Patents,R&D investments and post-IPO strategies

This paper empirically investigates the effect of going public on the evolution of high-tech entrepreneurial firms, focussing in particular on the interaction between innovation variables and financing and investment strategies. Specifically, I confront the effects of the IPO on firms with higher R&D investments versus firms with more patents. Firms with higher R&D investments typically view the IPO as a mechanism to raise external equity, used to pursue investments and to acquire participation in other companies, whereas those with more patents raise more debt capital and invest less after the IPO, as compared to high-tech entrepreneurial firms. I suggest that a large number of patents is an index of technological maturity for high-tech ventures, even more than age and size, that helps investors to individuate firms with a lower level of risk.     

Managerial Involvement and Perceptions of Strategy Process

Prior academic research attests to both positive and negative effects of involvement on the process of developing strategy. On the one hand, it has been argued that involvement strengthens shared vision, increases rationality and improves adaptiveness in strategy-making. On the other hand, involvement is said to lead to intense political behaviour, increased cultural inertia and more constraints in the strategy process. The purpose of this study is to investigate the relative importance of these effects. In a survey of over 6,000 managers, we find that their reported levels of involvement are positively associated with perceptions of strategy development processes that are more rational, more focused by a shared vision, and more adaptive. In addition, involvement is negatively associated with statements describing the process as top-down, influenced by politics and slowed by internal culture. Moreover, those who are more involved tend to see business and non-business constraints as less important in determining strategy. We argue that these associations between involvement and desirable features of strategy process are important because perceptions are the basis of managerial behaviour. Thus, managers who are more involved in strategy not only see the process in a more favourable light but also act in ways that make the process more effective. The main implication of these findings is that for most organisations increasing involvement improves the strategy process.     

Attracting qualified physicians to underserved areas. Part 2. Pay physicians more to practice in underserved areas.

With health networks searching for additional market share and with a projected 30.2 million to be enrolled in Medicaid HMOs by 2000, more health executives will be weighing various strategies of how to attract qualified physicians to practice in poor inner-city and rural areas. Most frequently cited as solutions are supplying more physicians, encouraging more medical school graduates to pursue primary care residencies, and modifying the number of international medical graduates entering U.S. residency programs. Part I of this article, which appeared in the November/December issue of The Physician Executive, reviewed the efficacy of these approaches. The second part explores a more pragmatic option: to simply improve the working conditions and pay substantially more to physicians who practice in "less desirable" locations. Although this idea is consistent with economic principles, drawbacks must be considered, such as: (1) the American taxpayers' reluctance to finance a more costly health care delivery system for the poor; (2) the inherent conceptual difficulties of a capitated Medicaid HMO serving as the linchpin for organizing, financing, and delivering care for the underserved; and, (3) many providers being expected to react in a fairly litigious manner to such an approach.     

Power Structure and Profitability in Assembly Supply Chains

This paper studies the impact of supply chain power structure on firms' profitability in an assembly system with one assembler and two suppliers. Two power regimes are investigated—in a Single Power Regime, a more powerful firm acts as the Stackelberg leader to decide the wholesale price but not the quantity whereas in a Dual Power Regime, both the price and quantity decisions are granted to the more powerful firm. Tallying the power positions of the three firms, for each power regime we study three power structures and investigate the system's as well as the firms' preference of power. We find that when the assembler is the most powerful firm among the three, the system‐wide profit is the highest and so is the assembler's profit. The more interesting finding is that, if the assembler is not the most powerful player in the system, more power does not necessarily guarantee her a higher profit. Similarly, a supplier's profit can also decrease with the power he has. These results contrast with the conclusion for serial systems, where a firm always prefers more power. We also find that when both suppliers are more (less) powerful than the assembler, it can be beneficial (indifferent) for everyone if the two suppliers merge into a mega supplier to make decisions jointly. When the assembler is more powerful than one supplier and less so than the other, it is always better for the system to have the two suppliers merge, and for each individual firm, merging is preferred if the firm becomes the more powerful party after merging.     

Public-Private Partnership Contractual Design: A Computational Model of the Moral Hazard with Lotteries

Public-Private Partnership (PPP) is a new model of public management which consists of the contractual relationship between public and private entities. In particular, PPPs enable risk share between public and private sectors making the asymmetric information problem in a contractual arrangement more evident. The aim of this paper was to study a moral hazard problem applied to PPP contracts. To achieve this objective, a PPP computational contractual model including the moral hazard with lotteries was developed to assess how contractual changes could affect the optimum behavior of arrangement members. Simulations indicate that projects with higher economic value should attract more qualified firms, which may be why the companies expend more effort. To deal with possible contractual contingencies and try to minimize the moral hazard problem, the government could draw up more flexible contracts in order to include possible necessary changes and punish unwanted or improper consortium behavior.     

THE UNEQUAL ENFORCEMENT OF LIBERALIZATION: EVIDENCE FROM RUSSIA'S REFORM OF BUSINESS REGULATION

We document the unequal enforcement of liberalization reform of business regulation across Russian regions with different governance institutions, which leads to unequal effects of liberalization. National liberalization laws were enforced more effectively in subnational regions with more transparent government, a more informed population, a higher concentration of industry, and stronger fiscal autonomy. As a result, liberalization had a substantial positive effect on the performance of small firms and the growth of the official small business sector in regions with stronger governance institutions. In contrast, in regions with weaker governance institutions, we observe no effect of reform and, in some cases, even a negative effect.     

