Environmental Management Systems and Local Community Perceptions: the Case of Petrochemical Complexes Located in Ports

Most oil refineries and factories producing basic chemical products are located in port areas, with the result that industrial complexes potentially have a strong environmental impact on their area of influence. These externalities result in a loss of welfare for citizens residing in neighbouring areas. In a context of sustainable development, companies must integrate concerns about the natural environment in their business strategy. External stakeholders, as residents, find it difficult to visualize the actions firms take to reduce their environmental impact, and the adoption of voluntary certified environmental management systems (EMSs) acts as a signal indicating the adequate environmental behaviour of these companies. These certifications enable companies to achieve the social legitimacy they need for long‐term survival and competitiveness. In the context of a petrochemical industrial complex located in the port of Castellón (Spain), this paper primarily discusses whether such certifications – which act as signals of firms’ desirable environmental conduct – translate into higher trust in firms and lower risk perception by residents. Contrary to what might be expected, despite the widespread use by companies of voluntary and certified EMSs, the research findings confirm a relatively high citizen perception of risk regarding the industrial complex and a low trust in companies. On the other hand, the findings also show a low trust in the public institutions responsible for authorizing and monitoring firms’ activities and for enforcing possible sanctions in non‐compliance cases. Copyright © 2013 John Wiley & Sons, Ltd and ERP Environment     

Non‐Fundamentalness in Structural Econometric Models: A Review

Current economic theory typically assumes that all the macroeconomic variables belonging to a given economy are driven by a small number of structural shocks. As recently argued, apart from negligible cases, the structural shocks can be recovered if the information set contains current and past values of a large, potentially infinite, set of macroeconomic variables. However, the usual practice of estimating small size causal Vector AutoRegressions can be extremely misleading as in many cases such models could fully recover the structural shocks only if future values of the few variables considered were observable. In other words, the structural shocks may be non‐fundamental with respect to the small dimensional vector used in current macroeconomic practice. By reviewing a recent strand of econometric literature, we show that, as a solution, econometricians should enlarge the space of observations, and thus consider models able to handle very large panels of related time series. Among several alternatives, we review dynamic factor models together with their economic interpretation, and we show how non‐fundamentalness is non‐generic in this framework. Finally, using a factor model, we provide new empirical evidence on the effect of technology shocks on labour productivity and hours worked.     

Interlocking directorates in Italy: persistent links in network dynamics

In this work we study the time evolution of interlocking directorates in Italy from 1998 to 2011 by means of dynamical networks. Our purpose is to assess if in Italy there is a connected and stable structure, due to the presence of directors with multiple mandates, like it happens in the German case. We find a very cohesive network structure, due to the presence of a few directors with multiple assignments and, unlike the German case, this structure is stable, but not connected. Moreover we propose an alternative approach to investigate the dynamics, based on temporal networks, in order to quantify the variation of links in a certain time period. We construct a unique cumulative network, where nodes are companies and the existence of an edge is related with the persistence in time of an interlock between two companies. This persistence is due on the one hand to the ownership of a few family firms, and on the other hand to cross-shareholdings between companies. To complete the analysis we also investigate whether the link stability results from the appointments of the same director or from the stepping in/out of different directors.     

Understanding the determinants of investment reactions to decoupling of the Common Agricultural Policy

The objective of this paper is to identify the determinants of the reactions of farm households to the decoupling of the Common Agricultural Policy (CAP) focusing, in particular, on changes in on-farm investment behaviour. The paper analyses a sample of 248 farm-households in 8 EU countries, using a non-parametric approach based on classification tree algorithms. The factors emerging as determinants of an increase in on-farm investment as a reaction to decoupling are: specialisation, existence of a successor, the farmer's age, labour management, SFP per hectare, location and expectations. When used, country variables, tend to substitute some of the factors listed above and become the main predictors, followed by labour endowment, specialisation and expectations. While the study confirms the relevance of the main determinants available from the literature, it also emphasises the articulation (non-linearities) of the effects of farm head age, labour management and SFP per hectare on the reactions to decoupling. This hints at the need for further research on the way such factors combine in determining farm-household reactions to a changing market and policy context, and support the usefulness of non-parametric statistics tools for such types of analysis.     

Innovation management in service firms: a research agenda

This article suggests an agenda for further research on innovation management in service firms. It investigates differences and similarities between issues identified by previous academic research and issues brought up by practitioners within the area of innovation management in service firms. The results show that there are some major differences; for instance, researchers stress a need for formalized processes for development work, while practitioners focus on facilitating innovation in everyday operations. The main conclusion is that in order to bridge the gap between research and practice we would encourage further research on innovation in service firms to (1) conduct micro studies of innovation work, (2) view innovation in the context of everyday operations and (3) focus on co-workers’ innovative potential.     

The impact of outward FDI on the home country's labour demand and skill composition

The present paper adds to the literature investigating the effects of outward FDI on the home country employment and skill composition. Considering the “industrial region” as the unit of the analysis, we capture both direct and indirect effects of foreign production on the parent company and its environment. The empirical evidence refers to the internationalisation of production by Italian firms throughout the period 1996–2002, and it shows that foreign activities have a negative impact upon the demand for low skilled workers in the parent company's “industrial region”, but also on the demand for high skilled workers when FDI are addressed to high income countries.     

LATIN AMERICAN EXCHANGE RATE DEPENDENCIES: A REGULAR VINE COPULA APPROACH

This study implements a regular vine copula methodology to evaluate the level of contagion among the exchange rates of six Latin American countries (Argentina, Brazil, Chile, Colombia, Mexico, and Peru) from June 2005 to April 2012. We measure contagion in terms of tail dependence coefficients, following Fratzscher's (1999) definition of contagion as interdependence. Our results indicate that these countries are divided into two blocks. The first block consists of Brazil, Colombia, Chile, and Mexico, whose exchange rates exhibit the largest dependence coefficients, and the second block consists of Argentina and Peru, whose exchange rate dependence coefficients with other Latin American countries are low. We also found that most of the Latin American exchange rate pairs exhibit asymmetric behaviors characterized by nonsignificant upper tail dependence and significant lower tail dependence. These results imply that there exists contagion in Latin American exchange rates in periods of large appreciations, whereas there is no evidence of contagion during periods of currency depreciation. This empirical regularity may reflect the “fear of appreciation” in emerging economies identified by Levy‐Yeyati, Sturzenegger, and Gluzmann (2013). (JEL C32, C51, E42)