The complementary nature of technological capabilities: Measurement and robustness issues

The application of composite indicators to complex phenomena in social science has come to remarkable prominence. As a result, they have been widely applied in wide-ranging fields. This paper explores the application of a composite indicator of technological capabilities that can be also valid for composite indicators in other fields. We focus on whether different methodologies to build composite indicators lead to different results. The arithmetic mean to aggregate technological capabilities variables has been widely criticized, as it allows for perfect substitutability between variables, thus disregarding the complementary nature of technological capabilities. We introduce a new aggregation rule, the concave mean, in order to take into account the complementarity argument in a Science-Technology-Innovation context. Using a dataset for 138 countries, we show that the arithmetic mean is biased in principle but robust in practice. This depends upon the fact that technologically more advanced countries tend to have a more complementary structure in their technological capabilities compared to less developed nations.     

Digitalisation,automation and upgrading in global value chains – factory economy actors versus lead companies

This article investigates the differences in the application and impact of digital technologies between manufacturing subsidiaries and lead companies, the principal orchestrators of global automotive value chains. Utilising a dataset of 10 in-depth interviews with automotive industry actors, we analyse headquarters–subsidiary differences in the patterns of digitalisation-driven upgrading. A theoretical framework is offered that explains why the significant upgrading achievements of manufacturing subsidiaries deploying industry 4.0 technologies will not reduce the gap between lead companies and manufacturing subsidiaries in terms of value generation. We show that the concept of ‘industry 4.0’ is much narrower than that of ‘digitalisation’ and transition to smart factories is only part of the digital transformation story. Industry 4.0 technologies contribute to the upgrading of operations, and enable subsidiaries to take on production-related knowledge-intensive assignments (functional upgrading). Conversely, digitalisation serves lead companies’ strategic differentiation efforts, and facilitates achieving competitive advantage: the latter are crucial for value capture.     

Pensions reforms,workforce ageing and firm-provided welfare

This paper investigates the impact of an exogenous increase in the legal retirement age on the firms’ propensity to provide welfare services voluntarily to their employees. To this purpose we exploit a unique information derived from the Rilevazione su Imprese e Lavoro (RIL), a survey conducted in 2015 on a large and representative sample of Italian firms. Applying different regression models we show that firms which were forced to give up previously planned hirings because of the Law 201/2011 (the so-called ‘Fornero pension reform’), increased the probability of providing welfare services at workplace. By referring to the sociological, human resource management and economic literature we then argue that a sudden increase in the legal retirement age may motivate the employers to establish welfare schemes as a way to cope with an ageing workforce. Our findings also hold when propensity score matching methods are used in order to control for sample selection issues.     

Bidding for Firms with Unknown Characteristics

When a region successfully attracts a firm by offering subsidies, the firm often commits itself to performance targets in terms of employment. In this paper, we interpret these firm‐specific targets as a consequence of incomplete information. We analyze a model of two regions that compete for a firm, assuming that the firm's productivity is ex ante unknown. We show that performance targets often induce overemployment in high‐productivity firms, and that tax credits are often superior to lump‐sum payments. Moreover, when regions differ in wage rates, the low‐wage region wins the bid and has a higher surplus than under complete information. Finally, we show that, under incomplete information, bidding might not lead to efficient firm location.     

Taxation and the quality of entrepreneurship

We study the effect of taxation on entrepreneurship, investigating how taxes affect both the number of start-ups and their average quality. We show theoretically that even with risk neutral agents and no tax evasion progressive taxes can increase entrepreneurial entry, while reducing average firm quality. So called “success taxes” encourage start-ups with lower value business ideas by reducing the option value of pursuing better projects. This suggests that the most common measure used in the literature, the likelihood of entry into self-employment, may underestimate the adverse effect of taxation.     

Beyond choice: investigating the sensitivity and validity of measures of strength of preference

Many experiments investigating different decision theories have relied heavily on pairwise choices between lotteries. These are easy to incentivise, but often yield only limited dichotomous information. This paper considers whether respondents’ judgments about their strength of preference (SoP) for one alternative over another can usefully supplement standard choice data. We report extensive evidence that such judgments show sensitivity to variations in question format and parameter values in the directions we should expect, not only within-subject but also between-sample. We illustrate how such judgments can usefully supplement standard pairwise choice data and enrich our understanding of observed behaviour.     

SOCIAL COOPERATIVES IN ITALY: ECONOMIC ANTECEDENTS AND REGIONAL DISTRIBUTION

Social cooperatives represent the most notable form of non‐profit organizations operating in Italy in the social services field, the birth and development of which has been strongly linked to, and conditioned by, the needs and resources of territories and communities. This paper intends to demonstrate how certain socio‐economic factors, recognized in economic literature as antecedents of the development of social enterprises, may account for the spread of social cooperatives in different Italian regions. Furthermore, the research results demonstrate an inter‐regional differentiation of the shape social cooperation has entered into in Italy.     

Creating positive habits in water conservation: the case of the Queensland Water Commission and the Target 140 campaign

This case study reports the activities of the Queensland Water Commission (QWC) in securing the water supply for Brisbane and surrounding South East Queensland (SEQ) in response to the worst drought on record. The case focuses on residential water use and examines a three year period from 2006 to 2009. The focus of the study is the interventions of 2007, which centres on the Target 140 campaign. In 2007, the QWC faced with critically low dam levels identified household consumption as responsible for 70% of water use. The eight month Target 140 campaign targeted household users, aiming to change the water use habits of SEQ residents. The campaign achieved not only immediate reductions in water use but also contributed to long term behavioural and attitudinal change. The aim of the campaign was to reduce water consumption from 180 litres (l) /person/day to a target of 140 l /person/day by the end of 2007. This was achieved with water consumption dropping to an average of 129 l/person/day during the campaign and saving over 20 billon litres of water. In 2009, despite the drought broken for over a year and the water consumption target lifted to 200 l /person/day residents were continuing to consume water, on average, less than 140 l /person/day. The outcome was a capstone result for the QWC, and the Target 140 campaign went on to achieve international industry recognition. This case study demonstrates how attitudinal change, goal setting and feedback were key components of the change strategy and outlines the tactics used during the campaign. Furthermore, the case study discusses these mechanisms for change in terms of a theoretical understanding. Copyright © 2011 John Wiley & Sons, Ltd.     

The compliance model of employment standards enforcement: an evidence‐based assessment of its efficacy in instances of wage theft

This article critically assesses the compliance model of employment standards enforcement through a study of monetary employment standards violations in Ontario, Canada. The findings suggest that, in contexts where changes to the organisation of work deepen insecurity for employees, models of enforcement that emphasise compliance over deterrence are unlikely to effectively prevent or remedy employment standards violations.