Hand looms,power looms,and changing production organizations: the case of the Kiryū weaving district in early twentieth‐century Japan

The Kiryū silk weaving district, located 200 kilometres north of Tokyo, has been one of the most advanced silk weaving districts since the Tokugawa period (1603–1868). In the 1870s, it was a pioneer in the export of silk products from Japan and the leading producer of traditional Japanese kimono and obi (sash belts) for domestic markets. This study finds that the developmental process of the Kiryū district from 1895 to 1930 can be divided into at least two phases, that is, one of gradual growth based on an inter‐firm division of labour using hand looms and one of dynamic development based on the factory system using power looms. Weaving manufacturers‐cum‐contractors pioneered gradual growth by sub‐contracting with rural village out‐weavers and with a number of specialized, supporting firms in Kiryū town, and grew faster than factory production systems. New joint‐stock firms played the role of genuine entrepreneurs by introducing power looms, thereby realizing significant economies of scale. During this new phase, the weaving manufacturers‐cum‐contractors survived and also introduced new production systems.     

New Venture Performance in China,Japan, and the United States: The Impact of Formalized Market Information Processes

New venture companies, starting from small entities comprising entrepreneurs and their teams, start to grow in scale by instigating formalized processes to enhance management efficiency. This includes the use of formalized processes for collecting and disseminating market information. Despite the fact that utilizing market information is one of the fundamental factors of market orientation, little is known about the way market information is processed in new venture companies. The first aim of this research was to investigate the impact of formalized market information acquisition and utilization on new venture performance. The second objective was to investigate the effect of organizational formalization on the acquisition and utilization of market information in new venture firms. The final goal was to explore the extent to which these relationships vary in different cultural contexts. Based on an extensive literature review and interviews with managers in China, Japan, and the United States, a conceptual framework is developed that relates formalized market information processes to new venture performance in the three countries. The conceptual model is tested with data collected from 453 new venture companies in these countries. The results suggest that the use of a formalized process of market information utilization has a positive effect on new venture performance regardless of country. The analysis also indicates that the effect of organizational formalization, in general, differs between countries. Organizational formalization is associated with increased formalized utilization of market information only in the United States; the relationship does not apply in the two Asian countries studied. Taken together, these results suggest that in the Asian countries, organizational formalization improves information collection, while in the United States, it also improves the utilization of information throughout the organization. One implication of these results may be the potential of added benefits accruing to organizational formalization in new ventures in countries with high levels of individualism and/or high levels of power distance, where organizational power is concentrated in formal vertical reporting relationships, as opposed to informal horizontal peer‐to‐peer networks.     

Can a Regional Trade Agreement Benefit a Nonmember Country without Compensating It?

RTAs are generally formed without any tariff concessions or transfers to nonmember countries. Can such an RTA benefit nonmembers' welfare? In a two‐good three‐country competitive equilibrium model in the absence of an entrepôt, an RTA without concessions to a nonmember will hurt nonmembers' welfare when goods are normal. If one of the member countries is an entrepôt, however, it definitely improves nonmembers' welfare. In a three‐good three‐country model, an RTA without concessions damages the nonmember's welfare, provided that all the goods are normal and substitutes, and that initial tariff levels are small.     

The Impact of Word of Mouth Sources on the Perceived Usefulness of an Innovation

This paper examines the role of three indirect mechanisms linking word‐of‐mouth communication with one of the most important innovation attributes influencing the adoption decision: perceived usefulness. The authors hypothesize that word‐of‐mouth (WOM) communication impacts perceived usefulness by influencing potential adopter perceptions of the credibility of innovation information, the size of the adopter population, and the availability of complementary products. To test these hypotheses, the authors analyze the survey responses of over 550 potential adopters of e‐readers and smartphones. In both product samples, the perceived credibility of WOM information is positively related with perceived usefulness, which is positively related with purchase intent. Consistent with theoretical arguments regarding the importance of access to expert information sources, findings indicate that, relative to personal WOM, written and virtual WOM have stronger relationships with consumer perceptions of the credibility of innovation information. In addition, in both samples, perceived usefulness is positively related with the perceived availability of complementary products, which is positively related with both personal and written word‐of‐mouth. Finally, perceived usefulness has (1) a direct relationship with the perceived size of the local adopter population in the e‐reader sample and (2) an indirect relationship with the same variable that is mediated by the perceived availability of complementary products in both samples. In turn, the perceived size of the local adopter population is positively related with exposure to personal word‐of‐mouth.     

THE BENEFIT OF REDUCED COMPETITION AND THE COST OF INFORMATION RENT UNDER OUTSOURCING

We analyse the cost and benefit of outsourcing with adverse selection in a duopoly by comparing outsourcing with in‐house production in terms of the manufacturer’s expected profit. When two manufacturers faced with ex ante cost uncertainty compete in a differentiated duopoly, outsourcing brings about a benefit in terms of reduced competition, while it entails the cost of information rent. We show that the manufacturers always choose in‐house production in Cournot and Bertrand competition, when outsourcing and in‐house production follow the same ex ante cost distribution. When the manufacturers compete in Cournot fashion, the cost of information rent always exceeds the benefit of reduced competition under outsourcing. On the other hand, when they compete in Bertrand fashion, it is possible that even if the benefit of outsourcing exceeds the cost, both manufacturers cannot choose outsourcing.     

