|
April 29, 2008
April 28, 2008
links for 2008-04-28
March 7, 2008
links for 2008-03-07
March 5, 2008
links for 2008-03-05
March 4, 2008
links for 2008-03-04
March 3, 2008
links for 2008-03-03
February 28, 2008
links for 2008-02-28
February 26, 2008
links for 2008-02-26
February 24, 2008
links for 2008-02-24
February 22, 2008
links for 2008-02-22
February 21, 2008
links for 2008-02-21
February 20, 2008
links for 2008-02-20
February 19, 2008
Was There a Bright Side to the Evacuation of Greater New Orleans?
Was There a Bright Side to the Evacuation of Greater New Orleans? So asks Jacob Vigdor of Duke University in his recently published "Katrina Effect" paper.
This paper uses longitudinal data from Current Population Surveys conducted between 2004 and 2006 to estimate the net impact of Hurricane Katrina-related evacuation on various indicators of well-being. While evacuees who have returned to the affected region show evidence of returning to normalcy in terms of labor supply and earnings, those who persisted in other locations exhibit large and persistent gaps, even relative to the poor outcomes of individuals destined to become evacuees observed prior to Katrina. Evacuee outcomes are not demonstrably better in destination communities with lower initial unemployment or higher growth rates. The impact of evacuation on total income was blunted to some extent by government transfer payments and by self-employment activities. Overall, there is little evidence to support the notion that poor underemployed residents of the New Orleans area were disadvantaged by their location in a relatively depressed region.
links for 2008-02-19
February 18, 2008
The Music Industry's Other Problem
Since the 1999 launch of Napster, much ink has been spilt in discussions about the music industry's crumbling business model. What has not been given enough attention, however, is the crummy product that said model has been design to promote. According to the New York Times, what they sell is more than hazardous to the health, particularly that of youngsters:
Teenagers listen to an average of nearly 2.5 hours of music per day. Guess what they’re hearing about? One in three popular songs contains explicit references to drug or alcohol use, according to a new report in The Archives of Pediatrics and Adolescent Medicine. That means kids are receiving about 35 references to substance abuse for every hour of music they listen to, the authors determined.While songs about drugs and excess are nothing new, the issue is getting more attention because so many children now have regular access to music out of the earshot of parents. Nearly 9 out of 10 adolescents and teens have an MP3 player or a compact disc player in their bedrooms. Studies have long shown that media messages have a pronounced impact on childhood risk behaviors. Exposure to images of smoking in movies influences a child’s risk for picking up the habit. Alcohol use in movies and promotions is also linked to actual alcohol use.
Researchers from the University of Pittsburgh School of Medicine studied the 279 most popular songs from 2005, based on reports from Billboard magazine, which tracks popular music. Whether a song contained a reference to drugs or alcohol varied by genre. Only 9 percent of pop songs had lyrics relating to drugs or alcohol. The number jumped to 14 percent for rock songs, 20 percent for R&B and hip-hop songs, 36 percent for country songs and 77 percent for rap songs.
It's is probably not accidental that rap music sales are collapsing. An outdated business model plus garbage products is not a recipe for success; it's a prescription for rivers of red ink. Bigger changes are in the offing.
Business Concept Renovation
Despite the difficulty it had in Germany, 
Wal-mart continues to do well in many other overseas markets like Mexico and India. Two recent articles underscore the retailer's alterations to its US business model in those markets. Regarding Mexico, Wal-Mart plans to open over 200 stores and restaurants this year, an almost 13% increase:
The plans include developing the "Mi Bodega Express" format, chief executive Eduardo Solorzano said. The format will be more of a neighborhood store than a convenience market and said the results of two such existing stores have been encouraging. The 2008 expansion plan also includes 17 Wal-Mart Supercenters, 79 Bodega Aurrera stores and 30 VIPs restaurants. Currently Walmex has 1,023 stores and restaurants. Results in Mexico have been good, with the stock of Walmex up 40% the past two years and earnings have grown 32% over that same time period.
