Best fit,best practice,or stuck in the middle? The impact of unit ownership on unit HR performance in franchise systems

Franchising is an important form of entrepreneurial wealth creation in many retailing and service industries. Since Human Resource Management (HRM) is a critical factor in such industries, it is important to understand how franchisees—as semi-autonomous entrepreneurs—deal with HRM in their units and how this ultimately affects performance at the unit level. However, the very few studies linking franchisee HRM behaviors to performance have not included multi-unit franchising (MUF) as a type of unit ownership. Given the ever-increasing popularity of MUF and the unique characteristics of MUFs, this represents an important knowledge gap. We aim to fill this gap by building a theoretical framework on how the type of unit ownership affects unit HR performance within franchise systems. Building on agency, resource and entrepreneurship perspectives, we propose that units owned by single-unit franchisees (SUFs) and small MUFs (i.e., franchisees with a very small number of units) adopt a ‘best fit’ system regarding HRM, whereas company-owned units (COs) and units owned by larger MUFs (i.e., franchisees with a large number of units) typically adopt a ‘best practice’ system. Each system has its own advantages and disadvantages, which results in two contrasting propositions regarding their effects on unit performance. Moreover, we expect the units owned by medium-size MUFs to have the lowest performance since they are ‘stuck in the middle’ regarding their HRM system.     

Functions of innovation systems as a framework to understand sustainable technological change: Empirical evidence for earlier claims

Understanding the emergence of innovation systems is recently put central in research analysing the process of technological change. Especially the key activities that are important for the build up of an innovation system receive much attention. These are labelled ‘functions of innovation systems’. This paper builds on five empirical studies, related to renewable energy technologies, to test whether the functions of innovation systems framework is a valid framework to analyse processes of technological change. We test the claim that a specific set of functions is suitable. We also test the claim made in previous publications that the interactions between system functions accelerate innovation system emergence and growth. Both claims are confirmed.     

Cagan’s paradox and money demand in hyperinflation: Revisited at daily frequency

Using daily data the Cagan money demand is estimated and accepted for the most severe portion of Serbia’s 1992–1993 hyperinflation, i.e. its last 6 months. An implication is that the public adjusted daily throughout this extreme period. Moreover, the obtained semi-elasticity estimates are by far lower than those previously found using monthly data sets. Consequently, the daily estimates reject the longstanding Cagan’s paradox, based on monthly studies, by showing that the economy has been on the correct, increasing side of the Laffer curve almost through the end of hyperinflation. This strongly supports the view that hyperinflation is triggered and driven all way through its end by the government’s hunt for non-decreasing seigniorage. Daily adjustments of public in hyperinflation can account for the difference between the results obtained at daily and monthly frequencies, calling into question the latter. Some evidence is offered that the findings of this paper may hold for other hyperinflations.     

Valuing Mortgage Insurance Contracts in Emerging Market Economies

We develop a new option-based method for the valuation of mortgage insurance contracts in closed form in an economy where agents are risk neutral. While the proposed valuation method is general and can be used in any market, it may be particularly useful in emerging market economies where other existing methods may be either inappropriate or are too difficult to implement because of the lack of relevant data. As an application, we price a typical Serbian government-backed mortgage insurance contract.     

Inflation in New EU Member States: A Domestically or Externally Driven Phenomenon?

This article empirically analyzes the domestic and external inflation determinants for eight non-eurozone new EU member states (NMS), using a structural vector autoregression model. Results indicate that foreign shocks are a major factor in explaining inflation dynamics in the medium run, while the short-run inflation dynamics are mainly influenced by domestic shocks. Moreover, the importance of the foreign inflation component has had a rising trend in the precrisis period in all NMS and mostly coincided with their accession to the EU. This trend ended with the onset of the global financial crisis. The study implicates the need to augment the classical Taylor rule with foreign factors in the case of small open economies.