Land‐use change trajectories up to 2050: insights from a global agro‐economic model comparison

Changes in agricultural land use have important implications for environmental services. Previous studies of agricultural land‐use futures have been published indicating large uncertainty due to different model assumptions and methodologies. In this article we present a first comprehensive comparison of global agro‐economic models that have harmonized drivers of population, GDP, and biophysical yields. The comparison allows us to ask two research questions: (1) How much cropland will be used under different socioeconomic and climate change scenarios? (2) How can differences in model results be explained? The comparison includes four partial and six general equilibrium models that differ in how they model land supply and amount of potentially available land. We analyze results of two different socioeconomic scenarios and three climate scenarios (one with constant climate). Most models (7 out of 10) project an increase of cropland of 10–25% by 2050 compared to 2005 (under constant climate), but one model projects a decrease. Pasture land expands in some models, which increase the treat on natural vegetation further. Across all models most of the cropland expansion takes place in South America and sub‐Saharan Africa. In general, the strongest differences in model results are related to differences in the costs of land expansion, the endogenous productivity responses, and the assumptions about potential cropland.     

Impacts of increased bioenergy demand on global food markets: an AgMIP economic model intercomparison

Integrated Assessment studies have shown that meeting ambitious greenhouse gas mitigation targets will require substantial amounts of bioenergy as part of the future energy mix. In the course of the Agricultural Model Intercomparison and Improvement Project (AgMIP), five global agro‐economic models were used to analyze a future scenario with global demand for ligno‐cellulosic bioenergy rising to about 100 ExaJoule in 2050. From this exercise a tentative conclusion can be drawn that ambitious climate change mitigation need not drive up global food prices much, if the extra land required for bioenergy production is accessible or if the feedstock, for example, from forests, does not directly compete for agricultural land. Agricultural price effects across models by the year 2050 from high bioenergy demand in an ambitious mitigation scenario appear to be much smaller (+5% average across models) than from direct climate impacts on crop yields in a high‐emission scenario (+25% average across models). However, potential future scarcities of water and nutrients, policy‐induced restrictions on agricultural land expansion, as well as potential welfare losses have not been specifically looked at in this exercise.     

Capital Flight, North-South Lending, and Stages of Economic Development

We present a two-country OLG economy in which international capital mobility exists in the presence of moral hazard in financial contracts. The difference in the extent of asymmetric information is a source of capital movement and capital flows from the South to the North. Even though there exists a unique steady state under autarky, multiple locally stable steady states may emerge in a world economy with an integrated capital market. However, the integration may drive the South down to further impoverishment. The South's government therefore should take into account seriously the timing of capital market liberalization as a conduit of economic development.     

Incorporating Network Externalities into the Technology Acceptance Model*

Research on network externalities has identified a number of product categories in which the market performance of an innovation (e.g., unit sales and revenues) is an increasing function of that innovation's installed base and the availability of complementary products. Innovation scholars have attributed these findings to the positive impact of network externality variables on consumer perceptions of innovation attributes. This paper provides the first empirical examination of these perceptual linkages by extending the Technology Acceptance Model to include consumer perceptions of network externality variables. The authors hypothesize that, when direct and indirect network externalities exist, consumer purchase intentions and consumer perceptions of an innovation's usefulness and ease of use will positively reflect perceptions of installed base size and the availability of complementary products. To test this reasoning, the authors developed new measures of consumer perceptions of network externality variables. These measures were incorporated into a survey that explored the attitudes in Japan of potential adopters toward digital music (DM) players at an early stage in the product life cycle. Findings reveal a direct positive relationship between ease of use and the perceived availability of digital music. The authors also find positive and significant relationships between both purchase intention and perceived usefulness and (1) the perceived size of the DM player installed base and (2) the perceived availability of digital music. An application of the Baron‐Kenny test for mediating variables reveals that (1) ease of use partially mediates the relationship between the perceived availability of digital music and perceived usefulness and (2) perceived usefulness partially mediates the relationship between the perceived availability of digital music and purchase intention. The research has important implications for future research on new product adoption and for the management of innovations that involve network externalities. The conceptual model provides a framework for testing alternative explanations of observed variations in the impact of network externalities within and across product categories. The empirical analysis provides guidance for managers who wish to manage the impact of network externalities on adoption. In addition to stimulating the size of the installed base and the variety of complementary products, executives must also manage consumer awareness of network externality variables and consumer understanding of the relationship between those variables and innovation attributes. Finally, traditional adoption models link consumer adoption decisions to perceptions of innovation attributes. The findings provided here imply that predictive accuracy of these models can be improved by including consumer perceptions of network externality variables.     

The Choice of International Monetary Regimes in a Context of Repeated Games

A game theoretic and incentive approach is used to explain an international monetary regime. Decisions concerning a fixed exchange rate regime are difficult because they involve cooperation among participants, but decisions concerning defections from a fixed exchange rate regime are relatively easy because they are taken unilaterally. This may explain the difficulties for the completion of Economic and Monetary Union (EMU) in Europe well as the instability recently observed in the quasi-fixed exchange regimes of the Asian countries. EMU is now in full force. The perception of political benefits by national leaders has been the driving force of currency unification in Europe. The cost of a monetary union is the loss of monetary control by each participating nation. If countries cannot contain their desire to deviate from the common monetary expansion, then the currency could potentially be under speculative attack. After January 1, 1999, theoretically each EMU country can no longer deviate from the common norm; but the question remains how to implement this mode of conduct. Even the country in the center, Germany, may find a cost associated with the loss of its leadership role.