A second story from the Hindustan Times details plans for Wal-Mart's cash-and-carry model in the Punjab:
The Bentonville-based retail giant Wal-Mart has finalised the business model for its cash & carry (wholesale) business in India. The first warehouse (distribution centre), which will be up and running in Ludhiana, Punjab, by this June, will have a format similar to Wal-Mart models in the US. However, the product profile will be different from the US stores. Wal-Mart’s cash & carry business, which is a 50:50 joint venture with the New Delhi-based Bharti group, is meant for large institutional or wholesale buyers and is not for retail sales. German retailing major Metro was the first international giant to set up cash & carry stores in India. Ted P Huffman, director of supply chain and logistics for Bharti Wal-Mart, said, “The distribution centre will be similar to Wal-Mart centres in the US, but it will be smaller.” While centres in the US are spread over 1 million sq ft —two football fields put together—the Indian centre will have a size of 80,000 sq ft. He says high real estate costs are the reason for smaller distribution centres. “We will be stocking grocery items and will not have items like toys and medical supplies, which we do in the US,” Huffman said.
Thus, overseas we are seeing a variety of retail formats: in addition to the super-centers, there are also restaurants; in addition to it's traditional focus on retail sales, we see experimentation with a wholesaler model; instead of going it alone, as in the US, we see a willingess to take on 50-50 joint ventures; instead of football-field size footprints, we see smaller distribution centers; and instead of every SKU under the sun, we see a more targeted selection. Doubtless there are other dimensions along which Wal-Mart's overseas business models diverge from the highly successful one developed in the US. How long until some of the successful overseas experiments are adopted back home in Bentonville? Perhaps not very long.
Has opinion turned on Wal-Mart?
nHas opinion turned on Wal-Mart? Like so may questions, it depends on who you ask. In the state of Indiana it just may have:
For years, Wal-Mart was best known as a business killer. The Arkansas-based retailer had a reputation for coming into town and putting competitors out of business. Now Wal-Mart is being hailed by Gov. Mitch Daniels and other Indianapolis officials as an economic savior for opening in a depressed commercial area around Lafayette Square Mall."Just by being who they are,
Elite opinion within the state Democratic party neither hews the Republican governor's line nor shares his enthusiasm for the retail giant:
Daniels' comment prompted criticism. Jennifer Wagner, communications director for the Indiana Democratic Party, told The Star Press, "It's one thing to laud a company for opening a store in an economically depressed area. It's quite another thing to hold up that company as a shining example of the kind of jobs we should be trying to recruit to our state." Wal-Mart and its place in the economy can lead to disagreement even among those concerned about the poor and disadvantaged.
Setting aside the inaccurate implication of the last sentence, i.e. that pro-business forces are less concerned about the poor and disadvantaged, it's worth noting that rank-and-file opinion within the party may be less ideologically driven:
"Any opportunity for economic development in a community is a good thing, especially when there's a need for more of that type of development," Tanasha Anders, vice president of Youth and Family Programs for Indiana Black Expo, told The Star Press. "I was raised in Gary, where our steel mills closed and we didn't have a lot of opportunity and alternatives," Anders said. "A number of things are debatable, but the fact that there's another source of employment for a community -- and not just low-income employment because there are management opportunities -- you can't discount that."
But there are some who, in the name of abstract notions of "social and economic justice", would "discount that". And there are others who- in the name of free markets- would discount prices.
Is Obama's Anti-business Rhetoric to be Taken Seriously?
Is Obama's Anti-business Rhetoric to be Taken Seriously? It depends on who you ask. Terence Corcoran of Canada's National Post thinks American voters should listen closely to the message behind the rhetoric and "rhythmic cadences". If they do, he asserts, they'll find the "same old stuff":
When it comes down to content, however, an Obama speech is not about change at all. It's about more of the same, more of the same old anti-corporate demagoguery, more of the same old attacks on CEO bonuses, Exxon, gouging businesses. There are ritual panderings to big labour and populist notions of free trade and NAFTA and China -- as he did in a speech on Tuesday night to an arena crowd in Madison, Wisc.On NAFTA and trade, under which businesses "ship jobs overseas and force parents to compete with their teenagers to work for minimum wage at Wal-Mart," Mr. Obama is playing on the same old populist mythologies that have driven political debate in America for more than a century -- the little people versus the wealthy, the lobbyists, the powerful, profits, special interests, the privileged.
