Generalized spatial autocorrelation in a panel-probit model with an application to exporting in China

This paper proposes a generalized spatial panel-data probit model with spatial autocorrelation of the dependent variable, the time-invariant individual shocks, and the remainder disturbances. It proposes its estimation with a Bayesian Markov chain Monte Carlo procedure. Simulation results show that the proposed estimation method performs well in small- to medium-sized samples. This method is then applied to the analysis of export-market participation of 1451 Chinese firms between 2002 and 2006 in the prefecture-level city of Wenzhou in the province of Zhejiang. Empirical results show that two of the three forms of the hypothesized spatial autocorrelation are significant, namely the spatial lag for the dependent variable and the time-invariant firm-specific shocks, but not the time-variant shocks. Ignoring any of these significant spatial effects would lead to misspecification.     

The effect of advertising on brand awareness and perceived quality: An empirical investigation using panel data

We use a panel data set that combines annual brand-level advertising expenditures for over three hundred brands with measures of brand awareness and perceived quality from a large-scale consumer survey to study the effect of advertising. Advertising is modeled as a dynamic investment in a brand’s stocks of awareness and perceived quality and we ask how such an investment changes brand awareness and quality perceptions. Our panel data allow us to control for unobserved heterogeneity across brands and to identify the effect of advertising from the time-series variation within brands. They also allow us to account for the endogeneity of advertising through recently developed dynamic panel data estimation techniques. We find that advertising has consistently a significant positive effect on brand awareness but no significant effect on perceived quality.

Beyond plain vanilla: Modeling joint product assortment and pricing decisions

This paper investigates empirically the product assortment strategies of oligopolistic firms. We develop a framework that integrates product choice and price competition in a differentiated product market. The present model significantly improves upon the reduced-form profit functions typically used in the entry and location choice literature, because the variable profits that enter the product-choice decision are derived from a structural model of demand and price competition. Given the heterogeneity in consumers’ product valuations and responses to price changes, this is a critical element in the analysis of product assortment decisions. Relative to the literature on structural demand models, our results show that incorporating endogenous product choice is essential for policy simulations and may entail very different conclusions from settings where product assortment choices are held fixed.

Say-on-pay judgements: the two-strikes rule and the pay-performance link

We undertake an experiment to explore shareholder voting behaviour when the pay-performance link is weak or strong; and when there has (has not) been a first strike in the preceding year. We find shareholders are more supportive of a remuneration package evidencing a strong pay-performance link than a weak link. Further, shareholders are less supportive of a remuneration package when there has been a first strike in the preceding year than when there has not been a first strike. Importantly, we find that a first strike reduces the effect of the pay-performance link on voting intentions.     

Top managers in the digital age: Exploring the role and practices of top managers in firms' digital transformation

This study explores the role and facilitating actions of top managers in response to the digital transformation. Building on 27 in-depth interviews with top managers and close associates from large German firms, we find that top managers respond to the digital transformation by engaging in three key actions: understanding digitalization, setting the formal context for digitalization, and leading change. Moreover, findings emphasize that top management team support is essential in firms' digital transformation. Overall, this study contributes novel insights about the consequences of top managers for firms and establishes an initial foundation for investigating top managers in the digital age.     

Evidence on the Relationship between Low Income and Poor Health: Is the Government Doing Enough?

The government's report, Opportunity for All: Tackling Poverty and Social Exclusion (Department of Social Security, 1999), identified poor health as one of the major problems associated with low income. However, much of the available evidence on the relationship between income and health is of little help in forming policies to reduce health inequalities, as it has tended to be based on cross‐section surveys and is therefore unable to shed much light on causal effects. Here, we make use of two British longitudinal datasets to examine the longer‐term influences of income on health within a life‐course perspective. We then use the results of our analysis to provide a brief critical assessment of the likely success of the government's anti‐poverty strategy in reducing health inequalities. A more detailed assessment of government policy in this respect can be found in Benzeval et al. (forthcoming).