bluuebunny/crossref_metadata_2025 huggingface dataset:
Managing New Product Design and Development: an Anglo‐German Study
Authors: Voss Chris , Blackmon Kate , Hanson Philip , Claxton Tim
Published: October 2006

This article reports the results of a study of innovation and product development at 245 manufacturing sites in the UK and Germany. It examines the relationship between design and performance and the competitiveness of the UK and Germany in design and manufacturing. Overall, few sites reached “world‐class” standards ‐ 9% in Germany and 3% in the UK, although many sites were not far below these standards.
DraKula™: Medieval Value Chain Analysis Lives OK?
Authors: Ambler Tim
Published: October 2006

“Manufacturing good, marketing bad” was the official view in the Soviet Union ‐ with dire economic results. Even in the market economies, tax authorities are prone to take the Soviet line….
Resolving International Conflict: What Role for Business?
Authors: Roddick Anita
Published: October 2006

This second 1996 Stockton Lecture focuses on poverty as a cause of international conflict ‐ and on what businesses can do or avoid doing to reduce it. Poverty, Roddick argues, fuels revolution. And while the western armaments industry is especially to blame, big institutions like the World Bank and the multinationals have all contributed to causing conflict. Her answers to the problem include more “microenterprise” and fair trading initiatives by multinationals in local communities in the developing world. Her central message is that business “must not only avoid hideous evil; it must actively do good”.
Why Markets Need Referees
Authors: Doyle Chris
Published: October 2006

In this first article in our new series on research by the London Business School Regulation Initiative, the author uses the metaphor of a football game to illustrate why regulation is in the interests of most companies as well as of consumers. He sets out twelve criteria which should characterise credible regulation and concludes that once effective competition is firmly in place, less rather than more regulation ought to be needed.
Who Benefits from Price Promotions?
Authors: Hardie Bruce
Published: October 2006

This article reports new research on price promotions in grocery products. The results are striking and taken with other evidence they suggest that few consumers benefit from deep‐discount price promotions. The study raises big questions about how manufacturers and retailers allocate their marketing budgets ‐ and even about whether companies' management accounting and remuneration practices may be leading to reduced profits.
OB or not OB?
Authors: Barwise Patrick
Published: October 2006

Shakespeare's Globe Theatre has recently reopened, nearly 400 years after it burned down. To mark the event, this article publishes interim results from an ongoing research programme which has so far lasted 25 years. Shakespeare is often believed to have been merely a playwright, philosopher, psychologist and poet. But according to the author of this article, his greatest act of genius may have been to invent the academic discipline of Organisational Behaviour and to found the Harvard Business School case study approach to management education.
What is a Company For?
Authors: Handy Charles
Published: October 2006

This article is a precis of the Michael Shanks Memorial Lecture delivered to the Royal Society on 5 December 1990. In it the author raises a number of philosophical questions about the nature of the corporate enterprise which challenge some of the shibboleths of current thinking. It is published in the expectation that it will stimulate thought and comment.
Maxwell – The Failure of Corporate Governance
Authors: Stiles Philip , Taylor Bernard
Published: October 2006

This article examines a case of fraud – the Maxwell case – to assess the implications for corporate governance in Britain. The analysis of the case shows how Robert Maxwell was able to avoid the established network of regulations and controls. The authors then make a number of recommendations which suggest how this kind of fraud may be prevented in the future.
Corporate Governance Changes in UK Companies Between 1988 and 1993
Authors: Conyon Martin J.
Published: October 2006

In the UK, recently, there has been an intense debate about what constitutes good corporate governance. This paper presents the results of a retrospective postal survey into the nature of corporate governance structures in UK companies. The objective of this paper is to isolate the extent to which key corporate governance innovations are being adopted in the boardrooms of UK companies. The main findings can be summarised as follows: (i) 77 per cent of the sample of quoted companies separated the role of chief executive officer and chairman in 1993 compared to 57 per cent in 1988; (ii) 94 per cent of quoted companies operated remuneration committees in 1993 as compared to 54 per cent in 1988; (iii) the incidence of audit committees among companies has doubled between 1988 and 1993 whilst the incidence of nomination committees has trebled; (iv) in apparent contradiction of the Institutional Shareholders’ Committee recommendation, of those companies that operated remuneration committees in 1993, 40 per cent had the top executive director as a committee member. Overall the picture that emerges is of radical change in governance innovation since the late 1980s.
Diversity of Board Members and Organizational Performance: An integrative perspective
Authors: Treichler Christoph M.
Published: October 2006

This article examines the structure of boards and its effects on the performance of significant board functions. Composition of boards is measured by size, outside director representation and cognitive, as well as demographic diversity. A firm's environment, strategy, structure and culture, and factors attributed to personal characteristics of board members were viewed as important determinants affecting effectiveness of boards. Most important, decisions on board size and composition involve a trade‐off between benefits of diversity and enhanced costs of group development and group decision processes.
The Strategic Role of the Board
Authors: Stiles Philip , Taylor Bernard
Published: October 2006

