Applying cognitive adjustment theory to cross‐cultural training for global virtual teams

Global virtual teams are faced with the challenge of developing trust in a technology‐mediated context to overcome anxiety and uncertainty in their interactions. Research shows that adjustment is a function of an individual's ability to manage his or her anxiety and uncertainty in an unknown context (Gudykunst, 1995). We propose that the type of cross‐cultural training (CCT) received can influence cognitive adjustment in global virtual teams. Building on phenomenology and sense‐making theory, we argue that training needs to develop global virtual team members' capabilities in dealing with the unknown rather than providing ready‐made concepts of cultures. Managerial implications of our theoretical discussion of cognitive adjustment and how CCT influences it are discussed, as are directions for future research. © 2009 Wiley Periodicals, Inc.     

Resource complementarity and value capture in firm acquisitions: The role of intellectual property rights

Extant literature holds that firm acquisitions create value through innovation if the knowledge bases of the acquirer and the target complement each other. Little is known about the value that patents associated with a target's knowledge convey to the acquirer, i.e., their value in securing market exclusion and freedom to operate in R&D. We argue that such property rights hold preemptive power allowing firms to capture the value from combining complementary technologies and to realize gains from trade in strategic factor markets. Our results for a sample of 1,428 acquisitions indicate that—controlling for technological value—acquired preemptive power is an important determinant of the acquisition price, particularly when the acquirer is technology intensive and acquired patents are highly related to the acquirer's knowledge base. Copyright © 2013 John Wiley & Sons, Ltd.     

Using Intuition in Fuzzy Front‐End Decision‐Making: A Conceptual Framework

The goal of decision‐making during the execution of the fuzzy front end (FFE) is to develop a creative new product concept. Although intuitive decision‐making has been found to increase new product creativity, the theoretical knowledge base as to why and under which conditions intuition use during the process of generating a creative outcome is beneficial, is rather limited. Therefore, this study develops a conceptual framework theorizing why and under which conditions using intuition in FFE execution decision‐making may or may not be (as) beneficial for new product concept creativity. To develop this framework, the authors combine a creativity perspective of the FFE and a dual‐processing perspective of intuition. Interviews with eight FFE practitioners are used to support and illustrate the framework development. The theorizing leads the authors to postulate that intuition use may be beneficial to making generation and evaluation decisions during FFE execution because of the capabilities of the unconscious mind from which intuition results. However, the framework acknowledges that, due to the shortcomings of the unconscious mind, intuition may not be as beneficial to FFE decision‐making in some situations. The authors believe that this framework offers researchers a fertile area for further research and practitioners better insight into when intuition might be effective in FFE execution decision‐making.     

Pre-empting technology competition through firm acquisitions

This paper shows that firms engage in horizontal mergers and acquisitions to pre-empt competition in technology markets. Making use of the patent application procedure at the European Patent Office we introduce a measure for potential entry barriers in technology markets.     

Estimating Central Banks’ preferences from a time-varying empirical reaction function

We estimate monetary policy reaction functions for the United States, the United Kingdom, and Germany, using a Markov-switching model that allows for shifts in the coefficients of the central bank's reaction function as well as for independent shifts in the residual variance. The results indicate that central bank policy can be characterized as falling into a low- and a high-inflation regime. Over time all central banks have assigned changing weights to inflation and the output gap. Switching in the residual variance turns out to be important for the fit of the model. As a reaction function is a reduced form, coefficients embody preference parameters as well as parameters characterizing the structure of the economy. To recover the central banks’ preferences, we estimate the preference parameters jointly with a small model of the economy. The results show that the Bundesbank has placed a relatively higher weight on inflation than the Fed. Moreover, for the Bundesbank and the Fed the differences between both regimes seem to originate mainly from a changing preference for interest rate smoothing.     

China’s CO2 emissions from power generating stations and the role of subsidies – a first exploration

Our analysis is the first of its kind to explore patterns of subsidization and CO₂ emissions in China’s electricity-producing sector. Applying data for all power plants across China and controlling for the age, capacity and location of generating stations, we find that plants attracting a higher government subsidy are also the plants generating a disproportionate share of CO₂ emissions. This distortion is incongruent with China’s aspiration for a greener economy but may be eliminated if China delivers on its November 2013 announcement to review many industry subsidies on its way to a fully fledged market economy.     

Management of environmental and social risks and topics in the banking sector - An empirical investigation

This paper investigates how environmental and social (E&S) risks and topics (i. e. E&S issues that are important in terms of adaptation to a changing business environment) are integrated in the banking sector. Despite banks’ key role in steering financial flows towards sustainable development, little is currently known as to whether and how banks integrate E&S aspects into their management control systems and whether this integration translates into E&S performance. Building on prior studies in the environmental management control literature, we design a conceptual model in which we link contextual factors, a proactive strategy approach, E&S management controls, and E&S performance. Following common practice in the banking sector, we differentiate between two paths of E&S management controls: risk management (value protection) and topic management (value creation). Based on survey data for a small sample of 50 European banks, we find evidence that contextual factors, reflected in the perceived power and legitimacy of clients, voluntary standard setters and NGOs, are positively related to a proactive strategy approach. This proactive strategy translates into both topic and risk management. Yet, in the next step, only topic management is positively related to the E&S performance of a bank, but not risk management.