Supply-constrained fixed price equilibria in monetary economies

In this paper we consider an economy with restrictions on the relative prices of non-money commodities. The non-money commodities are partitioned into two groups, index makers and price following commodities. Then two cases are considered, namely that the relative prices of the index makers are fixed, respectively free. In both cases the money prices are flexible, whereas the relative prices of the price following commodities are tied to the prices of the index makers. The existence of a supply-constrained equilibrium is proved with (i) no rationing on the money commodities (stores of value), and (ii) at least one non-money commodity is not rationed. If prices of the index makers are fixed the result strengthens a theorem of Dehez and Drèze, if the prices are free a theorem of Kurz is strengthened. This paper is not only concerned with these existence results, but also with the question whether supply-constrained equilibria should appear more frequently than demand-constrained equilibria.     

Cognitive Inertia in a Turbulent Market: the Case of UK Residential Estate Agents

Recently, a number of researchers seeking to develop cognitive approaches for understanding processes associated with the development and implementation of competitive positioning strategies have drawn attention to the notion of ‘cognitive inertia’. Once established, there is a danger that actors may become overly dependent on their mental models of competitive space, to the extent that they fail to notice changes in the material conditions of their business environment, until these changes have become so widespread, or significant in other ways, that their organization's capacity for successful adaptation has been seriously undermined. While there have been several anecdotal accounts of cognitive inertia reported in the literature, and a number of researchers have explored processes of cognitive change in organizations more generally, to date there have been virtually no studies published which have investigated this phenomenon specifically within the domain of competitor assessment. This paper reports one such investigation, a longitudinal field study which explored the extent to which actors' mental models of competitive space in the UK residential estate agency (real estate) industry, an industry characterized by high volatility in recent years, remained stable or changed over time. An initial sample of 208 respondents from 58 firms completed detailed questionnaires at the onset of the recent recession in the UK property market. The questionnaires were designed to elicit the respondents' perceptions of their own organization and various competitors on a number of key dimensions. A sub-sample of 114 respondents from 41 firms returned a further set of completed questionnaires, 12 to 18 months later, when the recession had become deeply established. The findings are entirely consistent with the cognitive inertia hypothesis. The results indicate that the respondents' individual and collective cognitions remained highly stable, despite a significant down-turn in the property market from T1 to T2.     

A simultaneous model for regional labor supply, incorporating labor force participation, commuting and migration

Simultaneous relations between various components of the regional supply of labor and the situation on the regional labor market are developed. There is a distinction between migration, participation and commuting. Conventional research only devotes attention towards the partial relation between one of these components and the regional labor market situation. However, many decisions people make, involve a simultaneous approach towards participation, commuting and migration. This approach is operationalized at a macro-level by constructing a simultaneous supply model. For the specifications we go back to standard literature. In each of the equations, apart from variables that are specific for the particular function, special attention is given to the interrelation between the three supply variables. An overall simultaneity is described by a fourth endogenous variable: unemployment; this variable is explained by employment, participation, netmigration and netcommuting. A combined time-series/cross-section-analysis is used to estimate the model.

Surprisingly it appears that in comparison with OLS parameter- and t-values of the supply-equations are not affected by the use of simultaneous estimation techniques. Only for the unemployment-equation there are significant changes.     

Product creation process at Philips Electronics

About 3 years ago Dr F.P. Carrubba, Chief Technology Officer on the Board of Philips Electronics, stated that product creation is a core activity for Philips and thus needs continuous attention and improvement. A corporate-wide Product Creation Process Improvement Drive was started. In this article describing the drive, we want to share our experiences that we think are important for a successful improvement drive.
The elements to be addressed are:—a framework for the improvement drive;—top-down or bottom-up approach;—the creation of an assessment tool;—some considerations for the buy-in process;—application of the assessment tool;—follow-up after the creation of the assessment tool;—conclusion.     

An alternative to Marshall: Economic history and applied economics at the early LSE

Conclusion The LSE in its early years did not produce a “school of economics” in the sense that Marshall's Cambridge constituted a “school.” English historical economics was too diffuse, too lacking in strong leadership, too untheoretical, and too committed to economic history as a discipline to create such a “school.” The special contribution of the LSE in the pre-war period was certainly not in theory, since one of the chief reasons for it being an alternative to Marshall's school of orthodoxy was that it paid relatively little attention to economic theory during this period. Rather, its alternative economics was its central conception that the economist'sraison d'etre was to solve pressing contemporary problems for which orthodox theory seemed to offer little guidance. Thus its teachers and curriculum, assembled by Hewins and the Webbs, emphasized applied subjects and economic history.     

Friends,family, or fools: Entrepreneur experience and its implications for equity distribution and resource mobilization

Who helps entrepreneurs raise the resources they need and how much equity does an entrepreneur distribute in return? We use a sample of 611 entrepreneurs in the U.S. to examine why some entrepreneurs are more likely than others to distribute ownership selectively to helpers. We find that entrepreneurs with specific industry experience and start-up experience are able to provide ownership more selectively and raise more resources from their helpers. We refine the categorization of social ties further to make a distinction between professional and familial ties to show that the ownership distribution and types of resource contributions vary by the mix of ties in the entrepreneur's helper network. Our findings have implications for theories of resource assembly, social structure and entrepreneurship, and organization design.     

Development and validation of a firm-level vertical and horizontal internationalization metric

The lack of valid and reliable measures of firm-level vertical and horizontal internationalization is impeding the development and testing of hypothesized relationships between these respective dimensions of internationalization and a range of important MNE characteristics, actions, and effects. Through a series of qualitative and quantitative studies using data collected from senior MNE executives (total N?=?3,146), we develop and validate a scale to measure both vertical and horizontal firm-level internationalization. Subscales for each type of internationalization prove to be unidimensional, reliable, temporally stable, and to have predictive, cross-cultural, cross-sectoral, and discriminant validity.