total factor productivity intangible assets and spatial dependence in the european regions dettori b marrocu e and paci r total factor productivity intangible assets and spatial dependence in the european regions regional studies the aim of this paper is to analyse the determinants of the efficiency levels across the european regions firstly a regression based measure of regional total factor productivity is derived by estimating a spatial cobb douglas production function secondly the role played by intangible factors human capital social capital and technological capital on total factor productivity levels is investigated by applying the spatial two stage least squares 2sls method and the spatial heteroskedasticy and correlation consistent shac estimator to account for both heteroskedasticity and spatial autocorrelation it turns out that a large part of total factor productivity differences across the european regions is explained by disparities in the endowments of these intangible assets dettori b marrocu e and paci r

temporary import and export quotas and the current account abstract this paper provides a comprehensive analysis of temporary import and export quotas in a two period optimization model imposing much weaker restrictions on preferences and production technologies than in the existing literature we demonstrate that under net substitutability the imposition of a temporary quota which reduces imports by a small amount improves the current account and causes an appreciation of the real exchange rate if the initial equilibrium is quota restricted the effects of tightening the quota are ambiguous by contrast under substitutability a tightening of export quotas necessarily leads to a current account deficit regardless of the nature of the initial equilibrium

determinants of the equilibrium real exchange rate n b professor neary was based at university college dublin and queen s university ontario canada when this article was first published the full text of this article is not available in ora at this time citation neary j p 1988 determinants of the equilibrium real exchange rate american economic review 78 1 210 215

tariff liberalization policy and financial restrictions abstract the purpose of this paper is to assess how restrictions on capital mobility affect adjustment to a tariff liberalization policy this is done by comparing the adjustment process under free and restricted convertibility of foreign assets in a regime where the commercial exchange rate is pegged it is shown that starting from an equilibrium characterized by significant scarcity of foreign assets a policy of simultaneous liberalization of both current and capital account would cause a larger drop in domestic goods prices than would the short run effects of tariff liberalization alone in such an economy the effect of liberalization of capital controls is to generate current account surplus whereas tariff liberalization generates current account deficit

tariffs capital controls and equilibrium real exchange rates a general equilibrium intertemporal model with optimizing consumers and producers is developed to analyse how the equilibrium real exchange rate rer reacts to changes in the degree of restrictions to intra and intertemporal trade in particular the effects of changes in the level of import tariffs and of changes in taxes on foreign borrowing on the path of equilibrium rers are investigated in the case of import tariffs both temporary and anticipated changes are considered it is shown that in this intertemporal framework equilibrium real exchange rates can exhibit interesting and convoluted behaviour in particular results that contradict the traditional wisdom can be obtained a number of extensions are also discussed tarifs douaniers controles sur les flux de capitaux et taux de change reels d equilibre l auteur developpe un moddle d equilibre general inter temporel dans lequel consom mateurs et producteurs optimisent pour analyser les reactions du taux de change reel d equilibre aux changements dans le degre de restriction du commerce intra et inter temporel en particulier l auteur analyse les effets de changements dans le niveau des tarifs douaniers sur les importations et des taxes sur les emprunts a l etranger sur le sentier d equilibre du taux de change reel dans le cas des tarifs a l importation l auteur examine a la fois les changements temporaires et anticipes on montre que dans ce cadre intertemporel le comportement des taux de change reels d equilibre est interessant et contournm les resultats obtenus contredisent ceux suggeres par la sagesse conventionnelle l auteur discute aussi un certain nombre d extensions de ces resultats

legitimacy and multi level institutional environments implications for foreign subsidiary ownership structure in this study we examine from an institutional perspective the legitimacy rationale behind the choice of subsidiary ownership structure among multinational corporations mncs we suggest that when under a strong pressure to conform at the host country and local industry levels of their institutional environment mncs are likely to take a lower ownership stake in exchange for external legitimacy in the host country or local industry that their foreign subsidiaries are entering we also suggest that mncs are likely to take a higher ownership stake in response to strong internal pressure to sustain their internal legitimacy at the corporate level of their institutional environment we also propose that mncs are more likely to exchange ownership for legitimacy in local industries than in host countries and in local markets with a high level of political instability than in those with a low level of political instability these propositions are generally supported by our analysis of 4451 subsidiaries established by 898 japanese mncs that operated in 39 countries across 52 industries two digit sic between 1988 and 1999

institutions infrastructure and economic growth abstract this paper develops a structural model of infrastructure and output growth that takes account of institutional and economic factors that mediate in the infrastructure gdp interactions cross country estimates of the model indicate that the contribution of infrastructure services to gdp is substantial and in general exceeds the cost of provision of those services the results also shed light on the factors that shape a country s response to its infrastructure needs and offer policy implications for facilitating the removal of infrastructure inadequacies

does infrastructure investment stimulate building supply the case of the english regions ball m and nanda a does infrastructure investment stimulate building supply the case of the english regions regional studies policies to improve infrastructure to stimulate regional growth remain common this paper investigates whether increases in infrastructure investment in the english regions lead to subsequent rises in new commercial and residential property using time series modelling both physical roads and harbours and social infrastructure education and health impacts are investigated hardly any infrastructure effects with respect to commercial property investment were found which raises doubts about whether extra infrastructure creates employment though some impact was related to residential building overall these results raise doubts about the supposed direct effects of infrastructure policies on regional jobs and growth

choosing size of government under ambiguity infrastructure spending and income taxation i examine choice of size of government by a planner who has partial knowledge of population preferences and the productivity of public spending focusing on income tax financed spending for infrastructure i examine scenarios where the planner observes the outcome of a status quo policy and uses various decision criteria to choose policy the analysis shows that the planner can reasonably choose a wide range of spending levels thus a society can rationalise having a small or large government i conclude that to achieve credible conclusions about the desirable size of government we need to improve current knowledge of preferences and the productivity of spending vastly

infrastructures and productivity in the spanish regions mas m maudos j perez f and uriel e 1996 infrastructures and productivity in the spanish regions reg studies 30 641 649 the aim of this paper is to analyse the role of public capital the types of infrastructures in which it is invested and their territorial distribution in the gains in productivity of the private sector in the spanish regions in the period 1964 91 using panel data techniques to control for unobserved state specific characteristics the results obtained show how the infrastructures most directly linked to the productive process present a significant and positive effect on productivity they also show the importance of the network effect of the infrastructures of a productive nature as well as a decrease in the elasticity associated with such infrastructures as development progresses mas m maudos j perez f et uriel e 1996 les infrastructures et la productivite aux regions espagnoles reg studies 30 641 649 cet article cherche a analyser le role du capital public les

