UNEMPLOYMENT PERSISTENCE AND THE SUSTAINABILITY OF EXCHANGE RATE PEGS

It is commonly thought that an open economy can accommodate output shocks through either exchange rate or real sector adjustments. We formalize this notion by incorporating unemployment persistence into a two‐sided escape clause model of currency crises. We show that unemployment persistence makes a currency peg more fragile and undermines the credibility of the monetary authority in a dynamic setting. The fragility is captured by a devaluation premium in expectations that increases the average inflation rate when the currency peg is more vulnerable to ‘busts’ than ‘booms’. This interaction between macroeconomic and microeconomic rigidities suggests that a policy reform can only be consistent if it renders either exchange rates or the economy more flexible.     

Management Control of Project Portfolio Uncertainty: A Managerial Role Perspective

This article presents empirical results on different managers’ viewpoints regarding the sources and management of project portfolio uncertainty. As a key result, this study demonstrates the versatility of uncertainties experienced by managers, the limited degree of perceived control over them, the use of an almost complete management control package in managing uncertainties, and the necessity of managers’ cooperation in the skilled use of the management control package when managing uncertainties. In addition, a further research agenda is proposed.     

The projection dynamic and the replicator dynamic

We investigate a variety of connections between the projection dynamic and the replicator dynamic. At interior population states, the standard microfoundations for the replicator dynamic can be converted into foundations for the projection dynamic by replacing imitation of opponents with “revision driven by insecurity” and direct choice of alternative strategies. Both dynamics satisfy a condition called inflow–outflow symmetry, which causes them to select against strictly dominated strategies at interior states; still, because it is discontinuous at the boundary of the state space, the projection dynamic allows strictly dominated strategies to survive in perpetuity. The two dynamics exhibit qualitatively similar behavior in strictly stable and null stable games. Finally, the projection and replicator dynamics both can be viewed as gradient systems in potential games, the latter after an appropriate transformation of the state space.     

Joint learning in R&D collaborations and the facilitating relational practices

The present study considers joint learning as a relational dynamic capability and examines the role of relational practices as enablers of joint learning in R&D collaboration between suppliers and their customers. The study applies a qualitative comparative case method to analyze seven dyadic cases, selected based on a quantitative dataset and cluster analysis. Our results indicate that in dyadic relationships, firms would benefit from developing practices related to relational investments, relational structures, and relational capital that facilitate joint learning and yield collaborative advantages from R&D interactions. This paper contributes to the existing literature on joint learning in R&D collaborations by defining joint learning as a relational dynamic capability and by focusing on the practices that facilitate it in R&D collaboration.     

Engaging the economic facts and valuations underlying value for money in public procurement

This paper examines the possibilities and limitations in pursuing value for money (VfM) in public procurement. There is ambiguity about the VfM concept and the methods that public procurers should be using. It is difficult for decision-makers to thoroughly understand the economic facts and valuations underlying VfM. The authors explain the conceptual VfM challenges and present a path to overcoming these with a lifecycle costing (LCC) approach in an indepth case study in the Finnish waste management context.     

Investment in emerging market economies

This article empirically models investment in emerging economies. Using dynamic panel estimation methods and quarterly data for 31 emerging economies for the period 1990:1?C2008:3, we show that (i) the GDP and the cost of capital are the key fundamental determinants of investment; (ii) financial factors (such as equity prices, credit and lending rate) play a relevant role on the dynamics of investment, in particular, for Asian and Latin American countries; (iii) investment growth exhibits substantial persistence and (iv) crises episodes magnify the negative response of investment.     

School tracking and intergenerational income mobility: Evidence from the Finnish comprehensive school reform

This paper estimates the effect of a major education reform on intergenerational income mobility. The Finnish comprehensive school reform of 1972–1977 replaced the old two-track school system with a uniform nine-year comprehensive school and shifted the selection of students to vocational and academic tracks from age 11 to age 16. We estimate the effect of this reform on the intergenerational income elasticity using a representative sample of males born between 1960 and 1966. The identification strategy relies on a differences-in-differences approach and exploits the fact that the reform was implemented gradually across the country during a six-year period. The results indicate that the reform reduced the intergenerational income elasticity by 23% from the pre-reform elasticity of 0.30 to post-reform elasticity of 0.23.     

EE-IO modeling of the environmental impacts of Finnish imports using different data sources

The environmental impacts of Finnish imports were modeled using alternative emission datasets. The first dataset was based on domestic technology assumptions from the Finnish environmentally extended input-output (EE-IO) model. In the second dataset, emissions of the largest volumes of imported goods were substituted for EIOLCA (USA) data and in the third option for data from Ecoinvent and the Danish LCA Food Database. Comparative results show that the environmental impacts of imports based on domestic emission intensities are mostly lower than the alternative approaches. Considering the high level of Finnish environmental protection we concluded that the impacts of imports are underestimated using domestic emission intensities. Additionally, we concluded that hybrid IO modeling will increase the accuracy of IO modeling by using process-based data for the most relevant material flows until a multi-regional IO model for Finland has been developed.     

A network perspective on idea and innovation crowdsourcing in industrial firms

Crowdsourcing has been attracting the attention of both academics and practitioners over recent years. The aim of this article is to contribute to the current body of knowledge on innovation in networked contexts by systematically analyzing various crowdsourcing configurations available to industrial firms. We first develop a categorization of crowdsourcing in industrial firms comprising four distinct configurations: internal crowdsourcing; community crowdsourcing; open crowdsourcing; and crowdsourcing via a broker. We then proceed to draw from the literature on industry networks to further deepen our understanding of how these four distinct configurations can contribute to business and innovation activities of a focal industrial firm. Specifically, we focus on the structural properties, nature of collaboration, and governance of crowdsourcing networks. This novel combination of crowdsourcing and network research delivers new insights that enrich current understanding on various options available to industrial firms operating in networked contexts to facilitate their innovation processes.