credit constraints and the phenomenon of child labor abstract this paper develops an overlapping generations general equilibrium model where inefficient child labor arises due to credit constraints it derives a positive relationship between inequality in the distribution of income and the incidence of child labor looking at policy implications it shows how trade sanctions against countries using child labor may fail to reduce the incidence of child labor it discusses some alternative policies to reduce the incidence of child labor

a competitive distribution of auctions in this paper a competitive distribution of auctions is described for an economy consisting of an infinite number of buyers and sellers all of whom differ according to their valuation for the single indivisible object being traded a competitive distribution of auctions is such that no seller can improve his profits by deviating to any alternative direct mechanism it is shown that the competitive distribution of auctions will have the property that each buyer and seller s best reply is independent of his beliefs about the tastes of other buyers and sellers on the market the purpose of this paper is to provide an equilibrium for an economy in which sellers compete by offering different direct mechanisms to buyers no attempt is made to give a complete characterization of all possible equilibria rather we focus on one equilibrium in which the contracts that are offered by sellers in equilibrium and buyer s behaviour under these contracts are both independent of traders beliefs about one another the equilibrium illustrates one of the reasons why contracts that are employed in practice may not be as finely tuned to beliefs as the theory of mechanism design says that they should be the answer is simply that contracts are not offered in a vacuum sellers in the model studied in this paper need to compete with one another in order to attract buyers highly tuned mechanisms tend to extract buyer surplus in such an environment sellers are able to attract many buyers by offering to use cruder mechanisms that leave some surplus for buyers in this paper sellers are allowed to have different costs for the commodity that is being traded nonetheless the equilibrium for the limit economy in which there are infinitely many buyers and sellers is such that every seller offers a second price auction and publicizes a reserve price equal to his cost in a standard monopoly auction the optimal reserve price for the seller exceeds his cost by an amount that depends on his beliefs about buyers valuations myerson 1981 a seller who raises his reserve price has his profits affected in two distinct ways by raising his reserve price the seller makes it unprofitable for some buyer types to participate in his auction the seller therefore loses any surplus that he might have earned by trading with these buyers the buyers who still find it profitable to participate in the seller s auction will end up having to pay a higher price when they win because of this increase in the seller s reserve price this means that the seller will be able to extract a bit more surplus from buyers who continue to participate the seller raises the reserve price until the marginal cost associated with raising the reserve price is just equal to the marginal gain associated with the ability to extract more surplus from remaining buyers competition mitigates this argument since there is a limit to the amount of surplus that the seller can extract from remaining buyers before they decide that they should instead choose one of the alternative auctions that are being held on the market with

name your own price at priceline com strategic bidding and lockout periods a buyer suggests prices to n sellers in a time period and buys from the seller who accepts the bid first the number of bidding rounds is determined by how frequently the buyer can make an offer we show that with no limit on the frequency and without discounting the price path is either kept flat initially with large jumps at the end or increasing steadily over time which class of path occurs in equilibrium depends on the buyer s trade off between committing to a price ceiling versus finely screening the sellers costs with discounting limiting the number of rounds mitigates the delay caused by the reluctance to raise bids in the first class of equilibrium and therefore can benefit the buyer this result suggests why in reality bargaining parties often take measures to make their offers rigid and consequently force themselves to make fewer offers copyright oxford university press

corporate social responsibility failures how do consumers respond to corporate violations of implied social contracts this research documents consumers potential to monitor corporations license to operate through their consumption responses to corporate social responsibility failures the premise is that the type of social contracts or standards in place may determine how consumers through their individual and collective behaviors can play a direct role in influencing corporate behavior when corporations fail to meet social responsibility standards an experiment conducted with a large sample of consumers in the united states shows that consumers respond differently to a company s failure in its social responsibilities depending on whether the violated standard is a government mandate or a voluntary commitment and depending on the consumers own environmental consciousness the findings highlight the potential power of individual consumers and consumer collectives in narrowing the governance gaps relative to social and environmental issues and reducing the likelihood of csr failures

withholding consumption a social dilemma perspective on consumer boycotts this article draws on social dilemma theory and reference group theory to understand the individual boycott decision and tests the predictions stemming from this conceptualization in two experiments consistent with our predictions consumers likelihood of participating in both economic and social issue boycotts is jointly determined by their perceptions of the boycott s likelihood of success their susceptibility to normative social influences and the costs they incur in boycotting consumers success perceptions are in turn determined by their expectations of overall participation and efficacy as well as the message frame inherent in proboycott communications two key determinants of consumers boycotting costs are their preference for the boycotted product and their access to its substitutes more specifically consumers who are more susceptible to the normative influence exerted by the reference group of potential boycotters are more influenced by expected overall participation rates in their boycott likelihood

channel coordination and profit distribution in a social responsible three layer supply chain abstract this paper analyzes coordination of a manufacturer distributer retailer supply chain where the manufacturer exhibits corporate social responsibility csr in manufacturer stackelberg game setting the paper proposes a contract bargaining process to resolve channel conflict and to distribute surplus profit among the channel members the contract bargaining process consists of two wholesale price discount nash bargaining one between the distributer and the retailer based on the outcome of that between the distributer and the manufacturer although the contract bargaining process cuts out channel conflict and distributes surplus profit the wholesale prices are quite different from those of a pure profit maximizing supply chain the wholesale price of the manufacturer is less than its marginal production cost above a threshold of csr even it is negative for the manufacturer s heavy csr practice so the manufacturer s profit may be negative the behavior of the wholesale price of the distributer is same as that of the manufacturer but for higher threshold of csr

