategies the causal inferences are fairly stable over the sample period

real options and product life cycles in this paper i develop an option valuation framework that explicitly incorporates a product life cycle i then use the framework to value the real option to change a project s capacity standard techniques for valuing real options typically ignore product life cycle models and specify instead a constant expected growth rate for demand or price i show that this specification can lead to significant error in the valuation of capacity options in particular the standard technique tends to undervalue the option to contract capacity and overvalue the option to expand capacity this result has important implications for capital investment decisions especially in high technology industries that feature regular introductions of newly improved products

non transboundary pollution and the efficiency of international environmental co operation abstract the standard view is that situations where no transborder environmental externalities occur are most efficiently dealt with by national environmental policies rather than by international co operation though this may be the general case non coordinated national policies do not always produce the most efficient international allocation this paper presents four cases in which the allocative outcome of non coordinated domestic policy choices can be improved upon by international environmental co operation the first case refers to the use of environmental policy as a strategic trade instrument the other cases refer to the existence of discrete technologies set up costs and increasing returns to scale the form of international environmental co operation should be adapted to the situation formal international agreements between countries are characterised by high transaction costs and may not always be the most efficient form of co operation

foreign direct investment and economic growth in less developed countries an empirical study of causality and mechanisms we examine the causality between foreign direct investment fdi and economic growth for 66 developing countries taking into account their interaction with exports and technological change time series analysis for each country is conducted based on a method introduced by toda and yamamoto 1995 for testing granger causality in the presence of nonstationary time series the main findings of this article are fdi causes growth in several of the developing countries but the mechanism through which this works differs across countries and reverse causality from growth to fdi exists for many countries

a coordinated production planning model with capacity expansion and inventory management motivated by a problem faced by a large manufacturer of a consumer product we explore the interaction between production planning and capacity acquisition decisions in environments with demand growth we study a firm producing multiple items in a multiperiod environment where demand for items is known but varies over time with a long term growth and possible short term fluctuations the production equipment is characterized by significant changeover time between the production of different items while demand growth is gradual capacity additions are discrete therefore periods immediately following a machine purchase are characterized by excess machine capacity we develop a mathematical programming model and an effective solution approach to determine the optimal capacity acquisition production and inventory decisions over time through a computational study we show the effectiveness of the solution approach in terms of solution quality and investigate the impact of product variety cost of capital and other important parameters on the capacity and inventory decisions the computational results bring out some key insights increasing product variety may not result in excessive inventory and even a substantial increase in set up times or holding costs may not increase the total cost over the horizon in a significant manner due to the ability to acquire additional capacity we also provide solutions and insights to the real problem that motivated this work

new business entrepreneurship in the japanese economy abstract this article presents the results of a study focused on the role of new business entrepreneurship in the japanese economy particular attention is paid to the activities of various government agencies in relation to new business entrepreneurship and to the barriers to this activity in japan new business entrepreneurship was defined as the formation and rapid growth of a business enterprise through unique approaches to the firm s activities in contrast to the american stereotype of japan as an economy of a few large interconnected firms it is in fact characterized by small and medium sized enterprises over 99 of all japanese enterprises are categorized as small or medium and over 80 of all employed japanese are employed by such firms however very few of these firms are entrepreneurial in nature the vast majority are small firms that are either subcontractors to a single larger firm or small retail wholesale or restaurant establishments the start up rate for all types of businesses in japan has been declining for the past 10 to 15 years more importantly the rate of start up s for independent firms as opposed to firms started by a larger firm to serve primarily as a subcontractor declined even more sharply this indicates a significant weakness in japan s otherwise strong economy the low and declining rate of new business entrepreneurship in japan is a function of structural governmental and cultural barriers structural barriers include an acute long term labor shortage high financial start up costs due in large part to high land prices and a shortage of venture capital funding government barriers include red tape financial and other support for small firms that is withdrawn as they enter rapid growth and the persistent protection of inefficient industry structures cultural barriers involve japan s strong group collective orientation the traditional career path in japan bounds on creativity and the fact that entrepreneurship is not assigned a high social value while the government provides an extensive well developed network of services for small and medium sized firms these programs are not designed to facilitate rapid growth into the large firm phase the japanese experiences and programs offer useful insights for policy and tactics by other governments

learning mixed equilibria we study learning processes for finite strategic form games in which players use the history of past play to forecast play in the current period in a generalization of fictitious play we assume only that players asymptotically choose best responses to the historical frequencies of opponents past play this implies that if the stage game strategies converge the limit is a nash equilibrium in the basic model plays seems unlikely to converge to a mixed strategy equilibrium but such convergence is natural when the stage game is perturbed in the manner of harsanyi s purification theorem journal of economic literature classification number c72

dynamic capability view in terms of real options abstract in this paper we will make an attempt to open up the black box of the modern basic theory of strategic management i e the resource based view we will launch a dynamized version about it and interpret its usability in terms of real options applications according to the dynamic capability view of the firm the company consists of human physical and financial resources and its knowledge base which in turn consists of already existing and routinely exploited i e static and not yet fully developed or exploited dynamic capabilities which both can be produced either internally by the firm itself or externally through the open market or networks it is widely recognized that in modern firms especially the development creation and management of dynamic capabilities is of utmost strategic importance our paper focuses on the hard issue of managing and valuating dynamic capabilities when designing the strategic boundaries of the firm let us say when making decisions about network relations to be able to do this we will take a broad look at the real options approach as a special method to shed some light on the very aspects of coping with technological and market uncertainty some empirical industry related illustrations about real options applications are launched as well

unequal pricing in the information economy implications for consumer welfare this article presents an economic analysis of information good pricing and consumer welfare and discusses the implications of price discrimination in the information economy it argues that network externalities coupled with information asymmetry enable a dominant marketer to price unequally extracting late adopters surplus to compensate for the loss from early adopters in the short term the minority early adopters benefit by paying less but in the long term the majority late adopters suffer by paying more considering that late adopters are likely to be at a disadvantage in resources this discriminatory pricing amounts to the poor subsidizing the rich based on this analysis implications for consumer welfare are discussed

testing the effect of investments in it and r d on labour productivity new method and evidence for indian firms abstract utilizing a micro level dataset of 900 firms for the period 2000 2016 from indian manufacturing this paper explores the effects of technological investments on labour productivity performance of firms by looking at investments in information technology it and research development r d the present study is the first to assess the role of it and r d jointly for indian manufacturing to control for transmission bias in production function estimation a gmm based one step control function estimator is applied we find large effects of both it and r d across various sub samples further our results imply that there is a complementarity between it and r d in generating labour productivity growth