Capital expenditure decision making in small firms

A number of studies have been conducted to determine the extent to which large firms utilize sophisticated techniques in capital expenditure decision making. This research effort focuses on financial decision making procedures of small firms, exploring the techniques utilized to evaluate investment opportunities, methods employed to adjust for risk, purposes of expenditures and concern for profitability, and the source and cost of funds. In light of the recent debate on the capital shortage issue, small firms were also asked what type of tax reform they deemed most desirable to stimulate capital investments.     

Structural constraints on organizational change: A longitudinal analysis

The results of a longitudinal study assessing the impact of internal constraints upon both organizational responsiveness to the environment and efforts to change structures for symbolic signaling of policy are presented. The causal model used is developed from a theoretical elaboration of Williamson, Thompson, and Meyer. The implications of the analysis for the signaling metaphor of organizational change are emphasized. The data indicate (i) that the varying resistance to change observed within core dimensions of organizational structure may be largely due to durable capital investments, (ii) that within capitalized dimensions of organizational structure, the resulting resistance to change leads to a longitudinal persistence of centralized decision making, and (iii) that failure to incorporate such constraints in analyses of organizational change leads to misleading results.     

Unilateral and bilateral trade policies for a minimum-wage economy

This paper considers optimal commercial policy for a trading economy which departs from neo-classical characteristics only in that a minimum-wage constraint gives rise to unemployment. Although for a flexible-wage fully employed economy the Baldwin envelope yields dominant domestic production-cum-trade possibilities, unilateral imposition of an optimum tariff is shown not necessarily to be optimal commercial policy for the minimum-wage economy. Rather, there exists an envelope, derived from foreigners' trade indifference and attained via bilateral trade policy, which dominates the Baldwin envelope when the optimum tariff is zero (as Brecher has shown it can be for a minimum-wage economy), and can still yield superior production-cum-trade possibilities when the optimum tariff is non-zero.     

SOME RECENT RESEARCH INTO HOME HEATING

As part of an investigation into the performance of heating systems and the effectiveness of energy saving measures, temperatures have been monitored in forty centrally heated homes. The addition of extra insulation had no effect on the way people operated their heating system or on the temperature level set in the main living room. However, bedrooms were warmer and the importance of individual room temperature controls demonstrated. Differences between people's thermal requirements in domestic and office environments are considered.     

ALTERNATIVE PRODUCTION FRONTIER METHODOLOGIES AND DAIRY FARM EFFICIENCY

This paper estimates technical efficiency (TE) measures using four alternative production frontier models, and evaluates the sensitivity of the results to the choice of methodology. The Cobb-Douglas functional form along with data for 1982 and 1983 from 404 dairy farms located throughout six northeastern states in the US are used in the estimation. A general conclusion is that, broadly speaking, frontier function models are neutrally upwardly scaled versions of the OLS or average model. A second conclusion is that different models yield markedly different efficiency levels across firms. However, the correlation between the indexes from the various methods is high, which implies that the ordinal ranking of firms according to their measured level of technical efficiency appears to be independent of the method used for a given year. By comparison, the correlation between efficiency indexes for the same method across time, although positive, is much lower than the previous set of correlations. Correlation analysis of efficiency versus farm size and of efficiency versus returns over variable costs, based on the alternative models, yielded consistent results.