Entrepreneurial dynamics of the self-employed and of firms: a comparison of determinants using Spanish data

Entrepreneurship is viewed at either an individual level (self-employment), or a firm level (firms’ creation) phenomenon. We also observe the self-employed and firms that hire employees and grow, and others that do not. This paper theorizes occupational and firm-creation decisions and uses Spanish data on industry, region and time to compare entrepreneurial indicators based on official statistics of the number of self-employed individuals and of the number of firms, both with and without employees. The results show that there are important differences in the patterns of the determinants of growth rates in the self-employed and in firms and, within each of them, between those that hire employees and those that do not. We establish sound arguments to recommend the highest level of disaggregation possible in entrepreneurship studies.     

What is the meaning of ‘talent’ in the world of work?

The ongoing confusion about the meaning of ‘talent’ within the world of work is hindering the establishment of widely accepted talent management theories and practices. The aim of this paper is to contribute to the literature on talent management by offering an in-depth review of the talent concept within the specific context of the world of work, and proposing a framework for its conceptualization. We group different theoretical approaches to talent into ‘object’ (i.e., talent as natural ability; talent as mastery; talent as commitment; talent as fit) versus ‘subject’ approaches (i.e., talent as all people; talent as some people) and identify dynamics existing within and between them, as well as implications for talent management theory and practice. Finally, we discuss different avenues for further research aimed at developing the talent—and consequently, the talent management—construct further.     

Modelling the spot prices of various coffee types

We investigate long-run relationships among the spot prices of four coffee types. Two cointegrating vectors emerge: one between the prices of Arabica coffee varieties, and the other one between Unwashed Arabicas and Robusta. A persistence profile analysis shows a more rapid adjustment to equilibrium for the first compared to the second vector due to the fact that the former involves the Arabica coffees, which are more homogeneous. Adjustment is relatively fast, implying that economic forces act rapidly and discrepancies in the equilibrium relationships are short-lived. We also find evidence of non-linear adjustment back to equilibrium; when prices are too high, adjustment takes place at a slower rate than when they are too low.     

THE ESSENCE OF THE AUSTRIAN SCHOOL

In a lecture in November 2008, Professor Huerta de Soto set out the key contributions of the Austrian School to economic thought.     

Production planning and inventories optimization: A backward approach in the convex storage cost case

We study the deterministic optimization problem of a profit-maximizing firm which plans its sales/production schedule. The firm controls both its production and sales rates and knows the revenue associated to a given level of sales, as well as its production and storage costs. The revenue and the production cost are assumed to be respectively concave and convex. In Chazal et al. [Chazal, M., Jouini, E., Tahraoui, R., 2003. Production planning and inventories optimization with a general storage cost function. Nonlinear Analysis 54, 1365–1395], we provide an existence result and derive some necessary conditions of optimality. Here, we further assume that the storage cost is convex. This allows us to relate the optimal planning problem to the study of a backward integro-differential equation, from which we obtain an explicit construction of the optimal plan.     

Technology Adoption with Multiple Alternative Designs and the Option to Wait

Technology adoption is one the most important elements of a firm's strategy. In this paper, we address an essential, yet largely overlooked, question: What should a firm do when faced with several alternative proprietary designs of a new technology? In our base case we assume there are two technology designs, each described by an independent stochastic process of technology evolution. We show that, in equilibrium, a buyer chooses the leading technology design as soon as the discounted payoff from doing so is positive. When the option value of waiting is very high, it is jointly optimal to delay adoption. But because sellers cannot commit not to extract all of the buyer's future rents, inefficiently early adoption takes place. Strategies that improve commitment to low future license fees, such as increasing the number of competitors or cross‐licensing, may alleviate the hold up problem. Although previous research stressed the benefit of such commitments in terms of increasing the rate of technology adoption, we present a class of cases when the benefit from commitment is efficiently to delay adoption.     

