When the mirror gets misted up: Modularity and technological change

This study investigates how component technological change affects the relationship between product modularity and organizational modularity (the across‐firm mirroring hypothesis). Studying the air conditioning industry, we show that the across‐firm mirroring hypothesis does not hold for technologically dynamic components and the associated supply relationships. In this case, the mirror gets “misted up” with buyers and suppliers having recourse to information sharing even in the presence of highly modular components. Our study contributes to the debate on the organizational implications of modularity and its ramifications for the theory of the firm. Copyright © 2013 John Wiley & Sons, Ltd.     

Sorting the good guys from bad: on the optimal audit structure with ex-ante information acquisition

In a costly state verification model under commitment, the principal may acquire a costly public and imperfectly revealing signal before or after contracting. If the project remains profitable after all signal realizations, optimally the signal is collected, if at all, only after contracting, and it may be acquired randomly or deterministically. Moreover, audit is deterministic and targeted on some signal-state combinations. The paper provides a detailed characterization of the optimal contract and performs a comparative static analysis of signal acquisition strategy and payoffs with respect to enforcement costs and informativeness of the signal. We explore the robustness of the results, including commitment issues. The results are interpreted in light of the observed features of financial contracts, showing that the optimality of the standard debt contract with deterministic audit extends to a setting with random audit.     

Getting Cars Off the Road: The Cost-Effectiveness of an Episodic Pollution Control Program

Ground-level ozone remains a serious problem in the United States. Because ozone non-attainment is a summer problem, episodic rather than continuous controls of ozone precursors are possible. We evaluate the costs and emissions reductions of a program that requires people to buy permits to drive on high-ozone days. We estimate the demand function for permits based on a survey of 1,300 households in the Washington, DC, metropolitan area. Assuming that all vehicle owners comply with the scheme, the permit program would reduce nitrogen oxides ( $\text{ NO }_{\mathrm{x}}$ ) by 42 tons per Code Red day at a permit price of $75. Allowing for non-compliance by 15 % of respondents reduces the effectiveness of the scheme to 33 tons of $\text{ NO }_{\mathrm{x}}$ per day. The cost per ozone season of achieving these reductions is approximately $9 million (2008 USD). Although year-round measures, such as the Tier II emissions standards, might be preferred on benefit-cost grounds, an episodic permit system might be considered as an interim measure before the Tier II emissions standards are fully reflected in the vehicle fleet.     

Formal,Justice‐Oriented Voice in the Nonunion Firm: Who Speaks Up and When?

Employee willingness to exercise workplace voice has been the subject of much recent research. However, very different types of voice are observed within the workplace, with some forms of voice receiving limited scholarly attention. In particular, limited attention has been given to the determinants of formal, justice‐oriented voice within a nonunion context. Using a policy‐capturing design, we examine factors that affect decisions to use formal, justice‐oriented voice among 498 nonunion employees who had access to the same appeal procedure. The results suggest that this type of voice is affected by perceptions regarding immunity from negative managerial reactions to voice and also by factors associated with the utility of voice (e.g., the social power of those involved in the appeal and the evidence available to support the appeal). The results further suggest that perceived immunity moderates the impact of the social power of those involved in the appeal and the evidence available.     

A network modeling approach for the optimization of Internet-based advertising strategies and pricing with a quantitative explanation of two paradoxes

This paper addresses the determination and evaluation of optimal Internet marketing strategies when a firm is advertising on multiple websites. An optimization model is constructed for the determination of the optimal amount of click-throughs subject to a budget constraint. The underlying network structure of the problem is then revealed and exploited to obtain both qualitative properties of the solution pattern as well as computational procedures. In addition, three different pricing schemes used in Internet marketing are quantitatively compared and indices that can guide marketers to shift from one scheme to another are proposed. Finally, two numerical examples are constructed that demonstrate two paradoxes: (1) that advertising on more websites may reduce the total responses and (2) that advertising on more websites may reduce the click-through rate. Through the analysis of the network model, such puzzling phenomena are then quantitatively explained.     

Developing indigenous tourism in the bomas: critiquing issues from within the Maasai community in Tanzania

ABSTRACT

With safari attractions dominating the African tourism sector, many tourism studies in Africa have focused on wildlife and wilderness resourced-based tourism, with a secondary body of literature exploring cultural aspects of tourism. Recently many countries in the region, including Tanzania, have started to recognize the potential for stand-alone, culture-based tourism to diversify the tourism industry and for rural, economic development purposes. Drawing upon insights from local stakeholders, primarily members of the Maasai community this study identifies the critical challenges for providing indigenous cultural tourism in the Ngorongoro Conservation Area, Tanzania. Qualitative data for the study were collected through interviews and site visits to eight Maasai bomas (cultural tourism villages or settlements). Thematic analysis of the interviews revealed significant limiting factors affecting the development of indigenous cultural tourism amongst Maasai in Tanzania. The findings indicate that achieving success in indigenous cultural tourism is therefore challenging, and needs to incorporate specific community-based strategies which can facilitate the development of Maasai cultural tourism.     

