Sustainability in small tourist businesses: the link between initiatives and performance

This study explores the combined effects of adopting sustainable practices on small tourism companies’ performance. The existing literature provides insufficient data on sustainable behaviour because most studies on environmental practices focus on larger companies in the tourism sector, and a gap exists in social practices. This study is based on a survey of 374 restaurant managers. It uses structural equation modelling to study direct links between three dimensions – quality, environmental practices and social practices – and financial performance and market success factors. Significant differences with earlier studies are found. This study suggests that proactive sustainable practices can benefit small service companies by improving competitiveness even in difficult times. Practical implications are discussed in relation to sustainable practices.     

Comparing children's explicit and implicit understanding of advertising and placement on TV

ABSTRACT

Although product placement is a frequently used promotional tool in local and international productions, particularly in combination with advertising, its study has been almost neglected in Latin America. This paper examines the explicit (verbal) and implicit (cued) understanding of advertising and placement in a sample of 9-, 12- and 15-year-old children from Chile. The results showed a more sophisticated comprehension of advertising in comparison with product placement. They also revealed that age is positively correlated with a more sophisticated understanding of both placement and advertising. Finally, significant differences were observed when comparing the use of verbal and cued methods. The results are discussed in terms of prior literature and their practical implications.     

An Exploration of Asset Returns in a Production Economy with Relative Habits

This paper explores asset returns in a production economy with habit forming households. We show that a model with capital adjustment costs and relative habits is consistent with salient financial facts, such as the equity premium, the market price of risk, and the riskfree interest rate. These predictions are not at odds with good business cycle predictions. In the model, economy investment is strongly procyclical and more volatile than output, which in turn is more volatile than consumption. Moreover, consumption growth is positively autocorrelated and negatively (positively) correlated with future (past) stock returns.

Spatial shift-share analysis versus spatial filtering: an application to Spanish employment data

The aim of this work is to analyse the influence of spatial effects in the evolution of regional employment, thus improving the explanation of the existing differences. With this aim, two non-parametric techniques are proposed: spatial shift-share analysis and spatial filtering. Spatial shift-share models based on previously defined spatial weights matrix allow the identification and estimation of the spatial effects. Furthermore, spatial filtering techniques can be used in order to remove the effects of spatial correlation, thus allowing the decomposition of the employment variation into two components, respectively related to the spatial and structural effects. The application of both techniques to the spatial analysis of regional employment in Spain leads to some interesting findings and shows the main advantages and limitations of each of the considered procedures, together with the quantification of their sensitivity with regard to the considered weights matrix.     

Equilibrium asset pricing with systemic risk

We provide an equilibrium multi-asset pricing model with micro- founded systemic risk and heterogeneous investors. Systemic risk arises due to excessive leverage and risk taking induced by free-riding externalities. Global risk-sensitive financial regulations are introduced with a view of tackling systemic risk, with Value-at-Risk a key component. The model suggests that risk-sensitive regulation can lower systemic risk in equilibrium, at the expense of poor risk-sharing, an increase in risk premia, higher and asymmetric asset volatility, lower liquidity, more comovement in prices, and the chance that markets may not clear. We thank Michel Habib, José Scheinkman, Hyun Shin and two anonymous referees for their helpful comments. Jean-Pierre Zigrand is a lecturer in Finance at the LSE, and is the corresponding author. The authors would like to acknowledge financial support under the EPSRC Grant GR/S83975/01 at the Financial Markets Group, London School of Economics.     

A model of innovation and learning with involuntary spillovers and absorptive capacity

We develop a model of innovation and learning that incorporates explicitly the need for a firm to conduct its own research and development (R&D) in order to realize involuntary spillovers from other firms’ R&D activity and the development of absorptive capacity of research firms over time. The conclusions of the model follow directly from the functional forms that are used to describe the generation and absorption of technological knowledge. The first proposition formally characterizes the steady-state rate of growth of technology for the model. The analysis also shows how some of the key features of two distinct, pure modes of organization of the production of new knowledge, the R&D model and the new localized knowledge model, are implied by our model by simply drastically changing the relative magnitude of two exogenous parameters: the ease of learning and the pace of knowledge advance. The second proposition formally characterizes the connections implied by the model between involuntary spillovers and absorptive capacity. Analysis of the long-term interactions between involuntary spillovers of knowledge and absorptive capacity provides the essential insights into an understanding of the elements of a self-sustained process of endogenous growth. The third and last formal proposition of this paper accommodates firm-level arguments and the crucial role of a firm's absorptive capacity in taking advantage of its location in clusters, as implied by the theoretical model.     

The knowledge multiplier

The paper develops a formal model of external knowledge and identifies the role of knowledge multipliers. Social interactions and knowledge multipliers play a crucial role in determining the rate of technological change. The analytical identification of the knowledge multiplier expression constitutes a key step in the appreciation of the crucial role of knowledge interactions. First, social considerations endogenously change the knowledge production function of each firm. The knowledge multiplier is the specific mechanism by means of which external knowledge contributes to enhance the innovative capacity of each firm. The production function of knowledge shows that the larger the knowledge multiplier is the stronger are the cumulative positive effects of external knowledge on the generation of new knowledge. Second, social considerations explain the long-run dynamics of innovation. Social reinforcement and the knowledge multiplier determine the rise or fall in the rate of accumulation of technological knowledge.