Effects of hiring former employees of multinationals in the absorptive capacity of local firms

The attraction of foreign direct investment seeks, among other things, to increase the productivity of local companies through knowledge spillovers. However, the empirical evidence in this regard is contradictory. One influential factor is the absorptive capacity of the local companies. This article analyzes the effect of the presence of former employees of multinational corporations as employees of local companies, on the absorptive capacity of said companies. The study was done in Costa Rica, a country known for its successful strategy in the subject matter. The data come from a survey applied to 1167 companies by the Observatorio Costarricense de las Pymes in 2011. It was found that the hiring of former employees of multinational corporations by local companies has a positive effect on the index of absorptive capacity of companies in all productive sectors. Specifically, this hiring of former employees increases the index of absorptive capacity by nine percentage points, with differences by sector and the size of the company.     

COMMUNICATION ABOUT FUTURE POLICY RATES IN THEORY AND PRACTICE: A SURVEY

We discuss the theoretical rationale for central bank communication about future policy rates, either as part of inflation targeting or in the form of forward guidance. We also summarize both actual central bank communication about future policy rates and empirical evidence on the effectiveness of these types of communication. We argue that there is a disconnect between the theory and practice of forward guidance, as theory assumes commitment on the part of the central bank, while in practice central banks generally do not commit. Future theoretical research on forward guidance should therefore take the absence of commitment by central banks into account.     

Association Between Independent Auditor Fees and Firm Value： A Study of Brazilian Public Companies

This article investigates the relationship between fees for audit and non-audit services with Tobin＇s Q. Using a sample of Brazilian public companies in the period from 2009 to 2011, we estimate the association between Tobin＇s Q and the auditors＇ remuneration scaled by total assets. Additionally, to strengthen the conclusions, we present a second model with the remuneration of the auditors in absolute terms. The results suggest a significant relationship between Tobin＇s Q and audit and non-audit fees, positive and negative, respectively. Specifically, increases in audit fees and non-audit fees respectively increase and decrease the Tobin＇s Q of the audited company. The results of this study have important implications for those interested in good corporate governance practices. Managers and board members concerned with value carefully evaluate the remuneration and nature of services creation, when engaging independent auditors, should provided.     

Public–private wage gap in Latin America (1992–2007): A matching approach

Using matching methods, we estimate the public–private wage gap for urban workers in eleven Latin American countries for the 1992–2007 period. These methods do not require any estimation of earnings equations and hence no validity-out-of-the-support assumptions; furthermore, this approach allows us to estimate not only the average wage gap but also its distribution. Our main findings indicate that the average public sector worker earns more than his/her private counterpart, and that this differential increased over the 1992–2007 period. Important differences along the wage distribution are also shown in the results; in fact, public servants in the highest percentiles of the wage distribution generally earn less than their private sector equivalents. Nonetheless, the percentile at which a positive wage gap becomes a wage penalty shifted over the period as the average wage gap experienced by most countries widened. Still, the most qualified public sector workers do face a wage penalty. Furthermore, indicators of government effectiveness show no relationship with the country ranking according to the public–private wage gap.     

International automotive production networks: how the web comes together

This paper aims to provide empirical evidence for the connections between new trade theory and the spatial distribution of economic activities, considering the results obtained by the literature on New Economic Geography as a starting point. To do this, we apply Social Network Analysis specifically to the World Automotive Trade Network. We explore the structural features of the auto network for the years 1996 and 2009 using data on trade flows for 172 countries. Our findings suggest that the auto network has become denser, more extensive and more integrated over time, depicting a center-periphery structure in which regional clusters play a prominent role. In this configuration, strong agglomeration forces generated by companies’ desire for large and rich market access with minimum transportation costs are balanced by the search for new high-potential markets.     

Salespersons as Internal Knowledge Brokers and New Products Selling: Discovering the Link to Genetic Makeup

Managers increasingly realize the importance of involving the sales force in new product development. However, despite recent progress, research on the specific role of the sales force in product innovation‐related activities remains scarce. In particular, the importance of a salespersons' internal knowledge brokering has been neglected. This study develops and empirically validates the concept of internal knowledge brokering behavior and its effect on selling new products and developing new business, and explores whether a salesperson's internal brokering qualities are determined by biological traits. The findings reveal that salespeople with the DRD2 A1 gene variant engage at significant lower levels of internal knowledge‐brokering behavior than salespeople without this gene variant, and as a result are less likely to engage effectively in new product selling. The DRD4 gene variant had no effect on internal knowledge brokering. Management and future research implications are discussed.     