anticipated protectionist policies real exchange rates and the current account the case of rigid wages abstract in this paper we develop a general equilibrium model of an economy with short run unemployment to analyze how anticipated protectionist policies affect real exchange rates the current account and aggregate employment we find that a key transmission channel is the change in current employment induced by future changes in tariffs we show that the direction and magnitude of this effect will depend on relative factor intensities and on real exchange rate behavior if a future tariff generated a current real exchange rate appreciation and if nontradables are labor intensive the anticipation of protectionist policies will generate an increase in current employment

the welfare effects of trade and capital market liberalization treatise on the welfare effects of trade and capital market liberalization consquenses of the capital account liberalization in the presence of trade restrictions specifies on the liberalization of trade in the presence of foreign borrowing constraints proves superiority of gradual liberalization of trade to an abrupt liberalization

the role of business models in firm internationalization an exploration of european electricity firms in the context of the energy transition this article ties in directly with recently intensified interest in business models in international business ib using the energy transition as empirical context to explore their relevance in firm internationalization the global energy transition presents a challenge for almost all industries but some face specific difficulties particularly important from an ib perspective we study a set of european firms that used to operate in a highly regulated context with partial state ownership until government directed market liberalization started to allow further competition and internationalization existing firms were prompted to adapt their business models to these changes with new ventures entering the market to reap opportunities with novel energy related technologies and business models linking insights from strategic management to the ib literature we conceptualize business model related specific advantages bmsas and explore the role of bmsas in the internationalization of the firms in our sample we also uncover barriers to bmsa recombination in potential host countries consider bmsa location boundedness and discuss implications for firms international expansion by presenting a new framework consequences for the energy transition and the actors already involved and in directly confronted with it are explicated while outlining promising areas for further research building on the insights and limitations of our study

linking local business with global growth opportunities the role of infrastructure infrastructure is instrumental when it comes to linking local businesses with their global growth opportunities this paper shows that by making this link the transport network can act as a catalyst for regional economic growth using a novel approach we find that firms in regions with a more developed transport infrastructure are better placed to benefit from positive growth opportunities than those in regions with a less well developed transport network this advantage is most pronounced in times of economic slack making a better transport network a key ingredient for economic recovery it is against this background that the recent slowdown in infrastructure investment in europe is worrisome but it is through this channel among others that the substantial ramp up of activity by the european investment bank is expected to foster growth and enhance competitiveness in europe

accommodating public expenditure policies the case of fast growing asian economies abstract it is widely believed that the exceptional economic performances of the east asian economies are attributable as much to the visible hand of the state as to the invisible hand of the market this paper analyzes the experiences of japan south korea singapore and taiwan in implementing a key instrument of state intervention namely public expenditure policy the analysis shows that these economies could achieve high standards of physical and social infrastructure even with relatively low spending the key features of complementary spending policy include emphasis on macroeconomic stability cost effective spending involvement of private sector in providing quasi public goods minimum distortions in the labor markets and human resource development to achieve a broad based development

trade taxes and the current account abstract we show that under some conditions a temporary import tariff improves the current account whereas a temporary export tax deteriorates it permanent import tariffs and export taxes have an identical although ambiguous effect on the current account

the effect of government spending on the current account output and expenditures evidence from latin america abstract this paper examines the linkages between government expenditures and current account balances in several latin american economies over the period 1974 1984 in theory these linkages critically depend on private sector responses to changes in government expenditures on both the demand and supply sides the analysis provides evidence that the negative current account government expenditure linkage is much stronger in the event of a temporary shock to government expenditures than in the event of a permanent shock the source of this differential response appears to be primarily on the expenditure side suggesting that private sectors in latin america incorporate the present discounted value rather than simply the current value of government expenditures into their expenditure decisions

the global integration of business functions a study of multinational businesses in integrated global industries the way that multinational businesses in integrated global industries coordinate and control r d manufacturing and marketing functions across borders has significant implications for performance we propose that in such global industries certain integrating modes will be more effective than others in integrating a function globally we show that each function has a different combination of effective integrating modes for global r d integration people based and information based modes are more effective than formalization based and centralization based modes for manufacturing people information and formalization are more effective than centralization with respect to marketing information and centralization are more effective than people and formalization we also demonstrate that the co alignment between actual and ideal profiles configurations or patterns of integrating modes results in superior performance our results reveal that people based and information based modes are generally more effective than formalization based and centralization based modes in coordinating and controlling business functions worldwide

are small firms willing to pay for improved power supply evidence from a contingent valuation study in india abstract this paper provides new estimates on indian small scale manufacturing firms willingness to pay wtp for reliable power supply almost half of indian manufacturing lies in the small scale sector and its productivity is severely affected by power outages however there is a surprising paucity of research on small firms wtp for avoiding outages we conduct a double bounded dichotomous choice contingent valuation experiment with a random sample of 260 small scale firms in the region around hyderabad we find that on average firms are willing to pay approximately 20 more for uninterrupted power supply the wtp estimates and the explanatory factors for the firms decisions were tested for robustness using both probit and bivariate probit models in addition a two step heckman correction was used to control for selection bias induced by protest responses our results are vital to understand behavior of small firms which are crucial to india s economic growth further the government s continued emphasis on power sector reforms makes the paper even more important as it provides realistic estimates for designing tariffs while keeping in mind the preferences of the small scale industry

catching up by hiring the case of huawei hiring experts in centers of state of the art technology is an important way in which a multinational enterprise mne can gain competitive advantage and yet use of this mechanism remains under researched this study uses the case of a chinese mne that recently achieved a leading position in the telecommunications market huawei technologies taking the perspective of huawei s offshore hires i find that greenfield investments contributed to overcoming liabilities of origin and outsidership in the global telecommunications industry nevertheless even now that huawei has caught up with industry incumbents its output capabilities remain dependent on the innovation capabilities of its offshore experts

common factors and common breaks in panels an empirical investigation abstract unobserved common factors and common breaks are two important features in empirical studies using large panels recently baltagi feng and kao 2016 2019 extended pesaran s 2006 common correlated effects cce approach by allowing for common breaks and endogenous regressors in large heterogeneous panels in this note we empirically investigate these estimators and compare them with cce and bai s 2009 interactive fixed effects ife estimators in the context of china s provincial infrastructure investment

