Response to “Revisiting ISO 14000 Diffusion: A New ”Look“ at the Drivers of Certification”

In Corbett and Kirsch (2001), we used a simple regression in an exploratory investigation of drivers of global diffusion of ISO 14000 certification. We found that ISO 9000 certification levels, environmental treaties ratified, and exports as a proportion of GDP were the main significant variables, where the environmental measure may be moderated by GDP per capita. In his replication study, Vastag (2004, in this issue) analyzes the same data using more visual techniques, specifically regression trees, and finds support for the significance of ISO 9000 certification levels and environmental treaties ratified, but not for export‐propensity. Vastag raises a number of relevant methodological issues, to which we add some perspectives here.     

Remitting Behaviour of “Temporary” and “Permanent” Migrants: The Case of Greeks in Germany and Australia

This paper makes the point that migrants have different motives for sending remittances and remittance receivers have different claims on migrants' income, depending on whether people move to accumulate capital to improve their living at home after they return — temporary migration — or to start a new life in a foreign country — permanent migration. This hypothesis is empirically tested with data from Greek–German and Greek–Australian migration. The findings attest to the fact that German remittances constitute obligatory income streams to close family at home, while Australian remittances are gifts. Some quantitative estimates of the relative impact of individual factors on remittances are also obtained. Some hints are also given for a changing remitting behaviour of Greek migrants in Germany, along with the changing character of migration in that country.     

Investigating the Moderating Effects of Leader–Member Exchange in the Psychological Contract Breach–Employee Performance Relationship: A Test of Two Competing Perspectives

Leader–member exchange (LMX) has been characterized as a form of social support capable of buffering the effects of negative work experiences. However, employees with high‐quality relationships with leaders in the organization may have stronger negative reactions when psychological contracts are breached. Thus, while a social support perspective would suggest that LMX minimizes the adverse impact of psychological contract breach on employee performance, a betrayal perspective proposes that high LMX would aggravate the negative effects. Using cross‐sectional and longitudinal research designs, results across three samples provided support for the betrayal perspective. That is, breach had a stronger negative relationship with organizational citizenship behaviours and in‐role performance under conditions of high LMX. Implications of these results and future research directions are discussed.     

A Paradox for the “Smooth Ambiguity” Model of Preference

Two Ellsberg‐style thought experiments are described that reflect on the smooth ambiguity decision model developed by Klibanoff, Marinacci, and Mukerji (2005). The first experiment poses difficulties for the model's axiomatic foundations and, as a result, also for its interpretation, particularly for the claim that the model achieves a separation between ambiguity and the attitude toward ambiguity. Given the problematic nature of its foundations, the behavioral content of the model and how it differs from multiple priors, for example, are not clear. The second thought experiment casts some light on these questions.     

Labour Institutions and Economic Growth: a Survey and a “Regulationist” Approach

Abstract. The paper argues that it is detrimental to assume perfect competition and total flexibility of labour markets in order to understand the intensity and stability of growth. Whereas development theories emphasize the impact of imperfect labour markets, this is not so for modern endogenous growth theories. By contrast, the régulation approaches (in the French meaning) both theoretically and empirically suggest that the transformations in labour institutions might have played a crucial role in the post World War II boom: an unprecedented division of labour associated with long-run labour relations contracts have enhanced the genuine Fordist growth model. Furthermore, international comparisons among OECD countries suggest that job regulations and active minimum wage policies may have created some short-run disequilibria but have stimulated dynamic efficiency, via more technological and organizational innovations. Consequently, this area requires more active researches by labour economists.     

Comment on “The Law of Large Demand for Information”

Say that one information structure is eventually Blackwell sufficient for another if, for every large enough n, an n‐sample from the first is Blackwell sufficient (Blackwell (1951, 1954)) for an n‐sample from the second. This note shows that eventual Blackwell sufficiency lies strictly between (one‐shot) Blackwell sufficiency and the ordering of information structures formulated by Moscarini and Smith (2002), and thus offers a new criterion for comparing experiments. A characterization of eventual Blackwell sufficiency in terms of the one‐shot experiments remains an open question.     

Notes and Communications “A DECISION THEORY EXAMPLE IN FOOTBALL”: A COMMENT*

Janssen and Daniel analyzed the choice between a one- or a two-point conversion for a particular game situation in college football. Their decision criteria was maximum expected utility based on a von Neumann-Morgenstern utility function defined over the games outcomes. An alternative approach based on a stochastic dominance criterion is presented that does not rely on knowledge of the relative importance of tying vs. winning; rather, it relies on a notion of consistency in the sequential problem.     

Promoting Seismic Retrofit Implementation Through “Nudge”: Using Warranty as a Driver

This article proposes a new type of warranty policy that applies the “nudge” concept developed by Thaler and Sunstein to encourage homeowners in Japan to implement seismic retrofitting. Homeowner adaptation to natural disasters through loss reduction measures is known to be inadequate. To encourage proactive risk management, the “nudge” approach capitalizes on how choice architecture can influence human decision‐making tendencies. For example, people tend to place more value on a warranty for consumer goods than on actuarial value. This article proposes a “warranty for seismic retrofitting” as a “nudge” policy that gives homeowners the incentive to adopt loss reduction measures. Under such a contract, the government guarantees all repair costs in the event of earthquake damage to the house if the homeowner implements seismic retrofitting. To estimate the degree to which a warranty will increase the perceived value of seismic retrofitting, we use field survey data from 1,200 homeowners. Our results show that a warranty increases the perceived value of seismic retrofitting by an average of 33%, and an approximate cost‐benefit analysis indicates that such a warranty can be more economically efficient than an ex ante subsidy. Furthermore, we address the failure of the standard expected utility model to explain homeowners’ decisions based on warranty evaluation, and explore the significant influence of ambiguity aversion on the efficacy of seismic retrofitting and nonanalytical factors such as feelings or trust.     

“Chemophobia” Today: Consumers’ Knowledge and Perceptions of Chemicals

This mixed‐methods study investigated consumers’ knowledge of chemicals in terms of basic principles of toxicology and then related this knowledge, in addition to other factors, to their fear of chemical substances (i.e., chemophobia). Both qualitative interviews and a large‐scale online survey were conducted in the German‐speaking part of Switzerland. A Mokken scale was developed to measure laypeople's toxicological knowledge. The results indicate that most laypeople are unaware of the similarities between natural and synthetic chemicals in terms of certain toxicological principles. Furthermore, their associations with the term “chemical substances” and the self‐reported affect prompted by these associations are mostly negative. The results also suggest that knowledge of basic principles of toxicology, self‐reported affect evoked by the term “chemical substances,” risk‐benefit perceptions concerning synthetic chemicals, and trust in regulation processes are all negatively associated with chemophobia, while general health concerns are positively related to chemophobia. Thus, to enhance informed consumer decisionmaking, it might be necessary to tackle the stigmatization of the term “chemical substances” as well as address and clarify prevalent misconceptions.