Regulatory quality,financial integration and equity cost of capital

We study the impact of international financial integration on firm‐level equity cost of capital in the presence of regulatory differences. International financial integration reduces the domestic cost of capital in the presence of well‐defined regulations that make it easier for foreign firms to overcome information asymmetry. We study this relationship for 55 countries for the period 2002 to 2014. Using multilevel mixed estimations, we find a negative relationship between cost of capital and both financial openness and regulatory quality. However, economies with better regulatory quality have a positive relationship between financial openness and cost of capital. Our results inform policy on the cost of higher level of regulations on firms’ equity cost of capital, especially when an economy has a high level of financial openness.     

Team Design Thinking,Product Innovativeness,and the Moderating Role of Problem Unfamiliarity

Team design thinking in new product development (NPD) refers to a set of design-oriented principles that can be embedded in the everyday routines of NPD teams. We theorize that team design thinking enables NPD teams to develop more innovative products––products that are useful and novel––by reducing the routine and cognition-based inertia that constrains the team’s innovativeness. Through a study of 247 NPD projects, we investigate the relationships between team design thinking, product utility, and product novelty. Further, we also explore whether the team’s unfamiliarity with product contexts influences these relationships. Findings show that team design thinking is positively associated with useful products in both familiar and unfamiliar contexts, but that team design thinking is associated with product novelty only in familiar contexts. Findings also suggest that team design thinking can be framed as a dynamic capability that addresses routine and cognition-based inertia by expanding the organization’s knowledge resource base, particularly in familiar contexts. A key implication of this research is that team design thinking will influence product utility in a variety of situations, but its influence on product novelty will be evident primarily in familiar contexts.     

Determinants of New Product Development Team Performance: A Meta‐analytic Review

New product development (NPD) has become a critical determinant of firm performance. There is a considerable body of research examining the factors that influence a firm's ability to successfully develop and introduce new products. Vital to this success is the creation and management of NPD teams. While the evidence for the use of NPD teams and the factors that determine their success is accumulating, there is still a lack of clarity on the team‐level variables that are most impactful on NPD success. This meta‐analytic study examines the effects of NPD team characteristics on three different measures of success: effectiveness (market success), efficiency (meeting budgets and schedules), and speed‐to‐market, requiring incorporation of a broader set of team variables than previous studies in order to capture more factors explaining NPD outcomes. Unlike a typical empirical study that considered no more than two team variables to predict NPD performance, this study combines research spanning eight team variables including team input variables (team tenure, functional diversity, team ability, and team leadership) and team process variables (internal and external team communication, group cohesiveness, and goal clarity). Results from 38 studies were aggregated to estimate the meta‐analytic effect sizes for each of the variables. Using the meta‐analytic results, a path analytic model of NPD success was estimated to isolate the unique effects of team characteristics on NPD effectiveness and efficiency. Results indicate that team leadership, team ability, external communication, goal clarity, and group cohesiveness are the critical determinants of NPD team performance. NPD teams with considerable experience and led by a transformational leader are more successful at developing new products. Effective boundary spanning within and outside the organization and a shared understanding of project objectives are paramount to success. Group cohesiveness is also an important predictor of NPD outcomes confirming the importance of esprit de corps within the team. The findings provide product development managers with a blueprint for creating high‐performance NPD teams.     

Productivity and firm size in India

Are smaller firms more productive? Intuitively, while small firms have the advantage of more flexible management and lower response time to market changes, larger firms have the advantages of economies of scale, political clout and better access to government credits, contracts and licenses, particularly in developing countries. Using a panel dataset from a commercially available database of financial statements of manufacturing firms in India, we find that firms in the lowest quintile of the asset distribution that invest in research and have better liquidity are most productive. The Indian manufacturing sector, characterized by both large scale public and private firms as well as numerous smaller firms, provides an ideal setting. Our findings are robust to alternative definitions of size, alternative estimation methods and alternative estimates of total factor productivity.     

Tree Diversity and Carbon Sinks: Role of Village Agro-ecosystems in the Western Ghats,Karnataka, India

Tree species richness, diversity index, standing biomass and biomass carbon stocks were estimated in six villages located under three agro-ecological zones, namely, coastal, hill and plains of Uttara Kannada district, Western Ghats, Peninsular India. The study showed that land use categories other than forest support higher tree species diversity. High basal area, standing biomass and carbon stock in non-forest land categories indicates their potential as carbon sinks and for promotion of species diversity. Inclusion of other non-forest land use categories in afforestation programmes for promotion of multipurpose tree species for conservation of diversity and for enhancing carbon sinks is suggested. There is a need to promote synergy between biodiversity conservation and carbon sequestration under carbon mitigation projects.