an empirical analysis and extension of the bartlett and ghoshal typology of multinational companies this study offers an empirical test and extension of the bartlett and ghoshal typology of multinational companies mncs a three fold typology of multinational companies global multidomestic and transnational is developed from the literature this typology is tested using data from 166 subsidiaries of 37 mncs headquartered in 9 different countries subsidiaries in the three types of mncs are shown to differ significantly in aspects of interdependence and local responsiveness

infrastructure investment a review essay economists try not to be faddists but they often cannot help themselves while work on a topic should mirror the prospective importance of the topic that situation seems to occur with disappointing frequency instead the usual pattern is that some reasonably important topic will be totally ignored for the longest time then recognized and then the subject of a flurry of work all out of proportion to its likely long run importance nowhere has this speculative bubble of economic research been more clearly illustrated than with infrastructure investment macroeconomists havelong felt that the stock of public capital is an important factor input in the production of total output macroeconomists have known that u s productivity growth slowed dramatically in about 1973 and macroeconomists should have known that united states investment in public capital has been down since the late 1960s yet analysis of the u s productivity slowdown completely ignored infrastructure investment for the first fifteen years of this slowdown concentrating instead on energy prices social regulation the composition of the work force research and development different rates of obsolescence of the private capital stock and any number of other matters the public capital stock was hardly ever even mentioned as a potential factor in the productivity slowdown aschauer changed all that he wrote a series of papers 1989a 1989b 1989c that put these two movements together econometrically infrastructure investment turned down and aggregate productivity turned down slightly later both in the united states and in some other developed countries his work hit the magic button those who had worried about the productivity puzzle for fifteen years welcomed a new suspect those who were worried about low rates of u s national saving welcomed a new way to make their argument even more forcefully than with official figures on saving and investment which do not count infrastructure investment as investment political liberals and liberal politicians saw a way to rescue government spending and projects from the assaults of reaganism and even a way to avoid oth

costs of deficient infrastructure the case of nigerian manufacturing as cities in developing countries continue to grow rapidly the need to meet the increasing demand for urban infrastructure services has become an important policy problem since failures to respon

leviathan and competition among jurisdictions the case of benefit taxation abstract this paper shows that interjurisdictional competition for mobile factors of production forces the government to raise the efficiency of the public sector and thus helps to tame leviathan governments however this result is derived under some restrictive assumptions concerning the kind of tax policy used by the government in the case of benefit taxes e g user charges a leviathan may be tamed by interjurisdictional competition whereas this is not necessarily true in the case of lum sum taxes

how misleading is linearization evaluating the dynamics of the neoclassical growth model this paper investigates the reliability of employing linearization to evaluate the dynamic adjustments to changes in productive government spending in a ramsey growth model if government expenditure is introduced as a flow and the dynamic adjustment is fast linearization may yield a reasonably good approximation to the true dynamics even for fairly large policy shocks if government expenditure assumes the form of a stock leading to more sluggish adjustment linearization may yield misleading predictions these errors occur at the beginning of the transition and weigh heavily in welfare calculations the implications for temporary shocks and the speed of convergence are also considered

scale congestion and growth this paper explores the relationship between aggregate and relative congestion returns to scale and economic growth aggregate congestion reduces the effective productivity of capital relative congestion reduces the effective productivity of labour both forms of congestion adversely affect the equilibrium growth rate although their relative effects depend upon aggre gate returns to scale the two forms of congestion have contrasting effects on the transitional dynamics relative congestion retards the rate of adjustment aggregate congestion accelerates it the externalities generated by congestion and non optimal expenditure can be fully cor rected both during the transition and in steady state by a time invariant income tax the role of public expenditure as an instrument of economic growth has been a major policy issue as governments throughout the world design stimulus packages as in japan and face difficult choices to meet the emu criteria in europe empirical research investigating the impact of public investment on the productivity of private capital and output was stimulated by aschauer 1989a b who found the effects to be strongly positive the nature of public investment is however diverse in general public goods vary extensively in terms of the nature of their services spanning the range between the polar cases of pure private and pure public goods but the treatment of public expenditures in formal growth models is limited barro 1990 and futagami et al 1993 treat government expenditure as a pure pub lic good and in so doing they fail to take account of the congestion typically associated with public goods however as barro and sala i martin 1992 have argued almost all public services are characterized by some degree of congestion so that the pure public good should be viewed as only a bench mark these considerations suggest that congestion is an important consider ation in assessing the effect of public expenditures on economic growth attempts to analyse the effects of congestion on economic growth have been limited in various dimensions drawing on the public goods literature edwards 1990 proposes a number of specifications of congestion two notions particularly relevant in a growth context are relative congestion and aggregate absolute congestion the former specifies the level of services derived by an individual from the provision of a public good in terms of the usage of his individual capital stock relative to the aggregate capital stock aggregate congestion sometimes called crowding indicates how aggregate usage of the service alone influences the services received by an individual 2 existing applications of congestion to growth theory introduce it into ak models see barro and sala i martin 1992 1995 glomm and ravikumar 1994 1997 and turnovsky 1996 1997 however the ak model features two limitations that restrict its flexibility to examine the relationship between congestion and growth first as solow 1994 pointed out sustained ongoing

ict and transport infrastructure development an empirical analysis of complementarity abstractthis paper provides an empirical framework to assess the nonlinear complementary linkage effects that arise from the interaction between motorway capital and information and communications

the terms of trade and the current account the harberger laursen metzler effect the paper examines the effect of terms of trade changes on a small country s spending and current account assuming optimizing behavior in an intertemporal framework with perfect international capital mobility a temporary future terms of trade deterioration implies a deterioration improvement of the trade balance whereas a permanent terms of trade deterioration has an ambiguous effect depending on the rate of time preference nominal and real variables are considered via exact price indexes two periods and an infinite horizon are examined

managing across borders an empirical test of the bartlett and ghoshal 1989 organizational typology this paper reports an empirical test of the bartlett and ghoshal 1989 organizational typology some 131 senior executives of corporations with worldwide operations classified their organizations as being multinational global international or transnational in nature and evaluated their organizations configuration of assets and capabilities role of overseas operations and development and diffusion of knowledge results provide partial support for the typology as expected transnational corporations were least frequently reported by the respondents the hypothesized practices associated with multinational and global organizations were more consistent with the typology s predictions relative to those of the international and transnational types