This article reports the results of a survey of 101 UK company boards designed to obtain information on the extent of their strategic involvement, the style of strategy making, the planning process and the methods used to monitor and control the implementation of strategy. There is much prescriptive work on the need for boards to be involved in the strategy making process, but little empirical evidence has been gathered about current practices. This article makes a contribution to this debate. With Pettigrew (1993) we aim to avoid placing this research within any one research tradition, but attempt to provide descriptive results which increase our understanding of the board's role in strategy based on initial findings from an on‐going study.
The Voluntary Use of Outside Directors by Initial Public Offering Firms
Authors: Mak Y.T.
Published: October 2006

This study examines the associations between the characteristics of initial public offering (IPO) firms and the voluntary use of outside directors. Five firm characteristics are examined: inside share ownership, variance of aftermarket returns, operating history, leverage, and firm size. Based on a sample of 110 New Zealand firms which made initial public offerings of equity securities over the period 1983 to 1987, the study finds that greater variance of after‐market returns and a lower inside share ownership are associated with a greater proportion of outside directors. In addition, firms without operating histories are likely to use relatively more outside directors. However, leverage and firm size are not significantly related to the proportion of outside directors. Overall, the findings from the study are generally consistent with arguments that firms with greater agency problems are likely to use relatively more outside directors because these directors are perceived to be more effective in mitigating agency problems.
Foundation Ownership and Economic Performance1
Authors: Thomsen Steen
Published: October 2006

Industrial foundations are private, self‐governing institutions that own business companies. This ownership category is quite common in Northern Europe although it appears to violate the basic principles of the (Anglo‐American) neoclassical corporation: profit maximization and risk diversification. The paper examines the economic performance of foundation‐owned companies using accounting data drawn from a sample of the 300 largest Danish companies 1982‐1992. Surprisingly, it is found that foundation‐owned companies perform slightly better than companies with private (personal) or public (dispersed) ownership. Foundation‐owned companies appear to specialize in capital and research intensive activities with high profit‐sales ratios which indicates that they are competitive in activities that require continuous long run investment. A parallel paper proposes a theoretical explanation.
Turning Organizational Culture from Fad into Management Tool*
Authors: Hofstede Geert
Published: October 2006

Talking about a company's culture has become a fad. To turn the concept into something of practical managerial use, we need to know how to assess a company's culture in ways that permit realistic proposals for actions with some chance of moving the company in a desired direction. The author has found six dimensions of corporate culture, some of which are consistent with earlier work. He shows how the dimensions can be a framework for introducing and monitoring proposed organizational changes.
Entrepreneurial Innovation: Beyond Schumpeter
Authors: Manimala Mathew J.
Published: October 2006

Entrepreneurial innovation is generally understood as product innovation not only by the layman but by entrepreneurs themselves, even though in practice the latter are innovative in several other areas. Researchers and scholars have attempted to capture the essence of the concept of entrepreneurial innovation. In a study of 138 Indian entrepreneurs, the author found that entrepreneurs acquire competitive advantage for their ventures through innovations in other areas also such as finance, personnel, organization structure, culture, R&D management, and government relations. A factor analysis of these different types of innovation brought out four major categories of innovation, namely (i) operations innovation, (ii) market/marketing innovation, (iii) organizational innovation and (iv) boundary management innovation. This broader perspective compares with, and extends a view of innovation originally suggested by Schumpeter.
From Profs to Profits: How Italian Academics Generate High Technology Ventures
Authors: Piccaluga Andrea
Published: October 2006

This article examines the motivations which induce academic researchers to found their own business and reports on the advantages and disadvantages that such an entrepreneurial form presents for an efficient transfer of creativity and innovation from public research laboratories to the marketplace. In the Italian situation it shows that academic spin‐offs can be very efficient in doing this although there are specific and crucial moments which generate tension within the first stages of the firm's life cycle.
Defining Entrepreneurship: Past, Present and?
Authors: Kao Raymond W.Y.
Published: October 2006

A definition of entrepreneurship is proposed as follows: Entrepreneurship is the process of doing something new and something different for the purpose of creating wealth for the individual and adding value to society.
A Creativity Model for the Analysis of Continuous Improvement Programmes: A Suggestion to Make Continuous Improvement Continuous
Authors: De Cock Christian
Published: October 2006

Continuous improvement programmes constitute an area in which creativity seems to play a vital role. This paper shows how continuous improvement may be studied more effectively in a framework which reveals relationships between the four facets of creativity: products, processes, people, and the press or environment. It is suggested that such a systematic analysis can enhance continuous improvement efforts by indicating how momentum is maintained as the company develops self‐reflective (‘learning’) skills.
Leadership Profiles, Situation and Effectiveness
Authors: Ekvall Göran , Arvonen Jouko
Published: October 2006

