The Year in Review: Economics at the Antitrust Division, 2005–2006

This paper covers the activities of the Economic Analysis Group (EAG) of the Antitrust Division, U.S. Department of Justice, during 2005–2006. It describes the economic analysis undertaken by EAG in several important investigations, appellate matters, and other activities as an advocate for competition.The views contained herein are solely those of the authors and do not necessarily represent those of the U.S. Department of Justice.     

On the Relationship between Japanese Manufacturing Firms and their Domestic Subsidiaries

Much past research on ownership policy has dealt with foreign subsidiaries. In this paper, we study the ownership relationship between Japanese firms and their publicly-traded domestic subsidiaries. Using a transaction cost framework, we find that benefiting from high subsidiary profitability is not the sole motivation behind parent firms' decisions regarding equity control of their subsidiaries. Our results indicate that different policies are adopted by Japanese firms with respect to domestic and foreign subsidiaries.     

Traumberuf oder Verlegenheitslösung?

So far relatively little is known about the situation of Ph.D. students in media and communication research. The main purpose of this study is, therefore, to shed light on the employment and working conditions for young scholars on their way to their doctoral degrees. We conducted a survey of 281 Ph.D. students in Germany, Switzerland and Austria. The results show that, on the one hand, young scholars are intrinsically highly motivated to do their jobs. On the other hand, they perceive an academic career as a very uncertain venture with many obstacles. Furthermore, several types of Ph.D. students can be distinguished: idealists, careerists and waverers. It is shown that only the idealists conform to the concept of a productive and interested scholar. The results are discussed in terms of their importance for the future development of the field.     

International compliance with new Basel Accord principles for risk governance

We assess international compliance with the Basel Committee's 2010 guidance on governance of banking organisations. Based on an extensive examination of regulatory documents in selected advanced economies, we find that reform is incomplete in jurisdictions most affected by the financial crisis, and with the largest financial centres. In contrast, other countries less affected by the financial crisis have enacted risk governance reforms as protection against potential future contagion. We provide insights for policy‐makers charged with improving governance at banks, and a richer understanding for international regulators as they revise the guidelines and aim for greater compliance at the national level.     

Country of origin labeling for complex supply chains: the case for labeling the location of different supply chain links

We investigate the value of a country of origin label (COOL) that separately identifies the geographic location of different stages in a food product's supply chain. We estimate the willingness‐to‐pay (WTP) of U.S. consumers for a packaged cereal product where the key grain ingredient may be grown in one country and processed in a second country (multicountry supply chain) and compare it to equivalent products that have both stages located in a single country. We find consumer WTP for products with single‐country and multicountry supply chains are statistically different, meaning that simplifying a multicountry label by listing only the country where the ingredients are grown or only the country where the ingredients are processed can result in different consumer values. We also find that for countries with a poor quality reputation, consumers respond more negatively when that country has the “last touch” than when that country's involvement is limited to upstream supply chain links.     

Contesting authentic practice and ethical authority in adventure tourism

This paper examines the discourses of authenticity and ethics employed by adventure tourists regarding the use of the natural environment. In one case, full-time traveling rock climbers use their dedication to the sport and annual visits to the Red River Gorge as evidence for their authoritative voice on ethical climbing practice. While they identify the growing numbers of leisure climbers as a problem for sustainability, many also take up temporary employment as guides and are directly involved in the introduction of new climbers to the area. In another case, two groups of wilderness enthusiasts – “ADK 46ers” and “Summit Stewards” – lament the environmental and social impacts of other recreational users in the Adirondack Park. Despite being visitors themselves, Summit Stewards and 46ers use their sense of place and knowledge of Adirondack history and ecology to substantiate their authority as purveyors of ethical practice. In both cases, senses of responsibility are inspired by senses of place, but are articulated through notions of authenticity and used as justification for ethical authority. While validating their presence in these outdoor spaces, the use of such rhetoric also minimizes their own impacts yielding further tensions among user groups.     

Development and transformation of collaborative networks in events

This study examines the mechanisms by which and the reasons that leaders of non-profit organizations transform interorganizational collaborative networks through event attendance. Drawing from a two-wave survey, this study examines the interorganizational networks of 30 individuals who participated in both waves, along with the reported activities of 121 individuals who participated in the second wave of the survey. This mixed methods study found that events transformed participants’ weak ties into strong ties and promoted development of collaborative networks. Further, the study found that participants’ motivations for attending the event and following up with contacts afterward focused on sharing resources and deepening connections. Implications for understanding how events promote formation and transformation of collaborative networks are discussed.     

Ethical Reasoning in Action: Validity Evidence for the Ethical Reasoning Identification Test (ERIT)

In recent years, a growing number of small-to-medium-enterprises are embracing wind turbine projects not only as part of their cost reduction strategy but also to actively play their part in the global fight against climate change. However, it would appear there are currently limited empirical studies carried out in this emerging industry. This case study analyses the cost effectiveness of one such wind turbine initiative by a company in the Republic of Ireland, who invested in a 300 kW embedded wind turbine project at the end of 2013. The research methodology which is primarily a case study analysis included comparing historical electricity utility bills which allowed the 2013 quantity of electrical energy units imported, i.e. the year before the turbine was installed to be compared with the 2014 value, i.e. the year after the turbine was installed. Numerous site visits were undertaken over a four-year period, during which electric meter readings were recorded and stored. The findings of this piece of research indicate that the installation of the embedded wind turbine had minimal positive effect on the annual electricity costs for the company. Indeed the turbine appears to have significant negative effects such as a need for an increased maximum import capacity and also it appeared to contribute to a deteriorating utility power factor. While the aesthetic nature of the on-site turbine seemed to create a positive image of the company, it would appear that caution should be exercised when business owners select alternative energy providers who claim to be experts in the energy field but may have limited knowledge in this area of wind energy, which as of yet has minimal robust research into all aspects of its benefits/attributes.     

Alain Bertaud,Order Without Design: How markets shape cities. Cambridge,MA: MIT press, 2018. Xiv + 419 pages. USD 40.00 (cloth)

The Review of Austrian Economics -