public procurement with unverifiable quality the case for discriminatory competitive procedures unverifiable quality may affect the enforcement of procurement contracts even when the award procedure is able to select the most efficient firm in the market in this paper we show that a discriminatory competitive mechanism which awards the contract on the basis of price and firms past performance yields an efficient allocation of the contract and allows the buyer to implement her desired quality quality enforcement arises out of relational contracting whereby the buyer handicaps a contractor in future competitive tendering processes if it fails to provide the required quality we study an infinitely repeated procurement model with two firms and one buyer imperfectly informed on the firms cost in which in each period the buyer runs a discriminatory auction we restrict our analysis to the case of a buyer committed to her handicapping strategy a case which captures some of the features of a public buyer when players use either grim trigger or stick and carrot strategies we find that the buyer can induce the delivery of optimal unverifiable quality with a variety of handicap levels and when applicable durations of the punishment period for some values of the handicap and the length of the punishment period both firms remain active in the market even when punished

consumer trust social marketing and ethics of welfare exchange the global corporate scandals such as enron worldcom and global crossing have raised fundamental issues of business ethics as well as economic social and anthropological questions concerning the nature of business competition and global capitalism the purpose of this conceptual paper is to introduce the concept of welfare exchange to the existing notions of economic social and anthropological notions of business and exchange in markets and society in the 21st century global competition and business success in the 21st century continue to raise the nature of economic value and the interaction among diverse actors in international markets institutions and society we believe that the nature of such exchange between consumers and organizations which can also be termed social marketing need to increasingly take into account a welfare and ethical component in this paper we introduce our concept of welfare exchange to emphasize the importance of such welfare and ethical issues in the global business environment of the 21st century

what will consumers pay for social product features the importance of ethical consumerism to many companies worldwide has increased dramatically in recent years ethical consumerism encompasses the importance of non traditional and social components of a company s products and business process to strategic success such as environmental protectionism child labor practices and so on the present paper utilizes a random utility theoretic experimental design to provide estimates of the relative value selected consumers place on the social features of products

national sentiment and consumer choice the iraq war and sales of us products in arab countries did the rise in anti american sentiment caused by the iraq war affect sales of us goods abroad we address this question using data on soft drinks and fabric detergents sales in nine arab countries we find a statistically significant negative impact of the war on sales of us soft drinks in seven countries the impact dissipates after a few months in two countries but persists in the other five in the case of detergents we only find a significant negative impact in one country we conclude that international politics can sometimes affect consumer behavior and market outcomes

the law of small numbers investigating the benefits of restricted auctions for public procurement abstracta commonly accepted view in the academic literature is that dispensing with competition may only be beneficial when tendering complex contracts however restricted auctions are frequently used among eu member states to procure small contracts in this article we investigate this paradox using an original data set of 180 contracts used by a local public buyer of social housing between 2006 and 2009 we show that limiting competition may enable economies to be made on transaction costs while the most efficient bidders still come forward and that abuses such as corruption or favouritism do not result to our knowledge this article is the first to shed light on the advantages of using restricted auctions when tendering small simple contracts

stopping the exploitation of workers an analysis of the effective application of consumer or socio political pressure commodity chain analysis bair and ramsay 2003 multinational companies and global human resource strategies is used to explore where economic pressure from consumers or socio political pressure from governments and ngos can be applied to reduce worker exploitation six paths are illustrated with examples of successful and unsuccessful application of pressure three conclusions are reached economic pressure on companies and brand owners is more likely to lead to improved workplace conditions than socio political pressure brand owners are more likely to implement improved workplace conditions than retailers and retailers who are under extreme consumer price pressure will resist improving workplace conditions

procurement contracting with time incentives theory and evidence in public procurement social welfare often depends on how quickly the good is delivered a leading example is highway construction where slow completion inflicts a negative externality on commuters in response highway departments award some contracts using scoring auctions which give contractors explicit incentives for accelerated delivery we characterize efficient design of these mechanisms we then gather an extensive data set of highway projects awarded by the california department of transportation between 2003 and 2008 by comparing otherwise similar contracts we show that where the scoring design was used contracts were completed 30 40 faster and the welfare gains to commuters exceeded the increase in procurement costs using a structural model that endogenizes participation and bidding we estimate that the counterfactual welfare gain from switching all contracts from the standard design to the efficient apb design is nearly 22 of the total contract value 1 14 billion copyright 2011 oxford university press

consumer preference for a no choice option the traditional focus in the decision making literature has been on understanding how consumers choose among a given set of alternatives the notion that preference uncertainty may lead to choice deferral when no single alternative has a decisive advantage is tested in seven studies building on recent research the article shows that the decision to defer choice is influenced by the absolute difference in attractiveness among the alternatives provided and is not consistent with trade off difficulty or the theory of search these findings are then extended to show that choice deferral can also be modified for the same alternatives by manipulations that make them appear more similar in attractiveness or that decrease the need to differentiate among them the results are consistent with the notion that preference uncertainty results in a hesitation to commit to any single action since small differences in attractiveness among the alternatives are potentially reversible consistent with this premise the effect of attractiveness difference on choice deferral decreased significantly when subjects were first allowed to practice making monetary trade offs among the available alternatives