urban growth and transportation we estimate the effects of interstate highways on the growth of u s cities between 1983 and 2003 we find that a 10 increase in a city s initial stock of highways causes about a 1 5 increase in its employment over this 20 year period to estimate a structural model of urban growth and transportation we rely on an instrumental variables estimation that uses a 1947 plan of the interstate highway system an 1898 map of railroads and maps of the early explorations of the u s as instruments for 1983 highways we investigate the role of interstate highways in the growth of u s cities our investigation is in three parts in the first we develop a simple structural model describing the joint evolution of highways and employment in cities in the second we develop an instrumental variables strategy that allows us to identify key parameters of our structural model we are also able to provide out of sample evidence for the validity of our estimates and for the central assumptions of our model in the third we use our estimates to assess counterfactual transportation policies we find that a 10 increase in a city s stock of interstate highways causes about a 1 5 increase in its employment over 20 years and that an additional kilometre of highway allocated to a city at random is associated with a larger increase in employment or population than is a road assigned to a city by the prevailing political process our results also suggest that too many new highways were built between 1983 and 2003 these findings are important for three reasons first transportation generally and infrastruc ture in particular are large segments of the economy the median u s household devotes about 18 of its income to road transportation while all levels of government together spend another 200 billion dollars annually overall the value of capital stock associated with road transporta tion in the u s tops 5 trillion dollars united states bureau of transportation statistics 2007 2010 given the magnitude of transportation expenditures it is important that the impact of these expenditures on economic growth be carefully evaluated and not assessed on the basis of the claims of advocacy groups our analysis provides a basis for assessing whether these resources are well allocated our results also provide useful guidance to policy makers charged with planning cities since changes in a city s transportation infrastructure cause changes to the city s employment new transportation infrastructure causes complementary changes in the demand for public utilities and schools our results provide a basis for estimating the magnitude of such changes finally this research is important to furthering our understanding of how cities operate and grow transportation costs are among the most fundamental quantities in theoretical models

evaluating the social optimality of durable public good provision using the housing price response to public investment recent empirical work in public finance uses the housing price response to public investment to assess the efficiency of local durable public good provision this paper explores the theoretical justification for this technique it points out that the logic justifying the technique for evaluating non durable public good provision does not translate to the durable case a model in which investment is determined by the interaction between a budget maximizing bureaucrat and a community s residents is used to demonstrate that the technique can falsely predict under provision falsely predict over provision or perform without error

from the editors can i trust your findings ruling out alternative explanations in international business research the complex nature of international business research with its cross country and multilevel nature complicates the empirical identification of relationships among theoretical constructs the objective of this editorial is to provide guidance to help international business scholars navigate this complexity and ensure that readers can trust their findings we provide suggestions for how to rule out alternative explanations explaining key considerations not only in empirical analyses but also in theory building and in research design our discussion covers both qualitative and quantitative studies because we believe that it is imperative to understand how trustworthiness is established in both traditions even for international business researchers who self identify with only one this enables scholars to have a broader scope of knowledge when interpreting past research in the field and to be more adept at explaining their design choices to a diverse audience

valuing rail access using transport innovations this paper uses a powerful empirical method to evaluate the benefits of rail access to consumers we study the effects on house prices of a transport innovation that altered the distance to the nearest station for some households but left others unaffected the transport innovation we study is the construction of new stations in london in the late 1990s using this innovation we implement a quasi experimental approach that allows us to avoid the biases inherent in cross sectional valuation work our evidence on distance station effects on local prices identified through distance changes induced by the transport innovation suggests that households value rail access and that these valuations are large compared to the valuations of other local amenities

on the effectiveness of private and public capital this study assesses the effectiveness of private and public capital investments in the performance of manufactures within the framework of the duality theory the response of costs of production and input utilization to changes in the stocks of private and public capital is measured by the appropriate elasticities obtained from a cost function instead of considering private capital either as a variable or fixed input on a priori grounds its nature is checked that is the study discriminates between a long and a short run situation the empirical exercise is made for the manufacturing industries in the spanish regions

is infrastructure capital productive a dynamic heterogeneous approach this paper offers an empirical evaluation of the output contribution of infrastructure drawing from a large data set on infrastructure stocks covering 88 countries and spanning the years 1960 2000 and using a panel time series approach the paper estimates a long run aggregate production function relating gdp to human capital physical capital and a synthetic measure of infrastructure given by the first principal component of infrastructure endowments in transport power and telecommunications tests of the cointegration rank allowing it to vary across countries reveal a common rank with a single cointegrating vector which is taken to represent the long run production function estimation of its parameters is performed using the pooled mean group estimator which allows for unrestricted short run parameter heterogeneity across countries while imposing the testable restriction of long run parameter homogeneity the long run elasticity of output with respect to the synthetic infrastructure index ranges between 0 07 and 0 10 the estimates are highly significant both statistically and economically and robust to alternative dynamic specifications and infrastructure measures there is little evidence of long run parameter heterogeneity across countries whether heterogeneity is unconditional or conditional on their level of development population size or infrastructure endowments

endogenous structural breaks public investment in agriculture and agricultural land productivity in taiwan using time series data for taiwan s agricultural sector and with the government s public investment in the agricultural sector serving as a proxy variable for nonfarm current inputs aside from the original labour and capital input variables usually taken into consideration this article examines the relationship between public investment in agriculture public investment land and agricultural land productivity output land in taiwan our main findings are as follows first the cointegration test reveals that public investment in agriculture and the productivity of agricultural land exhibit a significant positive relationship in the long run where the elasticity of land productivity in relation to public investment in agriculture is 0 55 second when controlling for endogenous structural breaks the long run equilibrium relationship for the productivity of the agricultural land model is still supported third the results of the weak exogeneity test indicate that a causal relationship exists in the lo

