The Short-Term Impact of a Domestic Cap-and-Trade Climate Policy on Local Agriculture: A Policy Simulation with Producer Behavior

This study is intended to develop understanding of possible impact of a domestic cap-and-trade climate policy on local agriculture. We focus the study on the transition period after the policy has raised input prices for production but before establishment of new equilibrium in agricultural commodity markets. We construct a policy simulation model based on production economics that explicitly considers producer behavior in the focal period. We apply the model to a production region in the US to quantify the impact of different levels of carbon price on production cost, production value, and farm income. Our case study shows that: (1) producers have ability to alleviate the cost impact, (2) producers may benefit by selling carbon credits in the carbon market but the revenue is likely to be limited, (3) the economic return of farm production is critical to the impact assessment, (4) the impact may vary across producers, and (5) regulation on the fertilizer industry is an important policy element that can influence the assessment of the impact. This study has important implications for climate policy design.     

Does organizational innovation moderate technical innovation directly or indirectly?

We find a divergence in the literature regarding the treatment of how organizational innovation affects innovation and performance. One point of view suggests that organizational innovation impacts performance only, while the other suggests that it impacts technical innovation and firm performance. We use the framework of Crepon-Duguet-Mairesse (CDM) to control for endogeneity; we also use two different measures for organizational innovation. Our contributions to the literature are: the CDM framework in this context is novel; prior research either did not/could not control for endogeneity whereas the CDM framework mitigates this. To discriminate between the direct and indirect approach, we implemented AIC and BIC tests. We find that for the innovation equations in all cases and regardless of which organizational innovation variable is used the direct model is preferable. In contrast, for the productivity equations, we find that in all cases the indirect model is preferable. Thus we do not have a definitive statistical test for which model is superior. Yet, it is our contention that organizational innovation is a new routine within the firm that should impact technical innovation. Furthermore, organizational design theories deduce that organizational innovation should impact technical innovation-implying that the direct model is indeed preferable.     

Secondary Capital Markets, Long-Run Growth, and the Term Structure of Asset Yields

An endogenous growth model is presented in which production uses a vector of capital inputs. Technologies for creating capital of different types vary by gestation period and productivity. Ownership of gestating capital must be "rolled over" in secondary capital markets in which transactions are costly. We study how reductions in transactions costs affect the equilibrium growth rate, the rate of return on saving, the volume of activity in secondary capital markets, and the term structure of asset yields. We give conditions under which reductions in transactions costs result in higher or lower growth rates.     

The trade-growth nexus in the developing countries: a quantile regression approach

This paper applies quantile regression techniques to investigate how the impact of trade openness on the growth rate of per capita income varies with the conditional distribution of growth. Using formal robustness analyses, we first identify robust variables affecting economic growth (investment, government balance, terms of trade, inflation, and population growth) which we then use as controls in the quantile regression estimations. Our findings suggest a heterogeneous trade-growth nexus: for both the short and the long run, the effect of openness on growth is higher in countries with low growth rates compared to those with high growth rates.     

‘Consumers’ Evaluation of Unethical Marketing Behaviors: The Role of Customer Commitment’

While there is a significant amount of research investigating managerial ethical judgments, a limited amount examines consumer judgments of unethical corporate behavior and its impact on the marketplace. This study examines how consumers’ commitment to a company impacts not only their ethical judgment of corporate behavior but also the outcomes of that judgment. The authors test hypotheses with data from 334 consumers and find that consumers’ level of commitment attenuates the level of perceived fairness. More specifically, highly committed consumers may forgive companies for behaviors when perceived harm is low, but become progressively dissatisfied as the level of perceived harm increases. Results of the study point to the importance of considering ethical behavior from a consumer perspective. If corporate actions are perceived as unethical, the company stands to lose favor with their most committed customers. Considering that more time, effort and investment is required to gain a new customer as to retain an old, this study shows that engaging in behavior perceived as unethical by consumers risks alienating the most committed customers.     

Efficient,Pareto-improving processes

We give two optimization programs for determining whether Pareto improving local changes are possible. When they are, the programs compute them. Any procedure generating efficient and Pareto improving changes can be replicated by these programs. The two programs are dual to each other. We apply the programs to Pareto improving exchange processes and to Pareto-improving tax-tariff reforms.     

How consumers’ assessments of the difficulty of manufacturing a product influence quality perceptions

This research shows that the perceived difficulty of manufacturing a product influences consumers’ perceptions of the firm’s other products. In three experiments (with 152 participants in Study 1, 86 in Study 2, and 91 in Study 3), participants received information about the quality of a firm’s product and then inferred the quality of another product from the firm. When participants believed that the initial product was relatively more difficult to manufacture than the second product, they inferred that the second product would be high in quality. However, when participants believed that the initial product was relatively easy to manufacture, they inferred that the second product would be low in quality. These effects occurred when perceived difficulty of manufacture was manipulated (Study 2) and occurred regardless of whether both products had dissimilar product benefits (Study 1) or whether brand names were present (Study 3). Allison R. Johnson and Valerie S. Folkes contributed equally to this article.     

OPTIMAL MULTI‐AGENT PERFORMANCE MEASURES FOR TEAM CONTRACTS

We present a continuous‐time contracting model under moral hazard with many agents. The principal contracts many agents as a team, and they jointly produce correlated outcomes. We show the optimal contract for each agent is linear in outcomes of all other agents as well as his/her own. The structure of the optimal contract strikingly reveals that the optimal aggregate performance measure in general can be orthogonally decomposed into two statistics: one is a sufficient statistic, and the other a nonsufficient statistic. As a consequence, the optimal aggregate performance measure in general is not a sufficient statistic, unless the principal is risk neutral. We further discuss agents' optimal effort choices using a “quadratic‐cost” example, which also strikingly suggests that team contracts sometimes provide lower‐powered effort incentives than individually separate contracts do.     

A longitudinal examination of HRM in a human resources offshoring (HRO) organization operating from India

Human resources offshoring (HRO) forms a significant part of the Indian business process offshoring (BPO) market. This paper assesses HRM in the emergent HRO sector. Longitudinal case-study research enables an in-depth examination of the development of HRM practices in an HRO organization where offshored HR services are delivered from two different cities in India. The paper highlights the development of HR activities focused on extrinsic incentives, rewards and penalties to influence employee behaviour. These practices are mediated by indigenous traditions, the nature of the service offering; management style and an aspiration to ‘role model’ systematic HR practices.     

Fractional cointegration and the term structure

According to the expectations theory of the term structure of interest rates, the yield spread between long-term and short-term interest rates is an optimal predictor of future changes in short rates over the long-run. Results concerning the empirical validity of this hypothesis are not unanimous. These contradictions may be due to the fact that the traditional concept of cointegration is too restrictive. We refer here to the concept of fractional cointegration introduced by Granger (1986). We study the expectations theory by testing for the existence of a (fractional) cointegration relationship between short-term and long-term interest rates. There is evidence of fractional cointegration between interest rates for the G7 countries, with the exception of Germany.First version received: July 2002 / Final version received: July 2003We thank two anonymous referees for very helpful and detailed comments.