Technology transfer to the U.S.S.R and the shape of the production function

Summary In this paper we argue that previous studies of the impact of imports of Western capital to the Soviet Union have erred by emphasizing the direct contribution of such capital to output. To our view, a more important consequence of such imports is a catalytic effect on the productivity of indigenous capital and labor cooperating with Western machinery. Estimates of production functions for Soviet industry and several subsectors indicate that Western capital imports do improve the productivity of indigenous inputs and make the production process more capital intensive.     

Discount Point Concessions and the Value of Homes with Conventional versus Nonconventional Mortgage Financing

This is an empirical investigation on the impacts of certain seller concessions on home prices. Specifically, we examine the impacts of two seller concessions: discount point concessions (DPCs) and closing cost concessions (CCCs) on home prices. Using hedonic analysis, we find that DPCs are capitalized into home prices. We do not find that CCCs produce capitalization effects. DPCs appear to work in a manner similar to other creative financing techniques such as a buydown mortgage. DPCs enhance affordability by lowering interest costs and debt service payments. DPCs thus lead to increases in effective demand. CCCs will reduce out of pocket expenses but will not necessarily enhance long-term affordability, thus their price effects are less certain. We show that these price premiums are prevalent only when conventional mortgage financing is used. When FHA and VA loans are used, premiums disappear. Of course, governmental insured/guaranteed loans are much more subject to regulation than conventional loans, which may prevent homesellers from price premium maximization. The study establishes the relative significance of discount points versus closing costs as marketing incentives. It appears that the use of discount points as a marketing incentive produces more capitalization effects. The presence of such capitalization effects is consistent with results found in other creative financing studies.     

Case study. Does this company need a union?

No doubt about it, the top managers in this fictitious case study agree, Wellington Associates is a great place to work. Analysts at the high-tech consulting firm enjoy some of the best pay in the industry. And their benefits are extensive: flextime, liberal educational opportunities, comprehensive medical and dental coverage, generous vacation leave, and even on-site day care. So it came as something of a shock to CEO Jane Wellington and her top executives when HR chief Elvin Cusack started out the weekly senior-management meeting by declaring that the United Office Workers Union had begun organizing the support staff. Turns out, Cusack explained, that the company looks very different from the support staff's point of view. Although their starting salaries are indeed competitive, raises average a mere 2% to 3%, and promotions to professional ranks are rare. Medical and dental coverage take a greater chunk out of clerical pay than out of the larger professional salaries, and the cost of the day care center is pretty much out of reach for the support staff. Flextime is impractical for workers who need to be in the office to answer phones and to file papers. Worse, the support staff is expected to accommodate the analysts' flexible schedules; if an analyst decides to work late to finish a project, the secretary has to stay as well. What to do? Suggestions ranged from "fire 'em" to "say nothing before calling in legal counsel." Five commentators examine Wellington's options and its legal obligations.     

PHANTASMAGORIC LABOR: The new economics of self-presentation

We are entering an economy based not on information, but on image. The result is a phantasmagoric capitalism in which labor performers gain value on markets through their work of self-presentation. After tracing the evolution of labor performance through the romantic and modernist styles, this article contends that performers now intentionally compose their persona for the market, and do so through methods learned from the celebrity world. The language of iconography, the discipline that investigates the meanings of images, reveals the methods through which persona is composed, these being personification, attribute and allegory. By contrast to literature on the postmodern self, the article concludes that this phantasmagoric style of self-presentation does not entail a fracturing of self. Rather, aspirants to economic success must have a stronger and more determined sense of self than ever before, since they must strategically adapt persona to meet market demand.     

Sensitivity of executive pay to accounting performance measures in all-equity firms

We investigate the relation between chief executive officer compensation and accounting performance measures as a function of the firm's capital structure. We specifically analyse pay–performance relationships for all‐equity firms relative to high‐levered firms. We find a significant positive association between return on equity and the level of compensation for all‐equity firms. Consistent with optimal contracting theory, we cannot discern any such relationship for high‐levered firms. Because of agency costs of debt, managerial compensation in high‐levered firms plays the role of a precommitment mechanism in addition to its conventional role of aligning management incentives with shareholder interest.     

Computer-Assisted Negotiations of Water Resources Conflicts

This paper describes the algorithms within and results obtained using an interactive computer program developed to assist those involved in negotiating agreements among parties having conflicting objectives. This Interactive Computer-Assisted Negotiation Support system (ICANS) can be used during the negotiation process by opposing parties or by a professional mediator. On the basis of information provided to the program, in confidence, by each party, it can help all parties identify feasible alternatives, if any exist, that should be preferred to each party's proposal. If such alternatives do not exist, the program can help parties develop counter proposals. Through a series of iterations in which each party's input data, assumptions, and preferences may change, ICANS can aid each party in their search for a mutually acceptable and preferred agreement. This paper describes the algorithms used for analyzing preferences and for generating alternative feasible agreements. Also presented a re the results of some limited experiments involving water resource system development and use conflicts that illustrate the potential of programs such as ICANS.     

Managerial Tenure and Recovery Following M-Form Reorganization in Diversified Firms

We identify two factors that affect how quickly highly interdependent diversified firms recover from the performance disruptions that typically accompany M-form reorganizations: (1) organizational tenure and (2) the tenure of top management teams. We find that top management teams with a rare combination of long organizational tenure and relatively short team tenure are associated with faster performance recovery in diversified firms with extensive business unit interdependencies. The effects of managerial tenure on recovery time were found to be inconsequential in unrelated diversified firms where the reorganization task is less complex.