The mode of corporate diversification: Internal ventures versus acquisitions

This study investigates empirically the underlying motives for selecting the mode of corporate diversification and attempts to match the form of capital investments with a corresponding theoretical rationale for diversification. The empirical results seem to support both the transaction-costs rationale for diversification and the motive that arises from a firm's prior experience with each form of capital investment. However, the empirical findings are inconsistent with the explanation that is based on the owner-manager conflict of interest.     

Optimal Contracting of Separable Production Technologies

We analyze the class of agency problems with a risk-neutral principal and a risk-averse agent, in which hidden actions and hidden information (on the agent's efficiency) are jointly present. Technological assumptions such as monotonicity of likelihood are no longer sufficient for the optimal contract to be monotone in the sharing rule. We show that these regularity properties obtain for the rather wide class of production technologies that are separable in the agent's inputs. Together with ordinal properties such as monotone differences and affiliation of inputs, separability yields the monotonicity in efficiency of the agent's actions and indirect utility.     

Public and Private Investment and The Growth Process in Developing Countries

This paper examines the relative contribution of public and private investment to per capita GDP growth in developing countries. It extends the basic neoclassical model of growth by separating investment into its public and private components, and estimates this model for a sample of 95 developing countries over the period 1970–90 using both cross-sectional and panel data. Using data on relative supplies of public and private capital stock, rates of return to public and private investment are also computed. The results suggest that once other determinants of growth, such as human capital formation, population growth, and technical progress, are taken into account, public and private investment have different effects on growth, and that these effects are characterized by marked regional and inter-temporal variations.     

Modeling the diffusion of public policy innovations among the U.S. States

This paper describes and validates a general model of state diffusion of public policy innovations. The model can be used to identify whether new policies are likely to become fully adopted into the system of states and the time horizon over which this is likely to occur. Limitations and extensions of the model are also concluded.     

Learning effect in multinational diffusion of consumer durables: An exploratory investigation

Literature reflects that a product/technological innovation introduced later in a country results in faster diffusion as the consumers in the lag market have an opportunity to learn about the new product from the consumers in the lead market. A systematic understanding of the learning that takes place between consumers in two countries—a pair of lead and lag countries—can provide insights for a firm’s international market entry decisions. To provide a richer understanding of the underlying structure and patterns that govern this process, propositions linking factors (country characteristics, product/innovation characteristics, and time lag) to the learning process are drawn. Subsequently, these propositions are tested through an empirical investigation of the diffusion patterns of four consumer innovations in multiple European countries. The findings help provide some preliminary guidelines for manufacturers regarding selection of foreign markets and the timing and order-of-entry decisions. He received his Ph.D. from the University of Houston in 1995. His research interests include global competition and marketing strategy, brand equity and brand extensions, customer satisfaction and brand loyalty, and issues pertaining to product development and introduction. He has been recognized with numerous teaching and research excellence awards and has published numerous articles in many scholarly journals in marketing and forecasting. He has coauthored the textbookMarketing Research and is currently working on a book titledInternational Marketing Research, which is based on his marketing research experience across the globe. He is on the editorial review board of many journals and has lectured on marketing-related topics in various universities worldwide. His research interests include developing forecasting models, international marketing strategy and research issues, models for sales promotions, and new methodologies for product positioning and market segmentation. His research interests focus on marketing strategy and international marketing. He has published articles and presented at conferences on research in his area of interest.     

How valuable is word of mouth?

The customers who buy the most from you are probably not your best marketers. What's more, your best marketers may be worth far more to your company than your most enthusiastic consumers. Those are the conclusions of professors Kumar and Petersen at the University of Connecticut and professor Leone at Ohio State University, who analyzed thousands of customers in research focused on a telecommunications company and a financial services firm. In this article, the authors present a straightforward tool that can be used to calculate both customer lifetime value (CLV), the worth of your customers' purchases, and customer referral value (CRV), the value of their referrals. Knowing both enables you to segment your customers into four constituent parts: those that buy a lot but are poor marketers (which they term Affluents); those that don't buy much but are very strong salespeople for your firm (Advocates); those that do both well (Champions); and those that do neither well (Misers). In a series of one-year experiments, the authors demonstrated the effectiveness of this segmentation approach. Offering purchasing incentives to Advocates, referral incentives to Affluents, and both to Misers, they were able to move significant proportions of all three into the Champions category. Both companies reaped returns on their marketing investments greater than 12-fold--more than double the normal marketing ROI for their industries. The power of this tool is its ability to help marketers decide where to focus their efforts. Rather than waste funds encouraging big spenders to spend slightly more while overlooking the power of customer evangelists who don't buy enough to seem important, you can reap much higher rewards by nudging big spenders to make referrals and urging enthusiastic proponents of your wares to buy a bit more.     

Measuring environmental efficiency of industry: a case study of thermal power generation in India

Technical and environmental efficiency of some coal-fired thermal power plants in India is estimated using a methodology that accounts for firm’s efforts to increase the production of good output and reduce pollution with the given resources and technology. The methodology used is directional output distance function. Estimates of firm-specific shadow prices of pollutants (bad outputs), and elasticity of substitution between good and bad outputs are also obtained. The technical and environmental inefficiency of a representative firm is estimated as 0.06 implying that the thermal power generating industry in Andhra Pradesh state of India could increase production of electricity by 6/ while decreasing generation of pollution by 6%. This result shows that there are incentives or win–win opportunities for the firms to voluntarily comply with the environmental regulation. It is found that there is a significant variation in marginal cost of pollution abatement or shadow prices of bad outputs across the firms and an increasing marginal cost of pollution abatement with respect to pollution reduction by the firms. This result calls for the use of economic instruments like pollution taxes instead of command and control regulation used currently in India to reduce air pollution.