Social media-related tensions on business-to-business markets – Evidence from China

Previous research has established the benefits of using social media in support of engagement in business-to-business settings. Yet the study of problems that arise from social media use in business relationships remains limited. Utilizing a dyadic perspective, this study addresses the gap by focusing on tensions in buyer-supplier relationships that arise from social media use. Findings present three dualistic tensions: active engagement anticipated by suppliers versus passive monitoring practices of the buyers; increased transparency through business-to-business social media versus invisibility; as well as tensions between local versus international business-to-business social media engagement practices. The study draws on 52 semi-structured in-depth interviews with senior managers who work in relevant positions at manufacturing firms based in China. By identifying characteristic tensions pertaining to business-to-business social media, this study aims to contribute to research on the ‘dark side’ of business relationships as well as to literature on business-to-business social media engagement.     

What drives smallholder farmers’ willingness to pay for a new farm technology? Evidence from an experimental auction in Kenya

We use an incentive compatible experimental auction to measure demand for a new agricultural technology, a triple layered hermetic storage bag. When used properly, the bag creates an airtight seal that reduces storage loss from insect pests and neutralizes aflatoxin contamination in stored grain. We find that demand for this new technology is highly elastic (4.3) and that the wholesaler could increase profit by lowering the price. We also find that farmers’ valuation for the bag is not significantly different based on the medium through which information about it is communicated to them, either text, audio or video messages. This suggests that practitioners should use the cheapest option for disseminating information, which is text messaging in this context. In addition, we find that farmers who have prior awareness of the bag are willing to pay 20% more on average than those previously unaware of it. In total, the highly elastic demand for the improved bags, along with the fact that prior awareness of the bag leads to higher willingness to pay, suggests that a one-time price subsidy for the new technology could spur demand and increase future adoption.     

Understanding farmers’ valuation of agricultural insurance: Evidence from Vietnam

Agricultural index insurance offers smallholder farmers the potential to manage pervasive weather and environmental risks, and smooth income over time. Yet despite the potential benefits, take-up of index insurance has been largely disappointing. We employ a novel approach to investigate the reasons for low demand and we confirm that farmers systematically undervalue agricultural index insurance. We find that access to private transfers acts as a substitute for insurance demand, while membership of a farmer’s union helps explain why farmers value index insurance. Finally, we find that individual riskiness is positively related to willingness to pay for agricultural index insurance and interpret this as further evidence that, within the context of basis risk and lack of trust in insurers, farmers valuation of agricultural index insurance can be better understood through behavioural theories such as ambiguity aversion or prospect theory.     

Realigning research and extension to focus on farmers’ constraints and opportunities

This paper argues that research and extension have failed to (1) develop technologies that take into account farmers’ resource constraints and risks; and (2) improve farmers’ capacity to adapt technologies to their own situations. The paper critiques continued use of blanket, high-dose fertilizer recommendations, arguing for approaches that teach farmers how to maximize returns from smaller, more affordable input purchases. Developing such technologies requires that researchers integrate a wider range of stakeholders (farmers, extension agents, agricultural exporters and processors) into research activities at an earlier point in time than has been the case. Although evidence that these new approaches are increasing the use of purchased inputs remains weak, a number of important lessons are emerging about how research and extension outcomes are influenced by institutional culture and incentives. The authors conclude that developing recommendations for small, affordable input doses and training farmers so they can adapt recommendations to their particular circumstances is as much an institutional challenge as a technology challenge.     