WHICH AGGLOMERATION EXTERNALITIES MATTER MOST AND WHY?

This paper revisits the ongoing discussion on the importance of agglomeration externalities – specifically specialization, diversity and competition effects – that may contribute to innovation, productivity and urban employment growth. Previous meta‐analyses suggested that the evidence on agglomeration externalities is strongly context‐specific. Expanding an earlier analysis of 31 articles, we seek to draw in this paper more robust conclusions by means of the statistical evidence for agglomeration externalities presented in 73 scientific articles, all building on the seminal work of Glaeser et al. (1992). Our results confirm that the heterogeneity among studies is huge and can only be partially accounted for by means of an ordered probit analysis. Additionally, some evidence of publication bias is found. We conclude that the conventional lines of inquiry in this literature may now have reached strongly diminishing returns. New lines of inquiry, using rich micro‐level data on firms and workers, dynamic general equilibrium models at the macro level, more attention for spatial and temporal variation in the impacts of agglomeration, and further investigations into the spatial scope of externalities are promising avenues for further research that can enhance our understanding of how agglomeration externalities continue to fuel our increasingly urbanized world.     

Intellectual capital drivers of product and managerial innovation in high-tech and low-tech firms

There is widespread understanding that intellectual capital (IC), consisting of the valuable knowledge resources of an organization, is a key enabler of innovation activities; however, little is known about the more specific contingencies impacting the relationship between IC and innovation. Thus, this article examines firm technology level and innovation type as contingency variables. It was argued that because high-tech and low-tech firms differ in terms of several knowledge characteristics (complexity, tacitness and pace of renovation), it is likely that their innovation performance is supported by different combinations of IC components. Furthermore, differences between product/service and managerial innovation could also lead to changes in the degree of relevance of various IC components. To test these contingency hypotheses, a survey dataset collected from 180 Spanish companies is analysed using structural equation modelling. The results demonstrate that both firm's technology level and type of innovation affect how IC influences innovation performance. The findings contribute to a knowledge-based perspective on innovation and pave the way for a more context-sensitive and contingency-mindful approach to understanding innovation and knowledge-based value creation.     

Me,Myself, and Future Generations: The Role of Affinity and Effectiveness in the Creation of Consumer Environmental Stewardship (CENS)

Policymakers, consumer advocate groups, and researchers agree that consumers need to increase their proenvironmental behaviors if a decent standard of living is to be ensured for future generations. Despite high levels of environmental concern, consumers still refrain from large‐scale adoption of proenvironmental behaviors. Social marketers agree that a change in attitudes is not enough to stimulate the necessary behavioral change and are looking for ways to help consumers overcome the costs (e.g., price premiums, inconvenience) that are often associated with proenvironmental behaviors. Currently, consumers often see proenvironmental behavior as a trade‐off between short‐term personal benefits and longer term collective benefits. The authors contribute to the social marketing literature on proenvironmental behavior by introducing the concept of Consumer Environmental Stewardship (CENS), which centers on the use of intrinsic motivation to stimulate a personal sense of responsibility for the environment. The findings, based on a survey and three experiments, show that the stimulation of consumers’ affinity with future generations (AFGs) and perceived consumer effectiveness (PCE) can help to promote CENS, which in turn raises proenvironmental behaviors. However, this research also shows that increasing levels of AFGs can backfire and result in lower levels of CENS, if consumers experience low levels of PCE.     

When deeds speak,words are nothing: a study of ethical leadership in Colombia

Using a sample of 124 managers and 248 subordinates, this study examines the mediating effect of subordinates’ job satisfaction in the relationship between ethical leadership and subordinate organizational citizenship and counter‐productive work behaviour in the Colombian context. We additionally analyse the effect of ethical leadership on subordinates’ perception of leaders’ performance. Factor analyses of the ethical leadership scale revealed two factors, ethical person (EP) and ethical guidance (EG), which were differentially associated to the outcomes. We offer an explanation from three cultural dimensions (in‐group collectivism, institutional collectivism, and power distance) by which Colombian employees seem to be more willing to follow leaders’ ethical example as a way to strengthen their membership to the leader's group, than leaders ethical disciplining by which norms are imposed. These findings have a number of implications for organizations and managers who aim to improve their employees’ behaviour. Our advice to them is that leaders’ deeds have a greater impact than their ethical words.