When marketing and innovation interact: The case of born-global firms

Previous research on born-global firms (BGs) has emphasized their strong dependency on establishing a competitive positioning from the early days of their existence. While many researchers emphasized BGs’ innovativeness as a driver of their competitiveness, the capabilities underlying BGs’ innovativeness are still under-researched, specifically, marketing, and innovation-related capabilities. Based on a preliminary stage of in-depth interviews with senior managers, we identified three capabilities, market intelligence generation, marketing adaptability, and team cohesion, that underscore the interaction between innovation and marketing. We then performed a SEM analysis based on data collected from 127 BGs. Our findings indicate that marketing intelligence and team cohesion directly and positively impact BGs’ innovativeness. Marketing adaptability was found to be moderated by environmental conditions—economic development and technological development. When economic development is high, salesforce adaptability enhances BGs’ innovativeness, while product adaptability or communication adaptability decreases BGs’ innovativeness. When technological development is high, product adaptability enhances BGs’ innovativeness, while salesforce adaptability decreases BGs’ innovativeness.     

Co-monotonicity: Toward a utility function capturing envy

Envy affects economic decisions, and can lead to monotonicity violation. We introduce co-monotonicity—a generalization of monotonicity, expected to hold even in the presence of envy. Experimental results and implications for the form of possible utility functions are discussed.     

The environmental implications of airlines' choice of aircraft size

One of the main outcomes of open skies policies is the importance of service frequency in the competition between airlines. To keep load factors high while offering high frequency service, airlines tend to reduce the size of the aircraft used. On short-haul routes this phenomenon is even more apparent, especially on routes between hub airports, even though these routes and airports are often congested. This choice of service frequency and aircraft size must have important environmental consequences that this paper aims to evaluate and quantify. The analysis considers local air pollution, climate change and noise impacts and aims to evaluate whether the competitive environment that drives airlines to offer high frequency service carries an environmental penalty. The analysis showed that increasing aircraft size and adjusting the service frequency to offer similar seating capacity will increase local pollution but decrease climate change impact and noise pollution. When local pollution and climate change impacts are monetized and aggregated the analysis showed that environmental benefits will result from increasing aircraft size. But these benefits, in monetary terms, were found to be relatively small and sensitive to the assumptions made.     

Visions for a walking and cycling focussed urban transport system

Walking and cycling can make a considerable contribution to sustainable transport goals, building healthier and more sustainable communities and contributing to traffic and pollution reduction. There have been many national and local initiatives to promote walking and cycling, but without a long term vision and consistent strategy it is difficult to see how a significant change may be achieved. This paper presents three alternative visions for the role of walking and cycling in urban areas for the year 2030: each vision illustrates a ‘desirable’ walking- and cycling-oriented transport system against a different ‘exogenous social background’. These visions have been developed through a process of expert discussion and review and are intended to provide a stimulus for debate on the potential for and desirability of such alternative futures. Each is based on the UK and represents a substantial change to the current situation: in particular, each of the visions presents a view of a society where walking and cycling are considerably more important than is currently the case and where these modes cater for a much higher proportion of urban transport needs than at present. The visions show pictures of urban environments where dependence on motor vehicles has been reduced, in two of the visions to very low levels. The methodological approach for devising visions is informed by work on ‘utopian thinking’: a key concept underlying this approach is one of viewing the future in social constructivist terms (i.e. the future is what ‘we’, as a society, make it) rather than considering the future as something that can be ‘scientifically’ predicted by the extrapolation of current trends.     

Self-Annuitization and Ruin in Retirement

Abstract

At retirement, most individuals face a choice between voluntary annuitization and discretionary management of assets with systematic withdrawals for consumption purposes. Annuitization–buying a life annuity from an insurance company–assures a lifelong consumption stream that cannot be outlived, but it is at the expense of a complete loss of liquidity. On the other hand, discretionary management and consumption from assets–self-annuitization–preserves flexibility but with the distinct risk that a constant standard of living will not be maintainable.

In this paper we compute the lifetime and eventual probability of ruin (PoR) for an individual who wishes to consume a fixed periodic amount–a self-constructed annuity–from an initial endowment invested in a portfolio earning a stochastic (lognormal) rate of return. The lifetime PoR is the probability that net wealth will hit zero prior to a stochastic date of death. The eventual PoR is the probability that net wealth will ever hit zero for an infinitely lived individual.

We demonstrate that the probability of ruin can be represented as the probability that the stochastic present value (SPV) of consumption is greater than the initial investable wealth. The lifetime and eventual probabilities of ruin are then obtained by evaluating one minus the cumulative density function of the SPV at the initial wealth level. In that eventual case, we offer a precise analytical solution because the SPV is known to be a reciprocal gamma distribution. For the lifetime case, using the Gompertz law of mortality, we provide two approximations. Both involve “moment matching” techniques that are motivated by results in Arithmetic Asian option pricing theory. We verify the accuracy of these approximations using Monte Carlo simulations. Finally, a numerical case study is provided using Canadian mortality and capital market parameters. It appears that the lifetime probability of ruin–for a consumption rate that is equal to the life annuity payout–is at its lowest with a well-diversified portfolio.     

Participation rules for Pareto-optimal clubs

This paper presents a unifying framework for the club participation problem using compensating variation measures of willingness-to-pay for membership. With more prospective club members than the equilibrium club population, Pareto-efficient participation rules are derived which depend upon whether or not individuals are assured of club access. Sale of lottery tickets offering club membership is shown to be a socially superior club participation allocation mechanism to sale of vouchers guaranteeing membership. The willingness-to-pay format readily encompasses the Buchanan case where all prospective club members are assured of club participation.     

The influence of supportive leadership and job characteristics on work alienation: A six-country investigation

This study examines the relationships between supportive leadership and job characteristics and workers’ alienation in Cuba, Germany, Hungary, Israel, Russia, and the United States. One thousand and nine hundred and thirty-three workers and non-managerial personnel participated in the research. Supportive leadership and job characteristics were found to be related to alienation. Evidence is provided along with implications for theory and practice.