Symmetric and Asymmetric Stationarity Tests of Productivity

Studies of productivity in the operations and engineering management literature have typically focused on identifying the drivers of productivity and how best to manage resources. To date, the issues of the time-series behavior and the stochastic structure of productivity have largely been overlooked. This article examines the times-series properties of productivity utilizing several unit root and stationarity tests including one that allows for asymmetric adjustments to equilibrium. The findings suggest that productivity is a nonstationary process and first-differencing is necessary to render a stationary series. Moreover, we find some evidence of an asymmetric adjustment process in the productivity growth rates of manufacturing.     

The Effects of Changes in Property Tax Rates and School Spending on Residential and Business Property Value Growth

In this article, we examine the effects of changes in property tax rates and school spending on residential and business property value growth in southeast Michigan. We use panel data for 152 communities in the five counties surrounding Detroit between the years 1983 and 2002, a period during which state government mandated major changes to school finance. Using the mandated changes to identify causality, we find that: (1) residential property values are more responsive to school spending changes than property tax rate changes; (2) business property values are more responsive to tax rate changes than school spending changes; and (3) business property values are more sensitive to changes in tax rates as compared to residential property. We also examine tax competition effects on property value growth, showing that tax competition plays an important role in property value growth in the southeast Michigan region.     

Virtual Word of Mouth and Willingness to Pay for Consumer Electronic Innovations

The authors examine the impact of virtual word‐of‐mouth (vWOM) communication on willingness to pay (WTP) for an innovation. A series of hypotheses are developed that link vWOM to the credibility of innovation information, perceived utilitarian value, and the perceived hedonic value of an innovation, which are in turn hypothesized to influence WTP. The authors test these hypotheses using data collected in Japan from 658 potential adopters of e‐readers and from 565 potential adopters of smartphones. Findings indicate that, in both samples, vWOM is positively correlated with the perceived credibility of innovation information, which in turn is positively correlated with both perceived utilitarian value and perceived hedonic value. WTP is also positively correlated with an innovation's perceived utilitarian and perceived hedonic value. In addition, the path between vWOM and perceived hedonic value is positive and significant in both samples. However, the path between vWOM and perceived utilitarian value is positive and significant in the smartphone sample, but not in the e‐reader sample. The empirical findings provide support for theoretical arguments that link WTP for complex consumer electronic products to consumer perceptions of utilitarian and hedonic value. The results also have important implications for the creation of vWOM strategies designed to reduce the price sensitivity of potential adopters.     

Prevailing Wage Regulations and School Construction Costs: Cumulative Evidence from British Columbia

The effect of prevailing wage laws on the cost of public construction has been the subject of an ongoing public policy debate. We measure this effect by comparing the public/private construction cost differential for schools built before and after British Columbia's Skills Development and Fair Wage Policy. Regression results indicate that public schools were 40.5 percent more expensive to build prior to the policy. This differential was 40.1 percent after the policy's enforcement. However, this change is not statistically significant. Regression results also indicate a stable construction cost function over the policy period. These results indicate that the effect of fair wage requirements was not different from zero in terms of magnitude or statistical significance. Combining these results with the findings of our previous research provides a comprehensive view regarding the effect of the British Columbian prevailing wage policy on school construction. This body of research, utilizing a variety of statistical methods, provides consistent evidence indicating that a relatively strong prevailing wage policy was not associated with changes in the efficiency or productivity of construction that contributes to increased building costs.     

Innovation Process and Outcomes for Large Japanese Firms: Roles of Entrepreneurial Proclivity and Customer Equity

