Consultation and communication in family businesses in Great Britain

Nationally representative data on family businesses are available in the 1998 Workplace Employee Relations Survey, alongside comparable information for other types of firms. We use these data to compare differences in the use of different consultation and communication procedures. We cover such practices as the use of direct communication schemes (e.g. briefings; the provision of information on financial performance to the workforce) as opposed to indirect methods such as the use of joint consultative committees. There is an a priori expectation in the literature that family-owned businesses are either more likely to use direct forms of communication (vis-à-vis indirect forms) or that they will not be involved in direct communication or consultation with their employees, and we test this using multivariate techniques. Finally, we consider whether the type of consultation/communication structure matters in terms of establishment performance, and what differences exist with respect to family-owned businesses. In particular, this paper tests if those firms that consult directly with staff, as opposed to those that consult through joint consultative committees or trade unions, have higher productivity and/or other measures of performance. Concurrently we test whether there are separate ‘family business’ effects or whether it is generally establishment size that ‘matters’, by estimating a model for family-owned and non-family-owned establishments. In general, our results show that not only do family-owned establishments have lower levels of communication and consultation, but, when the latter is present, this does not generally translate into greater economic benefits (as is the case in non-family-owned firms).     

An empirically-derived multidimensional measure of expatriate success: reconciling the discord

This paper examines the discord surrounding how expatriate success, or effectiveness, is defined. We review the many ways that success has been conceptualized and then seek to reconcile these differences by presenting a multidimensional measure of success, based on data collected from 118 expatriate respondents worldwide. A series of factor analyses, along with reliability and item analyses yielded nine measurement scales which included cultural adjustment, work-related adjustment, career development, HQ-subsidiary coordination, assignment completion, professional/skill development, shaping and controlling the subsidiary, satisfaction and overall assignment effectiveness. The process by which these scales were developed is described in the paper and all items and scale reliabilities are presented.     

Dynamic Costs of the Draft

Abstract. We propose a dynamic general‐equilibrium model with human capital accumulation to evaluate the economic consequences of compulsory services (such as military draft or social work). Our analysis identifies a so far ignored dynamic cost arising from distortions in time allocation over the life cycle. We provide conservative estimates for the excess burden that arises when the government relies on forced labor rather than on income taxation to finance public expenditures. Our results suggest that eliminating the draft could produce considerable dynamic gains, both in terms of GDP and lifetime utility.     

EXPLORING THE USEFULNESS OF A NONRANDOM HOLDOUT SAMPLE FOR MODEL VALIDATION: WELFARE EFFECTS ON FEMALE BEHAVIOR*

A particularly challenging use of decision‐theoretic models in economics is to forecast the impact of large changes in the environment. The problem we explore in this article is how to gain confidence in a model's ability to predict the impact of such large changes. We show that an approach to validation and model selection that includes the choice of a “nonrandom holdout sample,” a sample that differs significantly from the estimation sample along the policy dimension that the model is meant to forecast, can be fruitful.     

Market Size, Trade, and Productivity

We develop a monopolistically competitive model of trade with firm heterogeneity—in terms of productivity differences—and endogenous differences in the "toughness" of competition across markets—in terms of the number and average productivity of competing firms. We analyse how these features vary across markets of different size that are not perfectly integrated through trade; we then study the effects of different trade liberalization policies. In our model, market size and trade affect the toughness of competition, which then feeds back into the selection of heterogeneous producers and exporters in that market. Aggregate productivity and average mark-ups thus respond to both the size of a market and the extent of its integration through trade (larger, more integrated markets exhibit higher productivity and lower mark-ups). Our model remains highly tractable, even when extended to a general framework with multiple asymmetric countries integrated to different extents through asymmetric trade costs. We believe this provides a useful modelling framework that is particularly well suited to the analysis of trade and regional integration policy scenarios in an environment with heterogeneous firms and endogenous mark-ups.     

ASSESSING THE EFFECT OF PUBLIC SUBSIDIES ON FIRM R&D INVESTMENT: A SURVEY

This survey examines the empirical literature on the relationship between public R&D subsidies and private R&D investment over the past five decades. The survey reveals a considerable heterogeneity of empirical results that cannot be explained fully by methodological issues. We aim to provide further explanations of the possible causes of that heterogeneity. In particular, we emphasise a set of issues that, in our view, are critical to understanding the potential effect of public R&D subsidies on private R&D spending. Special attention is paid to the dynamic aspects and composition of firm R&D, the constraints faced by the firm (such as financial constraints), and the amount and source of public subsidies. None of these issues have been investigated in depth. We formulate a set of research assumptions to guide future empirical research in this field.     

Elasticities of substitution and complementarity

This paper develops a classification scheme of the many different definitions of elasticities of substitution and complementarity in the production case based on primal and dual representations of technology and their related direct and inverse demand functions, gross and net substitution, elasticity type, and three different basic concepts of substitution and complementarity. The ten elasticities of substitution are derived from the cost, profit, input distance, and revenue functions. All the elasticities are equally valid for single and multi-output technologies. The classic Berndt-Wood dataset is used to show the considerable variation across the elasticities.