bundling as an optimal selling mechanism for a multiple good monopolist abstract multiple objects may be sold by posting a schedule consisting of one price for each possible bundle and permitting the buyer to select the price bundle pair of his choice we identify conditions that must be satisfied by any price schedule that maximizes revenue within the class of all such schedules we then provide conditions under which a price schedule maximizes expected revenue within the class of all incentive compatible and individually rational mechanisms in the n object case we use these results to characterize environments mainly distributions of valuations where bundling is the optimal mechanism in the two and three good cases

on the analysis of asymmetric first price auctions we provide a new set of tools for studying asymmetric rst price auctions connecting their equilibria to the concavity of the underlying type distributions and showing how one can use surplus expressions related to symmetric auctions to bound equilibrium behavior in asymmetric auctions we apply these tools to studying procurement auctions in which as is common in practice one seller is given an advantage re ecting for example better reliability or quality we show conditions under which for any given rst price handicap auction there is a second price auction with bonuses that outperforms it with most of our results involving ex post dominance

focus on fairtrade propositions for integrating fairtrade and supply chain management research driven by increased consumer interest and stakeholder pressure the number of fairtrade ft products has been steadily increasing the mainstreaming of ft means that the products are now facing stiff competition within the generic product categories in which they operate while consumers may pressure organizations for ethical conduct they are less willing to pay premium prices for fairly traded products for ft to continue to grow more efficient operating models are required to offset the premium prices paid to producers to ensure competitiveness in the market one such improvement approach may be the management of ft supply chains to investigate the feasibility of this approach this article systematically combines literature on ft with key supply chain management scm constructs and theories we discuss existing scm paradigms in the context of ft and demonstrate aspects where the efficiency of ft chains needs to be improved to ensure their viability we present propositions that demonstrate the key limitations of the ft model from the point of view of scm theory and practice and suggest the potential changes needed in the management of ft supply chains the article provides a timely first attempt to systematically combine ft with scm constructs thus establishing a basis for the further development of ft chains and for the improvement of the operating efficiency within them

a dynamic lot sizing model with demand time windows one of the basic assumptions of the classical dynamic lot sizing model is that the aggregate demand of a given period must be satisfied in that period under this assumption if backlogging is not allowed then the demand of a given period cannot be deliveredearlier orlater than the period if backlogging is allowed the demand of a given period cannot be deliveredearlier than the period but it can be delivered later at the expense of a backordering cost like most mathematical models the classical dynamic lot sizing model is a simplified paraphrase of what might actually happen in real life in most real life applications the customer offers a grace period we call it ademand time window during which a particular demand can be satisfied with no penalty that is in association with each demand the customer specifies an acceptable earliest and a latest delivery time the time interval characterized by the earliest and latest delivery dates of a demand represents the corresponding time window this paper studies the dynamic lot sizing problem with demand time windows and provides polynomial time algorithms for computing its solution if backlogging is not allowed the complexity of the proposed algorithm is o t2 where t is the length of the planning horizon when backlogging is allowed the complexity of the proposed algorithm is o t3

consumer demand for fair trade evidence from a multistore field experiment abstract we provide new evidence on consumer demand for ethical products from experiments conducted in a u s grocery store chain we find that sales of the two most popular coffees rose by almost 10 when they carried a fair trade label as compared to a generic placebo label demand for the higher priced coffee remained steady when its price was raised by 8 but demand for the lower priced coffee was elastic a 9 price increase led to a 30 decline in sales while consumers attach value to ethical sourcing there is significant heterogeneity in willingness to pay for it

price competition for an informed buyer abstract this paper investigates price competition with private information on the demand side two sellers each offer a different variety of a good to a buyer endowed with a private binary signal on their relative quality the model provides an informational foundation to differentiation in hotelling s price competition game equilibrium comparative statics is performed with respect to the prior belief and the precision of the private information competition is fierce when the prior strongly favors one seller and private signals are relatively uninformative sellers equilibrium profits may fall with the revelation of public information and are nonmonotonic in the prior belief journal of economic literature classification numbers c72 d43 d82 l15

the csr quality trade off when can corporate social responsibility and corporate ability compensate each other this paper investigates under what conditions a good corporate social responsibility csr can compensate for a relatively poor corporate ability ca quality and vice versa the authors conducted an experiment among business administration students in which information about a financial services company s ca and csr was provided participants indicated their preferences for the company s products stocks and jobs the results show that for stock and job preferences a poor ca can be compensated by a good csr for product preferences a poor ca could not be compensated by a good csr at least when people thought that ca is personally relevant to them furthermore a poor csr could be compensated by a good ca for product stocks and job preferences

the value of public information in monopoly the logic of the linkage principle of milgrom and weber 1982 extends to price discrimination a non linear pricing monopolist who sells to a single buyer always prefers to commit to publicly reveal information a liated to the valuation of the buyer

