Bertrand–Edgeworth Duopoly with Buyouts or First Refusal Contracts

In this game the players are firms involved in a Bertrand–Edgeworth duopoly market. Payoffs to the low priced firm depend only on the own price, whereas the payoff to the high priced firm depends on both its own price and the price of the opponent. The price of the opponent enters the payoff function of the high priced firm through buyout or a first refusal contract. Only when the total capacity in the market is less than the output in a monopoly situation, there is an equilibrium in pure strategies.Journal of Economic LiteratureClassification Numbers: C72, D43, L12.     

ENDOGENOUS FORMATION OF COMPETITIVE RESEARCH SHARING JOINT VENTURES*

Research sharing is an important objective of many research joint ventures. When partners share R&D but do not maximize joint profits, large consortia are more profitable than small ones, and joint ventures prefer dispersed rivals. For much of the spillover space, a coalition formation game that permits limited membership predicts that at most, three joint ventures form. Research‐sharing joint ventures improve welfare when spillovers are low, and banning research sharing joint ventures is beneficial for high spillovers. With imperfect research sharing and low spillovers, allowing only research sharing is the best industry‐wide joint venture alternative for consumer surplus.     

The Progressive Second Price Mechanism in a Stochastic Environment

We consider in this paper an auction-based pricing scheme recently introduced by Lazar and Semret to allocate bandwidth among users. This mechanism, called Progressive Second Price, was studied using tools from noncooperative game theory, for a fixed set of players (i.e., users). We compare here the results obtained in that case with the more realistic situation when players randomly enter or leave the game. We assume that they enter according to a Poisson process, and leave it after an exponentially distributed sojourn time. We show that this stochastic assumption cannot be skipped since it can lead to very different results.     

Cultural Insights to Justice: A Theoretical Perspective Through a Subjective Lens

Distributive, procedural, and interactional justice are constructs that are increasingly being recognized as important factors that affect individual perceptions in the workplace environment. This paper presents a theoretical perspective that suggests that justice is perceived through a subjective lens that consists of individualized beliefs and proposes that cultural attributes and demographic characteristics play an integral part in determining the perception of justice. The distinctions between these three constructs are presented in context with the core beliefs of individual employees – affected by a multitude of perceptual and demographic factors that we briefly identify herein. Based on the theoretical perspective, an instrument that measures the constructs of justice as perceived by individuals was developed. With a focus on justice within the business setting, hypotheses about attitudes related to justice were tested. Survey results confirm that the three constructs of justice are distinct but correlated. Significant differences were found in the perceptions of African-American respondents with regard to procedural justice. Although the empirical findings do not support all the hypotheses, this research highlights the need for further development of measures to assess the perception of justice in business settings and at an applied level, underscores the importance of recognizing cultural attributes and demographic characteristics in understanding how justice is perceived.     

A chameleon function? HRM in the ‘90s

This article examines the changing role of the HR function in large corporations in the 1990s. It draws on data collected from a multi-sector case study research project – the Leading Edge Forum Consortium. Activities are analysed along three dimensions: access to strategic decision making, shift of responsibilities to the line, and the function's perceived contribution to business performance. It concludes that devolution to the line remains problematic, and that access to strategic decision making is still contingent on the personal influencing skills of senior HR managers or directors. Nevertheless the recognition of the strategic importance of HRM as a contributor to business performance has risen.     

Managing Business Ethics and Opportunity Costs

Economic profits differ from accounting profits. Accounting profits are usually defined as revenues minus costs, and those costs as fixed and variable. Economic profits enlist a third cost, opportunity costs. While these costs are difficult to determine with mathematical precision, they are nonetheless significant, especially for decision making in business. They reflect social costs and benefits, tensions between individual and corporate interests, and all internal and external considerations which enter into decision making in business. It is precisely within opportunity cost decision making that Primeaux and Stieber situate business ethics.