Are differences in firm size transitory or permanent?

An Erratum for this article has been published in Journal of Applied Econometrics 18(2) 2003, 249 Previous empirical work on corporate growth rates using cross‐section or short‐panel econometric techniques suggests that growth rates are random but that some degree of mean reversion exists. This means that size differences between firms are transitory. Another, more natural way to explore the long‐run distribution of firm sizes is to examine data on the growth of particular firms over long periods of time. Using a sample of 147 UK firms observed continually for more than 30 years, our conclusions are that growth rates are highly variable over time and that differences in growth rates between firms do not persist for very long. Further, firms show no tendency to converge to either a common size or to a pattern of stable size differences over time. These results are compared and contrasted with standard approaches that suggest that firms reach and maintain stable positions in a skewed size distribution. Copyright © 2002 John Wiley & Sons, Ltd.     

中国负债知多少？

【美国《华尔街日报》7月23日】中国的隐性债务可能成为一大麻烦。     

Is your vision consistent?: A method for checking, based on scenario concepts

Common sense tells us that the future is an essential element in any strategy. In addition, there is a good deal of literature on scenario planning, which is an important tool in considering the future in terms of strategy. However, in many organizations there is serious resistance to the development of scenarios, and they are not broadly implemented by companies. But even organizations that do not rely heavily on the development of scenarios do, in fact, construct visions to guide their strategies. But it might be asked, what happens when this vision is not consistent with the future? To address this problem, the present article proposes a method for checking the content and consistency of an organization's vision of the future, no matter how it was conceived. The proposed method is grounded on theoretical concepts from the field of future studies, which are described in this article. This study was motivated by the search for developing new ways of improving and using scenario techniques as a method for making strategic decisions. The method was then tested on a company in the field of information technology in order to check its operational feasibility. The test showed that the proposed method is, in fact, operationally feasible and was capable of analyzing the vision of the company being studied, indicating both its shortcomings and points of inconsistency.     

Nonlinear dynamics and competing behavioral interpretations: Evidence from intra‐day FTSE‐100 index and futures data

Extant empirical research has reported nonlinear behavior within arbitrage relationships. In this article, the authors consider potential nonlinear dynamics within FTSE‐100 index and index‐futures. Such nonlinearity can be rationalized by the existence of transactions costs or through the interaction between informed and noise traders. They consider several empirical models designed to capture these alternative dynamics. Their empirical results provide evidence of a stationary basis term, and thus cointegration between index and index‐futures, and the presence of nonlinear dynamics within that relationship. The results further suggest that noise traders typically engage in momentum trading and are more prone to this behavior type when the underlying market is rising. Fundamental, or arbitrage, traders are characterized by heterogeneity, such that there is slow movement between regimes of behavior. In particular, fundamental traders act more quickly in response to small deviations from equilibrium, but are reluctant to act quickly in response to larger mispricings that are exposed to greater noise trader price risk. © 2006 Wiley Periodicals, Inc. Jrl Fut Mark 26:343–368, 2006     

Multiple generation product life cycle predictions using a novel two-stage fuzzy piecewise regression analysis method

Product life cycle (PLC) prediction plays a crucial role in strategic planning and policy definition for high-technology products. Forecast methodologies which can predict PLCs accurately can help to achieve successful strategic decision-making, forecasting, and foresight activities in high-technology firms, research institutes, governments, and universities. Over the past few decades, even though analytic framework strategies have been proposed for production, marketing, R&D (research and development), and finance, aiming at each stage of PLCs, forecast methodologies with which to predict PLCs are few. The purpose of this research is to develop a novel forecast methodology to allow for predictions of product life time (PLT) and the annual shipment of products during the entire PLC of multiple generation products. A novel two-stage fuzzy piecewise regression analysis method is proposed in this paper. In the first stage, the product life-time of the specific generation to be analyzed will be predicted by the fuzzy piecewise regression line that is derived based upon the product life-time of earlier generations. In the second stage of the forecast methodology, the annual shipment of products of the specified generation will be predicted by deriving annual fuzzy regression lines for each generation, based upon the historical data on the earlier generations' products. An empirical study predicting the life-time and the annual shipment of the 16 Mb (Mega bit) DRAM (Dynamic Random Access Memory) PLC is illustrated to validate the analytical process. The results demonstrate that two-stage fuzzy piecewise regression analysis can predict multiple generation PLT and PLC precisely, thereby serving as a foundation for future strategic planning, policy definitions and foresights.     

