Tax competition,imperfect capital mobility and the gain from non-preferential agreements

The gain to competing governments from entering into binding non-preferential tax agreements (that prevents discriminatory taxation in favor of mobile capital) depends on the extent of capital mobility between jurisdictions. In particular the gain is increasing in the cost of relocation of capital and the fraction of the domestic tax base which is relatively immobile. We show this in a symmetric model of tax competition between two governments where all capital is imperfectly mobile and differ only in their cost of relocation.     

Is it still economic to build a new coal-fired power plant in the U.S.? A real option analysis

In the U.S., virtually no new coal-fired power plants have been built in recent years. Both industry experts and academics seem to believe that no rational firm will build a new coal-fired plant. Will such a trend continue in the future? To provide insights into this question, we investigate the optimal decision of an electricity company with an irreversible and deferrable opportunity to build either a new coal-fired or natural gas-fired power plant as its new base-load resource. According to our real option analysis, the optimal decision depends on the location. In the case of the eastern U.S., it is optimal to choose a natural gas plant if a firm is given a choice among a new natural gas plant, a new coal plant and deferring the investment. However, contrary to the common sentiment in the industry and academia, building a new coal plant in the western U.S. is still more economical than building a new natural gas plant in the absence of emission pricing. Furthermore, introducing carbon pricing to western U.S. states, as California did, can substantially increase the probability that a firm will optimally choose a natural gas plant over a coal plant.     

The Impact of Political Competition on Economic Growth: Evidence from Municipalities in South Africa

This paper examines the impact of political competition on economic growth. In this paper, I show that internal political dynamics, distinct from the type of political system, can having different effects on growth. Using results from the 1994 and 1999 elections in South Africa, I show that municipalities with higher levels of political competition have shown lower levels of economic growth. I use individual level surveys to show that this political competition is associated with political paralysis, dissatisfaction with the current democracy and government and lower optimism about the future.     

Determinants of the allocative,cost and scope efficiencies of Indian banks

ABSTRACT

This study aims to investigate the impact of competition on determinants of allocative, scope and cost efficiencies of Indian scheduled commercial banks (SCBs). Specifically, the study, analyzes the impact of the second round of licensing on the efficiency of Indian SCBs. This is the first paper to measure scope efficiency of Indian banks and analyze its determinants. A two-stage analysis is performed on a balanced panel dataset of Indian SCBs for the period 1999–2016. In the first stage, the allocative, cost and scope efficiencies for each bank are estimated following the data envelopment analysis approach. In the second stage, internal determinants of the stated efficiency measures are estimated following the system of the generalized method of moments approach. The findings suggest that competition has not resulted in enhancing the efficiency of Indian SCBs. Among factors that can influence efficiency, it is seen that size does matter. Larger banks can enhance the efficiency of SCBs. It is also seen that having more foreign banks improves the overall efficiency of SCBs. However, before embarking on further rounds of licensing, the study posits that market-driven correction to succeed, it is imperative to address sunspots in the form of investor or borrower repression.     

Why invest in green technologies? Sustainability engagement among small businesses

This study examines the links between sustainability engagement and green technology investments. Using data on 139 Finnish small businesses, the results show a positive relationship between the two. The sustainability engagement of small businesses affects their interest in investing in green technology. However, engagement in environmental sustainability does not seem to be the main motivator behind green technology investments. The results of the mediation analysis show that when investing in green technologies, companies do not consider environmental sustainability as a main value but as a way of achieving social and economic value.     

