National influences on European Works Councils in UK‐ and US‐based companies

The view that the role of European Works Councils (EWCs) is shaped predominantly by national industrial relations (IR) traditions in the company's country of origin derives largely from the experience of EWCs in companies based in continental Europe. This article argues that a more differentiated approach to the influence of national IR factors on EWCs needs to be developed to take account of the circumstances of companies headquartered in the UK and the US, whose national IR arrangements do not provide a strong institutional model for the EWC and, in the case of US‐based companies, where headquarters management has little or no direct involvement in the EWC. Findings from comparative case studies of EWCs in eight UK‐ and US‐based multinationals suggest that their character is shaped by the interplay between ‘country‐of‐origin’ factors,‘country‐of‐location’ factors and structural, company‐specific considerations.     

The short‐term impact of Brexit

• A scenario run on the Oxford Global Model suggests that Brexit would leave the level of UK GDP 1.3ppt lower by Q2 2018 compared with our baseline forecast that the UK votes to stay in the EU. A vote to leave would mainly shock business confidence but consumers would be adversely affected too. Exporters in price‐sensitive sectors would benefit from a weaker exchange rate.
• Market pricing suggests that sterling could initially fall by around 15% before recovering some of its losses, while the heightened uncertainty would also be expected to drive a sharp drop in equity prices in H2 2016.
• Brexit would present something of a dilemma for policymakers. While a weaker pound would cause inflation to initially spike upwards, we would expect the MPC to look through this and cut Bank Rate in order to support activity. And with the UK likely to retain its reputation as a safe haven, this would also see gilt yields stay lower for longer.
• Weaker growth would also put the Chancellor in breach of the fiscal mandate, though we would expect him to plead extenuating circumstances, rather than tighten policy and potentially exacerbate the slowdown.

     

US‐style contingent fees and UK‐style conditional fees: agency problems and the supply of legal services

Under contingent fees, the attorney gets a share of the judgment; under conditional fees, the lawyer gets an upscale premium if the case is won which is, however, unrelated to the adjudicated amount. We compare conditional and contingent fees in a principal–agent framework where the lawyer chooses unobservable effort after she has observed the amount at stake. Contingent fees provide better incentives than conditional fees independently of whether upfront payments are restricted to be non‐negative or not. Under contingent fees, the attorney uses her information about what is at stake more efficiently. Copyright © 2006 John Wiley & Sons, Ltd.     

The impact of employee‐share‐ownership schemes on performance in unionised and non‐unionised workplaces

Conventional wisdom suggests that higher performance is observed when employee‐share‐ownership (ESO) schemes coexist with employee participation arrangements. However, the evidence is inconclusive and it has been suggested that performance benefits occur in ESO workplaces only when employees are actually involved in the decision‐making process. Drawing on the cross‐section data from the 1998 Workplace Employee Relations Survey, the article shows that higher productivity is observed in those workplaces where unions coexist with ESO schemes. This result highlights the relevance of unions to High Performance Work Systems.     

The impact of job embeddedness on innovation‐related behaviors

It has often been argued that low turnover leads to less innovation in organizations, not only because fewer job vacancies are available for outsiders with new ideas, but also because longer‐tenured employees might be more resistant to change. In this study, we propose that job embeddedness may actually strengthen employees' motivation to generate, spread, and implement innovative ideas in organizations. In a longitudinal study with a diverse sample, we found that job embeddedness was positively and significantly related to innovation‐related behaviors, even after controlling for demographic variables, the job attitudes, and the job perceptions that are frequently associated with job embeddedness. In addition, we found some support for the proposed moderating effects of career stage; that is, the relationship between job embeddedness and implementing innovative ideas was stronger for individuals in the mid‐ and late stages of their careers than for those in the early stage of their careers. This article concludes with directions for developing future theory. © 2010 Wiley Periodicals, Inc.     

Is there a global bonds bubble ‐ what if it bursts?

Both real and nominal bond yields have fallen to historically low levels, and in the US the yield curve has been inverted (that is, two-year yields have been above ten-year yields) or very flat since the start of December. This article by Jonathan Hoffman and Keith Church discusses the possible reasons for these developments - including the 'savings glut' proposed by the new Fed Chairman Bernanke - as well as the likelihood of a sharp sell-off of bonds. It then looks at precedents for a sell-off but concludes that there are few parallels between the current situation and the earlier episodes. Finally, it identifies possible triggers for a sell-off and presents a simulation with the OEF Global Model to analyse the likely consequences for the world economy. The conclusion is that, while a rise in US yields to 6.5% in the first half of 2007 would cut growth significantly, including through a fall of almost 1% point in the growth rate of household consumption in the US in 2008, its impact would not be catastrophic.     

