Exclusive Licensing in a Sequence of Innovations

In this paper, I examine the issues involved with sequential licensing of innovations. In particular, a model is developed in which the granting of an exclusive license has the potential to distort future industrial structure. Subsequent licensing negotiations are then affected by the initial exclusivity, giving the initial licensee more leverage in bidding. This dynamic effect gives firms strategic incentives to take exclusive licenses, even when, in a one-shot market, such licenses would not be optimal. Appropriate antitrust rules in the context of sequential innovations are then discussed.     

EXAMINING MERGER SYNERGY WITH THE CAPITAL ASSET PRICING MODEL

This paper analyzes the impact of mergers on the alphas and betas of actual merged firms compared to those of the homemade mergers an investor could have created by buying proportional shares of the two firms. The results provide some evidence of merger synergy. Where alpha and beta shifts were observed, the evidence did not indicate that either the relative size of target firms or concurrent capital structure changes were related to these shifts as current theory suggests. There is weak evidence that nonconglomerate mergers were more frequently synergistic.     

Contextual factors in the success of reduced‐load work arrangements among managers and professionals

The purpose of this study was to consider the role of contextual factors, particularly those related to HR policies and practices, in the success of eighty‐two professionals and managers working on a reduced‐load basis. Results revealed agreement among senior managers, coworkers, direct reports, and reduced‐load managers and professionals themselves that the alternative work arrangements were successful. The key factors seen as facilitating success included individual characteristics and behaviors as well as contextual factors related to job content, work group, organizational culture, and human‐resource policies and practices. © 2002 Wiley Periodicals, Inc.     

A Review of Milgrom and Roberts'sEconomics, Organization and Management

Books reviewed in this article:
Economics, Organization and Management , by Paul Milgrom and John Roberts     

Rural employment and rural-urban differences in employment in Zaire: A comparative perspective

This article provides evidence on the extent of de-agrarianization, the nature of rural employment, and rural-urban differences in employment in Zaire. The composition of employment by industry is examined using data from Zaire’s 1984 Census. Increased schooling was associated with a greater propensity to be involved in nonagricultural employment. Since 1990, Zaire’s chronic economic crisis has become acute and is intertwined with the political crisis resulting from President Mobutu’s resistance to popular calls for democratization. In these circumstances, de-agrarianization is effectively put on hold. Nonagricultural employment opportunities have diminished considerably, and an increasing proportion of the country’s population is being pushed back to subsistence agriculture. An earlier version of this article was presented at the African Studies Centre-International Labour Organization workshop on “De-agrarianization and Rural Employment,” May 10–12, 1994, Leiden, The Netherlands.     

Moral Reasoning "On Hold" During a Competitive Game

When a person engages in a "game," that person may reason and behave in a manner that is inconsistent with non-game-situation moral reasoning. In this study we measured moral reasoning with the Defining Issues Test (DIT). We then engaged the students in a competitive game and collected accounts of their "reasoning" by having them explain their decisions with a forced choice inventory. The results indicate that there were significant inconsistencies in moral reasoning between non-game and game situations. The implications of this for business ethics are discussed.     

Waterway freight transport — survival or revival?

The author sees the official opening of the first new stretch of commercial waterway in the UK since 1905 as possibly the initial step towards a reappraisal of inland freight transportation. She explains the relative value of this method of transport in the 1980s despite the constant failure of successive UK governments to promote its use. A comparison is made of the decline of the UK inland waterway system of the Industrial Revolution, and the growth of the Western European system of the 20th century. The author pinpoints the West German and Dutch examples and returns to the UK situation in an attempt to understand why it has been so different. An analysis of recent moves by the UK legislature is given and the article concludes with a plea for some fundamental rethinking in UK transport planning.     

Symmetrically pairwise-bargained allocations in an assignment market

Consider an assignment game with transferable utility where the optimally assigned partners engage in bargaining of the sort modelled by Nash, using as their threats the maximum they could receive in an alternative match. A symmetrically pairwise-bargained (SPB) allocation is a core allocation such that all partners are in bargained equilibrium. It is shown that an SPB allocation always exists, that the set of SPB allocations coincides with the intersection of the kernel and the core, and that there is a rebargaining process which converges to an SPB allocation if it begins at a “distinguished point” in the core.