Finding Mr. Schumpeter: technology adoption in the cement industry

We examine the adoption of fuel‐efficient precalciner kilns in the cement industry using the universe of adoption decisions in the United States over 1973–2013. We find that cement plants are more likely to adopt the technology if fuel costs are high, nearby competitors are few, and local demand conditions are favorable. We relate the findings to the Schumpeterian and induced innovation hypotheses regarding the effects of competition and factor prices. Our results suggest firms may be most responsive to factor prices under advantageous competitive and demand conditions.     

Forward Contracts,Market Structure and the Welfare Effects of Mergers

We examine how forward contracts affect economic outcomes under generalized market structures. In the model, forward contracts discipline the exercise of market power by making profit less sensitive to changes in output. This impact is greatest in markets with intermediate levels of concentration. Mergers reduce the use of forward contracts in equilibrium and, in markets that are sufficiently concentrated, this amplifies the adverse effects on consumer surplus. Additional analyses of merger profitability and collusion are provided. Throughout, we illustrate and extend the theoretical results using Monte Carlo simulations. We discuss the practical relevance for antitrust enforcement.     

Labour,leisure, poverty and protest: the 1968 Poor People’s Campaign as a case study

Social movements exist in a liminal space between labour and leisure. Movements require an inordinate amount of work – mobilising communities, studying policy issues, raising funds, organising events and participating in direct action – but protesting can also be fun. Demonstrations engender community through singing, shouting, marching and confronting authority figures. Activists often pass up typical leisure activities and take time off of work to protest. This article examines the 1968 Poor People’s Campaign (PPC) to understand how people engage in both labour and leisure when participating in social movements. During the summer of 1968, a racially, geographically and politically diverse coalition of poor people caravanned to Washington, DC, and built a temporary city where they lived in wooden A‐frame huts for over six weeks in an attempt to expose poverty. Volunteers provided participants with social services and basic necessities they lacked at home, while participants conducted daily protests at nearby government agencies, demanding assistance for the basic needs of housing, food and jobs. While participants suffered under gruelling conditions – living in the summer heat and muddy conditions due to torrential rains – many have recounted how pleasurable the experience was. Most participants had never travelled beyond their home state, and the PPC provided participants with a free trip to the nation’s capital, three square meals a day, a chance to meet new people, and the opportunity to unite with other poor people and demand justice.     

Do Client Bankruptcies Preceded by Clean Audit Opinions Damage Auditor Reputation?*

There is a maintained assumption within the accounting literature that client bankruptcies preceded by clean audit opinions (Type II going concern opinion (GCO) errors) damage an auditor's reputation. Consistent with this view, the PCAOB proposes that stakeholders may use Type II GCO errors as indicators of low audit quality. This study examines audit committee and investor responses to Type II GCO errors. I find no evidence that audit offices with Type II GCOs are more likely to be dismissed, have lower subsequent audit fees, or have a lower likelihood of being selected for new audit engagements. These findings are consistent with audit committees not using Type II GCO errors as indicators of low auditor quality. Using event study analysis, I find evidence of modest incremental negative investor responses for clients of audit offices with Type II GCO errors. However, these negative investor responses are found only during the financial crisis period of 2008–2010 and are observed only within windows of 30 days or less. Given this limited evidence that stakeholders do respond to Type II GCO errors, I examine whether stakeholders should respond to Type II GCO errors. I find that audit office Type II GCO errors are positively associated with subsequent restatements, an established measure of low audit quality. Taking the results as a whole, I do not find that audit offices incur substantial reputational costs for Type II GCO errors. However, the negative investor response and the positive association with restatements provide some evidence that Type II GCO errors may serve as indicators of low audit quality.     

Participation by U.S. Agencies in International Brand Advertising: An Empirical Study

Abstract

Marry ad agency executives have proclaimed the era of the global advertising agency. They observe that corporations are moving towards placement of their worldwide advertising through a single agency, and they predict that a few large “mega-agencies” will take over a majority of international advertising accounts. Yet, no published studies have examined how many brands are actually handled by the same ad agency worldwide. This paper presents the results of a survey examining the extent to which U.S. companies use the same agency to advertise abroad and in the home market. The study found that of the brands sold abroad, only about one-third are handled by the same agency both at home and abroad. This proportion does not vary significantly with advertising budgets, by product class, or between standardized and non-standardized brands. In addition, no single-agency group or “mega-agency” handles more than eight percent of the sample brands, and no agency handles a majority of its U.S. brands abroad.     

Social inequalities in injury risk in Wales,U.K.

Road traffic accident data in Nigeria generally lack exact coordinate information. Accident analysis is, therefore, restricted to aggregate data on trends, magnitude and temporal dimensions. This article addresses the road accident problem in Jos between 1995 and 1999 through a road profiling approach. Results show that four gateway routes, seven multilane roadways (including two gateway routes) and seven road intersections accounted for 84% of all traffic accidents, 84% of injured casualties and 88% of fatalities. This approach allows for quantification of impacts of controlling for accidents by deliberate profiling of roads for close monitoring and policing. For example, reducing accident counts and fatalities by 50% each on gateway routes will amount to ～35 and 40% reduction in accident and fatality counts, respectively. Countermeasures must consider these roadways and intersections as important inputs in their accidents and casualty reduction targets.     

The effects of soft drink taxes on child and adolescent consumption and weight outcomes

Childhood and adolescent obesity is associated with serious adverse lifetime health consequences and its prevalence has increased rapidly. Soft drink consumption has also expanded rapidly, so much so that soft drinks are currently the largest single contributors to energy intake. In this paper, we investigate the potential for soft drink taxes to combat rising levels of child and adolescent obesity through a reduction in consumption. Our results, based on state soft drink sales and excise tax information between 1989 and 2006 and the National Health Examination and Nutrition Survey, suggest that soft drink taxation, as currently practiced in the United States, leads to a moderate reduction in soft drink consumption by children and adolescents. However, we show that this reduction in soda consumption is completely offset by increases in consumption of other high-calorie drinks.     

International environmental policy and poverty alleviation

We investigate how alternative national and international policies and circumstances impact the Clean Development Mechanism’s (CDM) contribution to sustainable development and the pursuit of poverty eradication goals in developing countries. In particular, we focus on the importance of technology-specific versus technology-neutral environmental regulations in the project host regions. We also consider alternative CDM benefit-sharing arrangements between the host and client regions. An analytical impure-public-good model is developed which considers CDM projects as a conditional transfer exerting price and income effects. These, in turn, induce changes in the use of environmental technologies, and with it global and local environmental protection levels. Aided by model simulations using empirical data for China and the European Union, we seek to assess conditions in which CDM transfers are more favourable towards improved environmental protection and welfare in developing regions.     

Forecasting annual water demands dominated by seasonal variations: the case of water demands in Mecca

Water usage in Mecca is dominated by trends and cyclical variations in the number of foreign pilgrims visiting for the annual Hajj Pilgrimage. Time series regressions show that the mean temperature in Mecca at the time of the Hajj affects the number of pilgrims, inducing a long-term cyclical pattern for this variable and therefore water usage. The cointegrating relation between water usage, number of external pilgrims and temperature produces long-run forecasts of Mecca water demand.