Outward FDI and Productivity: Micro‐evidence from Slovenia

This paper uses a rich data set of Slovenian manufacturing firms active in the period 1994–2002 that contains information on outward FDI and exports to different markets in order to test three empirical hypotheses that relate the decision for outward FDI to total factor productivity. First, the evidence supports the hypothesis proposed by Helpman, Melitz and Yeaple (2004) that more productive firms are more likely to invest in a foreign affiliate. Second, the hypothesis proposed by Head and Ries (2003 ) that less productive firms may be encouraged to invest in low‐income countries is rejected by the data. However, the main contribution of the paper is to confirm the third hypothesis that required firm's productivity increases with the number of markets that the firm serves, i.e. there is a positive relationship between the number of a firm's foreign affiliates and its total factor productivity.     

Downstream mergers and producer's capacity choice: why bake a larger pie when getting a smaller slice?

In this article, the effect of downstream horizontal mergers on the upstream producer's capacity choice was studied. Contrary to conventional wisdom, I find a nonmonotonic relationship: horizontal mergers induce a higher upstream capacity if the cost of capacity is low, and a lower upstream capacity if this cost is high. This result is explained by decomposing the total effect into two competing effects: a change in holdup and a change in bargaining erosion.     

Building service relationships: It’s all about promises

Her research focuses on customer evaluations of service, service quality, and service delivery issues. She has published in theJournal of Marketing, Journal of Business Research, Journal of Retailing, and theInternational Journal of Service Industry Management. She is coauthor of the textServices Marketing (McGraw-Hill, forthcoming).     

Modernization of a peasant crop in Colombia: evidence and implications

The survival of the small-farm sector in the process of agricultural modernization in Latin America has been a concern for many authors and institutions. It is generally believed that the small-farm sector is bypassed in the process of agricultural development. The authors analyze modernization of bean/maize cropping systems in Southern Colombia. Prices, production practices and profitability are compared for 1975 and 1989. By means of a production function, the effects of allocative efficiency, technical efficiency and technical change on productivity and profitability are analyzed. The observed changes reflect very well the price trends over the period. Between 1975 and 1989, total factor productivity increased by 50%. Bean/maize producers almost doubled returns to land and labor. Increased technical efficiency had most effect on profitability, followed by technical change. Allocative efficiency had more impact on yields than on profitability because it was associated with high input costs. Considerable opportunities for further productivity increases were identified. Conclusions on the nature of the modernization process are drawn. Implications for agricultural policy, research and the role of the small farm in agricultural development are derived.     

HYSTERESIS IN THE DYNAMICS OF EMPLOYMENT

In this paper, we derive a micro model of employment demand with hysteresis whereby firms can adjust along an intensive (employment) and an extensive (hours of work) margin. A mechanism of aggregation over heterogeneous firms is used to generate the corresponding aggregate dynamics. Longitudinal micro monthly data on a representative sample of Portuguese manufacturing firms are used in the empirical analysis. Our results indicate that signs of hysteresis found at the micro level do not vanish completely by aggregation and that hysteresis is magnified by the existence of an additional margin of adjustment (the hours adjustment margin).     

Disclosure frequency and earnings management

We examine the relation between disclosure frequency and earnings management, and the impact of this relation on post-issue performance, for a sample of seasoned equity offerings (SEOs). We contend that firms with extensive disclosure are less likely to face information problems, leading to less earnings management and better post-issue performance. Our results confirm that disclosure frequency is inversely related to earnings management and positively associated with post-issue performance. We also find that transparency-reducing disclosure is concentrated in firms that substantially, but temporarily, increase disclosure prior to the offering. Such firms exhibit more earnings management and poorer post-SEO stock performance, on average.     

Local Care Services: A Reflection on the Conditions for their Emergence and Development

Local care services are making a comeback in the headlines (with the Borloo plan, CAE report). The development of this market (or markets) and the policies linked with them nonetheless give rise to problems. This article seeks to identify the levers on which current policy can rely to become effective and emphasises the shortcomings that need to be resolved to ensure impetus. It attempts to specify certain macrosociological and macroeconomic conditions, and analyse the conditions specific to demand and the constraints in building efficient supply that may explain the failures of the policies implemented so far.     

Customer positivity and participation in services: an empirical test in a health care context

Many service interactions require customers to actively participate, yet customers often do not participate at levels that optimize their outcomes, particularly in health care. To gain insight into how customers shape a service experience with highly uncertain outcomes, we construct a model on the broaden-and-build theory of positive emotions. The model is used to empirically assess how situation-specific emotions and customer participation during a health care service experience affect perceptions of the service provider. The model is tested using data from 190 medical clinic customers. Consistent with theory, results reveal that as customers’ relative affect levels become more positive, levels of participation increase as well. In turn, higher levels of positivity and participation improve customer perceptions of the quality of the service provider and satisfaction with the co-produced service experience. Implications of this research focus managers on designing services to help clients manage their emotions in ways that facilitate positivity and participation and thus improve service perceptions.     

Using strategic performance measurement systems for strategy formulation: Does it work in dynamic environments?

This paper examines how strategic performance measurement systems (SPMS) influence organisational performance through the shaping of the strategic agendas and strategic decision arrays that result from the processes of (re)formulation of intended strategies. Using a combination of archival and survey data collected from 267 medium and large Spanish companies, we find evidence supporting a positive association between SPMS and organisational performance that is mediated by the comprehensiveness of the strategic decision arrays. We find this mediation is negatively moderated by the level of environmental dynamism, so that the comprehensiveness of strategic decision arrays that result from strategy (re)formulation processes mediates the association between SPMS and organisational performance when environmental dynamism is low, but not when environmental dynamism is high.