Managerial Selection Decisions in Multinational Corporations: Teaching International Business Using Problem-Based Learning

Companies face many challenges as they staff managerial positions in overseas operations, including decisions on whether to staff using expatriates, host-country nationals, or third-country nationals. We developed an exercise—designed to help students understand the differences between these three groups of employees—that requires students to develop a set of criteria that would form the basis for choosing the candidate they deem to be the best one. In addition, the exercise can serve as a springboard to discussion of the different training and compensation requirements for each of the three different types of employee. The steps involved in the exercise are presented together with suggestions for debriefing the exercise.     

Endogenizing leadership in tax competition

In this paper we extend the standard approach of horizontal tax competition by endogenizing the timing of decisions made by the competing jurisdictions. Following the literature on the endogenous timing in duopoly games, we consider a pre-play stage, where jurisdictions commit themselves to move early or late, i.e. to fix their tax rate at a first or second stage. We highlight that at least one jurisdiction experiments a second-mover advantage. We show that the Subgame Perfect Equilibria (SPEs) correspond to the two Stackelberg situations yielding to a coordination problem. In order to solve this issue, we consider a quadratic specification of the production function, and we use two criteria of selection: Pareto-dominance and risk-dominance. We emphasize that at the risk-dominant equilibrium the less productive or smaller jurisdiction leads and hence loses the second-mover advantage. If asymmetry among jurisdictions is sufficient, Pareto-dominance reinforces risk-dominance in selecting the same SPE. Three results may be deduced from our analysis: (i) the downward pressure on tax rates is less severe than predicted; (ii) the smaller jurisdiction leads; (iii) the ‘big-country-higher-tax-rate’ rule does not always hold.     

Product variety and the demographic transition

Why does the rate of population growth decline in the face of economic growth? We show that growing product variety may induce a permanent reduction in the demand for children and a continuous rise in income and consumption.     

“Social Security-Adequacy,Equity, and Progressiveness: A Review of Criteria Based on Experience in Canada and the United States,” Robert L. Brown and Jeffrey Ip,January 2000

Abstract

We consider an optimal dynamic control problem for an insurance company with opportunities of proportional reinsurance and investment. The company can purchase proportional reinsurance to reduce its risk level and invest its surplus in a financial market that has a Black-Scholes risky asset and a risk-free asset. When investing in the risk-free asset, three practical borrowing constraints are studied individually: (B1) the borrowing rate is higher than lending (saving) rate, (B2) the dollar amount borrowed is no more than K > 0, and (B3) the proportion of the borrowed amount to the surplus level is no more than k > 0. Under each of the constraints, the objective is to minimize the probability of ruin. Classical stochastic control theory is applied to solve the problem. Specifically, the minimal ruin probability functions are obtained in closed form by solving Hamilton-Jacobi-Bellman (HJB) equations, and their associated optimal reinsurance-investment policies are found by verification techniques.     

Domain‐Relevant Commitment and Individual Technical Innovation Performance

Individual innovators play a critical organizational role in that they generate and often champion technology and product ideas. Amidst an ongoing stream of organizational and team innovation research, few empirical studies focus on differences in individual innovation performance despite the importance of the individual innovator to a firm's innovation efforts. Based on goal commitment theory, we introduce a new domain‐relevant commitment construct and develop a conceptualization of conditional indirect effects. Our model suggests that relevant individual abilities enhance commitment to technical innovation and innovation performance while also insulating against the impact of situational variables, making employees' commitment to innovation performance less dependent upon context. Hypotheses are tested using two sources of data and a sample of 339 R&D professionals from a Fortune 100 industrial firm. Results suggest that commitment to innovation is a key motivational factor in explaining individual technical innovation performance. Situational characteristics impact motivation differently for individuals with lower vs. higher ability levels, even in this context in which truly low‐ability individuals, in the absolute sense, have been screened out by the employment selection process. The relationship between commitment and innovation performance is strengthened by higher levels of individual ability.     

Understanding the ideological roots of our global crises: a pre-requisite for radical change

Even though the unfolding global financial crisis has shaken the world, it has been accompanied in the background by slowly unfolding environment and development crises. While action is being taken to keep the financial crisis from getting worse, negotiations for next steps in the climate change treaty are ongoing, and efforts are being made to implement the millennium development goals to improve the lives of people globally. Herein, the author advocates the argument that the reason the solutions have not been very effective, and that the financial crises unfolded anyway, is because the roots of the crises have not been fully understood. In the absence of this understanding, the very mode of progress has ultimately worsened the problems. After a brief historical review, this paper puts forth and analyzes five major ideological root causes, and provides supporting arguments to show how these have led to a worsening situation for the long-term prospects for progress. Understanding the root causes better points to solutions and directions for progress that are for the long-term benefit of all.