two sector growth models with productive public goods equilibrium in determinacy author affiliation been lon chen institute of economics academia sinica 128 academia road section 2 taipei 11529 taiwan e mail bchen econ sinica edu tw corresponding author shun fa lee department of industrial economics tamkang university 151 ying chuan road tamsui taipei county 25137 taiwan e mail alphalee mail tku edu tw acknowledgment we are grateful to two anonymous referees and an editor for constructive comments and to participants in several workshops for valuable comments and suggestions in earlier versions of the paper 1 introductionmodels of economic growth with multiple equilibrium paths offer an explanation as to why we often observe diverse growth performances among countries with similar economic environments a central question is under what conditions is it possible to establish local indeterminacy in this paper we study a lucas 1988 human capital based growth model and investigate whether there are multiple equilibrium paths and thus local equilibrium indeterminacy in the neighborhood of a balanced growth path equilibrium indeterminacy in existing two sector human capital based growth models emerges based upon two mechanisms one of the mechanisms is differential factor tax rates initiated in the work of bond wang and yip 1996 and followed by that of raurich 2001 the other mechanism is sector specific externalities pioneered in the work of benhabib and farmer 1996 in an exogenous growth model and followed by the work of benhabib meng and nishimura 2000 and mino 2001 in endogenous growth models ben gad 2003 combined the two mechanisms these two mechanisms establish local indeterminacy when the mechanisms cause the factor intensities at the social perspective and those at the private perspective to reverse the purpose of this paper is twofold first we argue that once productive public goods are considered the two existing mechanisms are not robust in creating local indeterminacy then we take into account congestion in public services so a two sector model with the two existing mechanisms can generate local indeterminacy our purpose is motivated by the following in the existing models with sector specific externalities or distorted factor taxes there is either no government spending or if the government spending is taken into account only consumptive public spending and government transfers are considered recently a number of authors have documented the positive impact of public expenditure upon the productivity of private capital 1 when there is productive public spending the production technology is externally enhanced by the public goods productive public goods as an engine of economic growth have received much attention in endogenous growth models in particular a number of studies in this line of modeling strategy have obtained local indeterminacy 2 thus it is important to determine whether or not differential factor tax rates and sector specific externalities create local indeterminacy in models with productive public goods however as we will find the two existing mechanisms no longer create local indeterminacy in a two sector growth model with productive public goods unless the difference in the factor tax rates and the gap in the sector specific externalities are implausibly large intuitively productive public goods introduce the effects of intersectoral externalities they offset the effects of the two existing mechanisms that would have otherwise reversed the factor intensity at the social viewpoint from the factor intensity at the private viewpoint as a consequence the two existing mechanisms are not robust in the establishment of local indeterminacy in models with productive public goods this paper then introduces the congestion effect in the use of public goods an effect offsetting the effect from public spending to salvage the two existing mechanisms

the contribution of local public infrastructure to private productivity and its political economy evidence from a panel of large german cities this paper proposes a simultaneous equation approach to theestimation of the contribution of infrastructure accumulationto private production a political economy model for theallocation of public infrastructure investment grants isformulated our empirical findings using a panel of largegerman cities for the years 1980 1986 and 1988 suggest thatcities ruled by a council sharing the state bundesland government s current political affiliation were particularlysuccessful in attracting infrastructure investment grants with regard to the contribution of infrastructure accumulationto growth we find that public capital is a significant factorin private production moreover at least for the samplestudied we find that simultaneity between output and publiccapital is weak thus feedback effects from output toinfrastructure are negligible

is all public capital created equal this paper uses a var approach to investigate the effects of public investment on private sector performance in the united states this approach is consistent with the argument that the analysis of

theorising from case studies towards a pluralist future for international business research the literature on case studies both in the field of international business ib and in the social sciences more generally has tended to focus on the methods of data production and analysis suited to this research strategy in contrast in this paper we investigate methods of theorising from case studies we seek to understand how case researchers theorise and how future ib research might utilise case studies for theorising by means of a qualitative content analysis of case studies published in journal of international business studies academy of management journal and journal of management studies we construct a typology of theorising from case studies two dimensions of the case study namely causal explanation and contextualisation form the basis for our typology we distinguish four methods of theorising inductive theory building interpretive sensemaking natural experiment and contextualised explanation only the first of which has been widely used in jibs in the period that we investigate on the basis of our own qualitative analysis we show the limitations of inductive theory building and argue that greater utilisation of the other methods of theorising would enhance the case study s explanatory power and potential for contextualisation we argue for a more pluralist future for ib research

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

public capital and total factor productivity new evidence from the italian regions 1970 98 destefanis s and sena v 2005 public capital and total factor productivity new evidence from the italian regions 1970 98 regional studies 39 603 618 this paper analyses the relationship between industrial total factor productivity and public capital across the 20 italian administrative regions it adds upon the existing literature in a number of ways it analyses a longer period 1970 98 it allows for the role of human capital accumulation it tests for the existence of a long run relationship between total factor productivity and public capital through previously suggested panel techniques and for weak exogeneity of public capital and it assesses the significance of public capital within a non parametric set up based on the free disposal hull the results confirm that public capital has a significant impact on the evolution of total factor productivity particularly in the southern regions this impact is mainly ascribed to the core infrastructures road and airports harbours railroads w

a dynamic capabilities based entrepreneurial theory of the multinational enterprise this paper develops a dynamic capabilities based theory of the multinational enterprise mne it first reviews scholarship on the mne with a focus on what has come to be known as internalization theory one prong of this theory develops contractual transaction cost informed governance perspectives and another develops technology transfer and capabilities perspectives in this paper it is suggested that the latter has been somewhat neglected however if fully integrated as part of a more complete approach it can buttress transaction cost governance issues and expand the range of phenomena that can be explained in this more integrated framework dynamic capabilities coupled with good strategy are seen as necessary to sustain superior enterprise performance especially in fast moving global environments entrepreneurial management and transformational leadership are incorporated into a capabilities theory of the mne the framework is then used to explain how strategy and dynamic capabilities together determine firm level sustained competitive advantage in global environments it is suggested that this framework complements contract based perspectives on the mne and can help integrate international management and international business perspectives

control changes in multinational corporations adjusting control approaches in practice the issue of control in multinational corporations mncs is central to international business scholarship however prior literature tends to provide a static perspective offering few theoretical insights on control changes especially the practices that enable control adjustments adopting a practice theory perspective we consider control as in the making whereby adjustments emerge through a social accomplishment constituted and reconstituted as headquarters and subsidiaries engage in a co creating process using a longitudinal case study approach we had the rare opportunity to track and compare an unsuccessful and a successful attempt to adjust control in an mnc over time our main theoretical contribution is a model of adjusting control in mncs that details the practices that enable control changes this model offers theoretical implications for organizational control theory in mncs especially in relation to theorizing the subsidiary contribution in the design of control the reconciliation of raised tensions in headquarters subsidiary relationships and the nature of unintended consequences in the adjustment process our study also contributes to theories on mnc change as it details the construction of an ongoing strategy structure alignment for strategic flexibility

