Publication Selection Bias in Minimum‐Wage Research? A Meta‐Regression Analysis

Card and Krueger's meta-analysis of the employment effects of minimum wages challenged existing theory. Unfortunately, their meta-analysis confused publication selection with the absence of a genuine empirical effect. We apply recently developed meta-analysis methods to 64 US minimum-wage studies and corroborate that Card and Krueger's findings were nevertheless correct. The minimum-wage effects literature is contaminated by publication selection bias, which we estimate to be slightly larger than the average reported minimum-wage effect. Once this publication selection is corrected, little or no evidence of a negative association between minimum wages and employment remains.     

Illegal immigration in a heterogeneous labor market

This paper examines the effects of illegal immigration in a neoclassical growth model with two groups of workers, skilled and unskilled. We show that although illegal immigration is a boon to a country as a whole, there are distributional effects, whose sign is in general ambiguous. This is because all sources of income of both groups are affected and some of these changes tend to move income in opposite directions. Nevertheless, calibration exercises show that the wealth distribution is likely to become more unequal as the number of illegal immigrants increases. We confirm most of our calibration results analytically in a small open economy version of the basic model. Finally, our results remain robust when we extend the model to allow for endogenous skill acquisition.     

Wealth Distribution and Imperfect Factor Markets: A Classroom Experiment

The author presents a simple exercise to demonstrate how initial property distribution can affect final wealth patterns in developing areas of the world. The simulation is a variant of the Monopoly board game in which students role play different members of a market in which they each face different rules of credit access and salary patterns. The property distribution and new mortgage rules reflect the reality of many developing areas. The simulation can be completed in one full class period and has proven successful in making students more sensitive to wealth distribution issues. Students have suggested several variations of this simulation to make it applicable across more settings.     

An Exploration of Managerial Views on Positioning Services in Ghana

ABSTRACT

The paper constitutes an analysis of the views of managers of service firms on positioning strategies in Ghana. The research employed a qualitative research method. Data were collected from 21 service managers and analyzed using content analysis procedures. The results indicate that for service managers, the perceived dominant positioning strategies of their organizations were: service quality, customer relationship, innovation, availability of service, community support, and leading organization, among others. The findings suggest that the dominant managerial views of Ghanaian service managers form a ‘hybrid’ of those of the Western manager. This research is important in clarifying this position. Additionally, as an exploratory piece, the study provides bases for further research on a topic in Ghana with a rather scant evidence of research.     

The customer consequences of returns in online retailing: An empirical analysis

Pressure continues to build on the operations management function to facilitate system and firm level benefits. In the online marketplace, one area of growing interest is that of product returns. Though commonly viewed as a cost center from an operations perspective, operations’ actions have the potential to strongly influence future customer buying behavior in several ways. Using an archival database of actual purchase and returns history provided by a moderately sized online retailer, this study examines the relationship between a customer's experience of product returns, and subsequent shopping behavior. Employing transaction cost, consumer risk, and procedural justice theories, we demonstrate that the returns management process, rather than being regarded as an afterthought to the production and deployment of goods, can significantly and positively influence repurchase behavior. Additionally, we provide evidence that certain customers should be considered for prioritization in the returns process. We suggest ways through which operations managers can take care in discharging their responsibilities in this area – to make returns processing more than simply a “necessary cost of doing business” rather, using it to their advantage in engendering repeat and increased purchase behavior.     

The business case for commitment to diversity

Does an organization's commitment to diversity - as reflected by CEO commitment, human capital, corporate communications (internal and external), and supplier diversity - result in competitive advantage and superior financial performance? Diversity can bring new voices and perspectives into the strategy dialogue, help managers understand and address the needs of a demographically diverse customer base, and stimulate a wider range of creative decision alternatives. However, the anticipated benefits of corporate diversity efforts may also be accompanied by costs that can affect shareholder wealth. In a study comparing the financial performance of the DiversityInc Top 50 Companies for Diversity to a matched sample, we find evidence that firms with a strong commitment to diversity outperform their peers on average. For commitment to diversity to become ingrained in corporate culture there must be visible and ongoing support from senior management, a clear articulation of the business case for diversity, line manager accountability, and training programs directed at communications, conflict resolution, and team building.     

The impact of R&D on value added for domestic and foreign firms in a newly industrialized economy

This study compares the impact of R&D on value added between domestic and foreign firms in Singapore. The analysis is based on a comprehensive panel database from 1993 to 1999 provided by the Singapore Government. Our results found that R&D investments of foreign firms generated higher value added than those of domestic firms, and that the difference in value added contributed by R&D was moderated by the type of R&D and the technological level of industry. The study supports the argument that the ownership advantages possessed by foreign firms, relative to domestic firms, have positive effects on R&D performance.     

Transversals, systems of distinct representatives, mechanism design, and matching

A transversal generated by a system of distinct representatives (SDR) for a collection of sets consists of an element from each set (its representative) such that the representative uniquely identifies the set it belongs to. Theorem 1 gives a necessary and sufficient condition that an arbitrary collection, finite or infinite, of sets, finite or infinite, have an SDR. The proof is direct, short. A Corollary to Theorem 1 shows explicitly the application to matching problems. In the context of designing decentralized economic mechanisms, it turned out to be important to know when one can construct an SDR for a collection of sets that cover the parameter space characterizing a finite number of economic agents. The condition of Theorem 1 is readily verifiable in that economic context. Theorems 2–5 give different characterizations of situations in which the collection of sets is a partition. This is of interest because partitions have special properties of informational efficiency.     

Risk sensitive asset management with transaction costs

This paper develops a continuous time risk-sensitive portfolio optimization model with a general transaction cost structure and where the individual securities or asset categories are explicitly affected by underlying economic factors. The security prices and factors follow diffusion processes with the drift and diffusion coefficients for the securities being functions of the factor levels. We develop methods of risk sensitive impulsive control theory in order to maximize an infinite horizon objective that is natural and features the long run expected growth rate, the asymptotic variance, and a single risk aversion parameter. The optimal trading strategy has a simple characterization in terms of the security prices and the factor levels. Moreover, it can be computed by solving a {\it risk sensitive quasi-variational inequality}. The Kelly criterion case is also studied, and the various results are related to the recent work by Morton and Pliska. Mansucript received: July 1998; final version received: January 1999     

The Pattern of Intraday Portfolio Management Decisions: A Case Study of Intraday Security Return Patterns

This article examines causes of observed stock trading patterns that show high hourly returns and trading volume during early and late trading hours. Using time-stamped data from an institutional investor, we document high levels of portfolio managers' early-morning and late-afternoon decisions to trade that can result in the volume pattern and relatively higher proportions of buy decisions that could contribute to the return pattern.