the importance of nongovernmental organizations ngos in global governance and value creation an international business research agenda the emergence of organized civil society and of nongovernmental organizations ngos as organizational manifestations of broader social movements has dramatically altered the global political economic landscape the increasing global reach of ngos challenges established international business ib research and highlights opportunities for broadening and adapting extant paradigms in the field in this article we introduce the concept of ngos and contrast them with their private sector firm and public sector government counterparts within the context of ib we discuss factors giving rise to ngos as important organizational entities that participate in global value creation and governance and identify limits to their efficacy and viability we identify important questions raised by incorporating ngos into our conceptualization of global context and we challenge three basic tenets of ib theory the definition and dynamics of an institutional field the relevance centrality of a firm government i e two sector bargaining model and the pre eminence of the firm as the global organization of interest within the field we conclude by offering suggested research directions that should serve as catalysts for this new and potentially rich area of future ib research

the boycott puzzle consumer motivations for purchase sacrifice a boycott is never far from a firm s exchanges with its customers researchers in marketing need to understand consumer protest behavior both to aid nongovernmental organizations ngos who wish to organize boycotts and to assist managers who wish to develop appropriate strategic responses boycotts like many other instances of collective action are subject to free rider and small agent problems there appears to be little or no motivation for an individual to participate yet they assuredly occur we take an economic and psychological approach to the study of boycotts our approach is to develop a typology of motivations for consumer boycotts to embed these motivations explicitly in a dynamic economic model and thus to offer explanations for the extent of boycott participation

imperfect competition and efficiency in lemons markets this article studies the impact of competition on the degree of inefficiency in lemons markets more precisely we characterise the second best mechanism i e the optimal mechanism with private information in a stylised lemons market with finite numbers of buyers and sellers we then study the relationship between the degree of efficiency of the second best mechanism and market competitiveness a general message of our results is that increasing competition may not help lemons markets in some circumstances moreover increasing competition beyond a certain degree increases the distance between the first best and second best levels of efficiency

piecewise procurement of a large scale project this paper studies the optimal piecewise procurement of a large scale project in the unique markov perfect equilibrium mpe of the dynamic procurement game it is found that 1 unlike the static setting the procurer s optimal strategy depends on the number of suppliers and more importantly it is nonmonotonic as one more supplier participates in the procurement auction the procurer softens competition in the initial stages by including more cost btypesq while increasing competition in the mature stages 2 this in turn implies that existing suppliers might favor participation of additional suppliers 3 absent scheduling and or resource constraints the procurer prefers to procure the project as one piece if the suppliers technology exhibits constant or increasing returns and no additional suppliers are enticed to bid and 4 the optimal dynamic mechanism can be easily implemented via a sequence of dominant strategy auctions of the vickrey type d 2004 elsevier b v all rights reserved

consumer activism producer groups and production standards we examine competition between groups of producers when consumers prefer costly ethical production technologies consumers are unable to identify or monitor production technologies producers can freeride on their group s reputation by substituting cheaper unethical technologies when an ethical technology is pareto optimal social pressures within competing producer groups can ensure long run dominance of groups relying most heavily on the ethical technology even if social pressures cannot support the choice of the ethical technology in the long run competition between producer groups can increase the average level of adoption of the ethical technology for an arbitrarily long period of time

the impact of industry consolidation on government procurement evidence from department of defense contracting abstract we study the relationship between market structure and public procurement outcomes in particular we ask whether and to what extent consolidation driven increases in industry concentration affect the way in which the government procures its goods and services we focus on the defense industry by far the largest contributor to federal procurement spending in the u s this industry experienced a sharp increase in the level of concentration during the 1990s driven by a series of large mergers between defense contractors using detailed microdata on department of defense dod contract awards we estimate the causal effect of industry concentration on a series of procurement outcomes leveraging the differential impact of these mergers across product markets we find that market concentration caused the procurement process to become less competitive with an increase in the share of spending awarded without competition or via single bid solicitations increased concentration also induced a shift from the use of fixed price contracts towards cost plus contracts however we find no evidence that consolidation led to a significant increase in acquisition costs we infer that the government s buyer power especially relevant in this context given the government is often the only purchaser constrained firms from exercising any additional market power gained by consolidation

ethical products less strong how explicit and implicit reliance on the lay theory affects consumption behaviors many consumers implicitly associate sustainability with lower product strength this so called ethical less strong intuition elsi poses a major threat for the success of sustainable products this article explores this pervasive lay theory and examines whether it is a key barrier for sustainable consumption patterns even more importantly little is known about the underlying mechanisms that might operate differently at the implicit and explicit levels of the consumer s decision making to fill this gap three studies examine how the implicit judgments that consumers activate automatically shape their consumption behaviors in concert with their more controlled explicit beliefs about sustainable products the main study investigates the elsi s imprint on actual shopping patterns and disentangles the implicit and explicit mechanisms of the lay theory this paper also asks how this negative influence can be attenuated by examining whether the consumer s interest in sustainable consumption reduces reliance on the elsi two follow up studies confirm the robustness from different methodological and practical perspectives implications for companies and policy makers are derived

understanding socially responsible investing the effect of decision frames and trade off options over the past two decades the phenomenon of socially responsible investing has become more widespread however knowledge about the individual socially responsible investor is largely limited to descriptive and comparative accounts the question of why do some investors practice socially responsible investing and others don t is therefore still largely unanswered to address this shortcoming in the current literature this paper develops a model of the decision to invest socially responsibly that is grounded in the cognition literature the hypotheses proposed in the model are tested with an experimental survey the results indicate that the framing of the investing situation influences the likelihood of engagement in socially responsible investing and how much return the individuals are willing to sacrifice when choosing socially responsible over conventional investments the study does not find support for a relationship between expectations about corporate social responsibility and the likelihood of engagement in socially responsible investing