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

agricultural productivity and economic growth role of tax revenues and infrastructures 1 introductiondevelopment economists such as rostow 1960 and ranis and fei 1961 have stressed a positive linkage between agricultural productivity and industrialization the positive link however has been argued to be nonexistent by matsuyama 1992 in a two sector endogenous growth model of small open economies with a low elasticity of agricultural goods and the existence of learning by doing only in the domestic manufacturing sector 1 as a result of comparative advantage higher agricultural productivity solicits labor inputs from the manufacturing sector in his model leading to lower learning by doing and economic growth matsuyama s results however may not be consistent with what has actually happened in japan and other east asian economies in japan a land reform has been implemented and allocation of resources to agricultural research has been increased since the meiji restoration as a result of agricultural technical progress 2 agricultural productivity in japan is much higher than before the meiji restoration in particular evidence has shown that the agricultural technical change after the meiji restoration tends to increase nonagricultural output by pushing resources out of the agricultural sector into the nonagricultural sector for example see yamaguchi and binswanger 1975 table 7 for the quantitative effects of the agricultural technical change in japan on nonagricultural output column 3 and on input reallocation columns 5 and 7 in 1880 1965 similarly the agricultural technical change was higher in korea s and taiwan s early stages of economic development as they have founded agricultural research institutes and farmers associations during the japanese colonial period3 and implemented land reforms after world war ii for evidence see mason et al 1980 chapter 7 for the case of korea and thorbecke 1979 for the case of taiwan a world bank 1982 p 45 study reports that for the 23 developing countries whose agricultural growth rate in the 1970s exceeded 3 a year 17 countries had a gdp growth rate above 5 a year in the same period finally using cross country data for 14 asian developing countries in 1960 1986 mellor 1995 finds a positive and significant relationship between growth rate of per capita agricultural and nonagricultural gdps in which both agricultural and nonagricultural sectors grow more rapidly than 31 sub saharan and 20 latin american countries these above observations lead to interesting questions as to what mechanism lies in the positive impact of accelerated agricultural growth on nonagricultural growth what policies might increase the efficiency with which a productive agricultural sector moves a nonagricultural sector forward the purpose of this study is to revisit the linkages between agricultural productivity and economic growth with a government policy our model is based on matsuyama s 1992 framework with a small twist so that we can clearly identify the mechanism leading to a positive relationship the departure in this article lies in introducing a government which collects taxes and then conducts expenditures on infrastructures an important role played by higher agricultural productivity in an early stage of economic development is the one by which it renders the government larger tax revenues so that larger expenditure on infrastructures is facilitated 4 in a study investigating taiwan s rice for fertilizer bartering system in the 1950s and 1960s koo 1996 table 2 finds that the resulting hidden taxes on rice alone account for 10 20 of total tax revenue in the period extending from 1950 to 1969 along with other taxes the agricultural sector is thus an important source of government revenue in a developing economy 5 following barro 1991 public expenditure on infrastructures is assumed to be productive in that the learning by doing effect of the manufacturing sector becomes enhanced with public expenditure on infrastructures

the transaction costs driving captive power generation evidence from india the 2003 indian electricity act incentivizes captive power production through open access in an attempt to harness all sources of generation yet we observe that only some firms self generate while others do not in this paper we give a transaction cost explanation for such divergent behavior using a primary survey of 107 firms from india we construct a distinct variable to measure the transaction specificity of electricity use the make or buy decision is then econometrically tested using probit model results are highly responsive to transaction specificity and the likelihood of captive power generation is positively related to it at the industrial level this explains why food and chemical firms are more likely to make their own electricity since the burden of poor grid supply is highest on smaller sized and high transaction specific firms the grid access policies need to account for firm level characteristics if government wants to incentivize captive power generation

public investment and regional inequality in rural china this paper develops a method for decomposing the contributions of various types of public investment to regional inequality and applies the method to rural china public investments are found to have contributed to production growth in both the agricultural and rural non agricultural sectors but their contributions to regional inequality have differed by type of investment and the region in which they are made all types of investment in the least developed western region reduce regional inequality whereas additional investments in the coastal and central regions worsen regional inequality investments in rural education and agricultural r d in the western region have the largest and most favorable impacts on reducing regional inequality

corrigendum to congestible public goods and local indeterminacy a two sector endogenous growth model journal of economic dynamics control 31 7 2007 2486 2518

infrastructure provision and macroeconomic performance this paper studies the differences between private and government provision of infrastructure capital utilization decisions and their differential role in determining market prices for capital goods under the two regimes of infrastructure provision serve as a critical transmission mechanism for fiscal policy a subsidy to private providers of infrastructure is preferable to direct government provision irrespective of how the subsidy or expenditure is financed the case for private provision is much stronger in economies characterized by high levels of congestion the choice between private and government provision also has a crucial effect on the design of optimal fiscal policy 2011 elsevier b v all rights reserved

strategies of legitimation mnes and the adoption of csr in response to host country institutions drawing on institutional theory this study examines the question of how host country institutions affect corporate social responsibility csr adoption by multinational enterprises mnes i propose that csr encompasses a set of practices that mnes draw on to signal legitimacy in different kinds of institutional contexts contexts that vary in how they shape issue salience and stakeholder power in a given issue field building on ideas related to field opacity and the managerial implications of csr i study why mnes adopt two distinct types of csr policies standards based csr in response to contexts marked by issue salience and rights based csr in response to contexts marked by stakeholder power to test these hypotheses i use subsidiary and firm level data from a sample of 540 western european mnes in the issue field of labor rights results show that mnes strategically adopt these csr policies related to their presence in distinct institutional contexts the study offers implications for how mnes manage the legitimacy of their global operations and how csr as a form of private governance can emerge as both a substitute and complement to regulatory institutions

a new approach to test the effects of decentralization on public infrastructure investment this paper proposes a simple theoretical framework to obtain a tractable equation that considers the traditional criteria for allocating public infrastructure investment and variables to capture de

capital utilization economic growth and convergence abstract optimal decisions by economic agents regarding the utilization of capital lead to empirically plausible speeds of convergence in one sector models of economic growth the relationship between depreciation and capital utilization plays a crucial role in slowing down convergence to the steady state cross country differences in the extent to which the capital utilization decision is internalized along the transition path may lead to differences in convergence rates even for countries with similar initial and terminal conditions finally by assuming a constant depreciation rate and full capital utilization standard growth models may be overstating the magnitude of the steady state equilibrium

