Merger policy in innovative industries

We analyze optimal merger policy in R&D-intensive industries with product innovation aiming to improve the quality of products. Our results suggest that a permissive merger policy is rarely optimal in high-tech industries when the antitrust authority considers a welfare standard that balances the impact of mergers on consumers’ surplus and firms’ profits. In particular, relative to a benchmark where the effects from R&D are absent, we show that the optimal merger policy should not be substantially more permissive in the presence of those effects from R&D.     

Upgrading peripheral wind sectors

The implementation of traditional policies does not consider institutional singularities in peripheral sectors. The main aim of this paper is to analyse the interaction among local capabilities and multinational agents to upgrade a peripheral wind sector. The case study conducted in the peripheral region of Galicia (Spain) emphasises the challenges concerning policy design and implementation in this kind of regions. The theoretical foundations are based on the systemic and evolutionary approach of the innovation system and the global value chain perspective. This combination enables to analyse how local contexts could shape governance patterns within value chains in peripheral regions. Likewise, the target approach is also applied concerning the design and implementation of a policy programme and its timing. Empirical evidences underline the complementarity of market size and foreign direct investment policies, as well as the diversification towards green transitions through enhancing local capabilities.     

On the test score gap between Roma and non‐Roma students in Hungary and its potential causes

Using unique data from Hungary, the gap in reading and mathematics test scores between Roma and non‐Roma 8th grade students is assessed and a substantial gap between them revealed. Standardized test scores as well as the fraction of students with competences considered inadequate are examined. Regardless of measurement and subject area, the bulk of the gap is explained by social differences in income, wealth and parental education. Using reduced‐form regressions, two major mediating mechanisms are identified: first, on average the home environment of Roma children is less favourable for cognitive development; second, the educational environment of the average Roma student is different from the average non‐Roma student. Comparing students with similar home environments from the same school and class, the ethnic gap in test scores is found to be insignificant. Ethnic differences in the home environment are explained by social disparity, and ethnicity seems to play no additional role in that regard. The unequal distribution of Roma students in schools and classes is found to be explained predominantly by social difference, too, with a significant residual portion, indicating the effect of ethnic segregation.     

Informality and mobility

Informality is a defining characteristic of labour markets in developing and transition countries. This paper analyzes patterns of mobility across different forms of formal and informal employment in Russia. Using the Russian Longitudinal Monitoring Survey household panel we estimate a dynamic multinomial logit model with individual heterogeneity and correct for the initial conditions problem. Simulations show that structural state dependence is weak and that transition rates from informal to formal employment are not lower than from non-employment. These results lend support to the integrated view of the labour market.     

An Exploratory Study on Nonlinear Causality Among the MILA Markets

According to conventional portfolio theory, an increase in the interconnectedness of international financial markets may reduce the potential for constructing diversified portfolios. This article explores the implications of the creation of the Latin American Integrated Market (MILA)¹ over the dependence structure of its members using correlation and cointegration analysis as well as linear and nonlinear Granger causality tests. The creation of MILA aimed to enhance the integration process that Latin American financial markets “naturally” present while still providing diversification opportunities to investors. The results of our empirical analysis suggest that such objective is being achieved. Evidence of a rise in cross-country linear correlations and their linear causal relationship supports the idea of an increasing financial integration process in the region, while the absence of cointegration and the weakening of the nonlinear causal relationship favors the creation of diversified regional portfolios. These findings provide valuable insights for investment portfolio designers, regulators, and supervisors.     

The market valuation of ethical assets in Spain: an application of the hedonic pricing method

The aim of this paper is to calculate the market valuation of non‐financial characteristics, namely, the social responsibility criteria (social, ethical and environmental) included in the Spanish Socially Responsible Investment Funds. The hedonic price method is applied for this purpose. This method relates the price of Socially Responsible Investment Funds with both financial and social responsibility characteristics. Because of the large number of social responsibility characteristics included in these funds, prior to application of the hedonic price method, the principal components factor analysis technique is used. The data are taken from the prospectus for each fund and from the data provided by the National Securities Market Commission. Results indicate that the Spanish market is sensitive to the social responsibility practices of companies. In particular, the market value practices related to environmental sustainability, the enforcement of labour rights, sustainable production and consumption and non‐abusive market practices.     