Production in incomplete markets: Expectations matter for political stability

In the present paper we study voting-based corporate control in a general equilibrium model with incomplete financial markets. Since voting takes place in a multi-dimensional setting, super-majority rules are needed to ensure existence of equilibrium. In a linear–quadratic setup we show that the endogenization of voting weights (given by portfolio holdings) can give rise to – through self-fulfilling expectations – dramatical political instability, i.e. Condorcet cycles of length two even for very high majority rules.     

The experience of Latin America with export subsidies

Zusammenfassung Die Erfahrungen Lateinamerikas mit Exportsubventionen. — Vor ann?hernd 30 Jahren wurde aus den ?konomischen überlegungen zum Thema Exportsubventionen abgeleitet, solche Subventionen würden zu gr?\erer Exportdiversifizierung und -leistung fuhren. Die Erfahrung zeigt indessen, da\ das im allgemeinen nicht geschehen ist. Das lag — wie in diesem Aufsatz gezeigt wird — in den meisten F?llen daran, da\ die Exportsubventionen nicht durch eine liberale Importpolitik unterstützt wurden. Im Ergebnis verminderten die Exportsubventionen nur geringfügig die von der Importprotektion ausgehende Exportschw?che lateinamerikanischer L?nder. Zus?tzlich negative Wirkungen sind von sehr unstabilen realen Wechselkursen ausgegangen. Bemerkenswerte Ausnahmen mit guten Exportleistungen sind Brasilien, wo Exportsubventionen von einer Liberalisierung der Importe, einer beachtlichen Stabilisierung der realen Wechselkurse und anderen, exportfreundlichen Ma\nahmen begleitet waren, sowie Mexiko, wo zu den nur minimalen Exportsubventionen eine Abwertung, Stabilisierung und Importliberalisierung hinzukamen.

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Résumé L’expérience de l’Amérique Latine avec les subventions aux exportateurs. — Il y a prèsque 30 années que les économistes ont argumenté que les subventions aux exportateurs augmenteraient les exportations et que les exportations deviendraient plus diversifiées. Mais au contraire, l’expérience démontre que cette expectation n’est pas arrivée en général. Dans cette étude on a argumenté que la raison pour ce résultat est dans la majorité des cas que les subventions aux exportateurs n’étaient pas secondées par des politiques d’importations plus libérales. C’est pourquoi les subventions aux exportateurs réduisaient seulement un peu le désavantage pour des exportations causé par la politique en Amérique Latine. De plus, les taux de change réels très instabiles ont contribué aux résultats négatifs. Mais il y a des exceptions notables avec une bonne performance d’exportations: le Brésil et le Mexique. En Brésil, les subventions aux exportateurs étaient accompagnées par une libéralisation des importations, une stabilisation significative des taux de change réels et d’autres politiques propices aux exportations. En Mexique, les subventions aux exportateurs seulement peu importantes étaient accompagnées par une dévaluation, une stabilisation et une libéralisation des importations.

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Resumen La experiencia de Latinoamérica con subsidios a la exportación. — Casi 30 a?os atrás el razonamiento económico sobre subsidios a la exportación sugería que estos resultarían en una mayor diversificación y en un mayor volumen de exportaciones. La experiencia, en cambio, muestra que esto generalmente no ha ocurrido. En este trabajo se arguye que esto se debe a que, en la mayoría de los casos, los subsidios a la exportación no fueron apoyados por políticas de importation liberales. Como consecuencia, los subsidios a la exportaci?n redujeron sólo marginalmente el sesgo antiexportador de los países latinoamericanos. Efectos negativos adicionales sobre las exportaciones derivaron de la inestabilidad de las tasas de cambio reales (RER). Excepciones notables con un buen sector exportador son el Brasil, donde los subsidios fueron acompa?ados por una liberalización de importaciones, una significante estabilización de las RER y otras politicas propicias al crecimiento de las exportaciones, y México, donde subsidios mínimos a la exportación fueron acompa?ados por una devaluatión, una política de estabilización y una liberalización de importaciones.