Country Competition and US Overseas Assembly

To examine the role of international competition in outsourcing production decisions, I study the decisions of producers who used the U.S. Overseas Assembly Program (OAP) to conduct assembly operations in developing countries. The evidence, which is based on U.S. OAP imports between 1991 to 2000, shows that production costs and corporate tax policies both shaped production decisions. While increases in own country costs reduced the size of a developing country's OAP shipments, increases in competitor costs helped to increase a country's shipments. The effects of competitor country cost changes were relatively large, as the analysis suggests that a ten percent increase in competing country costs would increase a country's OAP outsourcing activities by 5.8 percent, while a ten percent increase in competitor country taxes would increase a country's OAP exports by 1.6 percent.     

Institutional framing and perceptions of fairness

This paper's goal is to construct a positive theory of economic fairness. Using the theoretical schema developed by Hurwicz and others, the paper makes precise the notions of an “institution,” “fairness fraiming,” and “institutional framing.” Four fairness propositions yield an important corollary: the economic environment, the operative institution and history give meaning to the often used FORMAL PRINCIPLE OF DISTRIBUTIVE JUSTICE (“equals should be treated equally, and unequals unequellay, in proportion to relevant similarities and differences”). We support these four propositions and corollary by an analysis of laboratory, survey, and anecdotal evidence. Finally we describe a number of areas for future research. The authors would like to thank Allen Buchanan, James Buchanan, Joel Feinberg, Elizabeth Hoffman, David Schmitz, Linda Schnabel Stizer, Vernon Smith, Richard Wagner, the participants in the Aspen Institute's Conference on “Local Justice and Fair Allocation”, the members of the Industrial Organization Workshop of the Department of Economics at the University of Arizona, and panel participants at the Public Choice Society Meeting for their help and comments at various stages of this paper's preparation. Responsibility for errors is the authors' alone.     

Who are the world's most successful companies?

It seems that everybody wants to know which companies are the most successful. To help throw light on the issue, and to do so more reliably than the plethora of league tables and charts produced by most business magazines, the London Business School have teamed up with The Economist to compile an assessment of the top performers of the 1980's.     

Facilitating Global Organizational Learning in Product Development at Whirlpool Corporation

The challenges of leveraging learning about product development in a global company are complex. Whirlpool Corporation is addressing these challenges, using a multidimensional strategy that couples work in advanced products and product development with organization development and training. Deborah Durate and Nancy Snyder describe how Whirlpool has implemented training, best practices conferences, and programs focused on enhancing the performance of product development teams to facilitate learning after product development efforts and to leverage that learning on a global basis. Programs and processes are described, and lessons learned as well as guidelines for development are offered.     

Price rigidities and institutional variations in markets with posted prices

Summary Standard laboratory posted-offer markets respond slowly and incompletely to demand shocks. In these one-sided markets, where sellers control the setting of prices, very little information is transmitted via the process of exchange. For this reason, traders have trouble distinguishing randomness in their own experience from changes in market fundamentals. This paper reports the results of twelve laboratory markets conducted to assess whether some common variants to standard posted-offer rules can correct the adjustment deficiences. Although discounting, multiple postings and excess demand information all improve performance, we find that response remains poor, and efficiencies low.Support for this research was provided by the National Science Foundation (SBR 9319842 and SBR 9320044), and the University of Virginia Bankard Fund. Data are archived at FTP address: fido.econlab.arizona.edu. We wish to thank Charles Plott and Shyam Sunder for useful comments on an earlier draft of this paper. The usual disclaimer applies.     

When promises become contracts: Implied contracts and handbook provisions on job security

In this article, policy capturing was used to examine how lawyers, as experts, understand the wording in employee handbook passages that promise procedural protections for employees. Specifically, how the wording of employee handbook passages can create both legal and nonlegal obligations was examined. Forty-six lawyers were asked to make the following judgments: whether the handbook passage constituted a legal or moral obligation and the chances of the employer winning or being granted a summary judgment in a wrongful discharge suit. Five aspects of the handbook passages were examined: verb strength, specificity, contract disclaimers, legalistic jargon, and the employee's signature.     

Perceived conduct and professional ethics among marketing faculty

This paper describes the results of a mail survey to the educator membership of the American Marketing Association. Data were collected regarding beliefs about both the frequency of occurrence and severity of 59 ethical issues facing marketing faculty. The research questions examined include: What unethical practices are believed to most commonly occur? What practices are most severe? How do these beliefs vary by faculty rank and size and type of school? Implications for both the improvement of marketing education and for future research are provided.