procurement when price and quality matter a buyer seeks to procure a good characterized by its price and its quality from suppliers who have private information about their cost structure xed cost and marginal cost of providing quality we characterize the buyer s optimal buying mechanism we then use the optimal mechanism as a theoretical and numerical benchmark to study simpler buying procedures such as scoring auctions and bargaining scoring auctions can extract a signifi cant proportion of the buyer s strategic surplus the difference between the expected utility from the optimal mechanism and the e cient auction bargaining does less well and often does worse than the e cient auction

limited liability and mechanism design in procurement in the presence of cost uncertainty limited liability introduces the possibility of default in procurement with its associated bankruptcy costs when nancial soundness is not perfectly observable we show that incentive compatibility implies that nancially less sound contractors are selected with higher probability in any feasible mechanism informational rents are associated with unsound nancial situations by selecting the nancially weakest contractor stronger price competition auctions may not only increase the probability of default but also expected rents thus weak conditions are su cient for auctions to be suboptimal in particular we show that pooling rms with higher assets may reduce the cost of procurement even when default is costless for the sponsor

the marketing challenge towards being profitable and socially responsible this article reviews the history of marketing thought in relation to social responsibility and business ethics the main objective of the article is to show that business can be profitable and socially responsible at the same time by practising the societal marketing concept more specifically it presents the development of a marketing philosophy discusses the influence of consumerism on the marketing concept and deals with ethics and social responsibility in marketing it is argued that organisations who adopt the societal marketing concept will be the ones most likely to make long run profits as well as be beneficial to society as a whole

the manufacturing sector s environmental motives a game theoretic analysis what motivates manufacturing companies to make costly investments in producing in an environmentally clean manner the traditional argument is that such behaviour is value reducing and that therefore firms must be forced by regulation to invest in green production processes a counter argument is that firms have an incentive to make environmental investments in an attempt to attract green consumers and investors hence gaining competitive advantage over their rivals in this paper we employ a game theoretic approach that demonstrates that competing firms incentives to make voluntary investments in environmental clean up are affected by the size of the investment costs and the extent of consumer and investor green awareness we argue that an increase in green behaviour can be induced by a combination of governmental subsidies for firms that invest in environmentally clean production processes together with an education program that promotes green awareness amongst consumers investors and the managers themselves

the role of environmental management in consumers preferences for corporate social responsibility consumers in modern societies are increasingly sensitive to environmental performance by large and small corporations making it a crucial issue in the overall policy of corporate social responsibility the objective of this paper is to study the role of environmental performance in the profile of corporate social responsibility as perceived by consumers we utilize a stated preference approach to the study of consumer s preferences this approach allows for the evaluation in monetary terms of the trade offs that individuals can make between various aspects of corporate policy decisions including the extent of environmental performance the data is modelled by means of a mixture heuristics approach that allows us to study the utilization of various decision rules in the choice of products with various degrees of environmental performance the results show that the linear compensatory heuristic is the most extended across individuals and these subjects value most the policies concerned with environmental management those subjects opting for the non compensatory decision rule tend to focus on the attribute of good labour relations as the most salient factor defining corporate social responsibility in addition policy measures are relatively more valued for some products rather than for others suggesting that consumers discriminate between products when valuing companies environmental profiles

procurement under public scrutiny auctions versus negotiations we compare two commonly used mechanisms in public procurement auctions and negotiations the execution of the procurement mechanism is delegated to an agent of the buyer the agent has private information about the buyer s preferences and may collude with one of the sellers we provide a general characterization of both mechanisms based on public scrutiny requirements and show contrary to conventional wisdom that an intransparent negotiation always yields higher social surplus than a transparent auction moreover there exists a lower bound on the number of sellers such that the negotiation also generates a higher buyer surplus

social sustainability in selecting emerging economy suppliers despite the growing public awareness of social sustainability issues little is known about what drives firms to emphasize social criteria in their supplier management practices and what the precise benefits of such efforts are this is especially true for relationships with international suppliers from the world s emerging economies in asia latin america and eastern europe building on stakeholder theory we address the issue by examining how pressures from customers the government and employees as primary constituencies of the firm determine the extent to which firms consider social aspects in the selection of emerging economy suppliers further we analyze how such socially sustainable supplier selection relates to the capabilities of the firm s suppliers its market reputation and the learning in its supply management organization we test the developed research framework empirically using data from 244 u s and german corporations our findings consistent with our hypothesized model suggest that middle level supply managers as internal stakeholders play a major driving role for firms socially sustainable supplier selection and that strong positive links exist between that selection and the investigated outcomes

consumer response to unethical corporate behavior a re examination and extension of the moral decoupling model this research replicates bhattacharjee et al j consum res 39 4 1167 1184 2013 moral decoupling model and extends the original along the dimensions of theory method and context adopting a branding perspective and focusing on the corporate domain rather than the public figures investigated by bhattacharjee and colleagues this research examines the proposition that consumers dissociate judgments of morality from judgments of performance to justify purchasing from companies deemed to act immorally the original study is further extended by applying the model in a different cultural context and employing a more realistic stimulus to establish external and ecological validity the results of the replication generally support the original findings in particular under conditions of higher product involvement a theoretical extension