The paper provides a research report on leadership styles studied in a range of countries, industry types and organization levels. Unequivocal evidence has been found for a three factor model of style, incorporating the well‐known, task‐oriented/people‐oriented factors, and a change‐oriented factor. The new factor is presumed to be a consequence of more turbulent environments. Further analysis of the leader reports (supplied by 3,857 respondent ‘followers’) found ten clusters of ‘blends’ of style, of which three ‐ labelled super‐leaders, gardeners and MBO leaders ‐ were consistently rated more effective and most liked by subordinates. A significant theoretical implication is that the results showed no evidence of contingency effects, i.e. variations in effectiveness, across broad contexts such as branch, function or hierarchic level, although the clusters differed with regard to representation in the different contexts.
The Relationship Between the Social Environment of Organizations and the Climate for Innovation and Creativity
Authors: Turnipseed David
Published: October 2006

Relationships were examined among the social environment of organizations, employee satisfaction (both job‐related and personal), and perceptions of a creative work environment. The subject organization was a manufacturing facility in the United States which produced parts used in automobile production and operating in a dynamic market economy. Creativity was desired and verbally encouraged, but no attention was given to organization development, nor were there any intervention efforts designed to promote a creative environment.

Results from environmental and climate inventories indicate that there are significant linkages between the social environment of the organization and satisfaction with the organization and personal lives, and the potential for innovation. Pride in the work, freedom, and other personal variables were also found to be related to an innovative climate.
Planning For Entrepreneurial Innovation: Field Studies in Poland and Ukraine and Lessons Learned
Authors: Abetti Pier A.
Published: October 2006

Former Socialist Central and Eastern European Countries are working to achieve economic self‐sufficiency. The creation of high‐value‐added jobs to retain their skilled workpeople and the achievement of international economic competitiveness are major challenges they face. In this article the author proposes the strategy of regional economic development through entrepreneurial innovation, with emphasis on technological companies. The viability of this approach, and the lessons learned from it, are assessed using case study material from Poland and Ukraine.
“Fresh Blood” Innovation and the Dilemma of Personal Involvement
Authors: Shapira Reuven
Published: October 2006

“Fresh blood”, executive succession by outsiders, is widely used to enhance innovation. While it is quite clear that a nominee's competence is crucial to innovation, the exact causality is only partially understood. An anthropological study of the behaviours of a complete outsider and an industry‐insider suggests they followed different strategies for taking charge. The complete outsider had meagre local knowhow, and relevant competence in industry‐problems, making self‐exposure difficult, preventing active personal involvement, and led to a failure in building trust. Without trust, a vicious circle of mutual suspicions prevented openness and sincerity, crucial to successful use of intangible assets for innovation. A spiral of conflict and efforts at coercion on both sides emerged, causing conservatism. The other outsider with some local knowhow was unafraid of self‐exposure, got involved, created mutual trust, and succeeded. Thus a lack of specialized locally‐relevant competence could explain the failure of a gifted complete outsider to innovate, in a situation in which a less talented industry‐insider proved a successful leader of innovation.
The Psychoeconomic View of Creative Work in Groups and Organizations
Authors: Rubenson Daniel L. , Runco Mark A.
Published: October 2006

Although most research on creativity deals only with individuals, there are many settings in which creative tasks are assigned to groups. Indeed, in most contemporary research settings collaborative inquiry is the norm. Extensions to the psychoeconomic theory of creativity provide several specific predictions about the nature and optimization of group creativity. These predictions are based on consideration of the ways in which some individual differerences in creative style, such as domain experience and flexibility of thinking, are likely to interact. Instead of characterizing such attributes as conducive or harmful to the creative process, the psychoeconomic theory explicitly recognizes their potential for contributions in both directions. In particular, the theory implies that groups should be composed of heterogeneous participants who vary in their experiences within the domain in question, and who are only moderately familiar with one another, for most successful creative performance. This proposal is contrary to several theories which imply greater success from more congenial and symmetric groups. The theory also yields detailed predictions for how the optimal composition of a creative group should vary in response to changes in the characteristics of the group's members and the structure of its working environment.
Direct Control or Responsible Autonomy: Two Competing Approaches to the Management of Innovation in Information Systems Projects
Authors: Currie W.L.
Published: October 2006

The article examines the theoretical positions of direct control and responsible autonomy in the context of empirical work in the financial sector on the management of information systems projects. Direct control is employed by managers through the use of formal project management methodologies and techniques. Responsible autonomy addresses the difficulties in applying direct control strategies and seeks to encourage creativity and innovation by developing an informal working environment for project managers and technical staff. Contextualising the two approaches for the financial services sector, a conceptual framework is developed on the relationship between management control strategies and information systems project risk.
Process: Creativity Improvement in a System Development Work Unit
Authors: Snow Terry A. , Couger J. Daniel
Published: October 2006