How many proud
Yes, we have heard this before- from John Edwards and Hillary Clinton and many others. But as Corcoran notes, rarely have we heard it said and sold so well... so far.
links for 2008-02-18
February 15, 2008
links for 2008-02-15
February 14, 2008
Stakeholders and Potatoes
Adrian E. Tschoegl of the Wharton School of the University of Pennsylvania, has recently published an article in the Global Economic Journal entitled "McDonald's -- Much Maligned, But an Engine of Economic Development." In the paper he argues that McDonald's has very beneficial economic effects:
Critics have excoriated the US fast-food industry in general, and McDonald's most particularly, both per se and as a symbol of the United States. However, examining McDonald's internationalization and development abroad suggests that McDonald's and the others of its ilk are sources of development for mid-range countries. McDonald's brings training in management, encourages entrepreneurship directly through franchises and indirectly through demonstration effects, creates backward linkages that develop local suppliers, fosters exports by their suppliers, and has positive external effects on productivity and standards of service, cleanliness, and quality in the host economies.
I have no doubt that if he studied the effect of Wal-Mart on local and global economies, he'd find the all of the above and then some, but without the effect on the waistline and cholesterol levels.
Why Don't Inventors Patent?
Why Don't Inventors Patent? So asks former colleague Petra Moser. Using a very novel dataset, she argues that the reluctance may have something to do with the ability of inventors to keep innovations secret, especially from others within the same industry:
This paper argues that the ability to keep innovations secret may be a key determinant of patenting. To test this hypothesis, the paper examines a newly-collected data set of more than 7,000 American and British innovations at four world's fairs between 1851 and 1915. Exhibition data show that the industry where an innovation is made is the single most important determinant of patenting. Urbanization, high innovative quality, and low costs of patenting also encourage patenting, but these influences are small compared with industry effects. If the effectiveness of secrecy is an important factor in inventors' patenting decisions, scientific breakthroughs, which facilitate reverse-engineering, should increase inventors' propensity to patent. The discovery of the periodic table in 1869 offers an opportunity to test this idea. Exhibition data show that patenting rates for chemical innovations increased substantially after the introduction of the periodic table, both over time and relative to other industries.
Ignoring the Non-obvious
Inventions for which patents are granted must meet three criteria: they must be novel, useful, and non-obvious. Mark Lemley of Stanford Law School suggests in a recent working paper that a large number of patents share another criterion, one which was surely not intended by the US Patent and Trademark Office: they can be, and frequently are, ignored. The result is not nearly as negative, he argues, as the non-experts might suspect:
More than 2.5 million United States patents have been issued in the last twenty years. While these patents are spread across all industries, a large percentage are concentrated in the information technology (IT) industries, and others in biotechnology. The prevalence of patents in these industries has caused a number of people to worry about an “anticommons” in patent law. Given these problems, it's a wonder companies make products in patent-intensive industries at all.And yet make products they do. Both my own experience and what limited empirical evidence there is suggest that companies do not seem much deterred by the threat of all this patent litigation from making products.
What's going on here? The answer, I think, is quite simple: both researchers and companies in component industries simply ignore patents. Virtually everyone does it. They do it at all stages of endeavor. From the perspective of an outsider to the patent system, this is a remarkable fact. And yet it may be what prevents the patent system from crushing innovation in component industries like IT. Ignoring patents, then, may be a “workaround” that allows the innovation system to function in the face of overbroad patent protection.
At the same time, ignoring patents is hardly the optimal solution. I suggest some ways we might move towards a compromise - a robust patent market in which inventors could get paid without the problems of holdup and the anticommons.
