Asymptotic consequences of neglected dynamics in individual effects models*

We assess the asymptotic consequences of estimating static models based on cross-section or panel data, when in reality the data are generated by a dynamic relationship, involving lagged dependent and current and lagged exogenous variables as well as individual effects. If the exogenous variable follows a stationary process, then the static estimators usually underestimate its long-run effect. This inconsistency is less severe, the higher the autocorrelation of the exogenous variable. If the exogenous variable follows a random walk with or without individual-specific drift, then the estimators are found to be consistent for the long-run effect.     

A note on profitability as a measure of company efficiency

In this paper a sample of UK mechanical engineering companies is ranked by a number of one-factor and two-factor efficiency measures. Of the one-factor measures, profitability proves to be most closely related to the more theoretically correct two-factor measures. Whilst this empirical finding supports a priori reasoning, care must be taken with its interpretation. For when profitability differences between companies do not reflect efficiency differences, conventional two-factor efficiency measures will themselves be unreliable indicators of true efficiency.     

Growth Management and Land use Controls: The San Francisco Bay Area Experience

Local land use and growth controls have had a substantial negative impact on the San Francisco Bay Area housing market. These regulations have significantly diminished the availability of development opportunities in the region and forced builders to make major changes in the way they do business and costly alterations in their development projects. Both the empirical evidence reviewed and the case studies documented in this paper indicate that building moratoria, growth management systems, and restrictive zoning practices have helped lead to significantly increased house prices in those Bay Area communities in which they are present. The evidence strongly suggests that land use controls as they are currently utilized in the Bay Area provide a poor policy alternative for reconciling important environmental and fiscal considerations with equally important regional and national housing needs.     

FROM EXPERIENCE: Balancing the Product Development Process: Achieving Product and Cycle-Time Excellence in High-Technology Industries

Most companies' product development process (PDP) is inefficient and slow. Consequently, products are often late-to-market, over cost and not well-aligned with customer's needs. Because it involves all levels of the organization and crosses all functional boundaries, the PDP is very difficult to control. Unbalanced control is at the root of many of the symptoms of a troubled PDP. Michael T. Anthony and Jonathan McKay investigate the four primary unbalanced PDP behaviors exhibited by organizations and present four balancing mechanisms to correct these flaws. In their view, a balanced PDP contains a structured development methodology and project reviews at specific, high-impact points that involves top management appropriately while still allowing empowerment of the project teams.     

Common Patterns of Behavior and Communication in Corporate Mergers and Acquisitions

This study of common patterns of communication and behavior in mergers and acquisitions relied on a survey of twenty-one managers and professionals in acquired organizations in three separate mergers or acquisitions (M/A). The survey used focused interviews to construct three cases. Common patterns are identified and a syndrome is specified connecting communication variables with rumor mills, employee turnover, and employee commitment to the new organization.