Textbook Treatments of the Financial Market in the IS-LM Model

Intermediate macroeconomics textbooks introduce financial markets into the IS-LM analysis but typically as a beginning-of-period consideration. Here the financial market is introduced in an end-of-period model.     

Reassessing Firm Size in International Marketing Research

This study investigates the relevance and importance of firm size as a current research variable in international marketing while being cognizant of the reasons behind previous researcher's focus on firm size. Utilizing two different databases and analyses, this study integrates existing research on the effects of firm size variables on decisions in international marketing and draws a general conclusion. The main research questions center on whether firm size matters in internationalization decisions and whether firm size is a meaningful proxy for specific firm resources. Our results suggest that the effect of size on internationalization becomes less significant over time and that the effect of firm size on choice of ownership is significantly less than that of other firm-specific variables such as R&D intensity and advertising intensity, suggesting that strategic international marketing decisions are more related to a firm's unique assets than to its size.     

Regulatory Focus Intensity and Evaluations of Retail Experiences

Previous research indicates that consumers differ in their evaluation of and response to similar retail experiences. Reporting results from three studies, the current research proposes consumers’ regulatory focus intensity as one possible source of this variation. Study 1 examines how consumers’ regulatory focus intensity influences their in‐store behavioral intentions following good and bad shopping experiences. Study 2 illustrates how consumers’ regulatory focus intensity impacts their future loyalty intentions after satisfactory retail experiences. In Study 3, the researchers explore how retailers can employ regulatory framing in their communication messages to increase the future loyalty intentions of those chronically less loyal consumers. Lastly, theoretical and managerial implications as well as limitations of this research are discussed.     

Dynamic R&D choice and the impact of the firm's financial strength

ABSTRACT

This article investigates how a firm's financial strength affects its dynamic decision to invest in R&D. We estimate a dynamic model of R&D choice using data for German firms in high-tech manufacturing industries. The model incorporates a measure of the firm's financial strength, derived from its credit rating, which is shown to lead to substantial differences in estimates of the costs and expected long-run benefits from R&D investment. Financially strong firms have a higher probability of generating innovations from their R&D investment, and the innovations have a larger impact on productivity and profits. Averaging across all firms, the long-run benefit of investing in R&D equals 6.6% of firm value. It ranges from 11.6% for firms in a strong financial position to 2.3% for firms in a weaker financial position.     

Another Look at the Case for International Diversification

In an era of sluggish domestic growth, the business spotlight is once again turning to international diversification as a means to harness global growth opportunities and production efficiencies. However, the current empirical literature provides an inconsistent view of the effects of international diversification on business performance. We employ a panel-data analysis of the international revenues and assets of the 2011 Fortune Global 500 companies and examine their performance over the past 15 years. We find that the overall contribution of diversification to revenue growth, profitability and return on capital has been positive. However, the specific shape and timing of the impact can be complex. Accordingly, businesses need to be aware of the turning points for organizational gain as well as loss.     

Methods for delivering complex social services: exploring adaptive management and regulation in the Australian National Disability Insurance Scheme

In the wake of new public management, and with the emergence of new public governance, a number of challenges remain unsolved in the field of public service governance and management. In this paper, we use the example of the Australian National Disability Insurance Scheme to show how we might deal with the design and implementation of a public service reform within the context of new public governance. We argue that governments need to develop greater openness to risk and policy experimentation during implementation. We therefore propose an adaptive system architecture that could support such risk taking.     

Comparative advantage and unemployment

Worker heterogeneity in productivity and labor supply is introduced into a matching model. Workers who earn high wages and work high-hours are identified as those with strong market comparative advantage—high rents from being employed. The model is calibrated to match separation, job finding, and employment in the SIPP data. The model predicts a big drop in employment for workers with weak comparative advantage during recessions. But the data show that workers with strong comparative advantage also display sizable employment fluctuations, implying that aggregate employment fluctuations are not explained by the responses of workers with small rents to employment.