Monitoring Policy and Organizational Forms in Franchised Chains

Franchising is nowadays a prominent way to organize the distribution sector. While previous literature suggests that monitoring issues are a critical determinant of organizational choices, it is rather silent on the optimal monitoring strategy once the organization of the chain is set. In this article, we analyze the monitoring policy of chains with both franchised and company-owned units. We develop a model in which a chain monitors its outlets under asymmetric information on local demands and managers’ efforts. We show that partial monitoring (i.e., when the franchisor monitors only a subset of its outlets) represents an optimal monitoring policy. Second, we identify the units that should be monitored. Finally, we discuss the impact of information technologies and outlet location on monitoring policy and how it may affect the proportion of franchised and company-owned units within the mixed chains.     

Tourism in Maasai communities: a chance to improve livelihoods?

This paper examines community-based tourism among Maasai communities in Tanzania in the context of national policies that have increasingly devolved control over natural resources to local communities. It focuses on economic revenues generated from tourism growth, their distribution to village communities and the constraints and conflicts resulting from attempts to control or access resources. Specific cases illustrate the political and economic complexity of devolved resource management and increased income generation at the community level. Ecotourism and community-based tourism are frequently claimed to be possible remedies for wildlife and natural resources conservation, but research indicates that implementation and revenue-sharing are far from straightforward. The paper uses case studies from communities in northern Tanzania, in Ngorongoro District (Loliondo and Lake Natron), Simanjiro District and Longido District (West Kilimanjaro) to explore issues between pastoralism, cultivation, hunting tourism, photographic tourism, conservation and governance systems. It discusses the implementation of the 1998 National Forestry and Wildlife Policies, the creation of Wildlife Management Areas and the 1999 Land Act and Village Land Act. Data and experiences were gathered over a three-year period working with the Sand County Foundation – Tanzania from 2006 to 2008. The paper contributes to the assessment and discussion of pro-poor tourism and poverty alleviation concepts.     

Fear of rejection? Tiered certification and transparency

Product quality certifiers may not reveal the identity of unsuccessful applicants/sellers for three reasons. First, they respond to the desire of individual sellers to avoid the stigma from rejection. Second, nontransparency helps a certifier to increase his market power by raising the stigma from lower‐tier certification. Third, transparency does not help screen among heterogeneous sellers. Strategic complementarities arise as sellers move down the certification pecking order and lead to the stigmatization of the lower tiers. Mandating transparency benefits the sellers but has an ambiguous impact on buyers, who actually become less informed about product quality.     

Malmquist-type indices in the presence of negative data: An application to bank branches

In this paper we develop an index and an indicator of productivity change that can be used with negative data. For that purpose the range directional model (RDM), a particular case of the directional distance function, is used for computing efficiency in the presence of negative data. We use RDM efficiency measures to arrive at a Malmquist-type index, which can reflect productivity change, and we use RDM inefficiency measures to arrive at a Luenberger productivity indicator, and relate the two. The productivity index and indicator are developed relative to a fixed meta-technology and so they are referred to as a meta-Malmquist index and meta-Luenberger indicator. We also address the fact that VRS technologies are used for computing the productivity index and indicator (a requirement under negative data), which raises issues relating to the interpretability of the index. We illustrate how the meta-Malmquist index can be used, not only for comparing the performance of a unit in two time periods, but also for comparing the performance of two different units at the same or different time periods. The proposed approach is then applied to a sample of bank branches where negative data were involved. The paper shows how the approach yields information from a variety of perspectives on performance which management can use.     

Changes in Household Welfare,Poverty and Inequality During the Crisis

This study provides evidence about changes in the distribution of living standards among Indonesian households during the economic crisis. It uses consumption expenditure data from a panel of households that were surveyed in May 1997, just before the onset of the crisis, and then again in August 1998, about a year after the crisis began. A household-specific deflator is used to make nominal consumption expenditures comparable across this period. The results suggest that there was a considerable drop in household welfare during the economic crisis. Average per capita expenditures fell significantly, and at the same time inequality increased. The poverty rate also appears to have doubled from the pre-crisis level. However, transitions into and out of poverty before and after the crisis reveal remarkable fluidity.     

Rules- versus judgement-based accounting disclosure in the UK

In the wake of recent corporate debacles, considerable debate has ensued on the relative merits of rules-based versus judgement-based accounting disclosure. This note contributes to the debate by examining disclosure practices in the UK where a well-established regulatory framework nevertheless upholds the right of corporate managers to exercise discretion.A specific template is developed to examine simultaneously the content of the segment report and the operating and financial review (OFR) to detect disclosure patterns. The findings indicate that companies which provide the fullest and most relevant segment reports provide less voluntary additional disclosure in the OFR than those companies that, superficially, provide less extensive disclosure in their segment reports. It is unclear, therefore, that changes to more rules-based disclosure regimes will automatically lead to an increase in the level of overall disclosure.     

Organizational Culture: A ten Year, Two-phase Study of Change in the UK Food Retailing Sector

This paper argues that much of the current motivation for the study of organizational culture is fuelled by research which finds an association between culture and performance as well as by studies which suggest that culture is comparatively easily changed. However, much of the research upon which these claims are based is largely firm-specific with little critical evaluation of industry macrocultures and the impact that such cultures may have on both the performance of individual firms and the management of organizational culture. Through assessing separate change programmes spaced ten years apart, this paper documents and analyses the similarities and differences in the rationale, form, substance and impacts of two separate culture change initiatives in the same macroculture spaced ten years apart. These analyses suggest a number of conclusions and implications for both theorists and practitioners. In particular, the study argues that researchers examining organizational culture should devote significantly greater attention towards studying the effects of sector or industry macrocultures.     

On the Targeting and Redistributive Efficiencies of Alternative Transfer Instruments

The distributional characteristic provides an attractive alternative to conventional approaches used to evaluate the targeting performance of transfer programs. We decompose it into two components that are useful both conceptually and empirically; one capturing the targeting efficiency of the instrument, the other its redistributive efficiency . The redistributive index can also be generalized for the purposes of evaluating the degree of progressivity in tax-benefit structures. For illustrative purposes, we present an empirical application of the distributional characteristic and its decomposition using Mexican data. The welfare gains from using categorical targeting and means testing reflect improvements in redistributive and targeting efficiency respectively.     

The Political Economy of the "Minimum-Wage Institution" in an Internationally Integrated Market

The paper explores the political economy of the “minimum‐wage institution (MWI)” in an internationally integrated product market. The authors consider a two‐sector Economic Union (EU) with a perfectly competitive agricultural sector and a unionized oligopolistic manufacturing sector in which there exist productivity asymmetries across firms. It is shown that efficient firms have an incentive to strategically opt for intercountry minimum‐wage agreements high enough to raise their inefficient rivals’ costs and thus gain business in equilibrium. The unions of workers in all countries also find these agreements in their best interest. As a consequence, the MWI may emerge as the equilibrium institutional resolution of alternative political processes (i.e., an EU‐wide referendum or special‐interest politics), despite its negative effect on aggregate employment.