Cooperative membership and farmers’ choice of marketing channels – Evidence from apple farmers in Shaanxi and Shandong Provinces,China

Cooperatives are established to improve farmers' production conditions, to increase their bargaining power and to enable them to benefit from modern value chains. In China, farmers are members of a cooperative for multiple reasons. Little is known on whether and how cooperative membership affects farmers’ choice of marketing channels. This paper examines determinants of farmers’ choice of marketing channels, especially how cooperative membership impacts upon this choice. Our analysis is based on survey data collected in 2015 among 625 apple growing farm households in the provinces Shaanxi and Shandong. We employ endogenous switching probit models to deal with potential endogeneity of membership in estimating the determinants of marketing channel choices. We find that cooperative membership has a positive impact on selling to wholesalers and a negative impact on selling to small dealers, but no significant impact on selling to the cooperative itself. As products sold through cooperatives generally comply with relatively stringent food quality and safety standards, these results imply that policies promoting cooperative members to sell their products through cooperatives are likely to have a significant impact on food quality and food safety in China.     

Estimating effects of cooperative membership on farmers’ safe production behaviors: Evidence from pig sector in China

This research studies the determinants of pig farmers’ participation in farmers’ cooperatives and the effects of farmers’ cooperatives on pig farmers’ behaviors in adopting safe production practices using data from a household survey of 540 cooperative farmers and 270 non-cooperative farmers from four main pig production provinces in China. The propensity score matching (PSM) method was adopted to deal with possible self-selection bias associated with farmers’ participation in farmers’ cooperatives due to observables, which is further supplemented by a sensitivity analysis to assess the degree to which the PSM results are robust to the presence of unobservables. The PSM results show that the cooperative membership has significant and positive influence on farmers’ propensity to adopt safe production practices and the effects are heterogeneous across a number of key cooperative, farm and household attributes. Specifically, the membership effects tend to be bigger for cooperatives led by Investor-owned firms (IOFs) and farms of small production scale. And the effects tend to be greater for households (1) of medium and high level of education, (2) of less than 10 years of pig production experience, (3) of no off-farm job experience, and (4) that are specialized in pig production. The sensitivity analysis further increases our confidence in the results for the feed use and the breed use, however, the results for vaccination, drug use and waste disposable are more sensitive to the influence of unobservables, therefore should be interpreted with caution.     

Incumbency advantages,distribution networks and exclusivity — Evidence from the European car markets

This paper investigates the role of distribution networks in explaining incumbency advantages in the European car market. We compare three approaches to incorporate the size of distribution networks in discrete choice models of product differentiation: as an extra product characteristic, as a new dimension of product differentiation in a nested logit framework, or as a measure of the expected travel cost under a spatial Poisson distribution of locations. We obtain robust conclusions across all three approaches: distribution networks play an important role in explaining car producers' market shares, but they only appear to explain part of the bias towards domestic brands in the car market. We also report on an ongoing research project where we analyze the role of distribution networks at a much more detailed local market level, and investigate the specific role of exclusive dealing as a possible entry barrier.     

Consumers’ Reactions to Negative Information on Product Quality: Evidence from Scanner Data

Using daily scanner data we analyze consumers’ reactions to negative information with regard to product quality with reference to a fraud that involved a number of leading Italian firms in the cheese sector in 2008. We evaluate the effects of this event by using a difference-in-differences estimation strategy that compares the brands that were involved in the fraud with those that were uninvolved. It emerges that the negative news with regard to product quality induced consumers to shift their demand from involved to not involved brands. These effects persisted over time, even after the media stopped giving attention to the issue. Retailers suffered part of the costs of the bad news about product quality: the retail margin on brands that were mentioned adversely by the media decreased after the negative publicity.     

Change and diversity in smallholder rice–fish systems: Recent evidence and policy lessons from Bangladesh

