Prevention versus Treatment under Precautionary Regulation: A Case Study of Groundwater Contamination under Uncertainty

Policy discussions on agricultural pollution problems characterize prevention as more cost effective and precautionary than ex post treatment. We derive conditions under which treatment alone is more cost effective in situations involving multiple sources of emissions, multiple sites affected, and a commonly used precautionary approach to uncertainty. We also show that a greater degree of precaution can result in less reliance on prevention. An empirical case study indicates that treatment alone is the most cost-effective means of dealing with nitrate in most Maryland community water system wells. The use of leaching prevention measures is restricted to the most intensive poultry producing areas. The incremental cost of precaution is substantial.     

Labor unemployment risk and firm risk

This paper examines the effect of labor unemployment risk on firm risk. Using unemployment insurance benefits as a proxy for unemployment risk, we find an economically significant positive relation between unemployment risk and firm risk. This positive relation is more pronounced for firms that are more labor-intensive, have a higher layoff propensity and are more financially constrained. While existing literature that employs corporate policy measures such as debt and cash holdings suggests an opposite relationship, our paper presents evidence that the effects stemming from earnings management, earnings quality and reporting quality appear to dominate.     

Stakeholder management in sustainable supply chains: A case study of the bioenergy industry

Engaging with stakeholders and managing their issues when striving for a sustainable supply chain (SC) is a significant challenge. Although most studies on sustainable supply chain management (SSCM) consider stakeholder management necessary, little is known about related stakeholder management practices in SSCM. Thus, this paper seeks to enrich the theoretical debate on stakeholder management practices in SSCM through a case study approach to bioenergy SCs in Chile. Based on 28 interviews with SC actors and representatives from the surrounding stakeholder environment, the deductive–inductive analysis reveals that stakeholder management combines different practices to discuss stakeholder concerns, address them, and evaluate the process at the SC's external and internal levels. We propose structuring these practices based on two dimensions: “practices to address stakeholder requirements” and “practices whereby stakeholders are integrated.” The analysis' results indicate that although two-way communication with stakeholders can be seen as the core of stakeholder management, a certain willingness to learn and transform SC design is a prerequisite for true orientation toward stakeholder management in SSCM. Additionally, linkage development and local anchoring are practices used to obtain further legitimacy at the external level. Building on these findings, this study can guide practitioners in engaging with stakeholders and managing their issues across the SC.     

Environmental Innovations in Small and Medium Sized Enterprises

Supporting and accelerating the adoption and diffusion of environmental innovations amongst small and medium sized enterprises (SMEs) is a major challenge to environmental policy makers. Research suggests that whilst SMEs possess high flexibility, their innovative capacity may be limited to incremental changes within their existing technology system and network. Twenty case studies examining the innovation adoption process in SMEs in four sectors and in five countries within the ENVIS project (commissioned by the EU) revealed great variety in factors driving this process. Findings indicate that this variation can be attributed to the character of the environmental innovation, the specific business opportunity, the regulatory setting and pressure experienced by the sector. Based on these findings an analytical framework is suggested, whereby the environmental innovative capability of SMEs is conceived as the result of an interplay between the competencies, the network relations and the strategic orientation of the company (the 'dynamic triangle'). This indicates that policy to support SME's adoption of environmental innovations has to take an integrated form, i.e. addressing and developing competence, networks and strategic orientation of SMEs simultaneously whilst remaining systemic and context sensitive.     

Educational Attainment and Family Background

Abstract. This paper analyses the effect of aspects of family background, such as family income and parental education, on the educational attainment of persons born from 1967 to 1972. Family income is measured at different periods of a child's life to separate long-term versus short-term effects of family income on educational choices. We find that permanent income matters to a certain degree, and that family income when the child is 0–6 years old is an important explanatory variable for educational attainment later in a child's life. We find that short-term credit constraints have only a small effect on educational attainment. Long-term factors, such as permanent family income and parental education, are much more important for educational attainment than are short-term credit constraints. Public interventions to alleviate the effects of family background should thus also be targeted at a child's early years, the shaping period for the cognitive and non-cognitive skills important later in life.     

Employment changes, the structure of adjustment costs, and plant size

In this paper, we analyze the pattern of employment adjustment using a rich panel of Norwegian plants. The data suggest that the frequency of episodes of zero net employment changes is inversely related to plant size. We develop and estimate a simple “q” model of labor demand, allowing for the presence of fixed, linear and quadratic components of adjustment costs. The econometric evidence supports the existence of purely fixed components, unrelated to plant size. As a result, the range of inaction is wider for smaller plants. The quadratic component of costs is also always important. In most specifications fixed costs are higher for employment contractions. The quadratic component is higher during employment contractions compared to expansions for small plants, while this is not true for larger plants.     

Elasticity estimates of farmed salmon demand in Spain and Italy

In this paper, estimates of the elasticities that characterize the structure of demand for farmed salmon in Spain and Italy are reported. The demand models are specified using a Box-Cox transformation of the variables and a Hausman test is used to determine price endogeneity in the demand equations. The results show short-run unitary own-price elasticity of demand for farmed salmon in both markets, but long run estimates show significant elastic price response. Short run substitution of salmon for other fish species is not observed and, for both Spain and Italy, farmed salmon is characterized as a luxury good. Interestingly, we show that our a priori expectations about own-price elasticities being lower in smaller market areas is confirmed. Finally, the results obtained are compared to other recent results reported in the salmon demand literature.