A creativity improvement intervention was introduced in a work unit of system developers. The five month intervention consisted of three phases:Phase Iwas a training workshop to establish an environment to facilitate creativity and to teach a variety of creativity generation and evaluation techniques.Phase IIreinforced the concepts/principles taught in the workshop, with opportunities to discuss experience in application of the techniques and test the degree to which the environment for creativity had been enhanced. Additional techniques were also introduced during this period.Phase IIIprovided further reinforcement by reading and discussing creativity articles/papers. All personnel kept a record of their creative results, identifying 17 major improvements. In a post‐test, on average participants believed their individual creativity improved 23% and that the unit's creativity improved 27%. They also indicated that the environment for creativity was well established, that “creativity was now a part of their culture.”
Product: Measurement of Creativity of IS Products
Authors: Couger J. Daniel , Dengate Geoffrey
Published: October 2006

While the literature on creativity/innovation in IS is sparse, the literature on measurement of creativity in IS products/services is non‐existent. This paper provides a review of the literature on measurement of creativity, then concentrates on a discussion of the measurement of software products. Six software products are evaluated for their degree of creativity using a two‐criterion approach: novelty and utility.
Mergers and Innovation: Declining Commitment to Pharmaceutical Research
Authors: Jones Oswald
Published: October 2006

Using the work of Michael Porter it is argued that the success of the UK pharmaceutical industry has been the result of ‘vigorous’ domestic competition. It now appears that the UK industry will effectively become a duopoly dominated by Glaxo‐Wellcome and SmithKline Beecham. This will reduce the incentive to innovate new products which has been central to the pharmaceutical industry's success in recent years. In addition, the broader implications for the UK economy are also depressing as the pharmaceutical industry makes a disproportionate contribution to industrial expenditure on R&D.
Neural Nets: An Evaluation and a Spreadsheet Implementation
Authors: Howell S. D.
Published: October 2006

Attitudes to neural nets range from suspicion to uncritical admiration. This paper aims to introduce nets and to evaluate their strengths and weaknesses. The language is non‐technical, but the conceptual treatment is intended to be rigorous. A practical method for implementing a neural net on a spreadsheet is described, and sample results illustrated.
Vertically Related Markets: Export Rivalry Between DC and LDC Firms*
Authors: Chang Winston W. , Chen Fang‐Yueh
Published: October 2006

We present a model of export rivalry in vertically related markets where a DC firm produces a high‐quality good as well as a key input utilized by an LDC firm to produce a low‐quality export good. the DC firm acts as a Stackelberg leader by setting the price of the input and the quantity of its export good. We show that the DC firm's decision on vertical supply depends on the cost, demand, and quality parameters of both producers, and that the LDC government should tax either its final good exports or its key input imports.
POLITICAL ECONOMY AND PEEL'S REPEAL OF THE CORN LAWS
Authors: Irwin Douglas A.
Published: October 2006

The repeal of the Corn Laws in Britain in 1846 has been much debated as to whether interest groups or ideology contributed most to this policy reform. This paper examines a conventional view that Sir Robert Peel, in proposing repeal, converted from protection to free trade under the influence of the ideas of political economy. It is shown that economic ideas had a crucial influence on Peel, but that he remained skeptical of political economy as a doctrine.
MEASURING THE DEADWEIGHT COSTS OF DUP AND RENT SEEKING ACTIVITIES
Authors: Varian Hal R.
Published: October 2006

I examine a simple model of rent seeking behavior in order to determine the correct way to measure welfare loss due to rent seeking. I conduct this analysis using a general equilibrium version of the standard partial equilibrium consumers' surplus cost‐benefit setup. I conclude that the ordinary tools of cost‐benefit analysis, such as consumers' and producers' surplus, are up to the task of measuring the deadweight loss due to rent seeking, as long as they are applied in the proper general equilibrium context.
QUID PRO QUOFOREIGN INVESTMENT*
Authors: Dinopoulos Elias
Published: October 2006

The paper analyzes the phenomenon of industry‐specific direct foreign investment (DFI) which occurs with the view to defusing the threat of future protection by the host country (quid pro quo), under alternative imperfectly competitive market structures. It is established that, even in the absence of government intervention, firms in imperfectly competitive markets change the level of trade and DFI in response to future protectionist threats.
THE NEW POLITICAL ECONOMY: ITS EXPLANATORY POWER FOR LDCs*
Authors: Findlay Ronald
Published: October 2006

This paper reviews the new political economy and its relevance to explaining policymaking in the developing countries.
THE PARADOX OF POWER*
Authors: Hirshleifer Jack
Published: October 2006

In power struggles, the strong might be expected to grow ever stronger and the weak weaker still. But in actuality, poorer or smaller combatants often end up improving their position relative to richer or larger ones. This is the paradox of power. The explanation is that initially poorer contenders are rationally motivated to fight harder, to invest relatively more in conflictual activity. Only when the decisiveness of conflict is sufficiently high does the richer side gain relatively in terms of achieved income. Among other things, the paradox of power explains political redistributions of income from the rich to the poor.
DANGO: JAPAN'S PRICE‐FIXING CONSPIRACIES
Authors: McMillan John
Published: October 2006

