Can performance appraisals motivate employees to improve performance? A Mexican study

In this study of Mexican employees, we examined the relationship between performance appraisal characteristics (appraisal source, appraisal purpose and feedback richness) and perceived reactions of employees to the appraisal characteristics (perceived fairness and perceived accuracy of appraisals) and appraisal outcomes (appraisal satisfaction and motivation to improve). We hypothesized that multisource appraisals, appraisals used for administrative and developmental appraisals (multipurpose appraisals) and appraisals that have a high degree of feedback richness would lead to more perceived accuracy and perceived fairness of appraisals. We further hypothesized that higher levels of perceived fairness and accuracy would lead to higher levels of employee appraisal satisfaction and motivation to improve performance in the future. Results based on a survey of Mexican employees provide support for most of the hypothesized relationships. We discuss implications of the findings for research and practice of performance appraisals in the Mexican context.     

The weak linkages between processing exports and the internal economy. The Mexican case

The aim of this paper is to show the internal linkages of manufacturing exports and the rest of the economy. We take the Mexican economy as the case of study. Manufacturing exports constitute the most of exports and processing exports (maquiladora) represent an important part of them. We consider the indirect domestic value added contained in Mexican manufacturing exports, dividing them into exports from the internal economy and the maquiladora industry. We show that the internal backward linkages of exports are weak, that only a few sectors produce inputs for exports, and that the forward linkages are weak too because the Mexican maquiladora industry assembles imported parts and components into final goods for export. The actual picture is quite different from that presented by Hirschman [(1958) The Strategy of Economic Development. New Haven, Yale University Press], who argued that the manufacturing sector plays a key role to promote economic growth because of its dense forward and backward internal linkages.     

The relationship between perceived compensation,organizational commitment and job satisfaction: the case of Mexican workers in the Korean Maquiladoras

Expatriate literature has generally favoured home country factors to understand expatriate success. In this paper, we contribute to the field by shifting our focus to the host country workforce (HCW). We use equity theory to examine the effects of perception gaps in compensation between HCW and expatriates on organizational commitment and its impact on job satisfaction and job performance. Based on field surveys and in-depth interviews of Korean expatriates as well as Mexican workers, results provide support for our hypothesis that significant perception gaps exist in compensation. The finding that compensation gap was significantly related to affective commitment only is of crucial importance. Our results also suggest that only affective commitment is positively related to job satisfaction and performance. We discuss research as well as managerial implications.     

Industry trade between Canada and Mexico: Will a weakening peso help Mexican manufacturing in the long run?

Mexico has longed served as one of Canada's major trade partner, but the plunging peso has had drastic effects across North America. This study investigates the bilateral trade relationship between Canada and Mexico for 27 individual industries, from 1973 to 2006. Cointegration analysis shows that overall sensitivity to the real exchange rate is weak, but that the trade balances of certain manufacturing industries do indeed improve after a currency depreciation. The “J-curve” effect is present for certain electrical and mechanical industries, suggesting that the recent decline of the peso may currently be having a negative impact on Mexican trade—but that it might eventually be beneficial, particularly for the Machinery and Transport Equipment sector.     

International synchronization of the Mexican states business cycles: Explaining factors

The aim of this paper is to identify the explaining factors of the synchronization of the business cycles of the Mexican states and those of the US economy. The cycle indicator is obtained by de-trending the series of total formal employment (Mexican states) and nonfarm employment and industrial production (US). In general, our panel data model estimations suggest the existence of spatial autocorrelation and significant time-period fixed effects. Also, the estimates indicate a significant and positive effect of the ratio of foreign direct investment to gross domestic product (GDP), which may be supplementing the impact of international trade (driven by the most internationally integrated states) and a negative effect of the ratio of remittances to GDP (driven by less integrated states). Finally, the evidence suggests that more similar productive structures yield more synchronized business cycles.     