perspectives on multinational enterprises in emerging economies multinational enterprises mnes play a pivotal role in the development of many emerging economies in consequence they became the focus of scholarly research by economists and policy analysts in contrast international business scholars have been comparatively uninterested in analysing this role of mnes yet they could make important contributions to these debates first studies taking the individual firms as starting point would enhance understanding of the interaction between mnes and the local environment second theories and research methodologies developed in international business research could provide new insights into the dynamics of mnes in emerging economies the objective of this paper is to motivate more international business scholars to engage in research on positive and negative spillovers from foreign direct investment fdi in emerging economy societies to advance this research agenda scholars need to analyse the specific activities and capabilities of the firms involved and the impact of fdi on the broader social and environmental context for management this agenda raises the ethical question to what extent ought businesses to care about their local stakeholders

when should sellers use auctions the simultaneous bid auction is a standard method for sellers to solicit offers from buyers a simple alternative is for a seller to ask buyers to make offers sequentially if it is costly for buyers to participate the sequential mechanism will tend to be more efficient than the simultaneous auction because later potential buyers can condition their participation decisions on earlier bids however the sequential mechanism s greater efficiency may not produce higher revenues because while the possibility of deterring later potential entrants can lead early bidders to bid aggressively the fact that later firms might be deterred will tend to reduce revenues the relative revenue performance of the mechanisms will therefore depend on whether the threat of potential future competition which can raise bids in the sequential mechanism is more valuable to the seller than actual competition which will tend to be greater in the simultaneous auction the relative revenue performance of these alternative mechanisms has direct implications for how assets should be sold in the case of how to structure the sale of corporations this question has attracted attention from practitioners and commentators since the delaware supreme court s 1986 revlon decision charged a board overseeing the sale of a company with the duty of getting the best price for the stockholders revlon v mcandrews and forbes holdings 1986 in practice

a theory of consumer boycotts under symmetric information and imperfect competition this article models strategic interactions between non identical duopolistic firms and a public interest environmental organisation eo that promotes green production practices by threatening consumer boycotts against brown producers the article describes when boycotts are deterred by prior firm commitments to be green and also when a boycott arises in equilibrium despite symmetric information when a boycott arises it is either a small persistent boycott against the small firm in the industry or a large transitory boycott against the large firm in the industry that prompts the target firm to accede to the boycott demands quickly

motivating wealth constrained actors we examine how owners of productive resources e g public enterprises or financial capital optimally allocate their resources among wealth constrained operators of unknown ability optimal allocations exhibit 1 shared enterprise profit the resource owner always shares the operator s profit 2 dispersed enterprise ownership resources are widely distributed among operators of varying ability 3 limited benefits of competition the owner may not benefit from increased competition for the resource and sometimes 4 diluted incentives for the most capable more capable operators receive smaller shares of the returns they generate implications for privatizations and venture capital arrangements are explored

contingent payment auction mechanism in multidimensional procurement auctions abstract this paper considers the auctioning of an indivisible project among several suppliers who hold private information about their own efficiency type both quality and price need to be determined different from scoring auctions we present a new method i e contingent payment auction mechanism cpam which can effectively deal with the optimal procurement strategy in multidimensional procurement auctions cpam can implement the optimal mechanism for the buyer and is thus optimal among all possible procurement strategies cpam implies that the buyer should first design and announce a contingent payment function that specifies a payment for each possible quality level before the bidding begins compared to scoring auctions cpam has some advantages it does not require a special form of scoring rule and can be generalized in a more broad auction formats furthermore it can help us to solve the ex post moral hazard problem we consider two kinds of cpam for the cpam i is sensitive to different auction formats we come up with cpam ii which can improve the performance of cpam i broadly speaking cpam integrates the idea of dimension reduction from scoring auction into that of incentive contract design from contract theory to solve the problem of ex post moral hazard

requirements planning with pricing and order selection flexibility past requirements planning research has typically assumed that the firms demands are determined prior to production planning in contrast we explore a single stage planning model that implicitly decides through pricing decisions the demand levels the firm should satisfy in order to maximize contribution to profit we briefly discuss solution methods and properties for these problems when production capacities are unlimited the key result of this work is a polynomial time solution approach to the problem under time invariant finite production capacities and piecewise linear and concave revenue functions in price

regulation competition and liberalization in many countries throughout the world regulators are struggling to determine whether and how to introduce competition into regulated industries this essay examines the complexities involved in the liberalization process while stressing the importance of case specific analyses this essay distinguishes liberalization policies that generally are procompetitive from corresponding anticompetitive liberalization policies

procuring fast delivery sole sourcing with information asymmetry this paper studies a queuing model in which a buyer sources a good or service from a single supplier chosen from a pool of suppliers the buyer seeks to minimize the sum of her procurement and operating costs the latter of which depends on the suppliers lead time the selected supplier can regulate his lead time but faster lead times are costly although the buyer selects the supplier to source from possibly via an auction and dictates the contractual terms the buyers bargaining power is limited by asymmetric information the buyer only has an estimate of the suppliers costs while the suppliers know their costs precisely we identify a procurement mechanism that minimizes the buyers total cost procurement plus operating this mechanism is not simple it is a numerically derived nonlinear menu of contracts therefore we study several simpler mechanisms e g one that charges a late fee and one that specifies a fixed lead time requirement no menus no nonlinear functions we find that simple mechanisms are nearly optimal generally within 1 of optimal because asymmetric information conveys significant protection to the supplier i e the supplier is able to retain most of the benefit of having a lower cost renegotiation is another concern with the optimal mechanism because it does not minimize the supply chains cost the firms can be both better off if they throw away the contract and start over interestingly we find that the potential gain from renegotiation is relatively small with either the optimal or our simple mechanisms we conclude that our simple mechanisms are quite attractive along all relevant dimensions buyers performance supply chain performance simplicity and robustness to renegotiation