Volatility clustering and the bid–ask spread: Exchange rate behavior in early Renaissance Florence

This paper investigates the nature and behavior of the domestic (local) currency market that existed in Florence (Italy) during the late 14th and early 15th centuries (a.k.a. the Early Renaissance). We find that the extant volatility and microstructure models developed for modern asset markets are able to describe the statistical volatility properties observed for the denaro-florin exchange rate. Volatility is clustered and is related to the bid–ask spread. This supports the notion that, although there are huge social, industrial and technological differences between capitalism then and now, individuals trading financial assets in an organized venue behave in a similar manner.     

A multi-level analysis of sustainable mobility transitions: Niche development in the UK and Sweden

A wide range of intractable problems such as polluting emissions, noise, accidents, resource depletion, and inaccessibility of amenities are associated with the current transport regime. Given the slow movement towards a more sustainable mobility system, more radical, systemic innovation - a ‘transition’ - is required. Broadly speaking, this may be achieved via three routes: technological change, modal shift, and reduced travel demand. Drawing on concepts from the transitions literature (e.g., [Geels, F.W.: Technological Transitions and System Innovations: A Co-evolutionary and Socio-Technical Analysis, Edward Elgar, Cheltenham, 2005.]), we conceptualise each of these routes as a bundle of niche activities within an Area of Innovation, deviating to differing degrees from the current mobility ‘regime’. We present empirical evidence and indications of ongoing development of niches in these three areas within the UK and Sweden, and explore processes of co-evolution, divergence and tension within and between niches. Findings indicate recent market penetration of novel transport technologies, more advanced than modal shift or demand management activities; however, different transport technologies are more successful in each country. We also identify examples of a close relationship between development of radical vehicle/fuel technologies and provision of mobility services; and information technology as a driver in all three areas of innovation. We conclude that future innovation in transport depends on diversity, hybridisation, and co-evolution of niches. Finally, policy implications are discussed.     

A theory of innovation for process-based innovations such as nanotechnology

Many see Nanotechnology as the technology that will underlie the next Schumpeterian wave creating new opportunities for wealth and job creation. Further it is a process based or materials technology. Yet all currently used models of innovation are based on assembled products or service products and these simply do not recognize the differences in materials products nor the “enabling” nature of Nanotechnologies. If nanotechnology is poised to become the economic engine of this millennium and if current models of innovation, which are utilized, by policy makers and firm based strategist alike are based on technology product paradigms that are dissimilar to the realities of nanotechnology and other process-based technologies then there is cause for concern.Here the authors provide a model and supporting cases demonstrating a new process or materials based innovation model that is based on the tight coupling between product and process innovation of not only Nanotechnology-based products but other process-based products. This is an important finding, because it identifies and remedies a gap in the literature associated with earlier process and product innovation models. For process-based products like materials, food, chemicals and nanotechnologies any change to the manufacturing processes results in significant changes in end product features. The implications of this model to practice are considered.     

Towards collective business action and cross-sector collaboration in responsible competitiveness clusters in southern Africa

Responsible competitiveness clusters are cross-sector collaboration initiatives focused on identifying and acting upon synergies between sustainable development and economic competitiveness objectives. By means of three case studies in southern Africa this paper investigates the incentives, opportunities and challenges encountered in the emergence of such clusters. The first case study focuses on a regional response to the development challenges encountered in a South African mining area, the second describes efforts to make the Malawian agriculture sector more inclusive and competitive and the third discusses options for enhancing the competitiveness of the Lesotho textile sector. The paper concludes with a discussion of the role of international trade networks, the institutional framework, public sector support and internal governance processes as key factors influencing the initial level of success of these initiatives.