The role of innovation and opportunity in bilateral OECD trade performance

This paper investigates the specialization pattern in terms of technology and exports and examines the role of innovation intensity and technological opportunity in determining bilateral trade at the aggregate and sectoral level. Some of the major findings are: At the aggregate level, innovation intensity and technological opportunity has positive and significant impact on bilateral trade performance especially during the 1990s. At the sectoral level, innovation intensity affects bilateral trade performance positively mainly in the high-technology sectors. There is also a positive and significant relationship between technological opportunity and bilateral trade for five of the eighteen sectors, which are the high-technology sectors. JEL no. F14, C31, O33     

Incentivizing managers to build innovative firms

We investigate whether the equity-linked components of top executive pay have an effect on patenting activity within a firm. We find a positive relationship between firm patenting activity and managerial alignment incentives created by stock and stock option grants. Prior work has shown that the market value of a firm reflects the value of its patents. Thus, our finding suggests innovation is one such channel through which equity alignment incentives positively impact firm value. On the other hand, we find that the risk-taking incentive from stock options does not increase patenting.     

Institutional Pluralism and Housing Delivery: A Case of Unforeseen Conflicts in Mumbai, India

This paper demonstrates how institutional pluralism in the delivery of housing can evoke major disagreements and ultimately conflict between different stakeholders. The case study focuses on a case of slum redevelopment in Mumbai and shows how a major nongovernment organization (NGO) became involved in conflicts with the other stakeholders, including private market actors, government agencies and even the community group. But, these conflicts did not necessarily have only negative impacts. Under certain conditions, such as when property values were booming in Mumbai, communities can actually benefit from such conflicts.     

An Experiential Approach to Teaching Ethics in International Business

Ethics training in academia and corporations have grown as expansion in international business activities has lead to frequent inter-cultural exchanges. An effective instructional tool in theform of an experiential exercise is presented. The exercise using role-playing enables participants to recognize, confront, and understand business quandaries. A scoring system allows participants to compare the ethical standards of employers, employees, customers, and the society-at-large on a set of predetermined ethical events.     

Understanding Hurricane Evacuation Decisions Under Contingent Scenarios: A Stated Preference Approach

We conduct a stated preference analysis to understand the factors that individual households take into consideration to evacuate during hurricanes. In designing the contingent scenarios for evacuation, we randomly assign varying levels of hurricane characteristics (wind speed, lead time for landfall and the height of storm surge) combined with different types of emergency management options (voluntary versus mandatory evacuation order and a voucher with varying amounts to cover evacuation expenses). Findings indicate that individual households respond, in a non-linear fashion, to the intensity of hurricanes when making evacuation decisions. Respondents are also more likely to evacuate when the storm surge reaches a certain threshold. In terms of policy interventions, mandatory evacuation orders are more effective to increase the likelihood of evacuation. The potential intervention in the form of providing evacuation vouchers to assist households to cover their expenses (e.g. for food, water, transportation and lodging) also seems effective. We discuss policy implications of our findings.     

Social context,financial stakes and hypothetical bias: an induced value referendum experiment

This article investigates the effect of social context in an induced value, public good referendum experiment. In a split-sample treatment, social context is simulated by requiring participants to potentially have to disclose their vote to the group (voting disclosure) across both hypothetical and real settings. The experimental design also varies the cost (a coercive tax), and includes an uncertain level of benefit from the public good. The design allows investigation of the role of social context in both hypothetical and real referenda and its interaction with changes in the financial stakes involved (costs and potential benefits). Results show evidence of hypothetical bias, but also a social context effect that occurs in both real and hypothetical settings. This social context effect is larger than the effect of hypothetical bias, but is muted by the magnitude of costs and potential benefits. Hypothetical cases are also shown to be more prone to the social context effect.     

Nowcasting sales growth of manufacturing companies in India

The performance of private corporate sector is used as an important demand indicator for monetary policy making. As these data are received with a lag, assessing and monitoring of corporate sales on a real-time basis poses a significant challenge to policy makers in India. In this context, this article attempts to nowcast quarterly sales growth of Indian manufacturing companies and GDP growth of India using dynamic factor modelling framework. A multiple-level framework through turning point analysis and elastic net structure is used to overcome the overfitting problem during variable selection. Empirical results show improvement in forecast accuracy for one quarter ahead nowcast using 3-factor and 4-factor models over the benchmark model. However, absolute dominance of 3-factor models over 4-factor models was not established. As such, the article has proposed a forecast combination technique to nowcast sales growth of manufacturing companies in India.