This paper addresses two questions about collusion in the Japanese construction industry. First, what mechanisms are used for enforcing the collusive agreement, for dividing the spoils, and for preventing the entry of new firms seeking a share of the collusive profits? Second, how much are prices raised as a result of the collusion?
MACROECONOMIC POLICY AND ELECTIONS IN OECD DEMOCRACIES*
Authors: Alesina Alberto , Cohen Gerald D. , Roubini Nouriel
Published: October 2006

The purpose of this paper is to test for evidence of opportunistic “political business cycles” in a large sample of 18 OECD economies. Our results can be summarized as follows: 1) We find very little evidence of pre‐electoral effects on economic outcomes, in particular, on GDP growth and unemployment; 2) We see some evidence of “political monetary cycles,” that is, expansionary monetary policy in election years; 3) We also observe indications of “political budget cycles,” or “loose” fiscal policy prior to elections; 4) Inflation exhibits a post‐electoral jump, which could be explained by either the pre‐electoral “loose” monetary and fiscal policies and/or by an opportunistic timing of increases in publicly controlled prices, or indirect taxes.
ELECTIONS AND THE THEORY OF CAMPAIGN CONTRIBUTIONS: A SURVEY AND CRITICAL ANALYSIS*
Authors: Morton Rebecca , Cameron Charles
Published: October 2006

The formal theory of campaign contributions in elections has expanded in the past decade. The basic assumptions and results of these models are examined and analyzed. The assumptions of the models are often inappropriate for the political actors considered and the results are sometimes not empirically supported. We suggest ways in which these models may be altered to alleviate some of these problems.
VOTING ON GROWTH CONTROL MEASURES: PREFERENCES AND STRATEGIES*
Authors: DUBIN JEFFREY A. , KIEWIET D. RODERICK , NOUSSAIR CHARLES
Published: October 2006

Citizens of many California cities and counties have sought to restrict the rate of population growth in their localities. In 1988, Citizens for Limited Growth used the initiative process to place a pair of growth control measures on the ballot in the City and County of San Diego, respectively. The City Council and Board of Supervisors responded by placing less stringent, competing measures on the same ballot. This paper analyzes voting data from this election to examine the nature of support for such measures. We find strong support for the hypotheses that whites, homeowners, liberal/environmentalists, and those exposed to high levels of traffic congestion are more likely to favor growth controls. This paper also investigates the behavior of voters when they confront competing propositions concerning the same issue on the same ballot, and finds strong evidence of strategic voting.
SOME INEFFICIENCY IMPLICATIONS OF GENERATIONAL POLITICS AND EXCHANGE*
Authors: KOTLIKOFF LAURENCE J. , ROSENTHAL ROBERT W.
Published: October 2006

This paper explores the implications of generational selfishness in a model in which each generation has its own government. Such selfish generational governments will potentially distort the economy along a number of dimensions. One is the monopolization of factor supplies; another is the under‐ or overprovision of durable public goods. We demonstrate that selfish generations may place sizable marginal taxes on their factor supplies in order to monopolize their factor markets. We also show that selfish generations will provide inefficient levels of durable public goods both at the local and national levels. Finally, we demonstrate that generational inefficiencies can arise even in models of cooperative bargaining because of the first‐mover advantage of earlier generations.
MUNICIPAL CONSTRUCTION SPENDING: AN EMPIRICAL EXAMINATION
Authors: HOLTZ‐EAKIN DOUGLAS , ROSEN HARVEY S.
Published: October 2006

Despite widespread concern and discussion, no consensus exists concerning the causes of the “infrastructure crisis” or its implications for the efficiency of government decision‐making more generally. We investigate several models of the determination of local public capital expenditures. Using Euler equation methods, we cannot reject the hypothesis that construction spending is determined by unconstrained, forward looking municipal planning. Consistent with this result, the stochastic structure of resource flows is an important feature of the determination of construction spending. Only unanticipated changes in a community's resources alter its demand for structures, with an unanticipated increase of one dollar increasing current construction spending by about 5.6 cents.
ON THE FEASIBILITY OF A ONE‐SPEED OR MULTISPEED EUROPEAN MONETARY UNION
Authors: ALESINA ALBERTO , GRILLI VITTORIO
Published: October 2006

This paper addresses two questions: (1) Is a twelve‐country monetary union in Europe feasible? (2) Can monetary union be achieved at multispeed, i.e., with a small group of countries going first, and later admitting the others? After examining several politico‐economic arguments concerning problems of feasibility of the union, we conclude with a fair amount of skepticism concerning the multispeed idea. We show that the final result of the process of monetary integration is dependent upon the number of countries that initiate it. Our discussion of feasibility sheds some light on the political economy of the recent (Fall 1992) turmoil in the monetary system of Europe.
WHY SMALL GROUPS AND LOW INCOME SECTORS OBTAIN SUBSIDIES: THE “ALTRUISTIC” SIDE OF A “SELF‐INTERESTED” GOVERNMENT*
Authors: SWINNEN JOHAN F. M. , DE GORTER HARRY
Published: October 2006