the interplay between hq legitimation and subsidiary legitimacy judgments in hq relocation a social psychological approach this paper marks a departure from the focus on external stakeholders in much research on legitimacy and multinational corporations adopting a social psychological approach to study how mncs build internal legitimacy for controversial decisions with their subsidiaries we explore this through a longitudinal real time qualitative case study of a regional office relocation since office relocations represent rare yet significant strategic decisions we analyze the interplay between the legitimation strategies of senior managers and subsidiary legitimacy judgments based in instrumental relational and moral considerations and how the relationship between the two develops over time from this analysis we derive inductively a process model that reveals the dynamics of building internal legitimacy with subsidiaries and how an mnc moves on even in the absence of full legitimacy when dealing with controversial mnc decisions the model highlights two important dynamics the first is a dynamic between legitimation strategies and legitimacy judgments and how this is influenced by local subsidiary contexts the second is a temporal dynamic in how both the legitimation strategies and legitimacy judgments evolve over time our model contributes to research on legitimacy in mncs what we know about tensions that characterize mnc subunit relationships and research on headquarters relocation

a note on the transnational solution and the transaction cost theory of multinational strategic management this article assesses the extent to which the results of bartlett and ghoshal s 1989 work can be incorporated in what has now become one of the core explanations of multinational strategic management i e the transaction cost based theory of international production we demonstrate that the transaction cost approach fully incorporates the empirical findings of bartlett and ghoshal s work to do so requires that we make a new distinction between location bound and non location bound firm specific advantages in addition three possible uses of country specific advantages by multinational enterprises need to be identified while the transnational solution as proposed by bartlett and ghoshal is not itself a new theory of multinational strategic management it is compatible with the transaction cost based model of multinational strategic management

the intertemporal elasticity of substitution an analysis based on japanese data this paper investigates whether the intertemporal elasticity of substitution ies for japan possesses similar properties to that found for the united states in the literature as the existing empirical findings are mixed there is no clear consensus this paper uses a model with both production and non separability between nondurables and durables in order to control for possible factors that cause a bias in the ies we present the empirical results demonstrating that the ies is quite similar between the two countries

dynamic capabilities what are they this paper focuses on dynamic capabilities and more generally the resource based view of the firm we argue that dynamic capabilities are a set of specific and identifiable processes such as product development strategic decision making and alliancing they are neither vague nor tautological although dynamic capabilities are idiosyncratic in their details and path dependent in their emergence they have significant commonalities across firms popularly termed best practice this suggests that they are more homogeneous fungible equifinal and substitutable than is usually assumed in moderately dynamic markets dynamic capabilities resemble the traditional conception of routines they are detailed analytic stable processes with predictable outcomes in contrast in high velocity markets they are simple highly experiential and fragile processes with unpredictable outcomes finally well known learning mechanisms guide the evolution of dynamic capabilities in moderately dynamic markets the evolutionary emphasis is on variation in high velocity markets it is on selection at the level of rbv we conclude that traditional rbv misidentifies the locus of long term competitive advantage in dynamic markets overemphasizes the strategic logic of leverage and reaches a boundary condition in high velocity markets copyright 2000 john wiley sons ltd

public infrastructure and the productive performance of canadian manufacturing industries this article examines the effects of public infrastructure on the productive performance of 12 two digit canadian manufacturing industries a flexible cost function incorporating public capital infrastructure is estimated for each industry separately using annual time series data for 1961 1995 the effects of public infrastructure on productivity are measured in terms of both cost saving dual and output augmenting primal measures we also investigate how public capital influences the input demand and cost structure in each industry and calculate the rate of return to public capital the empirical results provide strong evidence of the important role public infrastructure plays in the productivity of manufacturing industries the public capital serves as a substitute for both private capital and labor in most industries the rates of return to public capital are significant and vary over the years

is public expenditure productive abstract this paper considers the relationship between aggregate productivity and stock and flow government spending variables the empirical results indicate that i the nonmilitary public capital stock is dramatically more important in determining productivity than is either the flow of nonmilitary or military spending ii military capital bears little relation to productivity and iii a core infrastructure of streets highways airports mass transit sewers water systems etc has most explanatory power for productivity the paper also suggests an important role for the net public capital stock in the productivity slowdown of the last fifteen years

international factor mobility minimum wage rates and factor price equalization a synthesis this paper examines the behavior of a small open economy facing perfectly elastic supply curves for some of its productive factors in particular the paper derives some comparative statics properties of such economies compares them with the properties of otherwise identical economies in which all factor prices are determined endogenously and investigates the relationship between factor price rigidities factor price equalization and the pattern of specialization among the new results which are proved it is shown that as more and more factor price rigidities are imposed on an economy it comes closer to a state of factor price equalization

infrastructure and education as instruments of regional policy evidence from spain regional policy and spain infrastructure and education as instruments of regional policy evidence from spain governments have often tried to influence the regional distribution of economic activity through supply side measures such as investment in training and infrastructure using evidence from spain we examine whether such policies can have an impact and whether they have done so in the past our results indicate that disparities in the stocks of human and public capital account for a third of observed regional inequality about evenly split between the two factors hence public investment can in principle be used to reduce regional disparity its actual impact however will depend both on its overall volume and on the extent to which its regional allocation does indeed vary with regional need in spain investment in infrastructure has made only a small contribution to regional convergence primarily because it has not in practice been allocated to redistribute across regions to any great extent in contrast efrd transfers have clearly been allocated among regions with redistribution in mind the impact of the fund has been significant but it has been limited by the relatively small size of the programme angel de la fuente and xavier vives

public capital and private productivity this paper uses three different approaches to investigate whether the declining provision of public capital is a major cause of declining labor productivity the juxtaposition of approaches removes

reprint to infrastructure provision and macroeconomic performance abstract this paper studies the differences between private and government provision of infrastructure capital utilization decisions and their differential role in determining market prices for capital goods under the two regimes of infrastructure provision serve as a critical transmission mechanism for fiscal policy a subsidy to private providers of infrastructure is preferable to direct government provision irrespective of how the subsidy or expenditure is financed the case for private provision is much stronger in economies characterized by high levels of congestion the choice between private and government provision also has a crucial effect on the design of optimal fiscal policy

efficiency adjusted public capital and growth summary this paper constructs an efficiency adjusted public capital stock series and re examines the public capital and growth relationship the paper also examines the effects of four specific stages of the public investment process appraisal selection implementation and evaluation on capital accumulation and growth the results show that public capital is a significant contributor to economic growth the quality of public investment as measured by variables capturing the adequacy of project selection and implementation is statistically significant in explaining variations in economic growth a result mainly driven by low income countries

