Entry and Exit in International Markets: Evidence from Chilean Data*

Several studies examine the patterns and determinants of entry and exit in manufacturing industries. Not much work exists on entry and exit in international markets. This paper uses Chilean data to analyze the industry‐level determinants of entry and exit in export markets. First, we show as stylized facts that entry and exit rates differ across industries, vary over time, and are positively correlated. Then, we study the main determinants of these patterns. Our econometric analysis shows that within‐industry heterogeneity, measured by differences in productivity or other firm characteristics, has a significant effect on plant turnover in international markets. Our findings reveal that trade costs, factor intensities, and fluctuations in the real exchange rate play a minor role explaining entry and exit. This last result is consistent with hysteresis in international markets.     

Italian Business Ills and Cures

The world’s press may have lost interest in the ongoing enquiry into the deep-rooted corruption in Italian business. But what exactly was going on, and what can be done to improve matters? The writers of this authoritative study are Faculty members of the prestigious Italian Business School, SDA Bocconi, Via F. Bocconi 8, 8-20136 Milano, where Umberto Lago lectures in Strategy and Roberto Castoldi in Accounting. They both lecture on the Business Policy course at Bocconi University.     

Clarity of manager roles and performance of R&D multidisciplinary projects in matrix structures

The matrix structure recommends itself as a convenient framework for implementing cross-disciplinary projects. However, this structure tends to generate conflict between project and disciplinary managements. In excess, conflict can reduce performance. The aim of the work described in this paper was to see whether conflict could be controlled by better definition of the respective roles of project and functional managers.
The study was carried out in a large laboratory in Brazil. A group of project managers, responsible for 58 cross-disciplinary projects, quantified their perceptions of the strength of their responsibilities for ten management activities, via a specially devised questionnaire. A Clarity about Responsibilities Index (CRI) was constructed to represent the fraction of these activities each respondent felt responsible for. Project performance was measured according to four criteria, technical, cost, schedule and client satisfaction.
The results show that better technical performance was associated with higher role clarity; no significant association was found with the other performance measures. The author discusses the reasons for these results, the validity of the measures used and the generality of the conclusions.     

Leveraging on systemic learning to manage the early phases of product innovation projects

A number of studies have pointed out the importance of the early phases of new product development projects. In fact, these phases (addressed in the literature with different names, such as pre-project activities, concept generation, product planning, idea generation, investigation, product definition) are concerned with a number of critical decisions that have great impact on the performance of product development. Any fault occurring in these early phases in understanding the market needs, in choosing the product architecture and technology and in defining the product specifications would eventually deteriorate the innovation process, since adjustments in later stages imply reworks that are costly and time consuming. Although the relevance of early project phases has been empirically verified in the literature, the mechanisms that allow these phases to be properly managed are still largely unexplored. This paper investigates the articulated and coherent set of methods, organizational mechanisms and behavioural patterns that successful companies adopt to manage concept generation and product planning. Inferences are based on a field research concerning 19 in-depth case studies of Italian and Swedish companies in the vehicles, helicopters and white goods industries. The paper supports findings of other studies concerning the importance of teamworking and communication. However, teamworking emerges as a necessary, but not a sufficient mechanism. Systemic learning from past experiences is the real keystone toward an effective management of the early phases of product development processes.     

THE EFFECT OF VOLUNTARY CORPORATE LIQUIDATION ON SHAREHOLDER WEALTH

This paper presents an analysis of the shareholder wealth effect of voluntary corporate liquidation, the extreme form of corporate divestiture classified as a “selloff.” For a sample of 37 firms that liquidated during the 1970–1982 period, the liquidation announcement is associated with statistically and economically significant stock price increases.     

Tax-induced Dissimilarities Between Domestic and Foreign Mutual Funds in Italy

Using data from Italy over the period 1998–2002, this study investigates whether tax effects can account for differences in return patterns between domestic and foreign mutual funds, and if this dissimilarity translates into performance. The paper presents evidence that much of the difference between domestic and foreign funds is explained by the different tax systems. The asymmetry between the two groups, due to the fact that domestic funds are obliged to pay taxes on a daily basis while foreign funds are taxed when capital gains are collected, also affects performance. We prove that comparing pre-tax returns, Italian funds are virtually indistinguishable from their foreign counterparts in terms of risk-adjusted returns, while when comparing after-tax returns, foreign funds outperform.     