Economies of scale in the Mexican automotive sector

Recent growth of the Mexican motor vehicle industry has sparked a great deal of controversy on both sides of the U.S.-Mexico border regarding the potential effects of the North American Free Trade Agreement. One of the key factors affecting the future competitiveness of the Mexican motor vehicle industry relative to U.S. producers is whether the Mexican firms can exploit economies of scale as their output expands. This article investigates that possibility as well as the direct and cross-price elasticities of demand for the inputs by estimating translog cost functions for the Mexican motor vehicle and autoparts industries. The results are consistent with the hypotheses that substantial economies of scale remain to be exploited by the Mexican motor vehicle industry, but that the autoparts industry is operating with diseconomies of scale. However, the lack of investment in new technology and X-inefficiency on the part of the autoparts firms may have been partially responsible for the latter finding.     

An empirical investigation of U.S. bank risk and the Mexican peso crisis

This paper examines two pairs of hypotheses about the effect of the Mexican Peso crisis on U.S. bank stock returns. We use a three-index market model as our empirical methodology because bank stocks are influenced more by both interest rate risk and foreign exchange risk than other non-banking stocks. The results show that the market reacted to each event promptly, supporting semi-strong market efficiency. To find out whether these effects created a domino effect in the U.S. banking system, a set of cross-sectional regressions were run. In general, the empirical results support the investor-contagion hypothesis, which indicates that the market penalized or rewarded banks without regard to their ecposure to the market for Mexican loans.     

Regional foreclosures and Mexican remittances: Evidence from the housing market crisis

This study investigates the extent to which Mexican workers’ remittances are affected from the recent housing market decline in the United States. Results from a multivariate model reveal that an increase in the national U.S. foreclosure rate has a negative and statistically significant impact on Mexican remittances. At the regional level, foreclosure rates of the South and the West have a significant impact on workers’ remittances in the same negative direction. However, foreclosure rates from the North Central and East Central regions do not appear to have this statistically significant impact. Lastly, in contrast to previous results in the literature, real exchange rate movements and Mexican remittances seem to be insensitive to one another once the housing market is accounted for in the analysis.     

Crucial exchange rate parity. Evidence for Mexico

Through a structural vector error correction model, one restricted cointegrating relationship for monthly data (1999.01–2012.04) was found between three exchange parities of great relevance for the Mexican economy: US Dollar–Euro, Mexican Peso–US Dollar, and Mexican Peso–Euro. The data's structure revealed endogeneity of the last one, but the first is the one that adjusts the long run (cointegrating) relation. A unitary elasticity of MxP–Euro parity to the other two parities was found, which validates PPP condition in absolute terms. These results are crucial to analyze the possible long run exchange effects on the Mexican real and financial variables because of the possible intensification of the Euro crisis and the currency war.     

Equity Valuation and Current Cost Disclosures: the Case of Mexico

This study uses an accounting-based valuation model to investigate the relation between the market value of publicly traded Mexican firms and their disclosures of price-level adjusted accounting information. The model is estimated on a sample of Mexican companies during 1987–1990, when annual inflation rates in Mexico decreased from 130 per cent to 20 per cent. The results indicate that general price level-adjusted and current cost disclosures explain a significant portion of the cross-sectional variation in the market-to-book ratios of the sample firms. Further, the explanatory power of holding gains is robust to decreases in the general level of inflation, which suggests that current cost and constant peso disclosures are relevant for determining firm value over a wide range of inflation rates. These results are particularly important now since the Mexican Institute of CPAs has proposed eliminating the measurement of holding gains in order to make Mexican financial statements more comparable to US and Canadian GAAP.     

The relationship between oil prices,the stock market and the exchange rate: Evidence from Mexico

This paper analyzes the variables of oil price, exchange rate and stock market index to explain how they interact with each other in the Mexican economy. The examined period includes monthly data from January 1992 to June 2017. A Vector Autoregressive Model (VAR) is implemented that includes oil prices, the nominal exchange rate, the Mexican stock market index, and the consumer price index. Results indicate that the exchange rate has a negative and statistically significant effect on the stock market index; this indicates that an appreciation of the exchange rate is related to an increase in the stock market index. It is also found that the consumer price index has a positive effect on the exchange rate and a negative effect on the stock market index. The results also indicate that oil prices are statistically significant against the exchange rate, concluding that an increase in oil prices creates an appreciation of the exchange rate. In addition, the impulse-response functions show that the effects found tend to disappear over time.     

