Implementing a Market Orientation in Small Manufacturing Firms: From Cognitive Model to Action

Using in-depth interviews of the CEO/Presidents of 21 small manufacturing firms, this research explored how leaders with a high market-oriented cognitive model have intentionally pursued the implementation of that model and how their activities differed from leaders with a low market-oriented cognitive model. Results indicated that leaders in high market-oriented organizations appeared to be working from cognitive models that reflected market-oriented values, and norms consistent with those suggested by Homburg and Pflesser. Additionally, results indicated strong consistencies across firms in the mechanisms used by leaders to implement their high market-oriented cognitive models and different but equally strong consistencies in the mechanisms used by leaders to implement their low market-oriented cognitive models. Structurally, high market-oriented leaders expressed less departmentalization than low market-oriented firms, used some form of internal customer/supplier networks, had very open communication systems, and established performance management systems designed to initiate and reward market-oriented behaviors among employees.     

Technical efficiency and region The U.S. manufacturing sector 1972–1977

In this paper we estimate the extent of technological bias in an interregional context for U.S. manufacturing during the period 1972–1977 using a factor augmenting production function approach. We present estimates of the elasticity of factor substitution for each of the 48 states in the sample using a variable elasticity of substitution production function. Next, we use these estimates to generate estimates of the rates of change in the efficiencies of capital and labor inputs and compare these estimates across states and census regions. We also examine and compare estimates of total factor productivity across states and regions. We ,find that the average annual rates of growth of capital efficiency during the period are 5.5 percent in the Northeast, 5.3 percent in the Northcentral, 5.6 percent in the West and 3.1 percent in the South. The rates of change of the efficiencies of labor are found to be negative across all regions except the South. The rates of change of total factor productivity are found to be 1.7 percent in the Northeast, 2.3 percent in the Northcentral, 2.4 percent in the West and 1.7 percent in the South. We also find that between 33 percent and 56 percent of the growth of output across regions is due to technical progress.     

Profit oriented and decision time market segmentation

The authors report a refinement of their Survey Implemented Market Segmentation (SIMS) algorithm that adds decisiontime implementation by retailers. The analysis incorporates more completely the complexity of practical market segmentation policy alternatives. Two retailing executives aided in classifying variables that characterize potential market segments in terms of their temporal implementability. The result is an ability to formulate a segmentation policy applicable to long-range, medium-range, or short-range planning horizons.     

The Value of Crowdsourcing: Can Users Really Compete with Professionals in Generating New Product Ideas?

Generating ideas for new products used to be the exclusive domain of marketers, engineers, and/or designers. Users have only recently been recognized as an alternative source of new product ideas. Whereas some have attributed great potential to outsourcing idea generation to the “crowd” of users (“crowdsourcing”), others have clearly been more skeptical. The authors join this debate by presenting a real‐world comparison of ideas actually generated by a firm's professionals with those generated by users in the course of an idea generation contest. Both professionals and users provided ideas to solve an effective and relevant problem in the consumer goods market for baby products. Executives from the underlying company evaluated all ideas (blind to their source) in terms of key quality dimensions including novelty, customer benefit, and feasibility. The study reveals that the crowdsourcing process generated user ideas that score significantly higher in terms of novelty and customer benefit, and somewhat lower in terms of feasibility. However, the average values for feasibility—in sharp contrast to novelty and customer benefit—tended to be relatively high overall, meaning that feasibility did not constitute a narrow bottleneck in this study. Even more interestingly, it is found that user ideas are placed more frequently than expected among the very best in terms of novelty and customer benefit. These findings, which are quite counterintuitive from the perspective of classic new product development (NPD) literature, suggest that, at least under certain conditions, crowdsourcing might constitute a promising method to gather user ideas that can complement those of a firm's professionals at the idea generation stage in NPD.     

