Upstream or downstream in the value chain?

Companies in the natural resources industry (e.g., mining, timber, farming and fishery) face the dilemma of whether to focus upstream or downstream in the value chain. The literature provides arguments and empirical evidence for either position. This paper presents an analytical framework based on the neoclassical theory of the firm, for which the best competitive advantage is the one that maximizes production efficiency. It serves to formulate an optimization model for the sawmill industry, and draws the data from the largest sawmilling company in the southern hemisphere. Although one conclusion is that the company should concentrate on the upstream activities, such conclusion is not applicable to other firms, since the analysis of the upstream-downstream dilemma must focus on the individual capabilities of each firm.     

International briefing 20: training and development in Andorra

This briefing investigates the status of the educational system and, more specifically, of continuing training in companies in the Principality of Andorra. Part of this analysis is based on a field study designed to explore and understand both the current situation and the training needs of the main sectors within the Andorran economy. A proposal for continuing training is posed, with reference to best practice from different countries, in particular Spain and France, which share geographic borders with the principality.     

Human Capital Spillovers and Regional Development

This paper introduces technological interdependence into the theoretical framework of Gennaioli et al. (Quarterly Journal of Economics 2013; 128 : 105–164). This extension leads to an expression for regional development with spatial effects that motivates the incorporation of the geographical dimension into their newly constructed database and empirical analysis. Our estimation results corroborate both the necessity of accounting for the presence of spatial dependence to study the determinants of regional income per capita and the importance of educational attainment in explaining regional development differences. Furthermore, we provide evidence that human capital generates positive spatial spillovers. Copyright © 2016 John Wiley & Sons, Ltd.     

Corporate Reputation Through Strategic Corporate Social Responsibility: Insights From Service Industry Companies

Corporate social responsibility (CSR) has gained global awareness in recent years. The proponents of CSR state that a good corporate reputation may be beneficial to an organization. This research paper reviews the theoretical basis of CSR, and by adopting a qualitative methodology examines the characteristics of CSR strategies and CSR communication tactics of eight companies in Cyprus market through personal in-depth interviews. Results reveal that CSR has a positive impact on the company's employees, the environment, stakeholders and the general public, and highlight that CSR is an important ingredient for the success of the organizations in the Cyprus market.     

IS MARKET‐ORIENTED REFORM PRODUCING A ‘TWO‐TRACK’ EUROPE? EVIDENCE FROM ELECTRICITY AND TELECOMMUNICATIONS

ABSTRACT: The European Commission has formally recognized that adequate provision of basic household services, including energy, communications, water and transport, is key to ensuring equity, social cohesion and solidarity. Yet little research has been done on the impact of the reform of these services in this regard. This article offers an innovative way to explore such questions by analyzing and contrasting stated and revealed preferences on citizen satisfaction with and expenditure on two services, telecommunications and electricity, in two large countries, Spain and the UK. We find evidence that in telecommunications, but not in electricity, reform has led to a ‘two‐track’ Europe, where citizens who are elderly, not working or the less‐educated behave differently in the market, with the result that they are less satisfied with these services than their younger, working, better‐educated, counterparts.     

Improving emergency plans management with SAGA

Emergency plans are the tangible result of the preparedness activities of the emergency management lifecycle. In many countries, public service organizations have the legal obligation to develop and maintain emergency plans covering all possible hazards relative to their areas of operation. However, little support is provided to planners in the development and use of plans. Often, advances in software technology have not been exploited, and plans remain as text documents whose accessibility is very limited. In this paper, we advocate for the definition and implementation of plan management processes as the first step to better produce and manage emergency plans. The main contribution of our work is to raise the need for IT-enabled planning environments, either at the national or organization-specific levels, which can lead to more uniform plans that are easier to evaluate and share, with support to stakeholders other than responders, among other advantages. To illustrate our proposal, we introduce SAGA, a framework that supports the full lifecycle of emergency plan management. SAGA provides all the actors involved in plan management with a number of tools to support all the stages of the plan lifecycle. We outline the architecture of the system, and show with a case study how planning processes can benefit from a system like SAGA.     

Optimal investment under multi-factor stochastic volatility

We consider a model for multivariate intertemporal portfolio choice in complete and incomplete markets with a multi-factor stochastic covariance matrix of asset returns. The optimal investment strategies are derived in closed form. We estimate the model parameters and illustrate the optimal investment based on two stock indices: S&P500 and DAX. It is also shown that the model satisfies several stylized facts well known in the literature. We analyse the welfare losses due to suboptimal investment strategies and we find that investors who invest myopically, ignore derivative assets, model volatility by one factor and ignore stochastic covariance between asset returns can incur significant welfare losses.     

The impact of socio-economic background on satisfaction: evidence for policy-makers

Consumer satisfaction with utility services has received increased attention from firms, consumer associations, regulators and governments since the 1990s. Evidence is mounting that consumers in specific socio-economic groups express lower satisfaction levels than their peers, at least, in some utility markets. Seeing this as part of their remit to protect consumer welfare, governments and international organizations are exploring possible demand-side policy responses with the intention of ameliorating lower satisfaction levels of these groups of consumers. However, more information on the precise relationships between satisfaction and consumers’ socio-economic background is required if policy is to be proportional and effective. This paper provides new empirical knowledge on this topic by contrasting consumers’ stated and revealed preferences for five utility services (electricity, gas, fixed and cellular telephony and Internet) across twelve European countries. We find strong evidence that consumers’ socio-economic characteristics matter: consumers with lower levels of education, the elderly and those not employed exhibit particular expenditure patterns on, and lower satisfaction levels with, some utility services. However, this relationship is uneven and depends on the socio-economic category and service in question. We conclude by highlighting five findings which may be of use to policy-makers when considering whether demand-side regulatory policies are required