Modelling consumer-directed substitution

We discuss the challenges and difficulties arising when approaching and modelling the consumer-directed substitution problem in quick response supply chains. Further, we propose heuristic solutions suited for large problems with complex uncertainty and dependency patterns. Despite the single-period newsvendor model we use, our substitution process is an approximation of the dynamic product choice. To ensure consistency with regard to the information used to establish substitution fractions and information available at the time of optimisation, substitution fraction estimation and inventory/assortment optimisation are discussed simultaneously. The decision-independent substitution preferences applied here do not require inventory or sales transaction data, but reflect understanding on the demand driver attributes. This approach, in turn, leads to increased robustness in assortment planning. Factual substitution is an outcome of the optimisation process, constrained by the available substitutes and unfulfilled demand.Despite being unable to fully describe the dependencies among the substitute choice possibilities, our substitution approach, together with the modelling process, allows handling the most important dependencies, such as negatively correlated substitute choice possibilities and positively/negatively correlated first and second choice possibilities.     

A global perspective on diversity and inclusion in work organisations

This Academy of Management, Human Resources Division, Ambassadors' Programme special issue presents a collection of empirical papers examining workplace diversity and inclusion in a global context. We introduce this topic raising three overarching challenges: to develop more context-specific definitions of diversity and inclusion; to include dimensions pertinent to a global context in the definition of diversity and inclusion; and to consider the impact of diversity and inclusion practices on performance outcomes across countries as well as within multinational corporations. We explore these challenges through three diversity and inclusion lenses – gender, age and nationality – exploring global perspectives at the national, organisational and team levels of analysis. In conclusion, we present an agenda for future research.     

Taxes and Transfers 1997-2001

Significant change was made to both tax and benefits systemsduring the period 1997–2001. The impact of the changeswhich directly affect households is highly progressive, reflectinga significant increase in means-tested benefit levels. But theunderlying distribution of income has moved such that overallinequality of income has not fallen, and the government hasmade less progress on reducing poverty than it had hoped.     

Human resource strategies and contingent workers: The case of safety and health in the petrochemical industry

One of the most important economic developments in recent years is the growth in the number of temporary and contract employees. Little is known, however, about the implications these contingent employees have for human resource practices. This paper presents the results of a study of one group of contingent workers, contract workers in the petrochemical industry. The primary concern of this study is the consequences contract workers have for safety, a hotly debated and politically charged issue in an industry where safety mishaps can have catastrophic consequences. We find that contract employees offer petrochemical firms an important degree of flexibility in meeting rapid fluctuations in their demand for labor. Contract employment relationships also create stresses with potentially severe adverse effects on workplace safety. Overcoming these threats to safety while maintaining flexibility will require a high level of coordination among human resource professionals, line managers, corporate executives, unions, and government agencies.     

Measuring economic uncertainty and its impact on the stock market

This paper proposes a novel measure of economic uncertainty based on the frequency of internet searches. The theoretical motivation is offered by findings in economic psychology that agents respond to increased uncertainty by intensifying their information search. The main advantages of using internet searches are broad reach, timeliness and the fact that they reflect actions, rather than words, which however are not directly related to the stock market. The search-based uncertainty measure compares well against a peer group of alternative indicators and is shown to have a significant relationship with aggregate stock returns and volatility.     

Identification of Asset Price Misalignments on Financial Markets With Extreme Value Theory

This article examines the potential for concurrence of crises and asset price misalignments from equilibrium in the foreign exchange, stock, and government bond markets of three Central European countries and the euro area. Concurrence is understood as the joint occurrence of extreme asset changes and is assessed with a measure of asymptotic tail dependence in the distributions studied. The results reveal a significant potential for the co-alignment of crises in the examined markets. Evidence for co-movements in misalignments from equilibrium is found among all examined stock and exchange rate markets; although it is not apparent in some government bond markets.