When does advice impact startup performance?

Why do some entrepreneurs thrive while others fail? We explore whether the advice entrepreneurs receive about managing their employees influences their startup's performance. We conducted a randomized field experiment in India with 100 high-growth technology firms whose founders received in-person advice from other entrepreneurs who varied in their managerial style. We find that entrepreneurs who received advice from peers with a formal approach to managing people—instituting regular meetings, setting goals consistently, and providing frequent feedback to employees—grew 28% larger and were 10 percentage points less likely to fail than those who got advice from peers with an informal approach to managing people, 2 years after our intervention. Entrepreneurs with MBAs or accelerator experience did not respond to this intervention, suggesting that formal training can limit the spread of peer advice.     

The influence of seller learning and time constraints on sequential bargaining in an artificial perishable goods market

This paper investigates the formation of prices in a perishable goods market where agents bargain repeatedly through pair-wise interactions. After extensive field observations, we chose to focus on two aspects that seem important to actors of this market: the passage of time and update in judgement when gathering information. The main feature of the market is that a seller bargaining with a buyer has incomplete information about buyer's willingness to pay and is not sure how her trading partner will evaluate an offer or compare it with other options. On the other hand, buyers have limited time to look for goods and cannot meet all possible sellers before making a decision. Hence agents cannot calculate the best price to offer but receive information through limited interactions, and use this information to choose their actions.An agent-based model was built to represent a framework that mimics the observed market institution and where agent's possible behaviors and learning was made as consistent as possible with gathered data. Simulations were run, first for sensitivity analysis concerning main parameters, then to test the dependance of agents’ learning to (a) the time buyers can spend on the market and (b) the frequency of update in learning by sellers. To validate the model, features produced by the simulated market are compared to the stylized facts gathered for negotiation about four goods. We reproduce the main features of the data on the dynamics of offers, transaction prices and agents’ behavior during the bargaining phases.     

Why not fully spend a conditional block grant?

This paper studies a conditional block grant that Dutch municipalities receive for welfare-to-work programs. Many municipalities do not fully use this grant, although programs are beneficial for them. We argue that municipalities incur expenses to use the grant. If these costs are substantial, then it is optimal not to fully use the grant. Based on municipality-specific data on grants and actual expenditures, we estimate that municipalities have to add about 90 cents from their own resources to spend 1 euro of the grant. As a result, the conditional block grant is de facto a closed-ended matching grant.     

Graphical disclosures by charities: clarification or distortion? The case of the Netherlands

• The literature on graph use and graphical distortions in nonprofit organisations is reviewed, highlighting measurement issues. A sample of 50 disclosed annual reports of Dutch charities containing graphs is analysed, leading to the observation of significant graphical distortions. These distortions seem to be related to organisational efficiency, though not in the way one might expect: better performing charities ‘embellish’ the data in their graphical representations, whereas the opposite seems to be the case for the less performing charities.

Copyright © 2009 John Wiley & Sons, Ltd.     

Disability insurance and unemployment insurance as substitute pathways

In this article, we estimate the degree of substitution between enrolment into Disability Insurance (DI) and Unemployment Insurance (UI) in the Netherlands. Starting in the 1990s many policy measures aimed at reducing DI enrolment, and increase labour force participation. We quantify whether these policy measures have led to a reduction in hidden unemployment in DI. A side effect of the reforms may be increased pressure on UI. Therefore, we simultaneously estimate reverse substitution, that is, hidden disability in UI. To this end, we employ a sample of firms in the Dutch AVO database from the period 1993 to 2002. Using instrumental variables in a bivariate Tobit specification, we identify the hidden components in both respective schemes. The estimation results indicate that about 3% of all dismissals took place through DI, which implies that about one quarter of the DI enrolments observed in our sample in fact consists of hidden unemployment. We find no evidence for reverse substitution of disabled persons ending up in UI.     

Consumers’ Perceived Value and Willingness to Purchase Organic Food

ABSTRACT

The demand for organic products has rapidly expanded worldwide in recent years. However, the organic market remains a niche market in most countries, and research in this area remains limited. Further investigation is necessary to better understand consumer perceptions about organic food and the circumstances in which they are willing to purchase organic food. Accordingly, the authors seek to understand the perceived value that consumers associate with organic food and the factors that impact their willingness to purchase organic food. This study is exploratory in nature and uses a qualitative approach through the use of in-depth interviews. Findings from the study suggest that consumers who perceive a positive value with regard to organic food are more willing to purchase organic food, in which health was the primary perceived benefit. For consumers who perceive a negative value with regard to organic food, they are less willing to purchase organic food. Many did not see any difference between organic food and nonorganic food. Instead, they viewed the prices of organic food as being expensive and argued that more efforts are needed on their part to source for organic food. Implications and recommendations from research findings are also presented.     

Food Insecurity,Soil Degradation and Agricultural Markets in West Africa: Why Current Policy Approaches Fail

The agricultural sector in West Africa is not at present capable of meeting the growing demand for food for its population and of reversing unfavourable trends in soil degradation. We argue that integrated soil management is an essential condition for sustainable agricultural development in the many regions in West Africa where population pressure forces an intensification of land use. Such an approach combines improved soil-moisture storage measures, and the use of organic and inorganic fertilizers and soil amendments. The synergetic effects which could result from this combination are indispensable for achieving the productivity increases needed to cope with the pressure of population. Current (neo-liberal and ecological-participationist) policy approaches are unable to realize the transition towards integrated soil management technologies. The time lags involved in learning to use new technologies, in the adaptation of technologies to local circumstances, and in reaping the benefits of soil fertility investments call for (at least temporary) support of agricultural incomes.     

Organizational Sensemaking of Non-ethical Consumer Behavior: Case Study of a French Mutual Insurance Company

Researchers and managers alike are becoming increasingly interested in the topic of unethical consumer behavior. Where most studies view unethical behavior as something that is identifiable per se, the authors of the present article believe that it only exists because it has been constructed by people operating within a specific context. Hence the efforts made by this paper to explore, at the level of one specific organization, how interactions between employees and consumers might lead to the construct of unethical consumers. Based on a case study of France’s AMDM—a mutual insurance company set up to serve a client base comprising motorcyclists—the paper addresses how one group of consumers ends up being categorized as unethical by revealing the existence of a sensemaking process within the target organization. This process develops in three main phases: the nurturing of a shared ethos; the protection of employees’ recognized status; and the demonization of any group of consumers threatening this status. Managers incorporating this sensemaking process can avoid or mitigate the negative effects befalling organizations when these kinds of unethical consumer behavior are constructed.     

Trade,Tariffs and Total Factor Productivity: The Case of Spanish Firms

The aim of this paper is to examine the sensitivity of total factor productivity (TFP) to foreign competition in the case of a European country. Using the Olley and Pakes method, we calculate the TFP of Spanish manufacturing firms and study the impact of EU tariffs and the presence of foreign products and imports on TFP at the firm level. Applying the System‐GMM method, we find that TFP is negatively impacted by European tariffs, whereas competition in the form of the increased presence of foreign products in the domestic market and firm imports leads to improvements in the TFP. Moreover, these two effects are complementary. We also find evidence of important asymmetries among firms depending on their involvement in foreign markets.