The authors investigate the structural relationships among entrepreneurial proclivity, innovation process characteristics (technological strength, marketing strength, and marketing–R&D integration), and customer equity in achieving business growth and financial return in the Japanese context. Following field interviews and a pilot test, survey data are collected from 207 pairs of marketing and R&D executives from strategic business units (SBUs) of large manufacturing companies in Japan. Based on the partial least squares analysis of data, the authors find nuanced effects of organizations' entrepreneurial proclivity on the critical organizational process, resource, and business performance. The study theorizes and empirically supports the idea that customer equity is a potent intermediary outcome that contributes to both top‐line (growth) and the bottom‐line (ROI) of a business. Specifically, the study shows that: (1) entrepreneurial proclivity directly and positively influences technology strength, marketing strength, and marketing‐R&D integration; (2) entrepreneurial proclivity's effect on business growth and financial return is positive and mediated by customer equity; (3) marketing–R&D integration has a moderating effect on the positive impact of technology strength on customer equity; and (4) customer equity is a strong driver of business growth and financial return. There is a dearth of research on entrepreneurship in Asia; very few empirical studies have been reported from Japan in particular. This study contributes to boundary testing of the theoretical relationships. Although entrepreneurial proclivity appears to be an inspirational concept, its actual adoption remains an important question for many Japanese companies. Those Japanese firms that aspire to be entrepreneurial need to be mindful what innovation processes and resources it takes to fulfill the positive influences of entrepreneurship.     

The reluctant regulator: The Rural Utilities Service and American broadband policy

Drawing on the increasing body of literature on policy stakeholders and the ever-growing acknowledgement that communication policy is crafted by more than just parliamentarians and formal communication regulators this paper examines the role that another set of regulators plays in communication policy: agriculture regulators. Based on a study of the United States Department of Agriculture's Rural Utilities Service (RUS), this paper explores alternative agents of communication policy. More specifically, through document analysis we examine the way in which the Rural Utilities Service has shaped rural broadband policy in the United States over the last three decades. The implications for this research are wide, as it brings another policy actor into the policy making melee, and pushes communication policy scholars to consider the role that non-traditional communication regulators play in the communication policy making process.     

A multinomial logit approach to exchange rate policy classification with an application to growth

We model a country's de jure exchange rate policy as the choice from a multinomial logit response conditioned on the volatility of its bilateral exchange rate, the volatility of its international reserves, and the volatility of its effective exchange rate. The category with the highest predictive probability implied by the logit regressions serves as our de facto exchange rate policy. An empirical investigation into the relationship between the de facto classifications and GDP growth finds that growth is higher under stable currency-value policies. For non-industrialized countries, a more nuanced characterization of exchange rate policy finds that those who exhibit ‘fear of floating’ experience significantly higher growth.     

Benefits Expected by Accounting Firm Partners Selling their Firms to Publicly Listed Companies

In the 1990s and 2000s publicly quoted companies acquired thousands of accounting partnerships in Australia, the United Kingdom (UK) and the United States (US). Little is known of why the partners sold. This study examines the benefits expected by partners who sold their practices to two Australian publicly listed accounting companies. The findings suggest that there were many reasons for selling and a range of expected benefits, with some partners seeing the sale as a ‘silver bullet’ solution to all of the challenges of operating a small to medium‐sized accounting practice.     

Listening to accounting

There are algorithms for the transformation of accounting data into music, and there is suggestive evidence that it is possible to hear different patterns in it than we see when it is transformed into a graph. We cannot say with certainty whether those different patterns are really there, and we cannot even say that if they were, we would be able to perceive them audibly without a disciplining education similar to that which has traditionally taught us to seek and find patterns—knowledge—visually. We can say, however, that there is reason to believe that the mental pathways for the creation of auditory patterns and visual patterns are different. One forms anticipations of events in time; the other forms structures of points in space. One engages the emotions more directly than the other. Each employs different parts of the brain. There are indeed reasons why we might hear something more or at least something else in the music generated by an algorithm than we might see in a picture that was created from the same data.     

Takeover defenses,innovation, and value creation: Evidence from acquisition decisions

The desirability of antitakeover provisions (ATPs) is a contentious issue. ATPs might enable managerial empire building by insulating managers from disciplinary takeovers. However, some companies, such as “hard‐to‐value” (HTV) companies, might trade at a discount due to valuation difficulties, thereby exposing HTV companies to opportunistic takeovers and creating agency conflicts of managerial risk aversion. ATPs might ameliorate such managerial risk aversion by inhibiting opportunistic takeovers. This paper analyzes acquisitions made by HTV firms, focusing on whether the acquirer (not the target) is entrenched in order to examine the impact of entrenchment managerial decision making. The results show that HTV firms that are entrenched make acquisitions that generate more shareholder wealth and are more likely to increase corporate innovation, suggesting that ATPs can be beneficial in some firms. Copyright © 2013 John Wiley & Sons, Ltd.