Efforts to unlock the genetic potential of both rice and fish, when combined with improvements in the management of rice–fish systems, can potentially increase agricultural productivity and food security in some of the poorest and most populous countries in Asia. In Bangladesh, estimates suggest that the country’s potential rice–fish production system encompasses 2–3 million hectares of land. But despite three decades of research on biophysical and technical aspects of rice–fish systems, this potential has not been fully realized due to insufficient attention given to the social, economic, and policy dimensions of rice–fish system improvement. This paper provides a characterization of the diverse and changing nature of rice–fish systems in Bangladesh to shed new light on the economic viability of different rice–fish systems and recommend policy and investment options to accelerate the development of appropriate rice–fish technologies. Data are drawn from a novel subdistrict-level survey of fishery officers, a household/enterprise survey, focus group discussions, and a meta-review of the literature on aquaculture in the country, all of which were conducted in 2010–2011. Findings indicate that concurrent rice–fish systems, alternating rice–fish systems, and collectively managed systems offer considerable potential for increasing productivity and farm incomes in Bangladesh. Findings also suggest that while innovation in these rice–fish systems is being driven by households and communities, there is need for more supportive government policies and investments to enable further innovation. Policymakers need to develop effective regulations to promote feed and fish quality and quantity, for example. More rigorous analysis of the intended and unintended impacts of these policies and investments is also necessary.     

Path dependencies versus efficiencies in regulation: Evidence from “old” and “new” broadband markets in the EU

This paper examines the determinants of sector-specific regulation imposed on broadband markets related both to efficiency objectives of regulators and to those of narrowly defined interest groups. We test hypotheses derived from the normative and positive theoretical literature employing recent panel data on 27 European Union member states taking into account endogeneity of the underlying regulation and market structure variables. Our empirical specification employs three different estimators based on instrumental variables in order to identify causal effects. We find evidence supporting both regulators pursuing normative objectives and inefficiencies related to regulatory path dependence, bureaucracy goals and an inadequate consideration of competition from mobile broadband networks. Our results call for adjustments in the institutional design of the decision-making process under the current European Union regulatory framework.     

Is profit-sharing participation?: Evidence on alternative firm types from West Germany

Systematic differences are reported in the structural and performance characteristics of firms in subsamples based on (a) profit-sharing and (b) participation-in-control (employee-involvement in decision-making). Moreover, whereas group (b) firms tend to conform to a theoretical, participatory stereotype, group (a) firms do not. The coincidence of profit-sharing and participation-in-control in a given firm is not surprisingly quite low. These results cast doubt on current theoretical and policy arguments concerning productivity gains dependent on the joint use of participation and profit-sharing, but indicate that one precondition for Weitzman-type macro-economic benefits of profit-sharing in the absence of participation may be present.     

Workfare programs and children’s meals intake: Evidence from India

This paper examines the impact of the Indian workfare program (MGNREGA - Mahatma Gandhi National Rural Employment Guarantee Act) that promotes female participation, on the food consumption of children. Using nationally representative data from the National Sample Surveys between 1999–2007, and a difference-in-differences strategy stemming from the staggered roll-out of the program across districts of India, we find that MGNREGA resulted in a decrease in the number of meals for preschool and school-going children. The negative effects on the number of meals are partially attenuated in larger households.     

Who explores further? Evidence on R&D outsourcing from the survey of research and development

Building off the resource‐based view and the knowledge‐based view, our study aims to examine determinants of firms’ R&D outsourcing, using annually‐conducted firm‐level survey data of Japanese R&D companies from 1984–2012. This survey allows us to measure strategic R&D outsourcing, isolated from those more for cost‐reducing, such as prototyping, testing and inspecting. The results corroborate the argument of complementarity in scale between internal R&D and R&D outsourcing. We also find that firms employing more doctorate holders and diversifying in knowledge spaces tend to make more use of R&D outsourcing. This study sheds light on firms’ absorptive capacity, associated both with higher‐order R&D human capital and diversified knowledge spaces, as determinants of R&D outsourcing.     