The impact of executive diversity on corporate innovation: Evidence from the natural experiment of high‐speed rail in China

We examine the impact of executive diversity on corporate innovation using an exogenous natural experiment: the implementation of high‐speed rail (HSR) in China. The findings suggest that after a city implements HSR, firms increase their executive diversity, resulting in better corporate innovation than firms in non‐HSR cities. Additional analysis suggests that when a firm belongs to a competitive industry, is located in a low marketization region, or operates in a poor transportation region, the impact of HSR on executive diversity and corporate innovation is magnified. Our findings carry implications for other emerging markets.     

China‐commodity nexus at the heart of global upturn

• ? The China‐commodity nexus has been at the heart of the global upturn in trade and industry. It could directly and indirectly account for as much as 70% of the recovery since mid‐2016, based on our analysis. We think this nexus will continue to support world growth in the near term, but the global upturn is vulnerable to moderating Chinese growth and slippage in commodity prices.
• ? China has directly accounted for around a third of the upturn in world trade, similar to the contribution of G7 countries. But adding in indirect effects, China's influence is likely to have been much more significant. Stronger Chinese demand has contributed to an improvement in the trade performance of its Asian trading partners, commodity exporters and other advanced economies.
• ? Using a model simulation that introduces positive shocks to imports in “greater China” and to commodity prices (based on the scale we have seen since mid‐2016), our top‐end estimate for China's contribution to the upturn in world trade is around 70%.
• ? The simulation points to especially strong improvements in output and exports for economies such as South Korea, Japan, Malaysia and some commodity exporters. This broadly matches the pattern of performance seen over recent months, though commodity exporters' performance has been quite mixed.
• ? G7 investment growth is likely to have played only a modest role in the recent global upturn. But Japan is an exception, while upgrades to investment forecasts for South Korea, Taiwan and Hong Kong have also been large.
• ? A 1% rise in commodity prices could raise commodity exporters' investment by 0.3–0.6%, based on our analysis. As a result, there could be additional improvement in commodity exporters' investment this year, supporting world growth. However, with our forecasts suggesting that commodity prices are set to slip further over the coming quarters, this boost could prove short‐lived.

     

Developing a global leadership perspective through the use of student‐created reusable learning objects

Study abroad programs have been identified as one of the most effective methods of globalizing curricula and students. The purpose of this study was to examine the current framework of the Leading Change in Costa Rica Study Abroad Program and its ability to diffuse leadership theory to the participating students and to students who are not able to take part in a study abroad opportunity. This study abroad program used reusable learning objects (RLOs) as an assignment to develop global leadership competencies by applying the learned leadership theory in an international context. Students were impacted by the experience. They gained knowledge of the course content, developed and expanded their cultural competencies, and expanded their views of developing countries. The Leading Change in Costa Rica Study Abroad Program also made an effort to develop the intercultural competencies and global leadership abilities of students who are unable to study abroad. The student‐created RLOs have been used in class presentations and made available to interested faculty to use in classrooms across disciplines.     

On the spatial economic impact of global warming

We propose a dynamic spatial theory to analyze the geographic impact of climate change. Agricultural and manufacturing firms locate on a hemisphere. Trade is costly, firms innovate, and technology diffuses over space. Emissions from energy used in production contribute to the atmospheric stock of carbon, which increases temperature. Warming differs across latitudes and its effect on productivity varies across sectors. We calibrate the model to analyze how climate change affects the spatial distribution of economic activity, trade, migration, growth, and welfare. We assess quantitatively the impact of migration and trade restrictions, energy taxes, and innovation subsidies.     

The environmental value and impact of the Maker movement—Insights from a cross‐case analysis of European maker initiatives

The aim of this paper is to explore the environmental value of the Maker movement, which is driving digital fabrication into the mainstream. Makers are inspiring each other to create smart solutions for all types of individual needs and address societal and environmental challenges at the same time. They share their creative ideas and solutions in collaborative work spaces and Maker Faires or on social media platforms. Is this grassroots innovation the beginning of the next industrial revolution? This paper will explore the environmental value and impact of makers' innovative business model and discuss on how to increase the circularity. At the same time, we will describe the role of maker communities and how to help to play a better role. In the framework of a case study analysis based on 10 different Maker initiatives across Europe, 39 interviews were conducted with makers and Maker initiatives managers evaluating core questions such as potential environmental value and impact, value chains, and energy efficient behaviours. This study is expected to contribute to building an explorative but yet empirically rooted analysis of the environmental value and impact of the Maker movement. Furthermore, the challenges in the future and the suggestions for policy makers are provided.     

