Local Content Requirements, Vertical Cooperation, and Foreign Direct Investment

Local content requirements (LCRs) have been observed empirically to 1) protect vertically integrated domestic industries and 2) induce inward foreign direct investment (FDI) in intermediate goods production. We examine the effects of an LCR in the context of potential FDI in upstream manufacturing by a foreign multinational and potential vertical cooperation between a host country's upstream and downstream producers. In case of vertical cooperation domestic producers have an incentive to set the price of the intermediate strategically to discourage FDI. Vertical cooperation is found to enhance the rent-shifting effect of the LCR, whereas the FDI response increases price competition and reduces domestic profits. In both cases, manufacturing efficiency and foreign welfare decrease, suggesting the need for multilateral agreement in the WTO to curb the continuing but disguised use of LCRs in industrialized countries.     

Hospitality service failures: Who will be more dissatisfied?

This research examines consumer responses to process and outcome failures in two hospitality settings, a hotel and a restaurant. Converging evidence from two experiments indicates that dissatisfaction with service failures reflects the joint influence of failure type and value orientation. Specifically, a face-conscious value that emphasizes a positive public self-image has an aggravating effect on dissatisfaction, and the effect is stronger for process failures. In contrast, a fate-submissive value that conduces fatalistic thinking has an attenuating effect on dissatisfaction, and the effect is stronger for outcome failures. These results have broad implications for hospitality research and practice, especially in the areas of service quality management and target marketing.     

Electronic money and the network externalities theory: lessons for real life

NETNOMICS: Economic Research and Electronic Networking - The aim of this paper is to show that the network externalities theory provides a useful framework to analyse the introduction and further...     

On the interaction between forecasting and stock control: The case of non-stationary demand

The effect of using estimated (forecast) demand parameters on the performance of an inventory control system is an intriguing and important subject. Recent research has been undertaken on this phenomenon assuming stationary demand data. In this paper we extend the research to non-stationary demands, by means of simulation. The case of a periodic order-up-to-level inventory system is considered and the experimental structure allows us to evaluate in a progressive manner the accumulated effect of using the optimal forecasting method, optimal forecast parameters and correct variance expression procedures. The results allow insights to be gained into operational issues and demonstrate the scope for improving stock control systems.     

Medical interventions among pregnant women in fee-for-service and managed care insurance: a propensity score analysis

This paper extends earlier research on the effect of managed care on the receipt of four medical interventions for pregnant women: ultrasound, induction/stimulation of birth, electronic fetal monitor, and Caesarean delivery. Propensity score methods are used to account for sample selection issues regarding insurance choice. Managed care enrollees are more likely to receive an ultrasound, which may be indicative of receiving better prenatal care. Managed care plans reduce the rate of Caesarean deliveries, but such limitations may be beneficial given the substantial medical evidence that Caesarean deliveries are over-utilized. The results indicate that insurance coverage does influence treatment intensity, but that utilization controls and provider financial incentives do not adversely affect care for pregnant women.     

Stalling innovation of Cognitive Radio: The case for a dedicated frequency band

After more than a decade of frantic R&D efforts, Cognitive Radio (CR) technology continues to fail to pass the first developmental milestone of a working prototype, suggesting that the CR innovation process may be stalling. This paper analyzes possible reasons for this situation from the perspective of innovation management and economics. The CR innovation process has developed in a complex environment shaped by a combination of technology-push and market-pull forces. This paper shows that this process is being stifled by two barriers emerging from the current reliance of CR technology on opportunistic dynamic spectrum access as the sole means for entry into the wireless market. The technology-push is affected by the barrier of technological complexities linked to the requirement to protect highly sensitive incumbent systems. The market-pull forces are being negated by market lock-in and a strong status quo of well-established wireless players. This paper argues that overcoming these barriers and revitalizing the practical development of CR could be possible with the aid of light-touch governmental intervention. This could take the form of designating a dedicated CR band, which would benefit CR through less strict spectrum access requirements. A vibrant cognitive environment could flourish in this type of band, supporting CR innovation.     

The development of a conceptual model of greening in the business events tourism sector

This paper examines the process of corporate greening, and proposes a general conceptual model of the process, which may be relevant in a number of different corporate sectors. The model includes drivers of greening and barriers to greening and also the organisational context in which greening decisions are taken. In addition, this paper considers the role of media coverage in influencing pro-environmental behaviour amongst organisations. The paper then tests the model in one particular tourism context – that of business events – in order to ascertain the specific nature of the corporate greening process in that context. The paper concludes that the general model may be applied to a number of industry sectors, and the model specific to business events tourism may be used to underpin future research in this area.     

Are non-risk based capital requirements for insurance companies binding?

We investigate whether insurers base their solvency margins on risk factors even when operating under a supervisory regime where minimum solvency requirements do not fully take such risk factors into account. To do this, we use a dataset of about 350 Dutch insurers from all major lines of business during the pre-Solvency II period 1995–2005. We find that the levels of insurers’ actual solvency margins are related to their risk characteristics and not to regulatory solvency requirements. Consequently, the vast majority of insurers hold much more capital than required, i.e. non-risk based capital requirements generally are not binding. Requirements are found to affect solvency adjustment behaviour, though. More specifically, below-target capital ratios are raised most rapidly by those insurers whose targets are relatively close to the regulatory minimum. One implication from our results is that, because insurers already follow a risk-based approach, the transition to the new European regulatory framework, Solvency II, is likely to be smooth.     

Restructuring Managerial Labour in the USA,the UK and Japan: Challenging the Salience of ‘Varieties of Capitalism’

This article provides a cross‐national, qualitative investigation into the experiences of middle managers in large organizations in the USA, the UK and Japan, following organizational restructuring. Despite well‐documented national differences in administrative heritage, institutional regimes or ‘varieties of capitalism’, our data point towards considerable similitude across the three countries in terms of a general expression of the need for change, and the concrete impacts of organizational reforms on managerial work. Specifically we analyse the changing nature of work roles, career paths, working hours and spans of control of mid‐level managers in five large firms in each of the three countries. The data demonstrate that middle managers in all three countries face fundamental changes to key areas of their work experience. In Japan, although changes do not amount to a genuine shift towards ‘Anglo‐Saxon’ institutions or business practices, the robust use of organizational reforms with very similar aims and underpinning assumptions to those used in the USA and the UK entails similar impacts in terms of work processes of middle managers across the three nations. This shared experience involved the augmentation of middle management skill levels, responsibilities and span of control, but alongside the downgrading of career expectations, and increased workload and work intensity. We argue that these changes are in keeping with some, but not all, of the features explained and predicted in Bravermanian labour process theory.