legitimizing leveraging and launching developing dynamic capabilities in the mne multinational enterprises mnes face simultaneous pressures for global integration and local responsiveness while the extant literature acknowledges that most mnes are neither entirely geared towards achieving global integration nor local responsiveness scarce attention is given to how mnes develop organizational flexibility to address multiple and shifting strategy pressures over time in this paper we draw on the dynamic capabilities literature to explore how the mne develops the capabilities needed to achieve this flexibility through a qualitative longitudinal case study spanning 12 years we identify three recombination capabilities legitimizing leveraging and launching capabilities through which the mne develops organizational flexibility we find that these recombination capabilities improve the mnes ability to sense and seize new opportunities and enable the mne to overcome organizational impediments to achieve flexibility our study offers a process perspective that shows how the three capabilities together nourish the mnes resilience to continuously balance between global integration and local responsiveness our findings have managerial implications illustrating that launching new strategic initiatives may fail if the mne does not have the capabilities to legitimize the new initiatives and to ensure that existing organizational strengths are properly leveraged to support the new initiatives

services sector and economic growth in india this study examines the long run equilibrium and short run dynamic relationship between services sector and gross domestic product gdp and between services and nonservices sectors in india the model is estimated using the optimal single equation and the maximum likelihood system estimators all the estimators consistently suggest the cointegrating relationship between services sector and gdp as well as between services and nonservices sectors the estimates of long run elasticity parameters are statistically significant and dimensionally consistent across the estimators the conventional cumulative sum cusum and the new cusum and moving sum mosum tests suggest the stability of the equilibrium residuals and reinforce the cointegrating relationship between the model series the error correction model provides some support for unidirectional granger causality from services sector to gdp the impulse response and variance decomposition analyses instead suggest the bidirectional causality between servic

innovating with infrastructure how india s largest carmaker copes with poor electricity supply abstract conventional wisdom suggests that self generation is a high cost and inefficient but often unavoidable solution to unreliable public power supply in developing countries this article examines the power problem from the perspective of a large industrial user and its upstream supplier firms in india it analyzes the innovative generation and power sharing system that this firm has devised to solve both its own power problems as well as those facing some of its suppliers this research finds not only that self generation is economical but also that self generation combined with power sharing serves as a model that policy makers can replicate to ameliorate the power problems plaguing firms in developing countries

spillover effects of public capital formation evidence from the spanish regions maybe because of the inconclusive nature of the results on the impact of public capital on output at the regional level the issue of the po ssible existence of the regional spillovers from public capital formation has received little attention the objective of this paper is to provide evidence on the possible existence of such spillovers we consider the case of spain and its seventeen regions our methodological approach consists in estimating an aggregate var model for spain as well as seventeen region specific var models in which both capital installed in the region and capital installed outside the region are allowed to play a role in en hancing regional output the estimation results can be summarized as follows the aggregate effects of public capital formation in spain are important they cannot however be captured in their entirety by the direct effects in each region from public capital installed in the region itself when for each region both the capital installed in the region and the capital installed outside the region are considered the total disaggregated effect from the seventeen regional models are very much in line with the aggregate results furthermore the aggregate effect seems to be due in almost equal parts to the direct and spillover effects of public capital formation ultimately this paper establishes the relevance of both capital installed in each region and s pillover effects in the understanding of the regional decomposition of the aggregate effects of public capital formation in doing so it opens the door to some tantalizing and potentially highly charged research issues in terms of the determination of the optimal location of public investment projects

the politics of infrastructure investment the role of product market competition abstract in spatial competition public infrastructure plays a crucial role in determining product market outcomes in our model consideration of infrastructure s impact on the product market drives the preferences of consumers in their dual role as voter taxpayers the spatial heterogeneity of consumers produces conflicting political interests and in many cases inefficient outcomes however across both exogenous and endogenous market environments product market competition consistently leads to higher levels of publicly funded infrastructure than monopoly collusion furthermore competition s boost to the popular support for infrastructure investment is often excessive while monopoly leads to underinvestment

public infrastructure and regional economic development a simultaneous equations approach an analysis of how central bank exchange market intervention can affect both the level of exchange rates and the risk premium in asset returns showing how the risk premium is related to the conditional variances of intervention and other exogenous processes

public investment and economic growth this article uses an extension of mankiw romer and weil s augmented solow swan growth model to examine whether public investment has a distinct role as a determinant of economic growth it considers both the predictions of the model in steady state and in transition to steady state for the steady state model there is no significant effect from public investment on the level of output per worker using standard ordinary least squares ols methods for the transition model it observes a significant contribution to economic growth from public investment when instrumental variables methods are used however the associated standard errors are much larger and the contribution of public investment is statistically insignificant

theoretical foundations of emerging economy business research in probing theoretically into central and eastern europe transactions resources and institutions we outlined the contributions of research in central and eastern europe cee to theoretical debates in business research in this retrospective we reflect upon the evolution of the field over the past decade with the fading impact of cee s distinct shared history we suggest that cee best be analyzed as emerging economies rather than as a distinct geographic entity emerging economy business research is converging on common themes and shared theoretical ideas while identifying critical variations that constrain generalizations among and beyond emerging economies this research thus highlights the need to develop a better understanding of the boundary conditions of scholarly theories of business knowledge over the past decade the institution based view has emerged from distinct intellectual traditions in institutional economics organizational theory and the analysis of business government bargaining research in these converging lines of theorizing places contextual variations at the center of explanations of business phenomena around the world we suggest that the institution based view is evolving toward a paradigm and offer suggestions on how to advance this research agenda further in particular by exploring how firms engage with different sets of potentially conflicting institutions at multiple levels and locations

firms operating under electricity constraints in developing countries many developing countries are unable to provide their industrial sectors with reliable electric power with the result that many enterprises must contend with an insufficient and unreliable supply of electricity because of these constraints enterprises often opt for self generation of electricity even though it is widely considered a second best solution this paper develops a theoretical model of investment behavior in remedial infrastructure in the presence of physical constraints it then illustrates the model s predictions using a large cross country sample of enterprises from the world bank enterprise survey database electricity intensive sectors in high outage countries are characterized by a significantly lower share of small firms

international aspects of public infrastructure investment m odelling infrastructure as an international public good in a two country m odel of trade where each country s social planner behaves strategically we show that the equilibrium levels of infrastructure are sub optimal from a global perspective utilising an appropriate econom etric fram ework and data from 16 european countries over the period 1987 95 we find evidence that accords well with the m ain predictions of our theory thus we are able to offer a plausible theoretical explanation why public capital m ay be undersupplied as suggested by previous em pirical literature