optimal procurement mechanisms we analyze optimal mechanisms in environments where sellers are privately informed about quality a methodology is provided for deriving conditions that are necessary and sufficient to determine when two simple trading environments maximize either social or private surplus the commonly used auction mechanism is frequently inefficient in procurement environments often the optimal mechanism is simply to order potential suppliers and to tender take it or leave it offers to each sequentially we completely characterize the environments in which either mechanism is optimal in doing so we develop a general methodology that determines when and if a given trading institution is optimal

do consumers care about ethical luxury this article explores the extent to which consumers consider ethics in luxury goods consumption in particular it explores whether there is a significant difference between consumers propensity to consider ethics in luxury versus commodity purchase and whether consumers are ready to purchase ethical luxury prior research in ethical consumption focuses on low value commoditized product categories such as food cosmetics and high street apparel it is debatable if consumers follow similar ethical consumption patterns in luxury purchases findings indicate that consumers propensity to consider ethics is significantly lower in luxury purchases when compared to commoditized purchases and explores some of the potential reasons for this reduced propensity to identify or act upon ethical issues in luxury consumption

fostering corporate social responsibility through public initiative from the eu to the spanish case should csr be approached only on a voluntary basis or should it be complemented with a compulsory regulatory framework what type of government intervention is more effective in fostering csr among companies this paper is an attempt to answer these questions reviewing the debate between proponents of the voluntary case and the obligatory case for csr and critically analysing current international government led initiatives to foster csr among companies and national government led initiatives in the eu area finally the paper focuses on the spanish case as an example of the failure of an exclusively voluntary approach despite the rapid uprise of csr spain is still far behind late in csr promotion strategies most action has been undertaken by companies themselves with no common guidelines governmental support or independent verification the lack of a regulatory framework for csr or ethical investment issues and the virtual absence of other indirect incentives explains the misbalance between private public and third sector initiatives based on the spanish context which is quite similar to other non oecd countries the authors call for a more proactive government position in csr related issues the conclusions of the paper detail the features of this regulatory framework and other policies to promote csr in spain as well as in other oecd countries

coordinating a socially responsible closed loop supply chain with product recycling abstract this paper analyzes the effects of corporate social responsibility csr and explores channel coordination in a socially responsible manufacturer retailer closed loop supply chain clsc by considering two areas profit maximization and social responsibility through product recycling the manufacturer is socially responsible and exhibits it by recycling of used product that it collects through the retailer using the reverse channel it is found that the channel s non profit maximizing motive through csr practice generates higher profit margin than the profit maximizing objective and revenue sharing contract resolves channel conflict recycling is a key factor for the wholesale price and hence pure profit of the manufacturer because variation of it may lead to decrement or increment even negative wholesale price thus there must be a limit of recycling for optimal benefit for best channel performance the manufacturer provides the retailer all revenues that it generates through recycling in the form of reward thus csr is purely a costly endeavor to the manufacturer moreover unlike the pure profit maximizing supply chain csr has the ability to vary surplus profit share

it s a matter of principle the role of personal values in investment decisions we investigate the role of personal values in an investment decision in a controlled experimental setting participants were asked to choose an investment in a bond issued by a tobacco company or a bond issued by a non tobacco company that offered an equal or sometimes lower yield we then surveyed the participants regarding their feelings toward tobacco use to determine whether these values influenced their investment decision using factor analysis we identified investment and tobacco related dimensions on which participants responses tended to load two of these factors relating to the societal impact of investment decisions and the health effects of tobacco were highly significant in determining whether participants selected a tobacco or non tobacco related investment more importantly we found that when the rate of return on a tobacco related investment exceeds the rate of return on an investment not involving tobacco by 1 the intensity of participant concerns about the societal effects of their investment decisions was especially important in determining investment choices this finding indicates that traditional wealth maximization approaches which do not consider the personal values of the investor omit an important factor that affects investment decisions

the role of personal values in fair trade consumption research in the u s on fair trade consumption is sparse therefore little is known as to what motivates u s consumers to buy fair trade products this study sought to determine which values are salient to american fair trade consumption the data were gathered via a web based version of the schwartz value survey svs and were gleaned from actual consumers who purchase fair trade products from a range of internet based fair trade retailers this study established that indeed there are significant interactions between personal values and fair trade consumption and that demographics proved to be useless in creating a profile of the american fair trade consumer

