The cointegrated vector autoregressive model with general deterministic terms

In the cointegrated vector autoregression (CVAR) literature, deterministic terms have until now been analyzed on a case-by-case, or as-needed basis. We give a comprehensive unified treatment of deterministic terms in the additive model $X_t=\gamma Z_t+Y_t$, where $Z_t$ belongs to a large class of deterministic regressors and $Y_t$ is a zero-mean CVAR. We suggest an extended model that can be estimated by reduced rank regression, and give a condition for when the additive and extended models are asymptotically equivalent, as well as an algorithm for deriving the additive model parameters from the extended model parameters. We derive asymptotic properties of the maximum likelihood estimators and discuss tests for rank and tests on the deterministic terms. In particular, we give conditions under which the estimators are asymptotically (mixed) Gaussian, such that associated tests are ${\chi }^2$-distributed.     

Analysis of SMEs partner proximity preferences for process innovation

This paper explores small and medium enterprises’ (SMEs) proximity preferences when selecting partners for collaborative process innovation. Drawing on a survey of 362 Danish SMEs, we address four partner proximity characteristics: geographic, cognitive, organizational, and social. The results show that SMEs prioritize geographic openness over regional clustering. Furthermore, to simultaneously facilitate collaboration and ensure innovation, firms tend to collaborate with partners that are characterized by cognitive similarity at a technological level and knowledge distance at a market level. Technological proximity is also found to be more relevant than social proximity when it comes to bridging the potential geographic and market distance between the collaborative partners. Finally, the results indicate that the tendency of organizational proximity to facilitate informal interactions with partners enhances process innovation only at two of four process innovation levels. Thus, the results highlight the fact that the value of partner proximity characteristics change with the level of process innovation considered.     

Private Equity and Investment in Innovation: Evidence from Patents

The authors' analysis of the patenting activity of 472 companies that received private equity investments between 1986 and 2005 provides suggestive evidence of an increase in the effectiveness (though not necessarily the quantity) of their innovative activities. After such companies received private equity backing, the patents they applied for received more frequent citations than patents awarded before the involvement of PE firms. Companies acquired by private equity also show no sign of deterioration in patent “originality” and “generality,” which have been shown to be fairly reliable indicators of the fundamental nature of the research. And while there is no clear pattern of change in the level of patenting activity, corporate patent portfolios become more focused in the years after the private equity investments. The increases in our measure of patent “impact” are greatest in the areas that constitute the companies' historical core strengths. These findings are likely to prove increasingly important as private equity continues its incursions into growth areas of the economy.     

Role of gastronomic,externality and feasibility attributes in consumer demand for organic and local foods: The case of honey and apples

Local food systems providing high‐value products are seen as a tool to sustain economic activity on family farms in rural areas. The objective of this study is to investigate the role of gastronomic, externality and feasibility characteristics in consumers' demand for local and for organic foods. An Internet questionnaire survey was conducted in 2010 among Danish consumers. 3211 respondents completed the questionnaire, which included questions about respondents' food‐related values and their specific perception of organic and local varieties of honey and apples. Variables related to consumers' food‐related values and product perception were analysed using principal component analysis, in order to identify overall dimensions (factors) in these variables. Although statements about gastronomic attributes (e.g. taste, appearance, quality) were quite strongly represented in three of these factors, externality and availability concerns also contributed significantly to the overall variation in the variables. Multinomial logit choice modelling was used for describing the relationship between these dimensions and respondents' stated choices regarding organic and local varieties of honey and apples. Results suggest that although both organic and local food supply chains are often associated with special attributes such as gastronomic characteristics and relatively beneficial externality attributes, these attributes are perceived differently for the two types of supply chains. Perceived gastronomic quality is the most important determinant for food choice, but externality and feasibility aspects are also important correlates.     

The Impact of Information on Consumer Preferences for Different Animal Food Production Methods

The motivation for the present study is to understand food choice in relation to animal food production and to study how preferences are influenced by information. To do this, we carried out a choice experiment. In the analysis, we focus on chickens reared indoors and outdoors and chicken labelled campylobacter-free versus non-labelled chicken. The results suggest that there is a positive willingness to pay (WTP) both for chicken reared outdoors and for campylobacter-free labelled chicken. Information about rearing methods resulted in a higher WTP for chicken reared outdoors, while information about campylobacter had both positive and negative effects on respondents’ WTP. The highest increase in WTP for campylobacter-free labelled chicken was found for one of the high risk groups, individuals with poor kitchen hygiene.     

Price Expectations and International Quota Trading: An Experimental Evaluation

This paper reports a preliminary experimental test of international quota trading on a market characterized by several dominant traders. Uncertain quota demand and supply imply true market-clearing prices that in general differ from an expected competitive quota price. However, in the experiment the expected price level emerges as a focal point on which the bulk of quota trade contracts are keyed. Thus, incomplete price discovery occurs.     

In search of an institutional framework for anticorruption: Lessons from Scandinavia

Scandinavian countries continue to build strong reputations as the world's least corrupt countries. In this case study, in a search for an institutional framework that other countries and policy makers can learn from, we explore sources of high transparency and anticorruption norms in Scandinavia. The most important lesson from this study is that legislative, normative, and cultural institutional pillars must be aligned to achieve the highest level of transparency and anticorruption. We made three main observations. First, adequate and comprehensive legislation in addition to severe noncompliance consequences contribute to an ethical business environment in Scandinavian countries. Second, a willingness to embrace integrity norms and standards through active participation in international conventions and agreements on anticorruption movements contributing to high transparency and integrity management in the Scandinavian countries. Third, a national culture that emphasizes high governmental and civic trust makes bribery and corruption less sustainable. Residents' high level of trust in public officials and police in addition to high civil and media engagement in antibribery cases results in corruption being “starved of oxygen”. The findings suggest high trust levels, enforced regulative legislation, small country size, and high human development help craft a framework that drives a transparent business environment.     

Inducing value and institutional learning effects in stated choice experiments using advanced disclosure and instructional choice set treatments

This article analyses the effect of inducing institutional and value learning in a choice experiment survey concerning food safety. Respondents were subjected to two types of treatments, namely, Advance Disclosure (ADV) and Instructional Choice Set (ICS). Employing a split‐sample setup, we test the effect of providing ICS and ADV in two treatment groups relative to a control group where learning is not induced. We further test and compare the effects of ADV and ICS directly against each other. We find some evidence that ICS reduces institutional uncertainty as intended. Moreover, the results suggest that both ICS and ADV could potentially remove a gender‐specific status‐quo bias.