Leaders perceived as distant and close. Some implications for psychological theory on leadership

This paper deals with some principles derived from the concept of psychological distance, which are relevant to the differential view of distant and close leaders as perceived by the followers. The claim is that psychological distance is a subjective dimension that affects the manner of construal and attributions with regard to leaders. The more distant the leaders in the followers' perception the more they will be construed in abstract categories; more weight will be attributed to them in explaining occurrences of events; the followers will relate more to their traits and less to their behaviors, and will derive from their image more meaning for their own self worth. The theoretical and empirical significance of these arguments is discussed in the paper.     

Attracting qualified physicians to underserved areas. Part 1: Why has the U.S. experienced such difficulty?

With health networks searching for additional market share and with a projected 30.2 million to be enrolled in Medicaid HMOs by 2000, more health executives will be weighing various strategies of how to attract qualified physicians to practice in poor inner-city and rural areas. Most frequently cited as solutions are: supplying more physicians, encouraging more medical school graduates to pursue primary care residencies, and modifying the number of international medical graduates entering U.S. residency programs. Part 1 of this article reviews the efficacy of these approaches, while the second part, which will appear in the January/February 1999 issue, explores a more pragmatic option: to simply improve the working conditions and just pay substantially more to physicians who practice in "less desirable" locations.     

A study of the use of business improvement initiatives: the association with company size and level of national development

This paper investigates the awareness, use and effectiveness of improvement initiatives in organisations of different sizes and in different countries. In particular, comparisons are made between large firms and small and medium enterprises (SMEs), between organisations in the developing and developed worlds and between organisations in China and India and the rest of the developing world. A questionnaire survey of 453 organisations across 44 countries was conducted with the findings indicating that there are significant differences in comparability of tools. For some tools there are no significant differences between developed and developing countries as well as between large organisations and small organisations. For other tools, there are significant differences with organisations in developing countries, in general, more aware and more likely to use business improvement initiatives when compared to organisations in developed countries. Similarly, organisations in China and India have a higher awareness of and are more likely to adopt improvement initiatives when compared to the rest of the developing world. Finally, larger firms are more aware and more likely to use improvement initiatives when compared to SMEs.     

Educational Inequality

Abstract. This paper develops a theoretical model of the inequality in wages and salaries associated with differences in years of schooling (educational inequality, for short). Our model assumes that in the long run individual decisions to become more educated equalize the lifetime earnings of more educated workers and comparable less educated workers. Given this assumption, our model implies that innovations that increase the relative demand for more educated labor, and which cause short‐run increases in educational inequality, in the long run induce offsetting increases in the relative supply of more educated labor. But our model also has the novel implication that innovations that increase differences between the wages and salaries received by workers with the same years of education who are more or less able (ability premiums, for short) cause a smaller fraction of workers to choose to become more educated. Consequently, innovations that increase ability premiums in the long run also cause educational inequality to be larger than otherwise. In applying our theory to recent changes in educational inequality in the USA, we suggest that, to the extent that innovations that increase ability premiums are contributing to educational inequality, the increases in educational inequality during the 1980s and 1990s are unlikely to be reversed soon.     

Using Risk Communication to Disclose the Outcome of a Participatory Decision-Making Process: Effects on the Perceived Acceptability of Risk-Policy Decisions

It has been suggested that public participation during decision making about risks can lead to more widely accepted risk policies. This article discusses an experiment to determine if this is true when people are made aware of the fact that a participatory decision-making process has taken place only through information disclosed during a subsequent risk communication effort. The results from this experiment showed that, after receiving information during risk communication that cast risk policies about space exploration as the product of a participatory decision process, participants in the study felt more supportive of the resulting decisions than did participants in a control group. This result coincided with the participants in the study group perceiving the risks associated with the decision to be lower and the benefits higher. Responses from these participants also showed that they were more satisfied with the decision-making process than they were with the outcome of the decision itself Therefore, it may be premature to view the objective of participatory decision-making approaches-and the risk communication efforts that discuss them-as a means of making risk policies more widely acceptable to the public at large. Rather, it may be better to view the benefits of these approaches in terms of their ability to help lead to higher quality decisions that are the product of more widely accepted decision processes.     

Prevention,Adaptation, and Threat Denial: Flooding Experiences in the Netherlands

Delta areas such as the Netherlands are more and more at risk of future flooding due to global climate change. Motivating residents living in flood-prone areas to effectively cope with local floods may lead to minimization of material losses and loss of life. The aim of this research was to investigate whether the extent to which residents had been exposed to flooding in the past was a key factor in motivating residents to effectively cope with future flooding. We also focused on the psychological variables that mediated this relationship. We conducted a survey (N = 516) among flood victims and nonvictims. We assessed subjective experiences due to past flooding, affective and cognitive appraisals, and coping responses. Results show that victims reported stronger emotions (negative and positive), and the receipt of more social support due to past flooding than did nonvictims. Moreover, victims worry more about future flooding, perceive themselves as more vulnerable to future flooding, perceive the consequences of future flooding as more severe, and have stronger intentions to take adaptive actions in the future than nonvictims. Structural equation modeling reveals that the latter effect was fully mediated by specific experiences and appraisals. Insights into factors and processes that have the potential to motivate residents to effectively cope with future floods may prove helpful in developing interventions to inform residents how to act effectively in case of an imminent flood.     

