University – industry collaboration in R&D: the role of labor market rigidity

We investigate how R&D university – industry collaboration (R&D UIC) is influenced by labor market rigidity. While it is well-established that an educated and skilled workforce will facilitate R&D UIC, another aspect of these alliances has been under-researched: the role of labor market rigidity, in particular the difficulties employers face in hiring and firing workers. We hypothesize that the size of the R&D labor pool in a country will encourage R&D UIC, and that the ease with which employers are legally allowed to hire and fire will directly and indirectly influence R&D UIC. Integrating data from various sources, we test our model on a sample of 73 countries for which information on the size of the R&D labor pool and labor market regulations are available. We also conduct a robustness test using a different proxy for R&D labor pool on a larger sample of 109 countries. Results confirm the strong link between a country's R&D labor pool and R&D UIC, as well as direct negative impacts of hiring and firing rigidity and an indirect negative impact of hiring rigidity. The findings have implications for managers, policy makers, and researchers of R&D collaboration between universities and industry.     

CAPITAL CHOICES: CHANGING THE WAY AMERICA INVESTS IN INDUSTRY

The Project on Capital Choices, sponsored by the Harvard Business School and the Council on Competitiveness, initially set out to determine the extent to which the competitiveness of American industry is being undermined by a short time horizon. The project has since evolved into a broader examination of how private capital is allocated in the United States, Japan, and Germany and an assessment of the relative effectiveness of the American corporate governance system. Eighteen research papers were prepared by 25 prominent scholars in a wide range of disciplines. Professor Porter's paper, from which the following article is excerpted, develops an overall framework for understanding national investment systems and their consequences, drawing on the project papers and his own research. The complete paper is available through the Council on Competitiveness. A book containing all the project papers will be published by the Harvard Business School Press.     

Seven surprises for new CEOs

As a newly minted CEO, you may think you finally have the power to set strategy, the authority to make things happen, and full access to the finer points of your business. But if you expect the job to be as simple as that, you're in for an awakening. Even though you bear full responsibility for your company's well-being, you are a few steps removed from many of the factors that drive results. You have more power than anybody else in the corporation, but you need to use it with extreme caution. In their workshops for new CEOs, held at Harvard Business School in Boston, the authors have discovered that nothing--not even running a large business within the company--fully prepares a person to be the chief executive. The seven most common surprises are: You can't run the company. Giving orders is very costly. It is hard to know what is really going on. You are always sending a message. You are not the boss. Pleasing shareholders is not the goal. You are still only human. These surprises carry some important and subtle lessons. First, you must learn to manage organizational context rather than focus on daily operations. Second, you must recognize that your position does not confer the right to lead, nor does it guarantee the loyalty of the organization. Finally, you must remember that you are subject to a host of limitations, even though others might treat you as omnipotent. How well and how quickly you understand, accept, and confront the seven surprises will have a lot to do with your success or failure as a CEO.     

Block Share Purchases and Corporate Performance

This paper investigates the causes and consequences of activist block share purchases in the 1980s. We find that activist investors were most likely to purchase large blocks of shares in highly diversified firms with poor profitability. Activists were not less likely to purchase blocks in firms with shark repellents and employee stock ownership plans. Activist block purchases were followed by increases in asset divestitures, decreases in mergers and acquisitions, and abnormal share price appreciation. Industry-adjusted operating profitability also rose. This evidence supports the view that the market for partial corporate control plays an important role in limiting agency costs in U.S. corporations.     

On the Persistence of Sexual Harassment in the Workplace

The persistence of sexual harassment in the workplace, despite the general abhorrence for the behavior and programs designed to eradicate it, is puzzling. This paper proposes that gender differences in perceptions of sexual harassment and power differentials in the workplace which permit men to legitimize and institutionalize their perspective are implicated. These two phenomena combine to result in blaming the victim of sexual harassment for her own plight. Shifting attention to the target of sexual harassment facilitates the persistence of sexual harassment because the institutionalized responses to the problem remain unquestioned.     

Enhancing performance in small professional firms through vision communication and sharing

Despite evidence of a positive relationship, vision’s effects on performance are not fully understood, particularly in small professional service settings. This study advances prior research using a multi-stakeholder, multi-measure approach. It reports a positive relationship between vision-communication and -sharing on performance in Australian retail pharmacies using five measures—financial assessments, employee and customer satisfaction, productivity, and staff retention. Organizations whose managers communicate the vision to staff and whose employees share this vision outperform their peers across all business indicators and retain their employees longer. Financial performance and productivity were higher with long-term staff and managers.     

Experiments Testing Multiobject Allocation Mechanisms

This paper reports the results of over 130 auctions conducted under controlled conditions to examine the robustness of several auction mechanisms to allocate multiple objects. The simultaneous discrete auction process used by the Federal Communications Commission to allocate Personal Communications licenses was contrasted with a sequential auction and a combinatorial auction over a variety of demand conditions. In test environments created to check only the minimum competency of the procedures, the simultaneous discrete auction process produces highly efficient allocations, approaching levels similar to those found with a continuous form of the auction, and it outperforms a sequential auction. However, in environments created to stress test the procedures, a combinatorial auction outperforms the simultaneous discrete auction.     

NOT REPORTING A PROFIT: CONSTRUCTING A NON‐PROFIT ORGANISATION

Public sector reformers advocate contracting‐out as a means of improving cost‐effectiveness. In the health sector, market‐based contracts with for‐profit organisations can reduce equity of access and divert public funds to private gain. Such issues have prompted policy makers to seek alternative contracting strategies. This paper examines a primary health care policy whereby government contracts with private non‐profit organisations to increase efficiency and meet World Health Organisation ideals. The study found that the policy's implementation has not achieved these aims when for‐profit providers masquerade as non‐profit organisations. The implication is that governments may find it more effective to manage for structural diversity than mandate homogenisation.