Ethics of Du Pont's CFC Strategy 1975–1995

The ethics of Du Pont's CFC strategy from 1975 to 1995 are analyzed using a Potter's Box framework. This approach includes an examination of relevant facts, prioritization of stakeholder loyalties, selection of a mode of ethical reasoning, and a world view. Du Pont's approach to ethical reasoning reflects changing facts and changing interpretation of the facts, a focus on shareholders as the primary and most important stakeholder, and ends-based reasoning, which views creating shareholder value as the primary end. An alternative approach is proposed, based on analysis of Du Pont's and stakeholders' needs.     

Social welfare effects of tax-benefit reform under endogenous participation and unemployment: an ordinal approach

This paper analyzes the social welfare effects of tax-benefit reforms in a framework integrating endogenous labor supply and unemployment. We adopt an ordinal approach to social welfare comparisons by searching for “socially desirable” reforms that would improve social welfare for an entire class of social welfare functions. In the model, there is a discrete distribution of individuals’ productivities and individuals are heterogeneous with respect to leisure preferences (or disability of work). Labor supply decisions are limited to the participation decision. Unemployment is modeled in a search and matching framework with individual wage bargaining. For the social welfare analysis, the model is calibrated for Switzerland. Starting from a situation with an unemployment benefit scheme, the introduction of in-work benefits is shown to be a “socially desirable” reform: it would be unanimously preferred to the current situation according to all social welfare functions based on the criteria of Pareto, anonymity, and the principle of transfers. This result holds for two different types of preference heterogeneity (leisure preferences or disability of work) and also for the case where job search effort cannot be monitored.     

Construct validity and second-order factorial model

Three second-order factorial models are defined, using the LISREL notation, to assess the univocity of a construct. The first model assumes that the constructs are heterogeneous, the second that they are homogeneous. The third model introduces the notion of partial homogeneity between constructs. Partial homogeneity is defined in terms of a LISREL second-order factor model. In some cases, this model offers a viable alternative to the collapsing of items into a unique scale. An example is given of scales which fit the partial homogeneity model.     

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STOCKHOLDER RETURNS AMONG HOMOGENEOUS GROUPS OF MERGERS

A sample of cash and stock merger transactions consummated between 1975 and 1987 is used to form homogeneous groups based on financial characteristics of both bidding and target firms. The results are used to determine how group heterogeneity with respect to financial characteristics influences intergroup differences in both bidding firm and target firm merger returns. Stockholders of bidding firms with attributes that fit the free cash flow hypothesis of merger motivation suffer wealth losses relative to firms that have characteristics consistent with achievement of scale or scope economies or financial synergies. Differences in target and merger portfolio returns are also found.     

Belonging,believing, bonding,and behaving: the relationship between religion and business ownership at the country level

This cross-country study adopts a competing theories approach in which both a value perspective and a social capital perspective are used to understand the relation between religion and a country’s business ownership rate. We distinguish among four dimensions of religion: belonging to a religious denomination, believing certain religious propositions, bonding to religious practices, and behaving in a religious manner. An empirical analysis of data from 30 OECD countries with multiple data points per country covering the period 1984–2010 suggests a positive relationship between religion and business ownership based on those dimensions that reflect the internal aspects of religiosity (i.e., believing and behaving). We do not observe a significant association for those dimensions that reflect more external aspects of religion (i.e., belonging and bonding). These results suggest that the social capital perspective prevails the value perspective, at least when internal aspects of religiosity are concerned. More generally, our study demonstrates the importance of distinguishing between different dimensions of religion when investigating the link between religion and entrepreneurship.     

R&D subsidiary isolation in knowledge-intensive industries: evidence from Austria

We investigate R&D subsidiary isolation within Multinational Corporations (MNCs) competing in knowledge-intensive industries. For such MNCs, accessing knowledge and nurturing the innovative potential of R&D subsidiaries is vital for on-going competitiveness. This, according to conventional thinking, requires integration of the subsidiary within the host country as well as internally within the MNC. Recent studies have shown, however, that overseas subsidiaries can become isolated (i.e., losing requisite integration), even in high-technology sectors. We tackle this issue by focusing on organizational factors at corporate and subsidiary levels that have the potential to explain subsidiary isolation. We analyze a sample of 45 foreign-owned Austrian subsidiaries undertaking R&D in knowledge-intensive industries using a combination of questionnaire and secondary data. The results suggest that parent and subsidiary experience, the degree of early-stage research conducted by the subsidiary and the use of training and rotation practices by the subsidiary, all act to counter isolation. Interestingly, we find that proximity between parent and R&D subsidiary does not play a significant role in predicting isolation. We also show how these factors influence communication frequency between the R&D subsidiary and various actors within the internal and the external networks in different ways.     

Bidirectional Information Transfer: An Imperative for Network and Marketing Integration in a Canadian Telecommunications Firm

Market intelligence helps ensure that R&D efforts are focused on customer needs. In turn, R&D supplies the information necessary for gaining competitive advantage through advances in product and process technology. However, improved R&D–marketing integration means more than simply involving additional marketing personnel in product development. We must focus on identifying and achieving the desired level of integration. Jozée Lapierre and Brigitte Hénault present the results of a study examining the R&D–marketing interface in a large Canadian telecommunications company. Their study explores managers' perceptions of interfunctional integration during the planning and implementation of new services. The goal of this study is to identify the critical integration areas and managers' satisfaction with the organization's current level of integration. Network (i.e., technical) and marketing managers differ substantially in their perceptions of the required level of integration. However, they agree on the five most important areas of interfunctional integration: marketing involvement in establishing service development schedules; information transfer from marketing to network on competitors' moves; information transfer from marketing to network on customer requirements for new services; information transfer from network to marketing on network availability for providing evolved services; and information transfer from network to marketing on network restrictions affecting performance, after-sales servicing levels, and service pricing. In other words, network and marketing managers view information transfer between their groups as requiring the highest integration level. Both groups agree that their budgeting activities do not require as much integration as other activities. Managers from both groups are generally dissatisfied with the current level of interfunctional integration. Marketing managers are far more dissatisfied than network managers in most areas of integration explored in this study. However, network managers are more dissatisfied than their marketing colleagues in all areas involving the transfer of information from marketing to network.