We develop a model of political support seeking politicians and support supplying voters. Based on Downs' original formulation, the framework yields endogenous political weights with both liberal and conservative properties. Our model reconciles the apparent contradiction between models of self‐interested politicians and of governments motivated by social concerns. We show that the “altruistic” aspect of government behavior is consistent with its “self‐interested” behavior. We determine that the Olson‐Becker pressure group model is not unique. An increase in deadweight costs reduces the equilibrium subsidy. Smaller groups receive a larger per capita subsidy. These results are consistent with Becker's model.
WHY A FREE TRADE AREA? THE TARIFF ALSO RISES*
Authors: RICHARDSON MARTIN
Published: October 2006

This paper considers the choice between a customs union (wherein partners share a common external tariff) and a free trade area (wherein each partner chooses its own tariff against non‐members). Following the result that a customs union dominates a free trade area, with coordination of domestic tax policies, we show that a free trade area may nevertheless be chosen if tariffs are determined endogenously through industry lobbying. This is so even when the free trade area equates producer prices within its borders and induces tariff revenue competition and whether or not there is domestic free‐riding in lobbying.
RENT DISSIPATION AND THE SOCIAL COST OF PRICE POLICY
Authors: Coggins Jay S.
Published: October 2006

This paper uses a general equilibrium‐based exchange economy model to examine rent seeking for a price policy. Opposing interests spend resources to influence the government's choice of a price vector. Rents, the willingness to pay for the policy, are determined endogenously from the Nash equilibirum of a non‐cooperative game. Numerical simulations explore the degree to which rents are dissipated by wasteful rent seeking. It is found that dissipation, measured as the ratio of rent‐seeking costs to rents garnered, can grow without limit, and is greatest when opponents are evenly matched. Dissipation is smallest with widely disparate groups, a result that might help explain the underdissipation that seems to occur in many industries.
A SIGNALING MODEL OF COMPETITIVE POLITICAL PRESSURES
Authors: Lohmann Susanne
Published: October 2006

This paper models competitive political pressures as a signaling phenomenon. People participate in collective action in support of or against the status quo, or they abstain. Their actions and abstentions inform the decision of a policymaker who may overturn the status quo in favor of a policy alternative. By providing an informational microfoundation for the widely used reduced‐form “pressure production functions” and “political influence functions,” the analysis allows me to reexamine the role of the free rider problem in creating a bias towards vocal special interests.

The signaling hypothesis finds empirical support with a study of pro‐ and anti‐Gulf War demonstrations that took place in San Francisco and Kansas City (Missouri) in early 1991.
INSTITUTIONS AND ECONOMIC PERFORMANCE: CROSS‐COUNTRY TESTS USING ALTERNATIVE INSTITUTIONAL MEASURES
Authors: Knack Stephen , Keefer Philip
Published: October 2006

The impact of property rights on economic growth is examined using indicators provided by country risk evaluators to potential foreign investors. Indicators include evaluations of contract enforceability and risk of expropriation. Using these variables, property rights are found to have a greater impact on investment and growth than has previously been found for proxies such as the Gastil indices of liberties, and frequencies of revolutions, coups and political assassinations. Rates of convergence to U.S.‐level incomes increase notably when these property rights variables are included in growth regressions. These results are robust to the inclusion of measures of factor accumulation and of economic policy.
THE POLITICAL ECONOMY OF QUOTA RENTS IN A DYNAMIC INTERNATIONAL TRADE MODEL*
Authors: Mitchell Shannon K.
Published: October 2006

This paper considers the implications of allowing quota rents to become capitalized. Capitalized quota rents crowd out physical capital in savers’portfolios, reducing the capital stock. Capitalization of quota rents also makes removal of the quota politically more difficult, since those currently alive may not be able to fully compensate the losers before the losers die. I use an overlapping generations model to provide examples which illustrate the difficulty of removing a quota once its rents have been fully capitalized. This work has implications for any policy which could lead to capitalized rents.
TRADE NEGOTIATIONS, INFORMATION AND DOMESTIC POLITICS: THE ROLE OF DOMESTIC GROUPS
Authors: Milner Helen V. , Rosendorff B. Peter
Published: October 2006

A domestic ratification game nested within an international bargaining game establishes that domestic politics influences the outcome of international negotiations. When information on the domestic side is incomplete, an informational role of lobbies is established. Cooperation is more likely when domestic lobbies provide information to Congress about a treaty presented for ratification, especially when cooperation would not otherwise occur. As government becomes more divided, cooperation is less likely; when it does occur, the legislature is better off – internal divisions worsen the external leverage of states, while a united home front is the executive's best chance for obtaining her ideal agreement.
The cost of capital in internationally integrated markets: The case of Nestlé
Authors: Stulz René M.
Published: October 2006

