Business Ethics in Latin America

Business ethics is a relatively new topic of academic discussion in Latin America. Corruption and impunity came to be serious moral diseases in the region, probably as a result of a long period of dictatorship in most countries. Low ethical standards in the politics have had deep impact on individuals, organizations and economic systems. Excessive consumption, materialism and selfishness, in contrast with real poverty, have been responsible for a sloppiness in attitudes and principles in many Latin American countries. Even though the majority of the population belongs to the Roman Catholic Church, the lack of education has led people to a dichotomy: faith and business practices are often very distant from each other. Several isolated efforts have been done in order to enhance business ethics through education, publications and professional activities. The relationship business-academia has proved to be an excellent initiative for this objective, mainly in Mexico, Brazil and Peru.     

The impact of the California Civil Rights Initiative (CCRI) on university and professional school admissions and the implications for the California Economy

Using data from the University of California and results from previously published research on the returns to higher education, this article presents a preliminary evaluation of the impact of ending affirmative action in admissions at a large, publicly funded university. At the undergraduate level, eliminating race as a factor in the admissions process will redistribute African Americans, Mexican Americans, and Native Americans away from the most competitive campuses (UC-Berkeley, UCLA, UC-San Diego) towards the less competitive campuses in the California State University system. This redistribution will lower the returns to schooling for those affected groups and could have a negative impact on the educational environment for all students. Affirmative action will, in the short run, reduce the number of African American, Mexican American, and Native American students admitted and, in the long run, will have an adverse effect on the delivery of legal and health care services to those racial and ethnic groups.     

Should I say it in English? Exploring language effects on print advertising among Latin American bilinguals

ABSTRACT

Despite the extensive research conducted on language standardization in advertising across several countries, little attention has been given to the use of English versus Spanish and code-switching when advertising to Latin American bilingual consumers. We propose that stereotypes about English speakers and code-switching have potential to help determine which language is most effective in print advertising. The results of experiments conducted in Chile, Ecuador, and Mexico show that the effects of language-related stereotypes on the persuasiveness of English ads vary across different countries. In the case of Chile, English may be persuasively superior, depending on the favourableness of the stereotype of individuals that code-switch. Differently, print ads in English are functionally equivalent, in terms of ad attitudes, to Spanish and code-switching ads in Mexico, and superior in Ecuador, regardless of the favourability of the language-related stereotypes. Suggestions for advertising practice and future research are offered.     

Political versus economic institutions in the growth process

After a decade of research on the relationship between institutions and growth, there is no consensus about the exact way in which these two variables interact. In this paper we re-examine the role that institutions play in the growth process using data for developed and developing economies over the period 1975–2005. Our results indicate that the data is best described by an econometric model with two growth regimes. Political institutions are the key determinant of which regime an economy belongs to, while economic institutions have a direct impact on growth rates within each regime. These findings support the hypothesis that political institutions are one of the deep causes of growth, setting the stage in which economic institutions and standard covariates operate.     

New Service Development and Digitalization: Synergies of Personal Interaction and IT Integration

ABSTRACT

This study investigates the effects of personal interaction and information technology integration (IT integration) on new service development in business-to-business (B2B) service firms' relationships. Personal interaction, IT integration and new service development are latent variables in a structural model tested with LISREL (N = 138). The relationship between personal interaction and IT integration is strong and indicates that both these constructs are drivers for new service development. Although both these constructs represent diverse ways of interacting, they both positively impact new service development. Hence, managers should not expect IT to replace personal interaction to a great extent in B2B-service contexts.     

Influences on Sino-Western joint venture negotiations

This paper attempts to increase the reader's knowledge of the influences present when negotiating in China. The current environment of Sino-Western joint venture (JV) negotiations is examined, and negotiating suggestions resulting from this examination are presented. The paper, the result of the author's research in China in 1987–1989, posits that the major influences on Sino-Western JV negotiations are the ideological and theoretical foundations for such JVs, their history, the problems they experience, and the political, economic, governmental, and cultural contexts of negotiations. The paper's importance lies in two areas: it contributes to the literature on the international transfer of capital and technology, and it provides valuable information to Western firms and individuals who consider entering into JV negotiations in China.     

Redistribution and entrepreneurship with Schumpeterian growth

We examine the effects of redistributive taxation on growth and inequality in a Schumpeterian model with risk-averse agents. There are skilled and unskilled workers, and the growth rate is determined by the occupational choice of skilled agents between entrepreneurship and employment. We show that redistribution provides insurance to entrepreneurs and increases the growth rate. The effects on inequality are such that low tax rates increase inequality relative to laissez-faire due to changes in wages, but higher tax rates can simultaneously raise growth and reduce inequality. We contrast the optimal linear income tax with alternative policies for promoting R&D and find that it is preferable on both equity and efficiency grounds.      

Growth and income inequality: a canonical model

Summary. We develop an endogenous growth model with elastic labor supply, in which agents differ in their initial endowments of physical capital. In this framework, the growth rate and the distribution of income are jointly determined. The key equilibrating variable is the equilibrium labor supply. It determines the rate of return to capital, which in turn affects both the rate of capital accumulation and the distribution of income across agents. We then examine the impact of various structural shocks on growth and distribution. We find that faster growth is associated with a more unequal, contemporaneous distribution of income, consistent with recent empirical findings.Received: 7 October 2004, Revised: 18 February 2005, JEL Classification Numbers: O17, O40.Cecilia García-Peñalosa: Correspondence toGarcía-Peñalosa would like to acknowledge the financial support received from the Institut d’Economie Publique (IDEP), Marseille. Turnovsky’s research was supported in part by the Castor endowment at the University of Washington. The paper has benefited from seminar presentations at the University of California, Riverside, and the University of Kansas, as well as from the comments of an anonymous referee.