Perceptions of work stress in Australian firefighters

This study surveyed 747 firefighters on their perceptions of work stress. The current emphasis in the fire brigades is on the management of traumatic or critical incident stress, but other work stressors may also be important. The firefighters rated their jobs as more stressful than other occupations, and psychological work stress as highest among a set of potential sources and types of stress. Although many factors were mentioned, the most frequently indicated stressors were associated with exposure to traumatic incidents such as major accidents or the suffering of others. Those who had previous experience with stress were more likely to rate current and future risk of stress as higher. Knowledge of existing organizational approaches to stress management was limited. The firefighters rated individual and informal sessions for dealing with stress as potentially more useful than the formal debriefing sessions now common in many emergency organizatins. Those who had previous experience with stress, however, were more likely to favour a formal organizational approach.     

Online buying behavior: a transaction cost economics perspective

Using a transaction cost economics perspective, this paper presents a model for understanding consumers' on-line buying behavior. An empirical study was conducted in Singapore to test the model. The results indicate that consumers' willingness to buy online is negatively associated with their perceived transaction cost, and perceived transaction cost is associated with uncertainty, dependability of online stores and buying frequency. When consumers perceive more dependability of online stores and less uncertainty in online shopping and have more online experiences, they are more likely to buy online. Implications of the results are discussed.     

Strategy Alternatives for Homeland Air and Cruise Missile Defense

Air and cruise missile defense of the U.S. homeland is characterized by a requirement to protect a large number of critical assets nonuniformly dispersed over a vast area with relatively few defensive systems. In this article, we explore strategy alternatives to make the best use of existing defense resources and suggest this approach as a means of reducing risk while mitigating the cost of developing and acquiring new systems. We frame the issue as an attacker‐defender problem with simultaneous moves. First, we outline and examine the relatively simple problem of defending comparatively few locations with two surveillance systems. Second, we present our analysis and findings for a more realistic scenario that includes a representative list of U.S. critical assets. Third, we investigate sensitivity to defensive strategic choices in the more realistic scenario. As part of this investigation, we describe two complementary computational methods that, under certain circumstances, allow one to reduce large computational problems to a more manageable size. Finally, we demonstrate that strategic choices can be an important supplement to material solutions and can, in some cases, be a more cost‐effective alternative.     

Managing diversity in the workplace

Recognizing and dealing with cultural diversity has become a critical issue in health care because of the growing numbers of women, minorities and foreign-born physicians and patients. To avoid a culture clash, physician executives have become more aware of the differences and are working to find ways to help the staff interact more effectively with each other and with patients.     

Accuracy in the long run—Where are we now

Long-term forecasting must be viewed as informative speculation about the future. It should be credited with relatively little scientific authenticity. At the present stage of theory and data, no magic methods can be expected to overcome the problem of satisfactory forecasting. Improvement, however, is certainly not just a question of putting more and more variables and more and more numbers into a computer. Methods which indicate how to cushion against uncertainty and methods which bring a greater awareness of options for the future are essential if we are to gain greater control over events. The hazy images of the long-term future which are generated by scenario and other forms of analysis form the guidelines within which short and especially medium-term choices must be made. But in the end we must recognise the inherent limitations of forecasting and forecasting methods and think of forecasting not so much as a method of prediction but as a contribution to tackling the future in a more integrated sense.     

The attitudes of socially marginalized men toward physician-assisted suicide

Bioethics and public policy literature suggests that socially marginalized populations may be at increased risk for overuse of physician-assisted suicide (PAS) were it to become more accepted. Yet the attitudes of socially marginalized populations toward PAS have not been widely studied. The present study surveyed a sample of men in a substance abuse recovery program. Participants completed a PAS attitude questionnaire and a religiosity measure. Support for PAS was fairly evenly split, with 52.2% indicating general opposition to PAS and 46.9% indicating general support. Greater religiosity was associated with more negative attitudes toward PAS. Higher educational level was associated with more acceptance. Overall attitudes toward PAS were considerably more negative than those of Dr. George Domino's (2003) general population sample.     

WHY IS FISCAL POLICY OFTEN PROCYCLICAL?

Fiscal policy is procyclical in many developing countries. We explain this policy failure with a political agency problem. Procyclicality is driven by voters who seek to “starve the Leviathan” to reduce political rents. Voters observe the state of the economy but not the rents appropriated by corrupt governments. When they observe a boom, voters optimally demand more public goods or lower taxes, and this induces a procyclical bias in fiscal policy. The empirical evidence is consistent with this explanation: Procyclicality of fiscal policy is more pronounced in more corrupt democracies. (JEL: E62, D73, D78)