A decent proposal

In this paper we explore the notion that players are decent in the sense that their choices are bounded by certain unwritten social rules. We apply this idea to problems of Bankruptcy and Implementation.JEL Classification: D78, D63The authors wish to express their gratitude for comments and suggestions to N. Baigent, S. Baliga, V. Bashkar, C. Beviá, S. Chattopadhayay, G. Charness, M. Maschler, C. Matutes, P. McAfee, I. Ortuño-Ortín, A. Rangel, J. Roemer, J. Schummer, T. Sjöström, W. Thomson, the participants in seminars in Hakone (Japan), Harvard, Queens University, Rochester, Studienzentrum at Gergenzee (Switzerland), two anonymous referees and an associate editor. The usual caveat applies. This research has been partially supported by grants BEC2002-02194, BEC2001-0535, and GV 01-371. This paper is dedicated to Bob Aumann, from whom we have learned so much.     

Breakthrough innovation in international business: The impact of tech-innovation and market-innovation on performance

The literature suggests that the greater the perceived novelty of a firm’s products and markets, the greater the potential value to the user (Lepak et al., 2007). In this study we analyze the extent to which breakthrough innovation (both tech-innovation and market-innovation) has a positive impact on both economic and strategic export performance. Tech-innovation incorporates technological developments to improve customer benefits versus existing alternatives in the market. Our findings reveal that tech-innovation has a positive impact on the economic and strategic export performance of firms. This relationship becomes stronger when more human resources are available and the exporter becomes more oriented toward the importer. In less competitive markets, the positive relationship between tech-innovation and both types of export performance becomes even stronger.Market-innovation occurs when the product concept or benefits depart from serving existing or conventional markets. Market-innovation was found to be negatively associated with strategic export performance, as it requires major learning effort by importers. This suggests that to create value, exporters need to develop solutions jointly with importers. Overall, these findings suggest that value creation in terms of both tech-innovation and market-innovation needs to involve importers to achieve expectations, thereby leading to improvement in a firm’s short-term and long-term export performance.