Inter‐firm R&D collaborations and green innovation value: The role of family firms' involvement and the moderating effects of proximity dimensions

The present paper investigates the relationship between the involvement of family firms in R&D collaborations aimed at developing green solutions and the value of resulting innovations. To dig into this relationship, the moderating effects of two proximity dimensions (i.e., geographical distance and technological relatedness) are also assessed. Analyses are based on a sample of 156 joint patents classified into the “Alternative energy production” field, as defined by the International Patent Classification Green Inventory and successfully filed at the United States Patent and Trademark Office in the period 1997–2010 by publicly listed companies. According to our conjectures, results reveal a positive relationship between the involvement of family firms and green innovation value. Moreover, our findings show that this relationship is hindered when partners are geographically distant or technologically proximate. Eventually, we contribute to the literature on green innovation by unveiling under which conditions inter‐firm R&D collaborations lead to more valuable innovations.     

Antecedents of Green Loyalty in the Cruise Industry: Sustainable Development and Environmental Management

As there is a lack of understanding about cruise travelers' eco‐friendly behaviors and knowledge about eco‐friendly cruises, this study attempted to examine the role of green value, satisfaction, desire, and internal and external normative factors in building passengers' green loyalty for environmentally responsible cruises. A survey methodology and structural equation modeling were utilized to achieve the research purpose. Data quality assessment revealed that all measures for variables included an adequate level of reliability and validity. Results of the structural analysis indicated that our theoretical framework had a sufficient level of anticipation power for loyalty. The proposed associations among study variables were generally supported. The significant indirect influence of green values and social norms on loyalty was identified. Moreover, the magnitude of the total influence of social norms on loyalty was the greatest among the study constructs. Overall, our findings offer valuable and meaningful insights for cruise researchers and practitioners. Copyright © 2017 John Wiley & Sons, Ltd and ERP Environment     

The Feasibility of the Double‐Dividend Hypothesis in a Democratic Economy

The two dividends in the double‐dividend hypothesis are assumed to be independent. This assumption can be misleading when it comes to formulating policy. I construct a model where the pollution tax rate is voted for by heterogeneous people. In addition to the revenue‐recycling effect, the equilibrium pollution tax rate depends on two opposite forces: the tax‐cutting effect and the profit effect. The two forces show that an instrument that exploits a greater revenue‐recycling effect can cause a more severe environmental deterioration, thereby resulting in the infeasibility of the hypothesis. The introduction of the interdependence between the two dividends can also mean that non‐revenue‐raising instruments are more efficient than revenue‐raising instruments.     

Beyond symbolic and substantive: Strategic disclosure of corporate environmental information in China

Under increasing regulatory pressure to disclose environmental impacts, corporate environmental information disclosure (EID) is becoming more prevalent. However, the motives for EID and disclosure approaches (i.e., symbolic or substantive) remain controversial. Using a sample of data for 742 listed manufacturing firms in China across 3 years, we provide evidence to show that the level of EID is significantly positively associated with a firm's advertising intensity and that firms in moderately competitive industries have a higher propensity for adopting an EID‐based differentiated strategy than firms in stronger or weaker competitive industries. We also find that firms that are more sensitive to environmental issues strategically understate their environmental impact when directly facing consumers. Our results suggest that the implementation of corporate EID is strategic and that firms have strong market motives, even under regulatory pressure to demonstrate legitimacy. We discuss this study's contributions to research on EID theory and implications for strategic EID management.     

How to respond to competitors' green success for improving performance: The moderating role of organizational ambidexterity

With increasing environmental competitions between companies, there is a pressing need to explore how the environmental pressures from rivals influence focal firms' actions and the subsequent performance consequences. On the basis of social contagion theory and upper echelons theory, we examine whether firms respond to competitors' green success through green supplier integration, which further improves firm performance, and the moderating effect of organizational ambidexterity. The research explores hypothesized relationships adopting hierarchical regression analysis and bootstrapping method by collecting survey data from 206 Chinese manufacturers. Our findings suggest that competitors' green success positively influences green supplier integration. Green supplier integration mediates the impacts of competitors' green success on financial and environmental performance. In addition, the combined dimension of organizational ambidexterity plays a positive moderating role in the impacts of green supplier integration on financial and environmental performance. This study expands previous literature and managers' practices on green supply chain management.