Getting to Know You
Robert Huckman, Bradley Staats, and David Upton, all of the Harvard Business School, shed some light on the role of "experience" of individuals comprising work teams and the consequent impact on team peformance. What they find matters most is how much team members have worked with one another, not how long any of them have worked in their respective capacities:
Much of the literature on learning views experience as a unidimensional concept captured by the cumulative production volume or number of projects completed by a team. Implicit in this approach is the assumption that teams are stable in their membership and internal organization. In practice, however, such stability is rare, as the composition and structure of teams often changes over time or between projects. In this paper, we use detailed data from an Indian software services firm to examine how such changes may affect the accumulation of experience within, and the performance of, teams. We find that the level of team familiarity (i.e., the average number of times that each team member has worked with every other member of the team) has a significant and positive effect on performance but that conventional measures of the experience of individual team members (e.g. years at the firm) do not impact performance. We do find, however, that the role experience of individuals in a team (i.e., years in a given role within a team) is associated with better team performance. We examine the impact of role experience separately for team managers and team members. We find that a manager's role experience is positively related to outcome measures that are easily observable in process but is not related to outcomes that are difficult to monitor in process. In comparison, a member's role experience is positively related to both types of outcomes. Our results offer an approach for capturing the experience held by fluid teams and highlight the need to study context-specific measures of experience, including role experience, in addition to offering further insight into how the interactions of team members may contribute to the development of broader firm capabilities.
Can Lawsuits Control File Sharing on the Internet?
Can Lawsuits Control File Sharing on the Internet? So ask Ville Oksanen and Mikko Välimäki of the Helsinki Institute for Information Technology and authors of a recent piece in the Review of Law and Economics. In short, they argue in the negative:
The music and movie industries have recently added individual consumers as the target of the file sharing lawsuits. It is often questioned why the industries use substantial resources to fight in the courtrooms instead of making better and more affordable products. In this article, we first analyze the reasons of the industry behavior suggesting that the court strategy may be in fact more effective, at least in the short term, than it should be based on pure economic calculations. However, the empirical evidence seems to imply that lawsuits fail to send a strong signal to individuals about the society’s supposedly negative attitude towards file sharing. General deterrence from the threat of being sued does not help in the end either because people are risk seeking in the face of making a decision between a certain and probable loss. In conclusion, we argue that the court strategy cannot be used to establish any social norm with a long lasting effect on individual behavior as long as the peer pressure works towards the opposite direction.
Search
About Me
- Profile My Academic Work
- An Old MIT Page
- MY CV
- Open Trackback Policy
- Contact: starlingdavidhunter at gmail dot com
Categories
- Ask the Professor
- Belmont Club
- Business Concept Innovation
- Core Strategy
- Customer Interface
- Strategic Resources
- Core Competencies
- Core Processes
- Strategic Assets
- Value Network
- Coalitions
- Partners
- Suppliers
- Business News Links
- CANSLIM
- Annual Earnings
- Current Earnings
- Institutional Sponsorship
- Leader or Laggard
- Market Direction
- New Products, Management, and Highs
- Supply & Demand
- Dubai
- Five Forces
- Four I's
- Market Direction
- Middle East
- Open TrackBacks
- Organizational Behavior
- Photos
- Political Economy
- Resources & Capabilities
- Financial Resources
- Human Resources
- Organizational Resources
- Physical Resources
- Question of Imitation
- Question of Organization
- Question of Rareness
- Question of Value
- Road to Serfdom
- TV & Movies
- Lost
- Ocean's 11
- The Godfather
- The Office
- Ugly Betty
- Video
- Wal-Mart
- World of Work
Archives
- April 2008
- March 2008
- February 2008
- January 2008
- December 2007
- November 2007
- October 2007
- September 2007
- August 2007
- July 2007
- June 2007
- May 2007
- April 2007
- March 2007
- February 2007
- January 2007
- December 2006
- November 2006
- October 2006
- September 2006
- August 2006
- July 2006
- June 2006
- May 2006
- April 2006
- March 2006
- February 2006
- January 2006
- December 2005
- November 2005
- October 2005
Recent Posts
Business News Sources
Blog Roll
- Jack Yoest
- Accidental Verbosity
- Businesspundit
- a different kind of biz
- Catallarchy
- Business Opportunities Weblog
- Crossroads Dispatches
- Business Opportunities
- Business Opportunity
- BuzzJungle
- Successful Blog
- nPost
- Business Blog Wire
- Going Global
- Commerce Bucket
- Pundita
- The Shopfloor.org Blog
- Private Sector Development Bank
- The Disruption Group
Powered by
Movable Type 3.31
Movable Type 3.31