The impact of mentoring quality on protégés' organization‐based self‐esteem and proactive behavior: The moderating role of traditionality

Based on self‐consistency theory, this study examined the relationship between mentoring quality as perceived by protégés and protégés' proactive behavior. It focused on the mediating role of organization‐based self‐esteem (OBSE) and the moderating role of traditionality. To examine these relationships, we administrated three‐wave surveys to 237 subordinate–supervisor dyads in a construction enterprise. The results of hierarchical linear modeling demonstrated that (a) mentoring quality and proactive behavior had a positive relationship; (b) OBSE mediated this relationship; and (c) traditionality strengthened both the relationship between mentoring quality and OBSE and the indirect effect of mentoring quality on proactive behavior via OBSE. Our findings have theoretical and practical implications for research on mentoring and proactive behavior.     

The rate of learning‐by‐doing: estimates from a search‐matching model

We construct and estimate by maximum likelihood a job search model where wages are set by Nash bargaining and idiosyncratic productivity follows a geometric Brownian motion. The proposed framework enables us to endogenize job destruction and to estimate the rate of learning‐by‐doing. Although the range of the observations is not independent of the parameters, we establish that the estimators satisfy asymptotic normality. The structural model is estimated using Current Population Survey data on accepted wages and employment durations. We show that it accurately captures the joint distribution of wages and job spells. We find that the rate of learning‐by‐doing has an important positive effect on aggregate output and a small impact on employment. Copyright © 2009 John Wiley & Sons, Ltd.     

Retaining a diverse workforce: the impact of gender‐focused human resource management

Demography theory suggests that high gender diversity leads to high turnover. As turnover is costly, we tested the following: a main effect prediction derived from demography theory, and a moderating effect prediction derived from the relational framework. Data on 198 publicly listed organisations were collected through a human resources decision‐maker survey and archival databases. The results indicate that higher gender diversity leads to lower turnover in organisations with many gender‐focused policies and practices. Findings suggest that organisations can lower their turnover rates by increasing their gender diversity and by implementing gender‐focused policies and practices.     

Every flow has its ebb: The impact of flow on work–family conflict and adjustment in global careers

Despite an increase in research in psychology on the mental state of flow, little is known within the area of organisational studies about its “dark side.” Although prior organisational studies literature suggests that flow leads to generally positive work outcomes, we use conservation of resources theory to argue that expatriates in the state of flow can accumulate resources that lead to work adjustment but at the same time may experience unintended negative work–family conflict consequences. Specifically, we argue that being in the state of flow can improve expatriates' work adjustment because they can concentrate on the task at hand in an unencumbered way. Yet the exclusive concentration on work tasks and the distortion of time while in the state of flow may reduce psychological and time resources available to the family, resulting in work–family conflict. We explore whether flow theory needs to be altered to discover potentially negative work–family conflict outcomes inherent in the complex work regimes associated with global careers. Structural equation modelling analyses based on a sample of 230 expatriates in the United States and 169 expatriates in Brazil revealed that flow increased both work–family conflict and work adjustment.     

The impact of political instability on risk‐taking in the banking sector: International evidence using a dynamic panel data model (System‐GMM)

This paper contributes to the existing literature by investigating the impact of political instability risk on risk‐taking in the banking sector of 75 countries, which is the first attempt for this nexus to the best of our knowledge. The dynamic panel data model (System‐GMM) showed that political instability risk significantly increases risk‐taking in the banking sector. Besides, corruption levels and government ineffectiveness are the most important channels of political instability that affect the banking sector risk. The results also actively support the “too big to fail” hypothesis. Finally, the robustness results confirm the conclusions derived from the baseline System‐GMM model.     

Explaining US–UK Interest Rate Differentials: A Reassessment of the Uncovered Interest Rate Parity in a Bayesian Framework*

In this paper, we test the uncovered interest rate parity (UIRP), allowing for transitory deviations from it. These deviations may arise from variations in risk premia, errors in expectations and linearization errors, and are modelled as a zero‐mean noise around the restrictions implied by the UIRP on a vector autoregression (VAR) in the interest rate differential and the spot exchange rate. Importantly, this approach includes the traditional one as a special case, which is derived by simply setting the noise to zero. When the noise is set to zero the UIRP is rejected, but if we allow for some degree of noise the UIRP is strongly supported by the data. Thus the UIRP relation does not hold exactly, but on average, with a stationary risk premium as opposed to a constant one. This result implies that analysing the effects of policy experiments under the null of the UIRP may be both safe and useful.