The strategic strength of weak signal analysis

Foresight can be seen as a social cognition process involving a complex set of methods and interactive processes intended to assist policy in becoming more adaptive and forward-oriented in unpredictable environments. As a form of foresight raw material, “weak signals” can be thought of as gross, unstructured, fragmented, incomplete and inadvertent environmental data that may be refined into valuable information regarding context and further be articulated into strategically actionable knowledge. As advanced indicators that precede significant discrete one-off events and/or novel developments in the rate and direction of trends, their analysis has the potential to facilitate the real-time alignment between organisational decision-making and changing external circumstances. These predictors of future change pose fundamental problems of identification and interpretation and represent a challenge to established mental models. Thus, the practical significance of weak signals is that they can be transformed into meaningful insight for policy action. Such a value, however, does not materialise automatically. Realising this potential requires a degree of tolerance and fluidity of the collective cognitive frameworks by which weak signals can be apprehended, assessed and acted upon. This paper aims at covering the scope of perceptions and actions typically involved in the tracing and tracking of this shaping process.     

EXCHANGE RATE TARGET ZONES: A SURVEY OF THE LITERATURE

This work selectively reviews the literature on exchange rate target zones and their theoretical and empirical methodologies and examines whether they can be used to clarify to what extent this type of exchange rate regime could contribute to greater exchange rate stability. We discuss the main contributions of the first and second generations of exchange rate target zone models. In an attempt to reconcile the poor empirical performance of the Krugman model with the reality of exchange rate target zone regimes, this line of research integrates target zones with alternative underlying economic models, such as imperfect credibility, intra‐marginal interventions and sticky price models. It was thus possible to understand the correlations observed between the exchange rate, its fundamentals determinants and the interest rate differential, and to explain the fact that the statistical distribution of the exchange rate is hump shaped rather than U shaped. This implies that the initial emphasis of target zone models on nonlinearities, ‘honeymoon effect’, ‘smooth pasting’ and marginal interventions has vanished. Exchange rate target zones are better described as similar to managed floating regimes with intra‐marginal interventions, with some marginal interventions when the exchange rate reaches the edges of the floating band.     

Inefficient sales delays by a durable‐good monopoly facing a finite number of buyers

This article offers a new explanation for unscheduled price cuts and slow adoption of durable goods. We study a standard durable‐good monopoly model with a finite number of buyers and show that this game can have multiple subgame perfect equilibria in addition to the Pacman outcome—including the Coase conjecture. Of particular interest is a class of equilibria where the seller first charges a high price and only lowers that price once some—but not all—high‐valuation buyers purchase. This price structure creates a war of attrition between those buyers, which delays market clearing and rationalizes unscheduled purchase and price cut dates.     

Is There an Optimal Constitution?

The optimal constitution is one that protects people from politicians' thirst of power and preserves citizens' civic virtues. This paper presents a model that blends David Hume's (1741) consideration that in politics every man ought to be supposed a knave, with John Stuart Mill's (1861) conception of self-interested politicians. The optimal constitution is proved to be feasible. However, there are two possible equilibria, the Frey and Brennan-Buchanan equilibrium. It is shown that Bruno Frey's (1997) crowding-in and crowding-out analysis is a particular case of our model. In the Brennan-Buchanan equilibrium there is a long-run neutrality of enforcement on citizens' performance. In general, a trade-off is expected between the optimal number of laws and enforcement. The comparison between the equilibria shows that the Frey equilibrium is the best option to enhance the civic virtues of citizens, while the Brennan-Buchanan equilibrium is the best way to deter the ambitions of self-interested politicians.     

Workforce Diversity and Religiosity

Journal of Business Ethics - Workforce diversity has received increasing amounts of attention from academics and practitioners alike. In this article, we examine the empirical association between a...     

The use of Fx derivatives and the cost of capital: Evidence of Brazilian companies

Large corporations have been using derivative instruments as a tool to protect their indirect exposure, as FX risks. A sample with 47 non-financial Bovespa Listed Brazilian companies from 2004 and 2010 was used to test the hypothesis that use of derivatives as a risk management policy tool reduces companies' cost of capital. In contrast to other countries, results rejected this hypothesis, showing that in Brazil there is a positive relationship between using these tools and cost of capital. However, a more in-depth analysis based on the TACC model for a Brazilian company, this hypothesis was not rejected after the 2008 crisis.     

Animal foods and climate change: shadowing eating practices

Animal farming exceeds all forms of transport in terms of global greenhouse gas (GHG) emissions. Despite the implications of the seriousness of addressing animal farming in relation to mitigating the effects of GHG emissions, to date, the relationship between consumer behaviour and climate change has tended to neglect the role of animal foods. This paper reports on a pilot study in which six UK households were ‘shadowed’ to facilitate the investigation of the relationship between animal food practices and environmental practices, as they emerge in day‐to‐day life. Results indicate that most participants make no connection between the two issues at present, in terms of awareness or practice. However, animal foods do have an ambiguous and complex status in most participants' food practices; for instance, being viewed as problematic for reasons of health or animal welfare. This finding suggests that further research is needed into the potential for raising awareness of the link between animal‐based foods and climate change. This might have a role to play in shifting food practices towards more plant‐based, less GHG intensive, foods.     

Competitiveness, resources, and capabilities: empirical evidence from retail banking

This research aims to identify and measure bank employee perceptions of the determinants of competitiveness in terms of resources, skills, and capabilities within the retail banking sector. All the 40 branches of a leading Portuguese bank—the Caixa Geral de Depósitos—operating in two Portuguese districts were surveyed. Our results show that bank competitiveness differs according to performance evaluation, human resource (HR) planning, the system of incentives, and managerial motivation. They also demonstrate that human capital is a source of success in the business of banks, which relies heavily on stable and enduring relationships with customers. The study also provides recommendations for retail bank managers seeking to refine their HR strategies as a means of improving their competitiveness.