Preventing HIV in injection drug users: exploring the tradeoffs between interventions

Injection drug users (IDUs) transmit the human immunodeficiency virus (HIV) via both needle sharing and sex. Available interventions for this population have varying costs and effectiveness and focus on different risk behaviors. In this analysis, we look at two interventions. One is inexpensive, broad-based and provides modest risk reductions (street outreach (SO)); the other is narrowly focused, expensive and relatively effective (methadone maintenance). This analysis explores the effects of population risk behavior, intervention effectiveness, intervention costs, and decision constraints when allocating funds between these two interventions to maximize effectiveness. We develop a model of the spread of HIV, dividing IDUs into susceptibles (uninfected) and infectives, and separately portraying sex and injection risk. We simulate the epidemic in New York City for time periods from the mid-1980s to the early 1990s, and incorporate the behavioral effects of two interventions performed singly or in combination to find the allocation that maximizes the number of infections averted in the IDUs and their noninjecting sex partners, assuming interventions have increasing marginal costs. We find that the optimal allocation nearly always involves spending the maximum allowable amount on SO. This result is largely insensitive to variations in risk parameters, intervention efficacy, or cost. The model's structure, however, makes clear that many factors contribute to this insensitivity, namely the scope of the interventions, the dual drug/sex nature of HIV risk in the population, the asymmetry of sexual risk for men and women, and the potential benefits to nonIDUs.     

Youth labour market performances in the Russian and Italian regions

The focus of this paper is on youth unemployment in Italy and Russia: in both countries, youth unemployment rates (YURs) are higher than adult (or total) ones. Despite these general trends, there are significant regional differences in YURs and above-average YUR regions tend to cluster close to each other. Moreover, a distinction between “North” and “South” regions seems appropriate for both countries. The purpose of this study is to identify key determinants of YURs in the Russian and Italian regions, for the period 2000–2009. We also search for the existence of distance spatial effects. In particular, we estimate a modified Arellano–Bond model for the regional YUR, including some explanatory and control variables (e.g. regional GDP in PPP, regional population density, regional total unemployment rate), together with year dummies and North/South dummies. The use of distance matrixes enables important analysis to be conducted on the role played by spatial effects, which turn out to be significant. Also the negative impact of the 2008–2009 crisis is statistically confirmed (at least in the case of Italy). The relevant policy implications are highlighted in the conclusions.     

U.S. Presidential election impact on Canadian and Mexican stock markets

Recent empirical evidence indicates that the delay in the 2000 presidential election results impacted the stock market performance in the United States. In the present study we examine the impact of the same delay on the performance of the Canadian and Mexican stock markets. We find evidence indicating that both the Canadian and the Mexican stock markets were affected negatively during the period. This study not only shows that the Mexican and Canadian stock markets are closely integrated with their American counterparts but also indicates that the markets of these countries follow the U.S. presidential elections as closely as U.S. markets do. The authors thank the Department of Economics and Finance, Texas A&M University-Commerce, for financial support to purchase some of the data used in the study.     

Comprehensive Protection,Winners and Losers: A Sectoral Analysis of the Mexican Economy 1970–87

Sectors that have the highest effective protection index should have a greater advantage within an economy than those that have lower index values, and should be the likely winners over a period of years. However, this proposition may not hold, as a result of limitations in the indexes' construction, namely, not considering imperfect structures, the inclusion of non-tradables and intersectoral simultaneity. To overcome these limita-tions, a comprehensive protection (CP) index is proposed. It is based on the Leontief model to calculate market prices and uses a class of equilibrium price models developed on labor value theories. The CP index is then used in a sectoral analysis of the Mexican economy to estimate which sectors are likely to have been winners and which losers. The results of the analysis showed consistency with the instrumentation of the Mexican economic policy. The study concludes that the index formulated here is both theoretically and empirically superior to alternative protection indexes.     

