From Social Pacts to Productivity Boards

Market solutions can be a way for small deregulated states like the Baltics to grow, but they are not a viable path for the EMU area as a whole or for the larger countries like France, Germany or Italy. As most of the challenges have to be addressed at the national level only, an interaction of flexible institutions (as the social pacts were) in coordination with developing European institutions (like a European unemployment scheme) can offer a more stable environment for growth.     

Income and Wealth Inequality in OECD Countries

This paper summarises some of the key findings and policy recommendations of the latest OECD report on income inequality - “In It Together: Why Less Inequality Benefits All”. In particular, the paper presents new findings regarding the trade-off between inequality and growth, as well as with regard to the impact of the economic crisis and of female employment on the distribution of income and the distribution of wealth. Key policy recommendations derived from these findings are the need to promote employment and good quality jobs, to further improve female participation, to invest in education and skills, and to foster well-designed redistribution policies.     

Greening the Street-Level Procurer: Challenges in the Strongly Decentralized Swedish System

This article investigates the every-day street-level practice of green public procurement (GPP) in Sweden, a country with one of the most decentralized systems of public administration within the European Union (EU). The street-level procurement officers in Swedish local and regional government are in charge of purchases estimated to represent between 10% and 15% of Sweden’s GDP. This article examines the constraining and enabling factors behind the individual procurement officer’s choice of green procurement in textiles and clothing through a combination of qualitative interviews and a review of documentary sources. The analysis shows that while indirect support through European and national soft regulation and policy advice is imperative for “greening” procurement, the direct factors which influence the local outcome of GPP comprises factors on the local level: political commitment and environmental knowledge, the organizational structure of local government and the local interpretation of the regulatory framework. This study shows that a decentralized structure has possibilities of furthering ambitions of buying green if there are committed politicians and public officials, an optimal level of internal centralisation and an external support structure of knowledge and enabling rules.     

An Economic Analysis of Requirements to Prevent Handheld Hair Dryer Water Immersion Electrocutions in the USA

Before 1987, when handheld hair dryers were not required to protect against water immersion electrocutions, there were almost 16 such electrocutions annually in the USA. This article presents a retrospective evaluation of the benefits and costs of the 1987 and 1991 immersion protection requirements of the voluntary hair dryer safety standard in the USA. The benefits are based on estimates of the reduced risk of electrocution resulting from the requirements, and the valuation of the reduced risk derived from willingness to pay studies of the “value of statistical life” found in the economics literature. The costs were defined as the incremental costs associated with incorporating the immersion protection technology into handheld hair dryers. The study found that the requirements were highly effective and may have reduced the immersion-related mortality rate by almost 97%. The expected present value of the estimated benefits of the requirements amounted to about $4.56 per dryer in 2014 dollars and substantially exceeded the costs of about $2 per dryer. The primary outcome measure, the expected net benefits (i.e., benefits minus costs) of the requirements, amounted to an average of about $2.56 per hair dryer, over the hair dryer’s expected product life. Given sales of about 23 million handheld hair dryers annually, the present value of the expected net benefits associated with 1 year’s production would have amounted to about $58.9 million. A sensitivity analysis showed that the major findings were robust with respect to changes in the underlying parameters of the analysis. The study also discusses the factors leading to a high rate of effectiveness estimated for the immersion protection requirements.     

Time heals many wounds – explaining the immediate and delayed effects of message sidedness

This study investigates the immediate and delayed effects of advertising messages including both positive and negative information. A two-sided message has a negative effect on message attitudes due to two mediating variables with trade-off effects: valence and balance. These two variables are also responsible for the alignment of the effect of sidedness on message attitudes and purchase intentions over time: the negative effects of two-sided messages are neutralized over time because negative information is reevaluated, improving the valence of the message. The results explain the negative effects of message sidedness that have been found in prior research and they show that a two-sided message in advertising is not necessarily inferior to a one-sided message despite unfavorable short-term effects.     

The variable effects of dynamic capability by firm size: the interaction of innovation and marketing capabilities in competitive industries

Although investments in marketing and innovation capabilities theoretically help firms to compete in dynamic markets and enhance performance, company size has a strong influence on whether this is the case. In a test of a proposed conceptual model, this study of 692 small, medium, and large enterprises found that large firms prospered from building dynamic capabilities under conditions of high industry competitiveness, while investments in innovation and marketing individually diminished small firms’ performance. The effect was mixed for medium-size firms. In small enterprises, however, dynamic capability proved to be crucial in order to withstand competition. Therefore, taking into account these firms’ limited resources, managerial efforts should be focused on the integration of marketing and innovation capabilities, because each capability alone does not have a significant positive impact on performance. In medium-sized enterprises, the support of marketing capability is required to raise profitability under conditions of high industry competitiveness; otherwise, innovation would not lead to actual profits. For large enterprises, industry competitiveness was found to be a less serious threat to performance, and instead is a catalyst to the development of capabilities, suggesting that managers of such firms should focus on building long-term strategic advantages.     

Towards right-shoring: a framework for off-and re-shoring decision making

Location decisions are crucial for manufacturing plants. While current research mainly stresses the cost considerations of location decisions, this research focusses on a more comprehensive decision-making process. Based on analyzing the motivations for off-and re-shoring, we present a decision-making framework which will help companies to ‘right-shore’. Through a multiple case study approach in the aeronautics industry, an industry known for its technical complexity and innovative nature, we will validate and broaden our initial decision-making framework based on literature. While analyzing this framework, it became apparent that the main motivation for offshoring in the aeronautic industry is far from being restricted to cost-cutting considerations. More specific, companies in this industry are willing to develop sustainable commercial partnerships in emerging countries to benefit from new capacities and resources. In the same vein, re-shoring decisions are grounded on long-term perspectives and are carefully balanced. While providing a comprehensive framework for offshoring and re-shoring decisions, our framework enables companies to make better informed decisions for choosing the right location for their plants.     

Do microfinance institutions fulfil their promise? Evidence from cross-country data

The concept of microfinance promises poverty reduction and economic growth. We empirically challenge this economic and social promise in an attempt to prove its fulfilment. Our multivariate regressions of economic development variables such as per capita gross national income based on PPP converted to international dollars (GNI per capita PPP), GDP growth, as well as gross capital formation and labour participation rate against specific microfinance institutions’ (MFI) variables show that the success and performance of MFIs significantly influence economic development. Microfinance directly influences economic growth through the value that MFI performance adds to purchasing power. An indirect impact comes from an improvement in capital accumulation and employment rates. These insights are valuable as the interdependencies between microfinance and economic development that this article verifies offer new and progressive insights into purposeful action that can be taken to stimulate economic development and growth. Targeted development programmes as well as socially responsible investments can be applied in developing economies in order to strengthen their growth and alleviate poverty.