Productivity Growth,Human Capital and Technology Spillovers: Nonparametric Evidence for EU Regions

This paper assesses the strength of productivity spillovers nonparametrically in a data set of 12 industries and 231 NUTS2 regions in 17 European Union member countries between 1992 and 2006. It devotes particular attention to measuring the catching up through spillovers depending on the technology gap of a unit to the industry leader and the local human capital endowment. We find evidence of a nonlinear relationship between the technology gap to the leader as well as human capital and growth in logs. Spillovers are smallest for units with a medium‐high technology gap to the leader, especially for regions where human capital endowments are low.     

Gesamtwirtschaftliche Effekte fiskalischer Unsicherheit

Fiscal uncertainty has potentially far-reaching effects on investment activity and the business cycle. This paper constructs an indicator for fiscal uncertainty in Germany based on (a) the dispersion of professional forecasts for Germany’s budget balance and (b) newspaper coverage frequency of fiscal uncertainty. We find that an exogenous increase in fiscal uncertainty affects the business cycle by significantly lowering investment activity in machinery and equipment. Fiscal rules that increase the degree of fiscal steadiness may contribute to a reduction in fiscal uncertainty and thereby stimulate investment.     

Beyond listening: the distinct effects of proactive versus responsive customer orientation on the reduction of uncertainties at the fuzzy front end of innovation

The extent to which the intensity of R&D employees' interaction with market-oriented employees, proactive customer orientation, and responsive customer orientation affect the ability to reduce product-related uncertainties at the fuzzy front end of innovation was analyzed. They investigated 160 product innovation projects in various high-tech industries and identified proactive customer orientation as an important moderator of the link between R&D employees' interaction with market-oriented employees and the reduction of product-related uncertainties at the fuzzy front end. They also found that responsive customer orientation diminishes the ability to reduce product-related uncertainties at the fuzzy front end. The theoretical and managerial implications of the results are discussed.     

Towards an attention‐based view of technology decisions

The importance of technology decisions is widely acknowledged in both research and practice. However, we know little about how companies structure technology decisions from an organizational point of view and how attention is distributed in the course of the decision process in order to identify, process, and transfer information between the organizational units involved. Using the attention‐based view of the firm and 14 qualitative case studies, we present five approaches for organizing technology decisions: (1) centralized decision‐making, (2) busy information bee, (3) double‐blind analysis, (4) moderated expert panel, and (5) coterie approach. On this ground, this paper introduces a new, attention‐based view on technology decisions, which improves the theoretical understanding of organizations and provides guidelines for practitioners in choosing an appropriate organizational configuration in this regard.     

Environmental factors affecting Hong Kong banking: A post-Asian financial crisis efficiency analysis

This paper examines the evolution of Hong Kong banks' technical efficiency during the period 2000–2006 through the prism of the intermediation and production approaches. Using a modified slacks-based model and purging efficiency scores of random errors, we analyse trends in bank efficiency and identify ‘environmental’ factors that affect the scores. Analysis reveals that Hong Kong banks suffered a severe downturn in technical efficiency during 2001 but recovered by 2006. Finally, private housing rent and the net export of goods and services are found to be negatively correlated with bank efficiency, while private consumption is shown to be positively correlated.     

The Bank for International Settlements Capital Adequacy ‘Rules': Implications for Banks Operating in the UK

In December 1987 the Basle Committee of Supervisors, operating under the auspices of the Bank for International Settlements (BIS), published guideline proposals for the approach to be taken by supervisors in the Group of Ten (G10) countries to the measurement and assessment of the capital adequacy of ‘internationally-active’ banks operating within their national boundaries. With some minor adjustments, these proposals were duly confirmed in July 1988 following extensive consultations with national supervisory bodies. The implications of these ‘rules', as interpreted and implemented by the Bank of England, for the capital requirements imposed on banks operating in the UK are assessed.     

Too much of a good thing? On the growth effects of the EU's regional policy

The European Union (EU) provides grants to disadvantaged regions of member states from two pools, the Structural Funds and the Cohesion Fund. The main goal of the associated transfers is to facilitate convergence of poor regions (in terms of per-capita income) to the EU average. We use data at the NUTS3 level from the last two EU budgetary periods (1994–1999 and 2000–2006) and generalized propensity score estimation to analyze to which extent the goal of fostering growth in the target regions was achieved with the funds provided and whether or not more transfers generated stronger growth effects. We find that, overall, EU transfers enable faster growth in the recipient regions as intended, but we estimate that in 36% of the recipient regions the transfer intensity exceeds the aggregate efficiency maximizing level and in 18% of the regions a reduction of transfers would not even reduce their growth. We conclude that some reallocation of the funds across target regions would lead to higher aggregate growth in the EU and could generate even faster convergence than the current scheme does.     

A Contingency‐Based Approach to the Use of Product Platforms and Modules in New Product Development

To face the challenges of increasing demand for variety, more specific customer demands and shortening product life cycles, firms increasingly adopt mass customization techniques. Two important such techniques are product modularization and product platform development, which allow firms to reach high levels of product variety, and at the same time, keep complexity and its related costs at a limited level. Often modularization and product platform development are treated as variants of the same basic idea. However, even if the concepts are closely related, they also have some fundamental differences, which influence their usefulness and applicability in different settings. One potential shortcoming of existing literature on modularization and product platforms is the present lack of research on their limitations and potential negative effects. Therefore, the purpose of this paper is to identify and explore contingencies influencing the applicability of modularization and product platforms, respectively, taking their different economic effects as a starting point. Moreover, the paper addresses how different organizing solutions are interrelated with the use of modularization and product platform approaches. The empirical observations originate from studies of three Swedish manufacturing firms. The study reveals that important contingencies affecting the applicability of modularization and product platforms are demand side characteristics and the speed of environmental change. Furthermore, it is seen that firms need to organize themselves differently with respect to how they combine modularization and platforms, for example, in terms of degree of centralization, formalization, and allocation of decision‐making authority, and that this poses challenges to the combined use of the two approaches.     

Financial Development and Inequality in the Global Economy

We build a heterogeneous firms model with firm‐specific wages and credit frictions to study the role of financial development for inequality in the global economy. If there are many small (non‐exporting) firms, better access to external funds reduces wage and profit inequality as well as unemployment. In contrast, if there are many large (exporting) firms, financial development might have opposite effects – especially if trade costs are low. In summary, the implications of financial development for inequality depend on the size distribution of firms and on the costs of exporting. Trade liberalization, however, raises inequality unambiguously.     

Offshoring and job loss fears: An econometric analysis of individual perceptions

We quantify the impact of offshoring and other globalisation measures on individual perceptions of job security. For the analysis we combine industry-level offshoring measures with micro-level data from a large German household panel survey and estimate ordinal fixed effects models. Our results indicate that offshoring to low-wage countries significantly raises job loss fears whilst offshoring to high-wage countries somewhat lowers them. Over our sample period from 1995 to 2006, offshoring to low and high-wage countries together can account for about 13% of the total increase in job loss fears. High-skilled workers are more sensitive to offshoring although their objective job loss risk is lower relative to low-skilled workers, which we argue reflects the fact that they have more to lose from unemployment.