The Interaction of Wage Bargaining Institutions and an Independent Central Bank – A Methodological Reflection on Current Theories

The paper analyses the increasingly popular literature on strategic interactions from a methodological viewpoint. These political economy approaches focusing on interactions between wage bargaining institutions and an independent central bank do not follow unified methodological rules and so cannot be categorised under a single particular paradigm. Moreover, the literature remains in a way circumscribed by the limits of our logical capacities and of mathematical tractability and therefore relates to the 'real world' of wage bargaining and economic policy institutions in a very limited way only. A consideration of the vast complexity of institutional conditions that impact economic performance in EMU reminds and cautions one that actual economic policy research is able to cover only very few of the numerous conditions responsible for the overall outcome.     

The effectiveness of interest-rate futures contracts for hedging Japanese bonds of different credit quality and duration

This study investigates the effectiveness of the Tokyo Stock Exchange (TSE)-traded Japanese 10-year JGB futures contract to hedge portfolios of Japanese bonds of differing maturity and credit quality. The bond portfolios examined are Government, AAA-, and AA-rated Eurobonds with maturities of 2, 3, 5, 7, 10, and 20 years. Consistent with the recent literature, the study employs univariate methods for calculating hedge ratios based on levels, first differences, and percentage change of each series. Out-of-sample forecasting is used to determine the effectiveness of the calculated hedge ratios for each of the bond portfolios and to determine which approach to calculating hedge ratios is the most effective. The results show that this particular futures contract does provide a good hedge, particularly for those bond terms closest to the 10-year term of the contract. There is some evidence, although not strong, that JGBs are better hedged than AAA and AA bonds. Investors should take some caution when using this futures contract to hedge bond portfolios of different maturities and credit ratings.     

A constitutional paradigm is not enough—would sovereign citizens really agree to manipulative nudges?—A reply to Christian Schubert

In this short note I reply to a comment made by Christian Schubert, who argues that my criticism of libertarian paternalism cannot be upheld under a constitutional economics paradigm. I disagree: it is implausible to assume that sovereign individuals behind a veil of ignorance would actually agree on manipulative nudges from the public sector. Resorting to a constitutional economics paradigm does not diminish the force of the manipulation objection—libertarian paternalism remains morally objectionable. Moreover, where sovereign citizens would agree on permissible (morally legitimate) nudges behind a veil of ignorance, these would no longer constitute “paternalism” under its commonly agreed definition. More constructively, the only morally defensible paternalistic nudges would be those that improve welfare while respecting or, better yet, improving individual autonomy. These are not the typical nudges defended by libertarian paternalists.     

A Retrospective Look at Wholesale Gas: Industry Restructuring

The purpose of this paper is to identify lessons learned from the restructuring of the natural gas industry. We draw a number of conclusions including that the billions of dollars of savings typically attributed to gas industry restructuring resulted not from competition but because restructuring stranded billions of dollars in contractual purchase obligations, costs that were absorbed by producers and pipelines. The replacement of regulated wholesale merchants by new entrants did not occur because of competitive efficiencies. Competition in wholesale gas marketing has produced consumer benefits in the form of innovation, new product development, broader choices and possibly reduced costs. Bi-lateral contracting led to the development of gas markets, which in turn, produced market-wide diffusion and integration of pricing information.     

Uncertain lifetimes and the welfare enhancing properties of annuity markets and social security

This paper explores the implications of social security programs and annuity markets through which agents, who are characterized by different distributions of length of lifetime, share death-related risks. When annuity markets operate, a non-discriminatory social security program affects only the intragenerational allocation of resources. In the absence of private information regarding individual survival probabilities, such a program will lead to a non-optimal intragenerational allocation of resources. However, the presence of adverse selection considerations gives rise to a Pareto improving role for a mandatory non-discriminatory social security program.     

An empirical investigation of interregional production relations and comparative advantage in US manufacturing, 1960–70

Hypothesized differences in mean changes in shares of European Community (EC) import markets over the period 1976-84 are tested for each of 36 less-developed countries. Means are calculated for cases in which MFN tariffs are re-established and for cases in which duty-free treatment is restored under the EC generalized system of preferences. They are compared with means for cases in which tariffs remained constant. We attempt to control for both product-specific and cyclical influences on imports. In contrast to some previous results, our findings suggest that denial (restoration) of preferential treatment, i.e. a tariff increase (decrease), has its expected negative (positive) effect.