Integrating local ecological services into intergovernmental fiscal transfers: The case of the ecological ICMS in Brazil

Local conservation efforts are often related to benefits at higher governmental levels. On the one hand, these efforts are strongly connected to local land-use decisions. On the other hand, activities such as sustainable water management or biodiversity conservation are associated with regional, national or even global public goods. Therefore, spatial externalities or spillovers exist, which—if not adequately compensated for—lead to an underprovision of the public goods and services concerned. This article investigates intergovernmental fiscal transfers as an innovative instrument for compensating local jurisdictions for the ecological goods and services they provide across local boundaries. From a public finance perspective, fiscal transfers are a suitable instrument for internalising spatial externalities. However, most federal states use this instrument predominantly for social and economic public sector functions rather than for ecological ones. This article investigates the case of the ecological “ICMS” that was first introduced by a few states in Brazil during the 1990s. Part of the revenue from this value-added tax is redistributed to the local level on the basis of ecological indicators. In this way, the state level uses fiscal transfers to compensate municipalities for the existence of protected areas and other ecological services provided within their territories. The Brazilian experience illustrates that such fiscal transfers can represent both a compensation for land-use restrictions and an incentive to value and engage in more conservation activities at the local level.     

Management of the political imperative in international business

In this paper we develop a framework for analyzing the political imperative. We argue that the effects of the political imperative on the firm will be a function of industry structure. Strategies that management employs in coping with the political imperative are a function of its impact on the firm and the firm's strategic predisposition. We also speculate on why strategic predisposition may lead firms to employ strategies that are not responsive to the demands of the political imperative.     

Some effects of perceived risk on consumer information processing

This experiment investigated, within the context of an information processing theory of consumer behavior, the effects of level of perceived risk on the amount of information acquired and the total time taken processing that information before making a brand choice, and selection of brands made by well-known manufacturers as a risk reduction strategy. A unique aspect of the experiment was the treatment of perceived risk as a stimulus variable rather than its customary treatment as an organism variable. Note Originally a prize-winning paper in the 1979 Academy of Marketing Science student paper competition, this version was prepared for publication by Dr. Raymond Horton.     

Optimizing or maximizing growth? A challenge for sustainable tourism

Virtually all destinations seek to increase tourist numbers, pursuing economic maximization strategies. Considerably less attention is paid to optimizing existing tourist systems to create more profitable, stable, resilient and potentially more sustainable entities. While aspects of tourist expenditure, average length of stay and seasonality as three key destination management variables have received considerable attention in the literature, focus has usually been on the identification of “profitable” tourism markets by considering observed patterns of spending, length of stay and vacation timing. Building on such earlier studies, this paper focuses on flexibilities in these parameters: could tourists have spent more, stayed longer or visited during a different season? Perceptions of destination expensiveness as a potential deterrent to visitation were also addressed. Based on a sample (n = 1914) of domestic and international tourists in the Swedish cities of Kalmar and Stockholm, data were collected in face-to-face interviews using questionnaires. Results indicate considerable potential to optimize the Swedish tourism system with regard to all variables studied, while also providing new insights for destination management in the context of economic resilience. Results also indicate the need for researchers everywhere to have detailed market knowledge if they are to persuade the industry to change its sustainability behavior.     

THE POLITICAL EMBEDDEDNESS OF PRIVATE ECONOMIC TRANSACTIONS*

Governments are able to manipulate economic transactions in order to achieve foreign policy goals. This article addresses the question: can managers of multinational enterprises (MNEs) structure economic transactions in ways that will limit the costs resulting from government intervention? Using a transaction cost framework, the efficiency of alternative structures (exporting, joint ventures, licensing, or wholly owned subsidiaries) for protecting a firm's interests are assessed. We argue that the traditional focus on the dyadic relationship between supplier and buyer misses sources of transaction costs; by conceptualizing economic transactions as embedded in a political context, additional sources of transaction costs are revealed. We examine three cases of home government intervention in US MNE transactions with the Soviet Union. We find that the full range of structural alternatives is affected by government sanctions, although sanctions are imposed on exporting relationships first and removed last. We find that MNEs are, therefore, beginning to insulate international transactions by making their overseas subsidiaries more independent of US technology and supplies with the hope that the US government will be less likely to impose its will extraterritorially by intervening in foreign subsidiaries’private economic transactions.     

Taking notice of risk culture – the regulator’s approach

Following the financial crisis and a series of mis-selling and ‘rigging’ scandals in the financial services, organisational culture, and particularly the risk culture of organisations, has come to be regarded as a key issue for both financial firms and their regulators This paper considers the extent to which regulatory published notices, ‘Final Notices’ (FNs), relating to breaches of the regulatory Handbook, are able to provide lessons, or pointers, in the development of ‘appropriate’ cultures. By undertaking a qualitative content analysis of all the FNs in 2012, we examine the extent to which FNs draw attention to issues of culture, and to the regulator’s analysis of the drivers of culture published as part of its treating customers fairly (TCF) initiative. The analysis finds that, although not easy to extract, there are important learning points in FNs relating to organisational culture, and in particular to the factors driving behaviours and outcomes that are signs of poor culture. This paper suggests that, whilst it may not be for a regulator to dictate firms’ culture, it could do much more to make use of the content of FNs as a learning tool for firms; particularly in the context of its cultural framework for TCF. This would support the ‘outcomes-based’ approach being espoused by the UK’s regulators.     

The role of fairness in alliance formation

We report on data from a revelatory qualitative case study of a failed attempt to form an international joint venture (IJV) agreement. We analyze issues related to distributive, procedural, interpersonal, and informational fairness and the roles of their occurrence in the course of the formation stage of an IJV. We find that perceptions of fairness types shape the partners' decision making logics (a property rights logic, a control rights logic, and a relational quality logic), which in turn influence the partners' evaluations of efficiency and equity of the proposed alliance and their decision on whether or not to form it. We develop propositions around this argument. Copyright © 2010 John Wiley & Sons, Ltd.     

Transacting in the State of Union: A Case Study of Exchange Governed by Convergent Interests

Transaction cost economics (TCE) treatments rarely devote extended consideration to the comparative advantages of non-contractual governance. This paper focuses on one form of non-contractual alternative. After addressing the concept of a `state of contract' as it may be inferred from TCE theory. I offer an alternative, `the state of union', in which the parties to an exchange can have their cake (efficient production frontiers) and eat it too (equitable outcomes without costly safeguards). An application of the concept is presented in a case study. The paper concludes with an assessment of implications of the argument for scholars and managers.     

Tourist segments' justifications for behaving in an environmentally unsustainable way

Misalignment of pro-environmental beliefs and environmentally unsustainable vacation behaviour can cause psychological tension to tourists. They manage this tension by finding justifications for their behaviour, rather than changing their behaviour. A recent study has systematized such justification; this systematics is used in the present study to investigate the existence of tourist segment sharing justification patterns. A finite mixture model with concomitant variables is used to analyse 2785 survey responses. Three segments are identified. The government blamers express strong interest in the environmental sustainability of their vacation, but deny both their responsibility and ability to make a difference. The struggling seekers would not book their dream vacation if it was environmentally unfriendly, yet do not feel in control of reducing negative environmental impacts of their holiday, which they fully acknowledge. The impact neglecters also state they would not book their dream vacation if it was environmentally unfriendly, but their main justification for taking – potentially environmentally harmful – vacations is denial of the negative environmental consequences of tourism. The existence of these differences in justification patterns indicates different approaches could counteract each of these segment-specific beliefs by inducing cognitive dissonance, shown in other contexts to induce behavioural change. Advice on approaches is given.