Elicitation of Expert Opinion in Benefit Transfer of Environmental Goods

Benefit transfer is a method for estimating the value of environmental goods that involves the use of past information on identical or similar goods. This paper considers the extent to which benefit transfer can be based on prior distributions elicited from expert opinion. We propose two alternative methods to elicit the parameters of a prior distribution from experts on environmental valuation. An experiment is carried out on the value of National Parks in Spain. The results from the elicited distributions are compared with the information provided by onsite samples of visitors. The results indicate that individual experts made different predictions about the potential value of the policy areas that were diverse and unable to accurately predict the value for each policy site. However, the average across the elicited distributions approaches the estimated distribution with empirical data and accurately predicts the relative values for the two policy sites considered.     

On the measurement of intra-industry trade: Some further thoughts

Zusammenfassung Zur Messung des intra-industriellen Handels. Einige weitere Gedanken. — Der Autor untersucht, was für und was gegen das Argument des Korrekturbedarfs bei der Messung des intra-industriellen Handels (IIH) spricht, und kommt zu dem Ergebnis, da\ eine Korrektur sowohl aus theoretischen als auch aus empirischen Gründen abzulehnen ist. Der unkorrigierte Index von Grubel und Lloyd hat sich als der beste der gegenw?rtig verfügbaren Indizes erwiesen, wenn er auch ziemlich stark auf das Ausma\ der Datendisaggregierung reagiert. Empirische Studien scheinen darauf hinzudeuten, da\ die Ebene der 4- bis 5-stelligen SITC am besten geeignet ist, um den IIH zu messen. Selbst an Hand dieser stark disaggregierten Daten ist der auf bilateraler Basis berechnete IIH sehr beachtlich, besonders wenn er mit dem hier vorgeschlagenen neuen Index gemessen wird. Dieser Index wird aus theoretischen überlegungen abgeleitet und ist nicht mit dem überlappen des Handels verknüpft.

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Résumé Des mésures du commerce intra-branche: Quelques réflexions supplémentaires. — Dans cette étude l’auteur examine les points positifs et négatifs de l’argument d'une ?nécessité de la correction? en mesurant le commerce intra-branche. Il conclue que la nécessité devrait être rejetée à cause de la théorie et l’évidence empirique. On trouve que l’indicateur de Grubel et de Lloyd est le meilleur de ceux qui sont au moment disponibles. Il réagit néanmoins de mesure considérable au niveau de la disagrégation des données. L’évidence empirique semble montrer que le niveau de 4 ou 5 chiffres CTCI est le plus adéquat pour mesurer le commerce intra-branche. Même avec ces données très hautement disagrégées le commerce intra-branche est tout considérable, particulièrement si mesuré par le nouvel indicateur du commerce intra-branche qui est proposé ici. Cet indicateur est dérivé des considérations théoriques et n'est pas lié aux échanges croisés.

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Resurnen Sobre la medición del comercio intrasectorial: algunas ideas más. — En este trabajo se examinan las ventajas y desventajas del argumente de la necesidad de corrección al medir el comercio intrasectorial y se concluye que deberia ser rechazado en base a razones teóricas y empiricas. El indice no corregido de Grubel y Lloyd es el mejor de los indices existentes; sin embargo, es sensible al nivel de desagregacón. La evidencia empírica parece indicar que el nivel de 4 a S digitos de la SITC es el nivel más apropiado para medir el comercio intrasectorial. Incluso medido a este nivel altamente desagregado, el comercio intrasectorial computado bilateralmente résulta bastante importante, especialmente si es medido con el nuevo indice propuesto aqui. Este indice es derivado de consideraciones teóricas y no esta ligado a la superposition del comertio.

     

Trade and agricultural development in the 1980s and the challenges for the 1990s: Latin America

Trends in agricultural trade for South and Central America are documented and the reform process is discussed. Performance of the agricultural sector of the region is evaluated. Challenges for policy makers are reviewed, ranging from macroeconomic policy to science and technology.