Combatant recruitment and the outcome of war

What determines who wins a civil war? We propose a simple model in which the power of each armed group depends on the number of combatants it is able to recruit. This is in turn a function of the relative ‘distance’ between the group leadership and potential recruits. We emphasize the moral hazard problem of recruitment: fighting is costly and risky so combatants have the incentive to defect from their task. They can also desert altogether and join the enemy. This incentive is stronger the farther away the fighter is from the principal, since monitoring becomes increasingly costly. Bigger armies have more power but less monitoring capacity to prevent defection and desertion. This general framework allows a variety of interpretations of what type of proximity matters for building strong cohesive armies ranging from ethnic distance to geographic dispersion. Different assumptions about the distribution of potential fighters along the relevant dimension of conflict lead to different equilibria. We characterize these, discuss the implied outcome in terms of who wins the war, and illustrate with historical and contemporaneous case studies.     

Institutional capacity to dynamically innovate: An application to the Portuguese case

The present paper addresses the dynamics of innovation, by extending the analysis beyond a static-economic perspective. It offers a dynamic-institutional mapping of relational capacities to dynamically innovate. Its main goal is to contribute to the above-mentioned research theme by presenting a new methodology able to pinpoint different trends in the relational capacities of institutions when they are innovative. Thereby, major characteristics in the networks of innovation are identified. This investigation uses an extended set of private institutions and public organizations located in Portugal, evaluated by their WebPage contents. To this data set a new combination of multivariate statistical methods is applied to detect group performances, to compare them, and to identify gradients of capacity to dynamically innovate. The results demonstrate that this method can provide extremely useful and tailor-made information for policy evaluation at regional or national levels.     

Cointegration with structural changes between per capita product and income inequality in Mexico

The long-run relationship between per capita product and income inequality in Mexico is assessed for the period 1963–2010. The methodology consists of stochastic unit root techniques with structural changes. The integration and cointegration tests suggest that it is not possible to understand this link if the possibility of structural changes is not taken into account. Causality, running from per capita product to income inequality, and a negative and significant overall effect are estimated. However, after the regime shifts – mainly estimated to occur in the 1980s – the connection is no longer meaningful. This result seems to be linked to the slow growth of the Mexican economy after these structural breaks, affecting, in turn, the reductions in income inequality.     

Ownership Structure, Technological Endowment and Competitive Advantage: Do Democracy and Business Fit?

The current study provides a model that aims to explain the origin of the competitive advantage of organizations in terms of the ownership structure. We have also studied the interactions between IT use and ownership structure. To reach these objectives, we have classified the organizations in two groups using the cooperative character criterion. The results show that cooperative firms achieve a superior competitive advantage regardless of the amount of IT that the firms use. The study is focused on the Spanish Pharmaceutical Distribution Industry.     

Asymmetric Demand Information and Foreign Direct Investment*

We examine the FDI versus exports decision of firms competing in an oligopolistic (quantity‐setting) market under demand uncertainty and asymmetric information. Compared to a firm that chooses to export, a firm that chooses to set up a plant in the host market has superior information about local market demand. In addition to the well‐known tension between the fixed set‐up costs of investment, the additional variable costs of exports and oligopoly sizes, the incentive to invest abroad is explained by the strategic learning effect. FDI may be observed even if trade costs are zero. The analysis is robust to price competition and to the possibility that a foreign firm can engage in both FDI and exports.     

Exploring the role of memory for self‐selected ad experiences: Are some advertising media better liked than others?

Advertising media are associated with different degrees of self‐selected versus intrusive ad experiences. The role of such media differences in attitudes toward advertising was explored in a nationwide survey. The survey provides a national picture of attitudes toward specific ad media ranging from advertising media that deliver highly self‐selected ad experiences (catalogs and business classifieds) to highly intrusive ones (TV). A total of 2,514 adults were surveyed regarding their opinions about ads in (1) TV, (2) radio, (3) catalogs, (4) business classifieds, (5) out‐of‐home, or (6) advertising in general. Media that allow for self‐selected experiences, where perceived interest in an ad is the basis for attention to it, were evaluated much more favorably than more intrusive advertising media. Catalogs and business classifieds elicited the most favorable opinions; TV advertising elicited the least, and these media differences generally cut across demographic lines. Also, although more educated and affluent consumers generally held less favorable views of advertising, preliminary results suggested that this did not hold true for media that allow for self‐selected processing. An additional study suggested that memory for advertisements plays a significant role in the evaluation of a self‐selected ad medium (catalogs). That is, consumers' strongest memories are for those ads to which they paid the most attention, and consequently these engaging ads have a disproportionate influence on opinions toward the ad medium. © 2004 Wiley Periodicals, Inc.     

A Cointegration Analysis of Car Advertising and Sales Data in the Presence of Structural Change

This paper examines whether there is a long‐run stable equilibrium relationship between advertising and sales across the market segments of the UK car industry over the period 1971–2001. In order to achieve this goal, we allow for structural breaks in the series using cointegration techniques. The results show the existence of long‐run equilibrium relationships in all six market segments, although in four of them the relationship is not stable. In general, one structural change is detected in the late 1970s and another in the early 1990s, coinciding with two economic recessions. When we do not account for structural changes, the estimated long‐run elasticities of advertising on sales are seen to be substantially downwardly biased. Finally, a noticeable increase is observed in long‐run elasticities in most car market segments during the nineties with respect to previous decades.     

A Practical Guide to Experimental Advertising Research

Experiments are conducted to help establish cause-and-effect relationships, and they can be powerful tools for doing so. We review fundamental concepts for conducting experimental advertising research. Good experimental research involves careful consideration of independent and dependent variables, and what they are supposed to represent. To this end, we review threats to construct validity as well as offer some suggestions on how to think about external and ecological validity in ad research. We review three quasi-experimental research designs and three simple, randomized experimental designs, along with more complex factorial design experiments. Finally, we discuss ethical considerations and the crucial role researchers play in maintaining research integrity.     

Fiscal Cyclicality in the Brazilian Economy: Something Is Changing

This article provides empirical evidence of the degree of fiscal cyclicality in the Brazilian economy from 2000 to 2010. The degree of fiscal cyclicality is estimated through OLS and GMM models for three different time samples with the objective of observing a change in the stance in the conduct of fiscal policy. The fiscal policy from January 2000 to December 2010 was countercyclical. However from 2000 to 2007 the search for credibility implied a cyclical fiscal policy. In contrast, after 2007, the possibility of using a countercyclical fiscal policy became feasible.     

Training policy and organisational performance in the Spanish hotel industry

There is currently a general agreement about the importance of training as a tool to help companies in the development of sustainable competitive advantages based on their human resources. Staff qualification is not an option in the tourism industry; human capital training actually becomes a determining factor to be able to achieve a differential positioning within the sector. In Spain, where the tourism sector is a strategic element, it becomes essential to analyse the training policy applied by tourism enterprises with the aim of assessing its quality and effectiveness. The objective sought in this study is to identify the main factors related to training policy that have an impact on performance. The study carries out an empirical research into the effects that training practices cause on performance levels in the Spanish hotel industry using a sample of 110 hotels.