This paper argues that the cost of capital for firms in small countries should be estimated using the global CAPM rather than a local CAPM. Two related formulas showing the mistake made when using a local CAPM rather than a global CAPM are presented. the global CAPM is implemented for the case of Nestlé and the results are compared to the cost of capital estimate one obtains for Nestlé using a local CAPM when the global CAPM is appropriate.
Corporate governance and incentives in German companies: Evidence from top executive turnover and firm performance
Authors: Kaplan Steven N.
Published: October 2006

This paper examines executive turnover—both for management and supervisory boards—and its relation to firm performance in the largest companies in Germany in the 1980s. Turnover of the management board increases significantly with poor stock performance and particularly poor (i.e. negative) earnings, but is unrelated to sales growth and earnings growth. These turnover‐performance relations do not vary with measures of stock ownership and bank voting power. Supervisory board appointments and turnover also increase with poor stock performance, but are unrelated to other measures of performance.
The role of defensive strategies and ownership structure of target firms: Evidence from UK hostile takeover bids
Authors: Sudarsanam P. S.
Published: October 2006

The outcome of a hostile takeover bid hinges on an interplay of the defensive strategies of targets and the offensive strategies of bidders. This study examines the determinants of outcome for a sample of 205 hostile bids for UK public company targets over the period 1983–1989. the impact of a number of defensive strategies adopted by the targets, their ownership structure which could aid or hinder the deployment of those strategies, and the method of payment selected by bidders is investigated using multivariate logit methodology. the City Code on Takeovers and Mergers in the UK and its influence on the choice of defensive and offensive strategies is described. the study finds outcome in hostile bids in the UK is significantly influenced by the use of certain defensive strategies, the presence of large institutional shareholders in targets, the size of targets and the method of payment chosen by the bidder. the results of this study are useful in devising effective strategies to frustrate or prosecute hostile bids.
Going public in the 1980s: Evidence from Sweden
Authors: Rydqvist Kristian , Högholm Kenneth
Published: October 2006

The paper explores the going public decision in a sample of family‐owned corporations in Sweden, 1970–1991. the issuers' motivations for going public are documented and contrasted with economic theory. We find that the average firm is old, that a significant portion of the shares are sold by existing shareholders, that most going public activity took place after an exceptionally sharp stock price increase, and that going public activity is not related to the business cycle. the findings suggest that firms were taken public by their owners who wanted to liquidate their investment to finance consumption or portfolio diversification. the findings strike the common view that firms go public to finance growth. Data from other European countries exhibit similar patterns and suggest that our findings for Sweden may extend to other markets as well.
Does the cost of capital differ across countries? An agency perspective*
Authors: Stulz René M.
Published: October 2006

In this keynote speech, I ask the question: Does the cost of capital differ for firms located in different countries? I argue that there are two ways to look at the cost of capital. First, there is the neoclassical perspective, which assumes that there are no agency problems. In integrated markets, the neoclassical cost of capital is the same in every country. Second, there is the agency perspective. Agency costs increase the cost of capital understood as the expected rate of return necessary for an investment to leave the value of the firm unaffected. Adjusting the cost of capital for agency costs, I argue that it differs across countries because of differences in corporate governance. I then provide a comparison of the agency‐adjusted cost of capital between Japan and the US.
Interim dividend cuts and omissions in the UK
Authors: Balachandran Balasingham , Cadle John , Theobald Michael
Published: October 2006

UK firms that cut or omit interim dividends during the period 1986–1993 are studied. Price reactions to cuts and omissions were found to be significantly negative and stronger for initial reductions. Future earnings variables were found to be predictable from interim dividend reductions. Gearing, company size and interim earnings change variables were found to have explanatory power for the decision to determine whether to cut or omit an interim dividend.
Expiration day effects of stock index derivatives in Germany
Authors: Schlag Christian
Published: October 2006

There is a significant increase in trading volume on quarterly futures expiration days in Germany. Delays in the opening for the majority of index stocks indicate that a large part of this extraordinary volume is indeed traded right at the opening of the market. an increase in trading activity is also observed over the 10‐minute settlement period for index options. Volatility remains unchanged around the expiration of a futures contract. an increase is found for the 10‐minute settlement period of DAX options. Return reversals as the measure for the economic costs of contract expirations are significantly higher when a futures contract expires at the open. When an option expires at the close no clear pattern for reversals can be found.
Arithmetic versus geometric mean estimators: Setting discount rates for capital budgeting
Authors: Cooper Ian
Published: October 2006

This paper addresses an issue central to the estimation of discount rates for capital budgeting: should the geometric mean or arithmetic mean of past data be used when estimating the discount rate? the use of the arithmetic mean ignores estimation error and serial correlation in returns. Unbiased discount factors have been derived that correct for both these effects. In all cases, the corrected discount rates are closer to the arithmetic than the geometric mean.
Pyrolysis gas chromatographic analyses of untreated and flameproofed wools
Authors: Urbas E. , Küllik E.
Published: October 2006

