Seasonality and non-linear price effects in scanner-data-based market-response models

Scanner data for fast moving consumer goods typically amount to panels of time series where both N and T are large. To reduce the number of parameters and to shrink parameters towards plausible and interpretable values, Hierarchical Bayes models turn out to be useful. Such models contain in the second level a stochastic model to describe the parameters in the first level.     

THE INFLUENCE OF ORGANIZATION STRUCTURE ON THE UTILITY OF AN ENTREPRENEURIAL TOP MANAGEMENT STYLE

This study examined the influence of organization structure on the relationship between top management's entrepreneurial orientation and financial performance. Moderated regression analysis was used to analyse data collected from 80 business organizations. the findings suggest that an entrepreneurial top management style has a positive effect on the performance of organically-structured firms and a negative effect on the performance of mechanistically-structured firms.     

The New Comparative Political Economy

With the collapse of communism in the late 1980s the field of comparative political economy has undergone major revision. Socialism is no longer considered the viable alternative to capitalism it once was. We now recognize that the choice is between alternative institutional arrangements of capitalism. Progress in the field of comparative political economy is achieved by examining how different legal, political and social institutions shape economic behavior and impact economic performance. In this paper we survey the new learning in comparative political economy and suggest how this learning should redirect our attention in economic development.JEL classification: B53, O10, O20, P0     

Enforcing Emissions Trading when Emissions Permits are Bankable

We propose enforcement strategies for emissions trading programs with bankable emissions permits that guarantee complete compliance with minimal enforcement costs. Our strategies emphasize imperfect monitoring supported by a high unit penalty for reporting violations, and tying this penalty directly to equilibrium permit prices. This approach is quite different from several existing enforcement strategies that emphasize high unit penalties for emissions in excess of permit holdings. Our analysis suggests that a high penalty for excess emissions cannot be used to conserve monitoring effort, and that it may actually increase the amount of monitoring necessary to maintain compliance.The authors are grateful to Anthony Heyes and three anonymous referees for their valuable comments. Partial support for this research was provided by the Cooperative State Research Extension, Education Service, U. S. Department of Agriculture, Massachusetts Agricultural Experiment Station under Project No. MAS00871.     

Deregulating Network Industries: Dealing with Price-quality Tradeoffs

This paper examines the effects of introducing competition into monopolized network industries on prices and infrastructure quality. Analyzing a model with reduced-form demand, we first show that deregulating an integrated monopoly cannot simultaneously decrease the retail price and increase infrastructure quality. Second, we derive conditions under which reducing both retail price and infrastructure quality relative to the integrated monopoly outcome increases welfare. Third, we argue that restructuring and setting very low access charges may yield welfare losses, as infrastructure investment is undermined. We provide an extensive analysis of the linear demand model and discuss policy implications.     

Competition in taxes and performance requirements for foreign direct investment

Tax incentives offered to attract firms engaged in foreign direct investment are often tied to performance requirements such as domestic content restrictions or adherence to environmental standards. The tax competition literature has repeatedly shown that competition between municipalities for mobile firms tends to drive taxes to low levels. One would expect a comparable result for burdensome performance requirements. Despite this, the evidence suggests that while taxes have indeed been driven down, performance requirements are as popular as ever. We explain this seeming conundrum by showing that in the presence of spillovers, binding performance requirements can act as a coordination device for firms. In equilibrium, municipalities choose performance requirements, which maximize joint surplus from investment. Competition between municipalities then transfers this surplus to firms via tax subsidies.     

Macroeconomic forecasting using structural factor analysis

The use of a small number of underlying factors to summarize the information from a much larger set of information variables is one of the new frontiers in forecasting. In prior work, the estimated factors have not usually had a structural interpretation and the factors have not been chosen on a theoretical basis. In this paper we propose several variants of a general structural factor forecasting model, and use these to forecast certain key macroeconomic variables. We make the choice of factors more structurally meaningful by estimating factors from subsets of information variables, where these variables can be assigned to subsets on the basis of economic theory. We compare the forecasting performance of the structural factor forecasting model with that of a univariate AR model, a standard VAR model, and some non-structural factor forecasting models. The results suggest that our structural factor forecasting model performs significantly better in forecasting real activity variables, especially at short horizons.     

The Risk Structure of Land Markets

Real property as an asset class represents over half of the wealth in the United States. Nevertheless, the structure of risk in real property markets is poorly understood. This paper develops a model of urban and agricultural land prices that integrates spatial and asset pricing theories and characterizes the spatial and temporal risk structure of the land market. Urban land is priced by a CAPM and agricultural land is priced by a real option to convert into urban land. We show that the price of land awaiting conversion increases with the growth rate of urban rents and unsystematic risk but decreases with risk aversion. However, it may be increasing or decreasing in systematic risk. The free boundary for exercise determines city size, which increases with the growth rate of urban rents but decreases with systematic and unsystematic risk.     

The effects of internal and external sources of justice on employee turnover intention and organizational citizenship behavior toward clients and workgroup members

Abstract

Organizational justice research tends to focus on the effects of fair treatment from organizations or supervisors on employee attitudes and behaviors. Thus, there is a dearth of research on the effects of fair treatment attributable to other parties that employees interact with at work such as coworkers and clients. Controlling for organization-focused and supervisor-focused justice, results from our field study of employees working in a healthcare organization demonstrate that perceptions of client-focused fairness uniquely predicts supervisor ratings of employees organizational citizenship behavior toward clients and that perceptions of workgroup-focused justice uniquely predicts organizational citizenship behavior toward workgroups. Further, we find that client-focused justice perceptions uniquely predict employee turnover intention.