Immigrants and Workplace Training: Evidence from Canadian Linked Employer–Employee Data

Job training is one of the most important aspects of skill formation and human capital accumulation. In this study, we use longitudinal Canadian linked employer–employee data to examine whether white/visible minority immigrants and Canadian-born emplooyees experience different opportunities in two well-defined measures of firm-sponsored training: on-the-job training and classroom training. While we find no differences in on-the-job training between different groups, our results suggest that visible minority immigrants are significantly less likely to receive classroom training, and receive fewer and shorter classroom training courses, an experience that is not shared by white immigrants. For male visible minority immigrants, these gaps are entirely driven by their differential sorting into workplaces with fewer training opportunities. For their female counterparts, however, they are mainly driven by differences that emerge within workplaces. We find no evidence that years spent in Canada or education level can appreciably reduce these gaps. Accounting for potential differences in career paths and hierarchical level also fails to explain these differences. We find, however, that these gaps are only experienced by visible minority immigrants who work in the for-profit sector, with those in the nonprofit sector experiencing positive or no gaps in training. Finally, we show that other poor labor market outcomes of visible minority immigrants, including their wages and promotion opportunities, stem in part from these training gaps.     

Industry Characteristics and Anti-Competitive Behavior: Evidence from the European Commission’s Decisions

We analyze all the European Commission’s decisions on antitrust cases between 1999 and 2004 using a unique dataset that also contains information on all the cases that were filed for the Commission’s consideration but were never pursued. This data allow us to determine whether there is any type of bias in the selection process followed by the Commission when deciding which cases to pursue until a final decision is reached. We find that the selection of cases is not random and that it is quite efficient but not very significant. We also find that the economic literature criteria are important for the Commission’s decisions.     

Evaluating the impact of divestitures on competition: Evidence from Alberta’s wholesale electricity market

Asset divestitures play a central role in antitrust and competition policy. Despite their importance, empirical evidence on their impacts on market competition is limited. We analyze market power in Alberta’s wholesale electricity market, where transitional arrangements that virtually divested generation assets from large incumbents were put in place during market restructuring in the early 2000’s and expired at the end of 2020. Subsequently, average peak hour prices rose by 120% the year after their expiry. We demonstrate that nearly two-thirds of this increase can be explained by elevated market power from the large suppliers. Further, exploiting variation in the allocation of the divested assets across heterogeneous firms, we demonstrate that market power execution is elevated when the divested assets are controlled by large strategic firms. Our findings highlight the important role that asset divestitures and their allocations can have on market competition. Our analysis also raises concerns over the ability of restructured electricity markets to facilitate sufficient competition through entry and the potential need for regulatory intervention.     

Objectives and incentives: Evidence from the privatization of Great Britain’s power plants

Does privatization increase plant productivity because the private owner’s objective is different, or because they are better able to control management? And, is privatization sufficient to improve productivity, or is it only effective in combination with competition? We answer these questions using the quasi-experiment of Great Britain’s electricity industry privatization. To separate the effect of a change in objectives from a change in incentives we assume, that the former only affects labor but not fuel productivity. And, assuming that effective competition was only introduced after privatization, we are able to separately identify the effects of privatization and competition. We find that privatization increased labor but not fuel productivity: evidence for the importance of objectives. There is no evidence that the introduction of effective competition after privatization increased labor or fuel productivity: evidence that privatization increases productivity by itself.     

What happens to diet and child health when migration splits households? Evidence from a migration lottery program

The impact of migration on food security and child health is likely to differ depending on whether children themselves migrate or whether they remain behind while other household members migrate. However, existing studies have not been able to examine how impacts differ in these two scenarios because parallel data are required for both the sending and receiving country. Moreover, self-selection into migration makes unbiased estimation of either impact difficult. We overcome these problems by using a unique survey of Tongan households that applied to migrate to New Zealand through a migrant quota which selects households through a random ballot. This survey covers both migrant children in New Zealand and non-migrant children in Tonga, with the migration policy rules providing a source of exogenous variation for identifying impacts. Our estimates of short-run impacts show that diets diverge upon migration: children who migrate experience improvements, while diets worsen for children who remain. There is also suggestive evidence of a divergence in health outcomes, with increases in weight-for-age and height-for-age found for migrant children, and decreases found for children who remain behind while other household members migrate.