VALUE OF IMPROVED LONG-RANGE WEATHER INFORMATION

An important human welfare implication of climate involves effects of interannual variation in temperature and precipitation on agriculture. Year-to-year variations in U.S. climate result from El Niño-Southern Oscillation (ENSO), a quasi-periodic redistribution of heat and momentum in the tropical Pacific Ocean. The study described here represents a preliminary assessment of the value to the entire U.S. agricultural sector of improved ENSO forecasts in the southeastern United States. This interdisciplinary assessment combines data and models from meteorology, plant sciences, and economics under a value of information framework based on Bayesian decision theory. An economic model of the U.S. agricultural sector uses changes in yields for various ENSO phases to translate physical (yield) effects of ENSO changes into economic effects on producers and on domestic and foreign consumers. The value of perfect information to agriculture is approximately $145 million. The economic value of an imperfect forecast is $96 million. These results suggest that increases in forecast accuracy have substantial economic value to agriculture.     

The marketing concept in the U.S. and the USSR: An historical analysis

This paper traces the evolution of marketing thought in the United States and Russia and advances the argument that the marketing concept is not unique to free-market systems. Rather the acceptance and application of the marketing concept seems inevitable in any society which advances to the point where it has: (1) a high degree of specialization and division of labor in production, (2) a reward system based on generalized purchasing power, i.e., money, and (3) significant amounts of discretionary income in the hands of consumers. MacFarlane & Company, Inc.     

The Future of Japanese Manufacturing in the UK

The expansion of Japanese FDI into the UK manufacturing sector during the 1980s and early 1990s gave rise to the debate on the Japanization of British industry. The paper argues that this debate was constructed from a Western perspective. It did not locate the strategies and structures of Japanese subsidiaries within the broader context of how Japanese multinational corporations were evolving in this period. The necessity to look at these issues from a more global perspective is reinforced by the changes which have occurred since the mid 1990s in the environment for Japanese multinationals. The global economy offers more choices to firms about their location as well as facing them with a more competitive environment. In the Japanese case, this is leading to a growing differentiation between standardized mass production (which can be located in Asia and Eastern Europe) and science–led sectors of industrial production (which necessitate location near to centres of research and development expertise in the USA and Europe). This means that Japanese firms are reconsidering the strategy and structure of their subsidiaries in the UK. Standardized mass production will only survive in the UK as long as costs can be pushed further down and productivity increased, both of which are difficult conditions to meet given possibilities elsewhere in the world for cheap mass production. The growing area of investment will be in science–based manufacturing, though here the UK will be competing against the USA and Germany for Japanese investment. Here, however, the organizational and management characteristics of Japanese subsidiaries will make the necessary connections with local managers and local networks of expertise difficult to achieve. Thus Japanese subsidiaries in the UK are in a period of prolonged uncertainty about their role in the future. These changes open up the necessity for a new agenda of research which goes beyond the Japanization approach and is concerned with the organization and management of Japanese multinationals in an era of global competition.     

Managing alliance relationships: Key challenges in the early stages of collaboration

Recent surveys indicate that executives of technology companies consider strategic alliances to be central to their competitive strategies. Yet the barriers to successful alliances are formidable. In many instances, these barriers develop in the early stages of an alliance. This study identifies and analyzes the types of challenges that companies face in the start–up phase of their alliances. It is based on a survey and interviews with executives in the Canadian high technology industry. The study finds that the principal challenges in the first year of an alliance relate to relationship issues between the partners. It suggests stronger attention to these issues in the design and implementation of an alliance. The paper concludes with guidelines to build and sustain effective working relationships between partners.     

'Them and Us': Social Psychology and 'The New Industrial Relations'

This article sets out to examine the impact of 'new industrial relations' techniques on worker attitudes to management and to worker-management relations. We found 17 case studies of share schemes, profit-sharing, quality circles and autonomous work-groups which reported relevant evidence on worker attitudes. Although workers often welcome new industrial relations techniques, there is very little evidence of any impact on 'them and us' attitudes. Drawing on social-psychological theories of attitude change, the persistence of 'them and us' attitudes can be explained by the ways in which new industrial relations techniques have been implemented and managed in organisations. Workers have often lacked choice over participation in new schemes; there has been a lack of trust between the parties involved, together with inequality in status and benefits and a lack of institutional support for the schemes among senior management. It is argued that these conditions explain the failure of new organisational initiatives to bring about changes in 'them and us' attitudes.     

Union algebra: Unionization,productivity and labor intensity restrictions

Two models are developed to investigate unionism effects. The first assumes Cobb-Douglas technology, derives an explicit cost function allowing for noncost minimization and separates productivity and labor intensity effects. The second assumes a more flexible translog shadow cost function and isolates a neutral productivity effect and factor-specific composite effects. The models are estimated using Allen's construction data. Both models indicate a positive union productivity effect in office construction and a negative union productivity effect in school construction. The Cobb-Douglas model indicates a binding labor-to-materials restriction in both office and school construction, but this evidence disappears with the nonminimum cost function.     

Customer response capability in a sense-and-respond era: The role of customer knowledge process

An organization’s customer response capability, its comptence in satisfying customer needs through effective and quick responses, is critical for sustained success. In this article, the authors examine how customer knowledge process influences customer response capability. They highlight two dimensions of customer response capability, customer response expertise and customer response speed. It is observed that apart from its direct positive association with customer response expertise and speed, the customer knowledge process also diminishes the positive association between risk propensity and these dimensions of customer response capability. The influence of customer response expertise and speed on performance is also examined. The hypotheses are tested using survey data collected from a sample of retailing firms and the findings triangulated using qualitative data collected through depth interviews with managers. The results highlight the importance of customer knowledge in enhancing customer response capability. Satish Jayachandran is with the Department of Marketing at the University of South Carolina. His research interests are in the area of marketing strategy, specifically market responsiveness of firms and the impact of organizational performance on subsequent managerial and firm behavior. His research has been published in theJournal of Marketing and theJournal of the Academy of Marketing Science. He was a recipient of the Harold H. Maynard award for 2001 from theJournal of Marketing. Kelly Hewett is with the Department of Marketing at the University of South Carolina. Her research focuses on the management of relationships between buyers and sellers, as well as between headquarters and foreign subsidiaries in managing the marketing function globally. Her research has been published in theJournal of Marketing, theJournal of International Business Studies, theJournal of the Academy of Marketing Science, and theJournal of International Marketing, among others. Peter Kaufman is with the Department of Marketing at Illinois State University. His research focuses on buyer-seller relationships, retailing, and distribution issues. He received an Honorable Mention in the Marketing Science Institute’s 2003 Alden G. Clayton Doctoral Dissertation Proposal Competition.     

Liquidity and Liquidation

The manager of a firm that is selling an illiquid asset has discretion as to the sale price: if he chooses a high (low) selling price, early sale is unlikely (likely). If the manager has the option to default on the debt that is collateralized by the illiquid asset, the optimal selling price depends on whether the manager acts in the interests of owners or creditors. We model the former case. In equilibrium the owner will always offer the illiquid asset for sale at a strictly higher price than he paid, and will default if he fails to sell. As a result, upon successful sales the illiquid asset changes hands at successively higher prices. We also consider a generalization of the model which permits sellers to finance sales using either debt or preferred stock, or both. This allows derivation of an optimal capital structure. We are indebted to seminar participants at the University of California, Los Angeles; University of California, Santa Barbara; Utah State University; University of Miami; Federal Reserve Bank of Atlanta; Federal Reserve Bank of San Francisco and Federal Reserve Bank of Kansas City. We have received helpful comments from Tom Cooley.