Sample bias in contingent valuation: A comparison of the correction methods

Abstract

This article compares various methods for correcting contingent valuation aggregate benefits when the sample is known to be biased. A sample is defined as the population, and response rates are simulated on the basis of a measure of salience. The simulated response rates suffer from nonresponse bias and selection bias. Coefficient and benefit estimates that result from weighting and self‐selection correction approaches are compared with the true coefficient and benefit estimates. Our results indicate that at both low and high response rates the standard approach leads to bias, and either correction approach will reduce the bias in coefficient and benefit estimates.     

Regulatory Barriers and Entry into a New Competitive Industry

We model the effects of license fees and bureaucratic delay on firm entry into a new competitive industry, whose profitability is initially unknown. A license fee alone reduces the number of first movers and the steady‐state number of firms. The combination of license fee and delay may cause some entrepreneurs to purchase licenses speculatively, only using them to enter production later if profitability is revealed to be sufficiently favourable. Alternatively, some entrepreneurs may wait, possibly buying a license only after profitability is revealed; but it is never found that some entrepreneurs adopt one of these strategies and some the other.     

New Product Development Practices and Early‐Stage Firms: Two In‐Depth Case Studies

New product development practices (NPD) have been well studied for decades in large, established companies. Implementation of best practices such as predevelopment market planning and cross‐functional teams have been positively correlated with product and project success over a variety of measures. However, for small new ventures, field research into ground‐level adoption of NPD practices is lacking. Because of the risks associated with missteps in new product development and the potential for firm failure, understanding NPD within the new venture context is critical. Through in‐depth case research, this paper investigates two successful physical product‐based early‐stage firms' development processes versus large established firm norms. The research focuses on the start‐up adoption of commonly prescribed management processes to improve NPD, such as cross‐functional teams, use of market planning during innovation development, and the use of structured processes to guide the development team. This research has several theoretical implications. The first finding is that in comparing the innovation processes of these firms to large, established firms, the study found several key differences from the large firm paradigm. These differences in development approach from what is prescribed for large, established firms are driven by necessity from a scarcity of resources. These new firms simply did not have the resources (financial or human) to create multi‐ or cross‐functional teams or organizations in the traditional sense for their first product. Use of virtual resources was pervasive. Founders also played multiple roles concurrently in the organization, as opposed to relying on functional departments so common in large firms. The NPD process used by both firms was informal—much more skeletal than commonly recommended structured processes. The data indicated that these firms put less focus on managing the process and more emphasis on managing their goals (the main driver being getting the first product to market). In addition to little or no written procedures being used, development meetings did not run to specific paper‐based deliverables or defined steps. In terms of market and user insight, these activities were primarily performed inside the core team—using methods that again were distinctive in their approach. What drove a project to completion was relying on team experience or a “learn as you go approach.” Again, the driver for this type of truncated market research approach was a lack of resources and need to increase the project's speed‐to‐market. Both firms in our study were highly successful, from not only an NPD efficiency standpoint but also effectiveness. The second broad finding we draw from this work is that there are lessons to be learned from start‐ups for large, established firms seeking ever‐increasing efficiency. We have found that small empowered teams leading projects substantial in scope can be extremely effective when roles are expanded, decision power is ground‐level, and there is little emphasis on defined processes. This exploratory research highlights the unique aspects of NPD within small early‐stage firms, and highlights areas of further research and management implications for both small new ventures and large established firms seeking to increase NPD efficiency and effectiveness.     

Client focus in regulatory agencies

Abstract

‘Client focus’ seems like a counter-intuitive notion for regulatory agencies, whose job is to compel people to comply with government requirements. Yet it is becoming the catchphrase for many regulatory authorities. This article puts forward an argument, based on social exchange and regulatory theory, that a client-focused approach is not only compatible with a regulatory role, but also actually facilitates it. It recognizes that most people's propensity to comply is a function of factors other than the fear of punishment, such as their intrinsic or normative motivations and their ability to do what is required. It also assists in delineation and understanding of the proportion of regulatees who opportunistically avoid their obligations. The article advances a broader model of social exchange between regulators and regulatees.     

World Population Growth; Past, Present and Future

Past, current and projected future population growth is outlined. Barring a calamitous pandemic, a further increase in the world’s population from 7 to between 8.8 and 10 billion by mid-century is unavoidable. This increase is driven by high fertility in sub-Saharan Africa whose population is forecast to more than double in the next 40 years and by a modest rise of 23 % in Asia’s huge population. Beyond mid-century, the range of plausible demographic destinations widens; much depends on fertility rates in the next few decades because they will determine the number of potential reproducers in the second half of the century. Vigorous promotion of family planning, particularly in Africa, is crucial to achievement of population stabilisation. Unchanged fertility implies a global population of 25 billion by the end of the century. In the next few decades the contribution of human population growth to global environmental change is moderate, because nearly all growth will occur in poor countries where consumption and emission of greenhouse gases is low. The implications for food production, and thereby water consumption, are greater. Much of the future need for food will be driven by increased numbers rather than changing diets. Loss of bio-diversity and natural habitats, degradation of fragile eco-systems due to over-exploitation and aquifer deletion are likely consequences.