Technology development in developing countries: The case of a private R & D institution in Brazil

Research Development (RD) is concerned with the conversion of inventions (i.e. new ideas) into innovations (i.e. new products, processes and services in the market-place). Empirical evidence indicates that the rate of success of RD is small. In the innovation chain of events the scientific or technical accomplishment is but one link, a necessary but not sufficient condition of success. Often the market is the decisive factor.
Many research and development organizations (R & DOs), especially those funded privately, allocate their resources with a strong orientation towards satisfying perceived market needs. If this incentive persists during the R & D work the RD effort will probably be much facilitated.
In the light of the above concepts, the Brazilian R & D and RD experiences are reviewed with practical examples and emphasis on the efforts of Centro de Tecnologia Promon—CTP (Promon Technology Center). CTP works on non-conventional energy, industrial process development and telecommunication product development.
The experience reported is not intended to serve as a general solution to R & D or RD problems in the developing world. The purpose is rather to suggest alternative pathways and to point out the importance of a diversified approach to the tough task of closing the innovation loop.     

Network formation with sequential demands

This paper introduces a non-cooperative game-theoretic model of sequential network formation, in which players propose links and demand payoffs. Payoff division is therefore endogenous. We show that if the value of networks satisfies size monotonicity, then each and every equilibrium network is efficient. The result holds not only when players make absolute participation demands, but also when they are allowed to make link-specific demands.     

Sovereign Debt Capacity and the Distribution of Domestic Wealth: A Common Agency Model*

This paper proposes a stylized two‐period, two‐country model illustrating the role of distribution of domestic wealth in determining a country's level of access to international lending. We model sovereign debt redemption policy in a common agency framework. Within this framework, policy is the outcome of the interaction between government and local and foreign interest groups with conflicting preferences on debt repayment. Our main result is that in full lobby competition, when all interests are represented, the only equilibrium solution is repudiation and the consequent inability of government to access international capital markets. Conversely, when the ability to lobby depends on wealth, governments can access international credit up to a given maximum external debt capacity, determined by the skew in the distribution of domestic wealth.     

Pricing options under stochastic volatility: a power series approach

In this paper we present a new approach for solving the pricing equations (PDEs) of European call options for very general stochastic volatility models, including the Stein and Stein, the Hull and White, and the Heston models as particular cases. The main idea is to express the price in terms of a power series of the correlation parameter between the processes driving the dynamics of the price and of the volatility. The expansion is done around correlation zero and each term is identified via a probabilistic expression. It is shown that the power series converges with positive radius under some regularity conditions. Besides, we propose (as in Alós in Finance Stoch. 10:353–365, 2006) a further approximation to make the terms of the series easily computable and we estimate the error we commit. Finally we apply our methodology to some well-known financial models.      

Buyer–Supplier and Supplier–Supplier Alliances: Do They Reinforce or Undermine One Another?

abstract    Previous research has portrayed buyer–supplier and supplier–supplier alliances as important mechanisms to foster learning and exchange efficiencies. Controversy remains, however, as to how these alliances interact. While some propose they reinforce one another (e.g. learning in horizontal ties generates positive spillovers to vertical ties), others propose a negative interplay (e.g. when increasing vertical-tie intensity, suppliers may weaken horizontal ties to avoid retaliation from buyers who wish to preserve bargaining power). We empirically test these competing views using survey data from the Brazilian auto-parts industry. In an attempt at reconciliation, we propose that the positive or negative interaction between vertical and horizontal alliances depends on the level of technological uncertainty of goods exchanged. Vertical ties seem to inhibit horizontal ties when technological uncertainty is low; when technological uncertainty is higher, vertical and horizontal ties do not seem to have any meaningful form of interaction. We discuss implications for theory and practice.     

Genetically Modified Crops: Their Market and Welfare Impacts

A framework is developed for examining price and welfare effects of the introduction of genetically modified (GM) products. In the short run, non-GM grain generally becomes another identity-preserved product. However, more profound market effects are observed under some reasonable parameterizations. When calibrated to reflect the U.S. corn market, introducing GM technology increases aggregate welfare over a wide range of scenarios, unless the corresponding production cost savings are small and consumers are seriously concerned about GM products. The possibility that GM technology may reduce aggregate welfare is interesting because the model assumes rational agents and does not include regulatory constraints.     

Attitudinal loyalty and trust in entrepreneurship: building new relationships

This paper studies the impact of attitudinal loyalty and trust in entrepreneurship, following a client-focused strategy. In this context, trust and commitment are the cornerstone of relationship marketing, and contributes positively to achieving attitudinal loyalty, which is suitable for the maintenance of relationships over time. This variable also acts as a facilitator or mediator on the influence satisfaction has on loyalty. We show that satisfaction has a positive impact on trust and attitudinal loyalty. Following structural equation modelling methodology we test all the relationships in a sample composed by travel agency customers.     

THEORETICAL FOUNDATIONS OF PAY‐AS‐YOU‐GO DEFINED‐CONTRIBUTION PENSION SCHEMES

The paper inquires into notional defined contribution pension schemes, which retain the pay‐as‐you‐go financing method while adopting the award and indexation formulas typical of funded, defined‐contribution systems. It examines the properties of the new arrangement and compares them with those of the traditional defined‐benefit pay‐as‐you‐go schemes.