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.     

Lone star or team player? The interrelationship of different identification foci and the role of self‐presentation concerns

Work identity is important in the attraction and retention of staff, yet how the facets of such identity relate remains convoluted and unclear despite this being of interest to both scholars and practitioners. We use structural equation modeling to analyze empirical data from 144 employees in the United Kingdom's oil and gas industry, analyzing the nature and interrelationship of identification as individual‐level (career advancement) and social‐level (work group and organization) foci, as well as considering the two psychological self‐presentation factors (value expression and social adjustment) that direct and drive identification processes. A dichotomy between individual and social components of work identity is found, revealing a strong association between both social‐level foci of identification. Moreover, both components of work identity are found to be premised on different psychological factors, furthering our knowledge of the enmeshed nature of identity at work.     

Aligning the Mindset and Capabilities within a Business Network for Successful Adoption of Smart Services

This paper explores the synchronized change of mindset and capability within a business network that is driven by the adoption and provision of smart services. The research is implemented as an empirical multi‐case study, and the primary data include interviews and observations in seven globally operating firms. The findings identify two categories of barriers and three categories of alignment needs to successful adoption of smart services. The study combines the institutional theory and dynamic capability perspectives to make three main contributions to the research of service innovation for an improved understanding of the determinants of successful field‐level adoption of smart services. The results show that firms need to align the change of logic and capabilities within the organization and the business network to succeed in the adoption of smart services.     

Initial directors of international R&D laboratories

Technology intensive companies establish new R&D laboratories in regions of high innovation and near centers of scientific excellence. Identifying the right R&D director to head up such greenfield investments is central to the success or failure of the new lab. Analyzing 162 interviews with senior R&D managers, we identify eight different directorship profiles. Examples of new R&D sites and their directors include IBM, Daimler, Leica, Microsoft, Xerox, Lucent and Ciba. The initial mission and the intraorganizational and intraregional integration of the new lab are principal factors for director selection, determining expatriate or national management, cultural and ethnic familiarity, as well as local or international transfers. The analysis of succeeding R&D directors indicates a trend towards locally rooted yet organizationally competent R&D managers. The paper concludes with desired qualifications of director candidates for newly established international R&D sites.     

Public input competition and agglomeration

This paper analyzes the impact of public input competition in a New Economic Geography framework. It is shown that regional competition yields an overprovision of public inputs if trade costs are sizable while it leads to underprovision if regions are highly integrated. Moreover, public input competition assures a dispersion of industry as long as trade costs are high but induces agglomeration even for ex ante identical regions if trade costs have fallen below a certain value. Finally, a trade-off between regional convergence and efficiency arises since the efficient distribution of regional infrastructure requires full agglomeration for sufficiently low trade costs.     

Field study with a computer-based office system

The authors describe a field study of computer-based aids in the office. The study was based on the assumption that a computer system should prove itself under realistic everyday conditions. The results show that advanced technology can be effectively applied at the executive level, where unstructured and variable activities are to be supported. Thus the authors do not confine themselves to technical issues - personal and organizational factors are also taken into account. The main aspects examined are system utilization, training and introduction strategy.     

The Business Value of Process Flexibility

Promising to cope with increasing demand variety and uncertainty, flexibility in general and process flexibility in particular are becoming ever more desired corporate capabilities. During the last years, the business process management and the production/operations management communities have proposed numerous approaches that investigate how to valuate and determine an appropriate level of process flexibility. Most of these approaches are very restrictive regarding their application domain, neglect characteristics of the involved processes and outputs other than demand and capacity, and do not conduct a thorough economic analysis of process flexibility. Against this backdrop, the authors propose an optimization model that determines an appropriate level of process flexibility in line with the principles of value-based business process management. The model includes demand uncertainty, variability, criticality, and similarity as process characteristics. The paper also reports on the insights gained from applying the optimization model to the coverage switching processes of an insurance broker pool company.