The thermal degradation of untreated and wool treated by various flame retardants, using pyrolysis gas chromatography, has been studied. The concentration of CO, CO2 and benzene produced does not appear to be affected by the flame retardants studied. The latter slightly decreases the concentration of toluene produced while the HCN production depends on the chemical composition of the retardant and on the temperature of exposure.
Home Office Legislation, Regulations and Controls in the UK in respect of premises within the scope of the Fire Precautions Act 1971
Authors: Christian S. D.
Published: October 2006

The Fire Precautions Act 1971, in contrast with previous legislation, is directed exclusively to the provision of fire precautions in buildings after occupation. The system of control is by fire certificate and can be applied to a class of premise (listed in Section 1) by means of a designating order. In the case of any particular use of premise, the Secretary of State, under Section 12, may by Regulation, make provision as to precautions which are to be taken in relation to the risk to persons in case of fire.
CAPITAL ACCOUNTING, USER NEEDS AND THE FOUNDATIONS OF A CONCEPTUAL FRAMEWORK FOR PUBLIC SECTOR FINANCIAL REPORTING
Authors: Mayston David
Published: October 2006

This paper analyses the need for an adequate conceptual framework for financial reporting, particularly in the public sector, and examines several factors which may have worked against progress in the UK in developing such a conceptual framework in the past. The paper then analyses in detail the needs of potential users for capital accounting information in public sector financial reports, and the relevance of accruals accounting and different measurement bases in this context. Given the large amount of existing work outside the UK on the development of conceptual frameworks for financial reporting, the paper argues the need not for a new framework, but rather for a more focused analysis of several key conceptual issues that are relevant to meeting user needs.
THE DEVELOPMENT OF CONCEPTUAL FRAMEWORKS OF ACCOUNTING FOR THE PUBLIC SECTOR
Authors: Jones Rowan
Published: October 2006

This paper offers a review of the conceptual framework projects that have been done by, or on behalf of, accounting standard‐setting bodies, and that have concerned themselves with public sector accounting. Developments since 1966 in North America are the primary focus, although the UK and New Zealand are also explicitly addressed. The major theme identified is the ubiquity of the user/user needs approach, despite the continuing lack of evidence about user needs. The paper tries to explain this and concludes that standard‐setting bodies have used these conceptual frameworks to establish their own legitimacy, by appealing to the public interest.
DOMESTIC VIOLENCE, EMPLOYMENT, AND DIVORCE*
Authors: Bowlus Audra J. , Seitz Shannon
Published: October 2006

Conventional wisdom suggests abused women get caught in a cycle of violence and are unable or unwilling to leave their spouses. We estimate a model of domestic violence to determine who abuses, who is abused, and how women respond to abuse via employment and divorce. In contrast to conventional wisdom, abused women are 1.7–5.7 times more likely to divorce. Employment before abuse occurs is found to be a significant deterrent. For men, witnessing violence as a child is a strong predictor of abusive behavior: re‐socializing men from violent homes lowers abuse rates by 26%–48%.
WHY ARE FERTILITY RATES AND FEMALE EMPLOYMENT RATIOS POSITIVELY CORRELATED ACROSS O.E.C.D. COUNTRIES?*
Authors: Da Rocha José María , Fuster Luisa
Published: October 2006

We develop a quantitative theory of fertility and labor market participation decisions in order to investigate the role of labor market frictions in generating the observed positive association between fertility and employment among O.E.C.D. countries. We find that unemployment induces females to postpone and space births, which, in turn, reduces the total fertility rate. Moreover, differences in female labor outcomes across the United States and Spain can account for the low fertility rate in Spain relative to the United States. We also find that labor market frictions can generate a positive association between female employment ratios and fertility rates across economies.
REGIONAL SPECIALIZATION, URBAN HIERARCHY, AND COMMUTING COSTS*
Authors: Tabuchi Takatoshi , Thisse Jacques‐François
Published: October 2006

We consider an economic geography model of a new genre: All firms and workers are mobile and their agglomeration within a city generates costs through competition on a housing market. In the case of two sectors, contrasted patterns arise. When one good is perfectly mobile, the corresponding industry is partially dispersed whereas the other is agglomerated, thus showing regional specialization. When one sector supplies a nontradeable consumption good, this sector is more agglomerated than the other. The corresponding equilibrium involves an urban hierarchy in that a larger array of varieties of the two goods is produced within the same city.
The Impact of Television on Terrorism and Crisis Situations: Implications for Public Policy1
Authors: Crelinsten Ronald D.
Published: October 2006

This article looks at the role that television plays in terrorist incidents and similar crisis situations. It highlights the specific features of television and television news that underlie its particular impact on crisis situations and points towards specific policy implications that derive from these features. The unique problems which television poses for the management of terrorist and other political crises will be addressed.