The impact of culture on consumers’ perceptions of service recovery efforts

The increasing globalization of business provides a compelling reason for understanding the cultural context of consumer behavior. The research reported here examines the impact of culture on consumers’ perceptions of service recovery efforts. In particular, we studied in an experimental setting, across East-West cultures, the combined effects of explanation and compensation in shaping customers’ attributions and post-recovery perceptions in a medium contact service—a restaurant setting. Our findings show that the differential sensitivity of East Asian and American consumers to situational constraints influence their attributions for service failures, and thus moderate their satisfaction with service recovery process. More specifically, the results suggest that a causal explanation for service failure decreases the likelihood of US consumers falling prey to the fundamental attribution error. Conversely, among East Asians, an explanation had minimal influence in attributional processes. Finally, our results indicate that attributional processes influence customer perceptions of employee effort, which in turn is linked to post-recovery satisfaction.     

Making direct democracy work: a rational-actor perspective on the <Emphasis Type="Italic">graphe paranomon</Emphasis> in ancient Athens

The specific way the Athenians set up their democracy presents both theoretical and empirical challenges. Decisions were taken by majority vote in the Assembly. To keep politicians in line, the Athenians first used ostracism, which however was replaced by the graphe paranomon around 415 BCE. The latter provided that anybody who had made a proposal in the Assembly could be accused of having made an unconstitutional suggestion, bringing a potentially severe penalty if found guilty. We know of 35 such cases between 403 and 322. During the fourth century the notion of illegality was extended to a mere question of political undesirability. Henceforth any decision by the Assembly could be overturned by the courts, but if the accuser failed to get at least 20% of the jury votes, he was punished instead. While these rules can be seen as a safeguard against bad decisions, they also provided the Athenian politicians with important information about the relative strength of their political support. This effect has not been analysed before, and it may help explain the relative stability of political life in classical Athens. Furthermore this analysis also contributes to our understanding of a curious but often overlooked fact, namely that the decrees of the Athenian Assembly to a great extent concerned honorary rewards, and the use of the graphe paranomon in turn was largely focussed on the honorary decrees.     

The Effect of Organic Food Labels on Consumer Attention

This paper aims to reveal consumer perceptions of organic food with a special emphasis on the labelling of organic products. The objectives were to find out, whether or not a significant difference between men´s and women´s perception existed. Two groups (88 subjects in the experimental group, 59 subjects in the control group) were shown various food labels; with organic product labelling (experimental) and without (control). Results suggest the importance of organic labelling using eye-tracking data and additional in-depth interviews to discover the importance of the labelling for participants. Based on eye-tracking data, the greatest visual attention was paid to product brand, graphic elements and organic labelling claims with additional information, such as a quantity or flavour, also being important. Additional in-depth interviews discovered that labelling, particularly of the origin, is important for most consumers. Contrary to what was expected, eye-tracking showed very little difference in the perception of organic product labelling based on gender. Although organic food is being purchased by more people, 50% of participants mentioned, during interviews, that they buy organic food only occasionally. The combination of eye-tracking and in-depth interviews shows that organic product labelling can play a role in decision-making, but regardless 27% of participants do not care about the organic quality labels or don’t pay attention to them.     

How does uncertainty impact opportunity development in internationalization?

The features of the internationalization of emerging market multinational companies (EMNCs) create a laboratory for extending theory. In this paper, we argue that a high level of asymmetry between prior knowledge and a non-incremental commitment, such as an acquisition, lies at the core of understanding these types of internationalization processes. Our proposed theoretical view is that while some uncertainties in opportunity development are known to the firms and can be managed by available knowledge, disruptive commitments can result in complexes of unstable and unilineal dynamics that bring about unexpected – and hence unforeseeable – uncertainties. These uncertainties may be a source of future unintended consequences that will have an impact on the firm as the internationalization process unfolds. This view is used for analysis of a longitudinal case study concerning the acquisition of a Swedish firm, Vargön Alloys, by the Turkish corporation Yildirim Group, focusing on the opportunity discovery and exploitation period between 2008 and 2013. By dividing uncertainty into two types (foreseeable and unforeseeable) and analysing the hidden problems that emerged after the sudden fusion of the two networks, the study nuances understanding of the emergent and non-orderly nature of the internationalization process as it unfolds. From a process point of view, the study may aid deeper understanding of complications when discovering and exploiting opportunities.