Inter‐state dynamics of invention activities, 1930–2000

We study the dynamics of the cross‐section distribution of patents per capita for the 48 continental US states from 1930 to 2000 using a discrete‐state Markov chain. We test for and find evidence in favor of the (knowledge) convergence hypothesis. The distribution of patents is converging to a limiting distribution that is significantly more concentrated than its initial distribution. States in the extreme are more mobile than states in the middle of the cross‐sectional distribution and are likely to move to the middle. However, the rate of convergence to the limiting distribution is ‘slow’. Copyright © 2006 John Wiley & Sons, Ltd.     

Organizational characteristics and HRM policies on rights: Exploring the patterns of connections

The protection of employee rights in the workplace is one of the fundamental ethical questions facing organizations today. Organizations differ in the extent to which they protect the rights of both employees and themselves as employers, yet little research has examined the types of organizations that have rights protection policies. Instead of the classic normative approach to ethical issues, this study took a contextual approach to the management of rights in the workplace through human resource policies. Associations were found between the organizational characteristics of size, industry, unionization, business condition, and the existence of employee and employer rights policies. Additional analyses revealed underlying dimensions in right policies and the relationship of organizational characteristics to these aspects of rights management were examined. The results are discussed in terms of understanding human resource rights management within an organizational context.Catherine E. Schwoerer is an Assistant Professor in the School of Business at the University of Kansas. Her research interests include work place rights and responsibilities, training and development, self-efficacy, and aging and work.Douglas R. May is an Assistant Professor in the Department of Management at the University of Nebraska. His research interests include social issues management and the impact of the physical environment on employees' attitudes and health.Benson Rosen is Hanes Professor of Management and Chairman of Management Area at the Kenan-Flagler Business School, The University of North Carolina. He is a Fellow of the American Psychological Association and a member of the Academy of Management.     

Nutrition and GNP: A comparison of problems in Thailand and the Philippines

The relationship between GNP and nutritional status between countries shows a high correlation. This study of two countries with the same GNP (Thailand and Philippines) investigated their use of equal resources and the impact on nutritional status. Malnutrition is more prevalent in the Philippines than Thailand despite an extensive national nutrition programme in the Philippines, better medical and educational services and safer water supplies. The most important underlying economic factor is not income distribution but rather the cost of living, particularly for basic needs. Finally, it is concluded that although GNP is closely related to nutritional status between countries, the longitudinal correlations within a country are much weaker.     

Democracy across Gender Diversity and Ethnicity of Middle Eastern SMEs: How Does Performance Differ?

This paper examines the relationship between boards of directors' demographic diversity and firms' financial performance. In particular, we highlight how women and ethnic minorities can affect Middle Eastern SMEs' financial performance. Using an unbalanced panel of 1,855 firm‐year observations of 371 boards of directors from nine Middle Eastern countries, our results support the positive impact of women and ethnic minority group members on Middle Eastern firms' performance. However, our evidence implies that when Western ethnic minority members increase, firms' performances tend to decrease, because these board members are appointed for regional and international board reputation legitimacy, personal business agendas, and links to the external corporate environment.     

Statement of the Financial Economists Roundtable: Bank Capital as a Substitute for Prudential Regulation

The Financial CHOICE Act recently passed by the House proposes to create an “off‐ramp” that would allow banks to escape burdensome prudential regulation if the ratio of their equity capital to their total assets is 10% or more. The Financial Economists Roundtable supports this idea as a means of reducing regulatory costs, but believes some additional safeguards are needed. A capital ratio of 10% may not be high enough to discourage banks from excessive risk taking. A solution is to have two capital requirements for banks choosing the off‐ramp: one absolute (as proposed in the act) and one risk‐based. The FER believes that many banks will prefer this regime to the current burdensome prudential regulation, especially if regulators simplify the setting of risk weights and make them more rule‐based. Regulators setting minimum capital requirements should consider not only a bank’s stand‐alone risk, but also the systemic risk posed by banks, as well as the tendency of accounting measures of income and assets to overstate the economic value of banks’ equity capital. The Financial Choice Act would also eliminate useful elements of ongoing supervision and regulation, not all of which can be addressed by higher capital alone. Furthermore, to facilitate regulatory learning about risks, off‐ramped banks should continue to report the data that regulators use for stress tests, even if they are no longer subjected to the discipline of stress tests. Finally, the act is viewed as too permissive in its treatment of off‐ramped banks that get into trouble. To prevent gaming of regulation, FERC recommends that off‐ramped banks that subsequently fall below the minimum requirements should be required to raise new capital immediately.     

Active ageing beyond the labour market: evidence on the role of intrinsic and extrinsic rewards at work

‘Active Ageing’ strategies aim to foster the participation of seniors in the society. Although economic literature has extensively studied the incentives for seniors to increase their labour supply, little is known about the motivations for older people to complement labour with other forms of social participation. This article provides empirical evidence of the role of intrinsic and extrinsic rewards received at work in the supply of formal and informal productive activities of 50- to 65-year-old workers. The results show that workers with higher levels of intrinsic rewards received at work, such as skill development opportunities and decision latitude, are more likely to participate in social activities outside the labour market. Extrinsic rewards on the other hand, like advancement perspectives, job security and pay, appear independent from both formal and informal social participation.     

Capacity Investment under Demand Uncertainty: The Role of Imports in the U.S. Cement Industry

Demand uncertainty is thought to influence irreversible capacity decisions. Suppose that local demand can be sourced from domestic (rigid) production or from (flexible) imports. This paper shows that the optimal domestic capacity is either increasing or decreasing with demand uncertainty, depending on the relative level of the costs of domestic production and imports. We test this relationship with data from the U.S. cement industry, in which the difference in marginal cost between domestic production and imports varies across local U.S. markets because cement is costly to transport over land. Industry data for 1999 to 2010 are consistent with the predictions of the model. The introduction of two technologies to the production set—one rigid and one flexible—is crucial to understanding the relationship between capacity choice and uncertainty in this industry because there is no relationship between these two variables in aggregated U.S. data. Our analysis reveals that the relationship is negative in coastal districts, and significantly more positive in landlocked districts.     

Fuzzy Chronic Poverty: A Proposed Response to Measurement Error for Intertemporal Poverty Measurement

A number of chronic poverty measures are now empirically applied to quantify the prevalence and intensity of chronic poverty, vis‐à‐vis transient experiences, using panel data. Welfare trajectories over time are assessed in order to identify the chronically poor and distinguish them from the non‐poor, or the transiently poor, and assess the extent and intensity of intertemporal poverty. We examine the implications of measurement error in the welfare outcome for some popular discontinuous chronic poverty measures, and propose corrections to these measures that seeks to minimize the consequences of measurement error. The approach is based on a novel criterion for the identification of chronic poverty that draws on fuzzy set theory. We illustrate the empirical relevance of the approach with a panel dataset from rural Ethiopia and some simulations.