The costs of governance in international companies

Using foreign direct investment as a governance mechanism has a cost side that goes beyond mere production and input costs. The governance costs of foreign operations are often vague and underestimated, and sometimes even ignored by companies entering a foreign market. The effects of these costs have also largely been neglected in former empirical research. This study examines the governance cost effects on foreign subsidiary performance. Using data from a survey of 160 Norwegian multinational companies the study shows that there are significant and negative relationships between bargaining, monitoring, and maladaptation costs and subsidiary performance. Conversely, costs incurred due to bonding activities are positively associated with performance. Overall, this study indicates that governance costs play a significant role in explaining the performance of foreign subsidiaries: close to 40% of the variation in performance can be attributed to such costs. Dealing with such costs is hence of utmost importance for the management of multinational companies.     

Border effects for domestic and international Canadian passenger air travel

An augmented gravity model of passenger air travel between five Canadian airports and destinations within and without of Canada reveals a substantial border effect. After controlling for GDP, populations and distance, the number of seats offered on domestic routes is about six times the number on international flights. This result is consistent with the border effects found in studies of international merchandise trade.     

Real estate,factory outlets and bricks: A note on non-aeronautical activities at commercial airports

This note considers the degree of complementarity of non-aviation activities to airside activities at airports in relation to airport governance and regulation. A simple economic model of airport operations is employed to draw the distinction between complementary and non-complementary non-aviation activities by airports and the effect of these activities on aeronautical prices and competition.     

Long-term forecast of Vologda oblast’s socioeconomic development

The article generalizes the experience in working out a long-term forecast of Vologda oblast’s socioeconomic development. Dynamic and structural characteristics of the oblast’s development are analyzed on the basis of statistical data. A set of models for forecasting regional economic development is presented. The main scenarios of the region’s long-term evolution are described. Quantitative characteristics of the development of Vologda oblast for the period up to 2020 are presented.     

The role of marketing in the introduction of technologically new products: the case of the electric car

The energy and environmental crises are important problems facing the United States today. With less than 6% of the world's population, the U.S. accounts for 47% of the world's automobiles and nearly 35% of the total energy demand. Automobiles consume nearly 14.5% of the total energy demand and are the major source of air pollution. Whiel there are many potential solutions for the energy and environmental crises, this paper specifically focuses on how the electric car can be a partial answer to the complex problem of personal transportation. The paper specifically discusses the role of marketing in bridging the gap between technology and the consumer. On the basis of an extensive exploratory study, the authors contend that there is sufficient interest among consumers for an economical, pollution-free, electric car. Understanding the consumer's need and developing a product that is feasible, considering existing technology, is the role that marketing must play.     

The future of the uplands

Upland areas provide UK society with many important functions, goods and services, but have experienced a number of disturbing trends and face an uncertain future. This paper outlines historic, current and future drivers of environmental, economic, socio-cultural and policy change in UK uplands, and assesses how these have affected or are likely to affect ways in which land is used and the provision of ecosystem services. Information is synthesised into scenarios summarising a range of possible futures anticipated for UK uplands to 2060 and beyond. Finally, innovations in science, technology, governance and policy are evaluated that could enable uplands to continue providing key ecosystem services under a range of scenarios. The paper concludes that many upland areas will need to be prepared for significant reductions in grazing and prescribed burning. Conversely, other areas could experience agricultural intensification, for example significant increases in grazing or an expansion of arable or bioenergy crops into upland valleys, due to anticipated increases in global demand for food and energy. These scenarios will take place in the context of climate change. Many may take place together and may interact with each other, with complex and unpredictable implications for the upland environment, economy and society. In this context, a number of advances are needed in science, technology and policy to maintain viable upland communities and the future provision of ecosystem services. These may include funding for ecological and hydrological restoration via carbon offsetting or other means. It may also involve advances in ecosystem service modelling, mapping and valuation, which through stakeholder participation could facilitate more integrated rural planning. New forms of environmental governance need to be explored that can empower those interested in developing upland economies to maintain thriving upland communities, while managing the ecosystem services they provide as efficiently as possible.     

A note on optimal capital stock and financing constraints

There is a robust literature on the relationship between financing constraints and real investment. Little has been said on the relationship between financing constraints and capital stock in the long run. This note focuses on this last issue. To keep the model tractable, we assume that the firm employs a single input, and this input is used as collateral. We get three main results. Firstly, we show that the optimal capital stock chosen by a firm is affected by financing constraints even when they are slack at the current time. Secondly, we show that the net present value of the potentially constrained firm is always smaller than the one of the never constrained firm. Finally, we find that in the presence of latent financing constraints the firm does not limit itself to reducing its investment when the upper limit is reached. What it actually does is to lower its long run optimal capital stock, amplifying the effects of constraints in the long run.     

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