The Performance of Service Industries in Canada: A Real Value Analysis

The performance of service industries in Canada has been lower than that of good industries over the last four decades, with noticeable exceptions such as for railways and telecommunication carriers. Service industries were less economically (and technically) efficient in that they generated less output value (quantity) per hour worked (level and growth) or per combined unit of labour and capital (multifactor productivity growth) than good industries. The relative output price of services declined slightly over time compared with goods. At the disaggregated level, changing relative output prices were substantial and proved to be an important factor explaining the relative satisfactory economic performance of many service industries despite their low technical performance. Nevertheless, the output share of service industries increased over that period, sustained, mainly, by the growing recourse of all firms to outsourcing of services.     

Myopic loss aversion and the equity premium puzzle reconsidered

Benartzi and Thaler [The Quarterly Journal of Economics 110 (1995) 73–92] offer a quasi-rational explanation for the equity premium puzzle. We reconsider their methodology and, making a simple modification to it, find that their analysis is not robust.     

Building a better literature review: Looking at the nomological network of the country‐of‐origin effect

Due to a rising pace of knowledge production, reviewing extant knowledge on mature topics has become increasingly challenging. Researchers often need to account for hundreds of references with little guidance on how to proceed. Taking the phenomenon of the country‐of‐origin effect (COE) as an example, this paper proposes a solution to tackle this challenge. By adopting the principles of integrative literature reviews and using online databases, bibliography management software, and literature‐mapping techniques, I organize 355 papers about the COE. As a result, the nomological network of the COE is drawn while establishing links between the phenomenon, its antecedents, and its outcomes. This methodological article contributes to building better literature reviews. Copyright © 2015 ASAC. Published by John Wiley & Sons, Ltd.     

Real Asset Valuation under Imperfect Competition: Can We Forget About Market Fundamentals?

Real assets are usually valued by computing the stream of profits they can bring to a price‐taking firm in a liquid market. This method ignores market fundamentals by assuming that all the relevant information is included in the spot price. Our article analyses the bias resulting from such an approach when the market is imperfectly competitive. We propose a stylised two‐period model of the natural gas market with no uncertainty, focusing on strategic interactions between two types of oligopolistic players—pure traders and suppliers with downstream customers—who have access to storage. We show that the true value of storage capacity is not the same for traders and for suppliers. Comparing the latter value with the traditional price‐taking valuation reveals a systematic bias that tends to induce underinvestment.     

Code and conduct in French cuisine: Impact of code changes on external evaluations

We study the effects of organizational code‐preserving and code‐violating changes on external evaluations by third parties—an essential but under‐studied strategic outcome. We define code‐preserving changes as a variation in the firm's product range that preserves the social code within which the firm positions its offering. By contrast, a code‐violating change corresponds to a variation in the product range that breaks with past codes and embraces another social code. Our analyses of French haute cuisine restaurants show that code‐preserving changes and code‐violating changes have positive effects on external evaluations. Both effects decline with prior evaluations received by the organization, but only the effect of code‐violating changes is reduced with age. Moreover, external evaluations improve when restaurants undertake more code‐preserving changes than their direct competitors but decline when they make more code‐violating changes than competitors. These results enable us to derive implications for research on strategic change, strategic groups, and strategic social positioning. Copyright © 2007 John Wiley & Sons, Ltd.     

The value relevance and reliability of reported goodwill and identifiable intangible assets

We examine the value relevance and reliability of reported goodwill and identifiable intangible assets under Australian GAAP from 1994 to 2003; a period characterised by relatively restrictive accounting treatment for goodwill and relatively flexible accounting treatment for identifiable intangible assets. Our findings, using an adaptation of Feltham and Ohlson (1995), suggest that for the average Australian company the information presented with respect to both goodwill and identifiable intangible assets is value relevant but not reliable. In particular, goodwill tends to be reported conservatively while identifiable intangible assets are reported aggressively.     

The impact of science and technology parks on firms’ product innovation: empirical evidence from Spain

Science and Technology Parks (STP) have attracted considerable attention and public funds in recent years. However, the conclusions on their effectiveness remain mixed. This work evaluates the impact of STP on firm product innovation in the Spanish context, as an example of a less developed innovation system in which regional and national governments are prioritizing STP initiatives. This work draws on a large sample of firms provided by the Spanish Survey on Technological Innovation that is conducted annually by the National Statistical Institute. We explore alternative econometric methods to obtain average treatment effects for firms located in 22 Spanish STPs. Our results show that Spanish STPs have a strong and positive impact on the probability and amount of product innovation achieved by STP located firms. These results hold when the endogeneity of STP location is taken into account.     

Public research/industry relationships: Efficiency conditions

If economists of technical change dealt with the public research/industry interface, the literature lacks empirical contributions. The present paper is clearly empirical. It investigates the efficiency of the relationships between public research institutions and industry from the point of view of the firm looking for solutions to its problems. The empirical work is based on the study of 32 cases of partnerships in France. It suggests that the efficiency of the interface depends on the context (nature of innovations, public research skills needed, duration of relationships, technological strategies of firms) and on the strategies of public research institutions (organizational linkages adopted). Four hypotheses are examined to test these efficiency conditions.     

Diversity Analysis of Structural Change Based on the Canadian Input–Output Tables

This article presents some of the results of a study conducted at Statistics Canada that involved the analysis of the variability through time of input–output structures. All structures have been analyzed in current and constant prices over the period 1961–84, but only the results about the industries' input structures in current prices are reported in this article. Structural changes are assessed over time horizons of 1, 2 and 5 years, using the Kullback, cross-entropy index formula. Structural changes in the current prices input structure are decomposed into a price and a quantity component, following a new decomposition of the entropy formula. It is shown from that decomposition that the traditional analysis of the variability of constant prices input–output structures may be quite misleading. The authors have found that structural changes generally follow a smooth path through time and tend to be cumulative in the long run, with some cyclical fluctuations in the short term. Some of the structural changes appear to be due to statistical events (establishment moves across industries, changes in methodologies, etc.) rather than reflecting real phenomena. The quantity component of structural change appears to be more important than the price component in almost all time periods and time spans, except when the Canadian economy was subjected to important price shocks during the 1970s.