business as usual economic responses to political tensions do political tensions harm economic relations theories claim that trade prevents war and political relations motivate trade but less is known about whether smaller shifts in political relations impact economic exchange looking at two major economies we show that negative events have not hurt u s or japanese trade or investment flows we then examine specific incidents of tensions in u s french and sino japanese relations over the past decade two case pairs that allow us to compare varying levels of political tension given high existing economic interdependence and different alliance relations aggregate economic flows and high salience sectors like wine and autos are unaffected by the deterioration of political relations in an era of globalization actors lack incentives to link political and economic relations we argue that sunk costs in existing trade and investment make governments firms and consumers unlikely to change their behavior in response to political disputes d o political tensions have economic consequences the relationship between economic interdependence and conflict has been a central debate in international relations leading scholars contend that states with good relations should have more trade than states with poor relations and import decisions of firms will respond to the climate of friendliness orhostilitythatexistsbetweentheimporterandexporter morrow siverson and tabares 1998 650 pollins 1989b 739 analysis of trade and conflict in a simultaneous equations model concludes that political relations are driving commerce not the other way around keshk pollins and reuveny 2004 1175 we reexamine these arguments in the current globalization era to show that sunk costs reduce incentives for state and private actors to link political and economic relations 1

dynamic version of the economic lot size model this article originally appeared in management science october 1958 volume 5 number 1 pp 89 96 published by the institute of management sciences a forward algorithm for a solution to the following dynamic version of the economic lot size model is given allowing the possibility of demands for a single item inventory holding charges and setup costs to vary over n periods we desire a minimum total cost inventory management scheme which satisfies known demand in every period disjoint planning horizons are shown to be possible which eliminate the necessity of having data for the full n periods

dynamic hypothetical bias in discrete choice experiments evidence from measuring the impact of corporate social responsibility on consumers demand abstract this paper is aimed at studying the dynamics of consumers preferences for corporate social responsibility the data come from both a discrete choice experiment dce and a field experiment conducted in a real market setting the results show that in a static setting first month predictions of a standard dce study and real market shares are statistically similar for the various profiles of corporate social responsibility however as time evolves real market shares present some dynamic patterns that are not mirrored by the standard dce predictions the overall conclusion is that differences between real market behavior and dce data can be attributed to the lack of learning experience or adaptation in dce surveys rather than to the hypothetical nature of the experiments

towards shared social responsibility a study of consumers willingness to donate micro insurances when taking out their own insurance in recent years the concepts of charity and development aid have changed significantly present concepts combine direct money transfer with co production knowledge sharing and the development of products and services designed for the need of developing and transition economies the concept of micro financing is a financial service which has proven to allow for entrepreneurs in the respective countries to start up their businesses a relatively new financial product for these countries is micro insurance this article deals with the question whether consumers in the netherlands are willing to donate micro insurances and which factors influence this willingness to contribute to the non profit micro insurance approach of an insurance company the data were collected with questionnaires among a sample of the dutch population n 504 the data have been processed in a one way between groups anova a paired sample t test and an ordinal regression analysis the results show that approximately half of the dutch consumers are willing to pay an additional amount on their insurance premium for the donation of micro insurances the amount of the insurance premium did however not affect the willingness to donate wtd if consumers could choose the beneficiary less people are willing to donate yet those people are willing to donate more money in conclusion there is readiness among consumers to contribute to micro insurance via an insurance company that assists in setting up micro insurance projects this indicates a possible role for companies to act as an intermediary between philanthropic acts and consumers

csr transparency and the role of intermediate organisations transparency is a crucial condition to implement a csr policy based on the reputation mechanism the central question of this contribution is how a transparency policy ought to be organised in order to enhance the csr behaviour of companies governments endorsing csr as a new means of governance have different strategies to foster csr transparency in this paper we discuss the advantages and disadvantages of two conventional policy strategies the facilitation policy and the command and control strategy using three criteria efficiency freedom and virtue we conclude that both strategies are defective most attention is paid to the facilitation strategy since governments nowadays mainly use this in evaluating this strategy we analyse the dutch case as an alternative we introduce a third government policy the development of a self regulating sub system by construing an analogy with the historical development of corporate financial disclosure we point out that the vital step in the creation of a self regulating subsys tem is the creation of strong informational intermediate organisations

court efficiency and procurement performance disputes over penalties for breaching a contract are often resolved in court a simple model illustrates how inefficient courts can sway public buyers from enforcing a penalty for late delivery in order to avoid litigation therefore inducing sellers to delay contract delivery by using a large dataset on italian public procurement we empirically study the effects of court inefficiency on public work performance we find that where courts are inefficient i public works are delivered with longer delays ii delays increase for more valuable contracts iii contracts are more often awarded to larger suppliers and iv a higher share of the payment is postponed after delivery other interpretations receive less support from the data

consumer ethics an assessment of individual behavior in the market place a national sample of 362 respondents assessed the ethical predisposition of the american marketplace by calculating a consumer ethics index the results indicate that the population is quite intolerant of perceived ethical abuses the situations where consumers are ambivalent tend to be those where the seller suffers little or no economic harm from the consumer s action younger more educated and higher income consumers appear more accepting of these transgressions the results provided the basis for developing a four group taxonomy of consumers which retailers should find insightful in assessing potential consumer actions in a variety of situations

uncapacitated production and location planning models with demand fulfillment flexibility abstract a wealth of past research on production planning models seeks to meet prescribed demands at minimum cost in many contexts demand comes from independent sources not all of which are necessarily profitable we consider such planning problems from a different perspective assuming certain demand characteristics are decision variables we wish to determine optimal levels of demand production and inventory for every planning period when flexibility exists in selecting demands and their delivery timing we present an optimal solution method under certain cost structures and computational tests demonstrating the effectiveness of a dual based heuristic for the general problem which is np hard