Business strategies and the transition to low‐carbon cities

Cities are key drivers of global climate change, with the majority of greenhouse gas (GHG) emissions being tied to urban life. Local actions to mitigate and adapt to climate change are essential for stabilization of the global climate and can also help to address other urban ecological problems such as pollution, decreasing biodiversity, etc. Companies are important urban actors in the development of low‐carbon cities because they provide a multitude of goods and services to city populations and directly influence urban carbon dioxide (CO₂) emissions. This is a new area of research. While studies on corporate sustainability are numerous, there is little, if any, existing research that examines the role of companies in climate change adaptation and mitigation within specific urban areas. Urban ecologists also have not examined how corporate activity affects urban systems. Taking a multi‐disciplinary systems approach, we present a conceptual model of the role of companies in managing urban interactions with the climate system. We also present empirical findings illustrating how one company ‘partners’ with the city of Rotterdam to test electric vehicles as a pilot project for urban climate adaptation and mitigation. Copyright © 2010 John Wiley & Sons, Ltd and ERP Environment.     

Exploring the customer's intention to switch firms: The role of customer‐related antecedents

This study examined the customer‐related antecedents of the customer's intention to switch firms. Customer citizenship behavior was a key element in this study. Scholars have extensively studied the antecedents of customer citizenship behavior. However, the way that customer citizenship behavior relates to other attitudinal variables and the intention to switch has scarcely been analyzed. The proposed hypotheses were verified using partial least squares variance‐based structural equation modeling applied to 947 users of beauty care service firms in five countries. The results suggest that customer citizenship behavior is an antecedent of satisfaction, trust, and attitudinal loyalty. Two of these variables influence customers’ intentions to abandon relationships with the service provider. The implications of these findings enhance managers’ and scholars’ understanding of the determinants of customers’ intentions to switch firms.     

Urban Warfare Ecology: A Study of Water Supply in Basrah

This article assesses the impact of armed conflict on the drinking water service of Basrah from 1978 to 2013 through an ‘urban warfare ecology’ lens in order to draw out the implications for relief programming and relevance to urban studies. It interprets an extensive range of unpublished literature through a frame that incorporates the accumulation of direct and indirect impacts upon the hardware, consumables and people upon which urban services rely. The analysis attributes a step‐wise decline in service quality to the lack of water treatment chemicals, lack of spare parts, and, primarily, an extended ‘brain‐drain’ of qualified water service staff. The service is found to have been vulnerable to dependence upon foreign parts and people, ‘vicious cycles’ of impact, and the politics of aid and of reconstruction. It follows that practitioners and donors eschew ideas of relief–rehabilitation–development (RRD) for an appreciation of the needs particular to complex urban warfare biospheres, where armed conflict and sanctions permeate all aspects of service provision through altered biological and social processes. The urban warfare ecology lens is found to be a useful complement to ‘infrastructural warfare’ research, suggesting the study of protracted armed conflict upon all aspects of urban life be both deepened technically and broadened to other cases.     

Determinants of corporate social responsibility and business ethics education in Spanish universities

The current economic crisis, unsustainable growth, and financial scandals invite reflection on the role of universities in professional training, particularly those who have to manage businesses. This study analyzes the main factors that might determine the extent to which Spanish organizational management educators use corporate social responsibility (CSR) or business ethics stand‐alone subjects to equip students with alternative views on business. A web content analysis and non‐parametric mean comparison statistics of the curricula of undergraduate degrees in all universities in Spain were conducted. The main conclusion of this paper is related to the Bologna effect in Spanish universities. Comparing our results with prior research in this matter, it is demonstrated that the main reason that explains the increase of CSR and ethical education in Spain is the Bologna process and its adaptation to the European Higher Education Area. Also, private universities in Spain are more likely to require an ethics course than public universities. Other factors, such as size, political orientation, or related to CSR chairs are not statistically explanatory of CSR and ethical education.