Why Do Some Places Succeed When Others Decline? A Social Interaction Model of Cluster Viability

One of the most convincing explanations papers generally provide concerning clusters in knowledge-based economies refers to the geographically bounded dimension of knowledge spillovers. Here we shall underline that location decision externalities precede local knowledge spillovers in the explanation of cluster aggregate efficiency, which thus requires us to focus on the sequential process of location and the nature of interdependences in location decision-making. To that end, we mean to associate cluster emergence with the formation of locational norms, and to study the critical parameters of their stability. These parameters relate to the type of decision externalities among more or less cognitively distant firms, which influences the weight and the resulting ambivalent role of knowledge spillovers at the aggregate level of clusters. We suggest two theoretical propositions which we test within a simple and general norm location dynamics modeling framework. We then proceed to discuss the results so obtained by comparing them with an emerging related literature based on the life cycle and viability of clustersclusters, location under decision externalities, cognitive distance, knowledge spillovers

Institutions and the Management of Human Resources: Incentive Pay Systems in France and Great Britain

Using data from large-scale establishment surveys in Britain and France, we show that incentive pay for non-managers is more widespread in France than in Britain. We explain this finding in terms of the 'beneficial constraint' arising from stronger employment protection in France, which provides an impulse to develop incentive pay; employer networking activities in France, which facilitate joint learning about its development and operation; and government fiscal incentives for profit-sharing, which reduces the cost of its operation.incentive systems, merit pay, profit-sharing, employer networks

The effects of scales, flows and filters on property rights and collective action in watershed management:

Research and policy on property rights, collective action and watershed management requires good understanding of ecological and socio-political processes at different social-spatial scales. On-farm soil erosion is a plot or farm-level problem that can be mitigated through more secure property rights for individual farmers, while the sedimentation of streams and deterioration of water quality are larger-scale problems that may require more effective collective action and / or more secure property rights at the village or catchment scale. Differences in social-political contexts across nations and regions also shape property rights and collective action institutions. For example, circumstances in the Lake Victoria basin in East Africa require particular attention to collective action and property rights problems in specific “hot spot” areas where insecure tenure leads to overuse or under-investment. Circumstances in the uplands of Southeast Asia require analysis of the opportunities for negotiating more secure rights for farmers in exchange for stronger collective action by farmer groups for maintaining essential watershed functions.

Organic Rural Innovation Systems and Networks: Findings From a Study of Ethiopian Smallholders

Agriculture in Ethiopia is changing. New players, relationships, and policies are influencing the ways in which information and knowledge are used by smallholders. While this growing complexity suggests opportunities for Ethiopian smallholders, too little is known about how these opportunities can be effectively leveraged to promote pro-poor processes of rural innovation. This paper examines Ethiopia’s smallholder agricultural sector from an innovation systems perspective to understand the changing roles, responsibilities, and interactions of diverse actors in relation to smallholder livelihoods. The paper uses a combination of qualitative and quantitative research tools to paint a picture of the innovation landscape at both the system and local levels. Findings suggest that public sector extension, administration, and related service providers form a closely-knit network in rural Ethiopia with the ability to influence smallholder access to knowledge and information. Given the Government of Ethiopia’s priorities of improving rural welfare by increasing market access among smallholders, these findings suggest the need for policies and programs designed to strengthen innovative capabilities among rural service providers from the public sector, and to create more space for private and civil society actors to participate in smallholder innovation networks.Ethiopia, Agricultural development, innovation, technology, Social networks, Social learning, Agribusiness, Agricultural and Food Policy, Consumer/Household Economics, Farm Management, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, International Relations/Trade, Marketing, Productivity Analysis, Research and Development/Tech Change/Emerging Technologies,

Technology adoption and pro-social preference

In this paper, I study the design of least cost technology adoption subsidy schemes when the individuals' decisions are affected by peer effects and pro-social motivations. I show that pro-social preferences lead to lower individual subsidies whether peer effects are positive or negative. However, the form of the optimal scheme strongly depends on the type of peer effects. When peer effects are positive pro-social preferences lead to an increase in objective inequality -the difference between individual material payoffs- while they lead to a decrease in subjective inequality -the difference between individual utility levels. When peer effects are negative, the optimal subsidy scheme is uniform, that is all the individuals receive the same subsidy. The model delivers insights for the design of a large range of intervention programs supporting the adoption of new technologies, both in contexts where peer effects are positive (as has been shown in the case of malaria prevention technologies and modern agricultural inputs) and in contexts where peer effects are negative (as has been shown in the case of deworming pills)

The Illusion of Sustainability

The history of foreign development assistance is one of movement away from addressing immediate needs and toward focusing on the underlying causes of poverty. A recent manifestation is the move towards sustainability,' which stresses community mobilization, education, and cost-recovery. This stands in contrast to the traditional economic analysis of development projects, with its focus on providing public goods and correcting externalities. We examine evidence from randomized evaluations on strategies for combating intestinal worms, which affect one in four people worldwide. Providing medicine to treat worms was extremely cost effective, although medicine must be provided twice per year indefinitely to keep children worm-free. An effort to promote sustainability by educating Kenyan schoolchildren on worm prevention was ineffective, and a mobilization' intervention from psychology failed to boost deworming drug take-up. Take-up was highly sensitive to drug cost: a small increase in cost led to an 80 percent reduction in take-up (relative to free treatment). The results suggest that, in the context we examine, the pursuit of sustainability may be an illusion, and that in the short-run, at least, external subsidies will remain necessary.

Information Inequality and Network Externalities: A Comparative Study of the Diffusion of Television and the Internet

This paper sheds light on whether intergroup inequality in Internet access is likely to persist as the diffusion process continues. To what extent is a given level of inequality in technology diffusion (e.g., use of the Internet) a long-term policy challenge or a temporary inconvenience? What general factors account for group-specific patterns of technology adoption? This paper draws on notions of network externalities to help answer this question. It also presents findings from a comparative analysis of household adoption of television from 1948 to 1957 and the Internet from 1994 to 2002.

Peer Influence in Network Markets: An Empirical Investigation

We analyze the effect of peer influence on the diffusion of an innovative network good. We argue that the adopters of a network good have an incentive to convince others to purchase the same product because their utility depends on the number of other users. This peer-effect influences individuals’ adoption decisions alongside the more familiar installed-base-effect, based on the individual’s own insight that a larger number of installed units increases his/her benefit of adopting. We test empirically which effect dominates with Instant Messaging, an innovative network good. We arrive at surprising results with far-reaching implications for research and management. The diffusion of Instant Messaging was to a large extent driven by the peer-effect, but the installed-base-effect seemed to play no role. We perform our estimation with a discrete time hazard rate model that controls for unobserved heterogeneity.Hazard Rate Model;Innovation Diffusion;Instant Messaging;Network Markets;Peer Influence

Property rights, collective action and technologies for natural resource management: a conceptual framework

Environmental management, Gender, Capacity,