Institutional Environment and Technical Efficiency: A Stochastic Frontier Analysis of Cotton Producers in West Africa

This paper examines the effects of the institutional environment on West African cotton farmers’ technical efficiency (TE). First, key aspects of the cotton sector institutional environment are discussed, including input and credit access, and producers’ organisations. Then, a stochastic frontier production function, which incorporates technical inefficiency effects, is applied to farm level data collected in Benin, Burkina Faso and Mali. The survey includes farmers’ evaluations of the cotton sector institutional environment. Results suggest that institutional level features influence producers’ TE, besides farm‐level characteristics. Cotton growers who report a negative experience with the joint liability programme, who identify the cotton price mechanism or access to credit as the main constraints to performance, and who cultivate more hectares of cereals are technically more inefficient in producing cotton. Findings suggest that cotton farmers in Mali are less technically efficient in producing cotton than in Burkina Faso and Benin. Agricultural development policies focusing on reducing farmers’ financial stress, particularly through the establishment of adequate price mechanisms (i.e. higher farm‐gate prices and timely payments to farmers) and improvement in the input–credit markets should be encouraged to improve TE in West Africa.     

When management strikes: PATCO and the British miners

In this article the author analyses the parallels and differences between the Federal Government's strong actions against air traffic controllers and the British Government's assault upon striking coalminers     

Non‐parametric Modelling of Spatial Price Relationships

We apply non‐parametric methods to a consideration of price transmission processes within US egg markets at the turn of the nineteenth century. Gordon (National Bureau of Economic Research Working Paper 7833, 2000) labelled this as an era of ‘Great Inventions’ which contributed to the subsequent years of significant productivity growth and noted that the development of mechanical refrigeration and transportation technologies played an important role in this growth. Our models present certain advantages relative to parametric models traditionally employed in price transmission analyses. We compare results derived from local polynomial modelling with those obtained using non‐linear threshold models. Both techniques suggest that US egg markets were interrelated at the turn of the nineteenth century. However, non‐parametric techniques often suggest a higher degree of price transmission than that implied by threshold models. Results also suggest that threshold models may have difficulties in adequately capturing price relationship dynamics, especially when these are of a highly nonlinear nature.     

Costly Factor Reallocation and Reduced Productivity Effects in International Trade

Most models of international trade assume extremes of factor mobility between productive uses. From perfectly mobile factors in the Heckscher–Ohlin model, to fixed capital and mobile labor in the Ricardo–Viner–Jones model, factors are assumed to move costlessly or not at all. In reality, factors are neither perfectly mobile nor fixed. This paper considers costs of reallocating factors between industries, deriving a measure of adjustment costs due to factor specificity in a two‐period model of a firm's input allocation decision. The degrees of specificity for labor and capital are then estimated based on data for 15 industries in 16 countries covering eight years. Estimating a system of nonlinear first‐order conditions using a three‐stage least squares technique, I find that recently reallocated factors are indeed less productive. Labor is 14% less productive in the period after reallocation, while capital productivity falls by 43%. Thereafter, capital, unlike labor, moves quickly toward full productivity.     

Managing micropolitical risk: A cross‐sector examination

This article stresses the need for today's multinational firms to adopt their own political risk‐assessment and risk‐mitigation strategies. A comparative study of the energy, financial, and automobile sectors illustrates the need for all companies in these sectors to undertake comprehensive risk‐assessment strategies. Risk‐assessment models established by leading multinationals like British Petroleum, Bank of America, and General Motors are examined as examples that other companies in these sectors can build upon. The consistent micropolitical risk variables then lead to a proposed practical framework for examining sector‐specific micropolitical risk. © 2006 Wiley Periodicals, Inc.     

Agricultural Policy Reform and Off‐farm Labour Decisions

Off‐farm labour decisions of a sample of Kansas farmers are evaluated. The central question of our analysis pertains to whether 1996 US farm policy reforms may have altered the decisions to work off the farm. The effects of policy decoupling on off‐farm labour are complex: different aspects of policy changes can have opposing effects on off‐farm work decisions. Essentially, this makes this issue an empirical question. Results show that the introduction of fixed, decoupled payments in 1996 might have reduced the likelihood of off‐farm labour participation. However, the new policy environment may have increased farm households’ revealed aversion to risk, motivating a higher participation in non‐farm labour markets. The effects of 1996 policy reforms on farm income variability could have been attenuated by changes in US crop insurance programmes and by an increase in emergency assistance payments towards the end of the 1990s. The reduction in price supports may have increased the motivation for working off the farm. The net effect of the overall reforms on off‐farm work participation is not likely to have been large.     

The Early Stages of New Product Development in Entrepreneurial High-Tech Firms

This study examines the most valuable sources of new product ideas and the criteria used to screen potential new products in entrepreneurial, high-tech firms. Teresa Pavia explored the practices of 118 small, young, high-tech firms. Her findings complement a variety of existing studies of the new product process in large firms and the few existing studies of the process in entrepreneurial, high-tech firms. The firms participating in this study rely on informal techniques to generate new product ideas. They place heavy reliance on input from their customers and often develop new products in response to problems articulated by these customers. Although the annual strategic plan is not used by most firms as a new product identification tool, it is highly rated by the most successful firms. Successful firms also actively engage in environmental scanning. The majority of the respondents do not use financial measures as a screening criterion, preferring to evaluate new products by "gut feel." However, the firms that have experienced the fastest growth in sales employ financial hurdles for project selection. The educational background of the key GO/NO GO decision-makers was also evaluated. Two thirds of the firms reported having a key decision-maker with an educational background in business. The educational background of the key decision-makers had little impact on the aspects of the new product process studied here.     

Dependent Development: the Subcontracting Networks In the Tiger Economies

The ‘dependency development’ approach attributes the phenomenal economic growth of Hong Kong and Taiwan to their structural linkage with the advanced industrialised countries through trade. Foreign buyers and sourcing agents of the multinationals subcontract to the Hong Kong and Taiwanese manufacturers for low-cost and flexible production of labour-intensive consumer products. Such a dependency relationship is, however, successfully managed by the manufacturers in the two economies of the operation of a very similar subcontracting system in major industries. This paper examines the nature of the subcontracting system, the reasons for subcontracting, the operating dynamics, the sustaining mechanisms and the inherent structural problems of the subcontracting network. With the industrial restructuring process taking place in Hong Kong and Taiwan, there are changes to the subcontracting system which have significant implications for the welfare of the workers.     

Data driven rank test for the change point problem

Data driven test procedure for detection of change is introduced and its properties are studied. The new solution is max-type statistic related to data-driven rank tests for two-sample subproblems. Simulations show that the new test possesses high and stable power. The test is consistent at essentially any alternative. Asymptotic null distribution of the test is derived. The work of the first two authors has been partially supported by the grants GAČR 201/06/0186 and MSM 02160839.