Personality similarities and differences between Mexican and American business leaders

A study was conducted to investigate personality similarities and differences for a group of 200 business leaders, 100 each from Southern Mexico and the United States. Mexican and American leaders were administered the Sixteen Personality Factor Questionnaire (16PF) in their native language (Spanish or English). A demographic questionnaire solicited information about age, education, and gender. These variables were used as covariates in some analyses. After controlling for the effects of age, gender, and education level, the authors found that Mexican leaders scored higher than their American counterparts on the warmth, emotional stability, social boldness, and openness to change scales. American leaders scored higher on the abstractedness and self‐reliance scales. On scales related to leadership there were between‐nationality differences on emotional stability, social boldness, abstractedness, and self‐reliance. Additional studies are suggested to illuminate cross‐nationality similarities and differences.     

The effects of population density on subjective well-being: A case-study of Slovakia

The main objective of the study is to examine the effects of population density on individuals’ subjective well-being (SWB). The physical characteristics of the built environment have recently received more attention regarding their role in influencing well-being. The research is based on two waves of a representative survey EU-SILC (2013: N = 12,791 and 2018: N = 14,665). The study focuses on the emotional domain of SWB and uses a score based on the Mental Health Inventory (MHI-5). In order to remove the potential problem of reverse causality, a two-stage least squares regression model with instrumental variables is used. It shows that population density positively affects the SWB score. The results reported in this study can be useful for urban planning aimed at optimizing spatial structure while taking into account the factors which positively affect subjective well-being. The findings can also be beneficial for assessing the resilience and vulnerability of cities.     

DO WATER-RICH REGIONS HAVE A COMPARATIVE ADVANTAGE IN FOOD PRODUCTION? IMPROVING THE REPRESENTATION OF WATER FOR AGRICULTURE IN ECONOMIC MODELS

With growing demand for fresh water and uncertain supplies, there is an increasing concern about future water scarcity. Since most freshwater withdrawals are for agriculture, reliance on water embodied in imported food (trade in ‘virtual water’) is a possible strategy to provide food to water-stressed regions while conserving their scarce supply for other purposes. To evaluate this proposition, we extend a model of interregional trade by (1) defining endowments of water that cannot be exceeded, (2) allowing simultaneous operation of rainfed and irrigated agriculture, and (3) distinguishing sub-regional endowments within a larger economic region. An application to the Mexican economy compares region-specific water abundance with economic comparative advantage under alternative scenarios. We conclude that the water-rich regions of Mexico are relatively high-cost producers of food and that they do not pick up the slack even when the lowest-cost Mexican regions are constrained by binding water constraints.     

Productivity effects on Mexican manufacturing employment

We examine the effects of labor productivity and total factor productivity (TFP) on employment across 25 Mexican manufacturing industries from 1984 to 2000. Employing panel data methods, several interesting findings emerge. First, we observe a strong and positive impact of NAFTA on employment. Second, productivity exerts a procyclical, positive effect on employment but this effect becomes smaller after NAFTA. Third, partitions of our sample according to capital-labor intensity suggest that industries which are less capital-intensive were affected negatively on impact by NAFTA but that productivity impacted employment positively after NAFTA. In contrast, more capital-intensive industries display these results in reverse.     

Category Divergence,Straddling, and Currency: Open Innovation and the Legitimation of Illegitimate Categories

The organizational literature is increasingly interested in the origins and consequences of category emergence. We examine the effects of being affiliated with categories initially considered illegitimate (‘divergence’), and of organizational attempts to blur the boundaries between categories (‘straddling’), on capital market reactions to firm announcements. We develop arguments for how these effects likely vary with increasing legitimation (‘currency’) of the category. We apply event study methodology to the complete population of firms' announcements of open source activities, an open innovation model for software development that is novel and defies the extant dominant logic of software production and valorization. Over a ten‐year period, we find negative effects of divergence, positive effects of straddling, and that the magnitude of both these effects diminishes with increasing category currency. The implications for theories of organization and open innovation in the context of category emergence are discussed.