The Direct Costs and Benefits of US Electric Utility Divestitures

This paper studies the impact of divestiture on the efficiency and costs of electric utilities. The empirical literature shows that there exist economies of scope for electric utilities and that divestiture decreases distribution efficiency but increases generation efficiency. This paper is to bring together these different results. Our analysis covers distribution, transmission, and power sourcing. Our data is an unbalanced panel of about 138 US electric utilities for the years 1994 to 2006 over which we observe 30 divestitures between 1997 and 2003. First, we regress firmlevel efficiencies for distribution and power sourcing on various divestiture indicators. Second, we compare the weighted cost between divested and non-divested firms and calculate a net present value for the entire sample of divestitures. Last, we regress net benefits from divestiture on the distribution side on the net benefit for power sourcing to see whether individual firms successfully off-set any costs of divestiture. We find that divestiture reduces distribution efficiency but increases power sourcing efficiency. Both effects depend on the amount of own nuclear generation output but not fossil-fuel or hydro output. The net present value for all divestitures in our sample is $11.3 billion. It seems that relatively lower costs of power outweigh losses in economies of scope as well as other restructuring costs. However, lower costs of power might be the result of favourable contracts put in place at the time of divestiture. Our study complements traditional studies of economies of scope and shows that divestitures might well be worth it

An Economic Approach to Article 82

This report argues in favour of an economics-based approach to Article 82, in a way similar to the reform of Article 81 and merger control. In particular, we support an effects-based rather than a form-based approach to competition policy. Such an approach focuses on the presence of anti-competitive effects that harm consumers, and is based on the examination of each specific case, based on sound economics and grounded on facts

An analysis into early customer experiences of self-service checkouts:lessons for improved usability

The research aims to examine the perceptions of relative novice users of self-service checkouts (SSCOs) and if these perceptions change before, during and following use. Employing a diary approach with 31 respondents relatively unfamiliar with SSCOs, the research will document their experiences with this technology across stationary, hardware and grocery stores in two Scottish cities (Glasgow and Dundee). Findings suggest that the majority of respondents were motivated to use the technology because of time saving and convenience. However, the actual experience of using SSCOs was not always considered quicker when compared to staffed checkouts because of technical issues, lack of staff assistance and the impersonal, sometimes stressful and controlled nature of the cramped SSCO environment. Following post-use reflections, the majority of respondents’ opinions did not change from their initial perceptions and indicated that they would prefer not to use the technology in the future. Based on the findings, this study makes some practical suggestions centring on the design and usability of SSCOs, which may go some way to reducing customer dissatisfaction and frustration with the technology, especially from the perspective of new users of the technology

Supply chain uncertainty:a review and theoretical foundation for future research

Supply-chain uncertainty is an issue with which every practising manager wrestles, deriving from the increasing complexity of global supply networks. Taking a broad view of supply-chain uncertainty (incorporating supply-chain risk), this paper seeks to review the literature in this area and develop a theoretical foundation for future research. The literature review identifies a comprehensive list of 14 sources of uncertainty, including those that have received much research attention, such as the bullwhip effect, and those more recently described, such as parallel interaction. Approaches to managing these sources of uncertainty are classified into: 10 approaches that seek to reduce uncertainty at its source; and, 11 approaches that seek to cope with it, thereby minimising its impact on performance. Manufacturing strategy theory, including the concepts of alignment and contingency, is then used to develop a model of supply-chain uncertainty, which is populated using the literature review to show alignment between uncertainty sources and management strategies. Future research proposed includes more empirical research in order to further investigate: which uncertainties occur in particular industrial contexts; the impact of appropriate sources/management strategy alignment on performance; and the complex interplay between management strategies and multiple sources of uncertainty (positive or negative)

Multinational Banking in Europe: Financial Stability and Regulatory Implications. Lessons from the Financial Crisis

This paper examines whether multinational banks have a stabilising or a destabilising role during times of financial distress. With a focus on Europe, it looks at how these banks‟ foreign affiliates have been faring during the recent financial crisis. It finds that retail and corporate lending of these foreign affiliates have been stable and even increasing between 2007 and 2009. This pattern is related to the functioning of the internal capital market through which these banks funnel funds across their units. The internal capital market has been an effective tool to support foreign affiliates in distress and to isolate their lending from the local availability of financial resources, notwithstanding the systemic nature of the recent crisis. This effect has been particularly large within the EU integrated financial market and for the EMU countries, thus showing complementarity between economic integration and multinational banks‟ internal capital markets. In light of these findings, this paper supports the call for an integration of the European supervisory and regulatory framework overseeing multinational banks. The analysis is based on an analytical framework which derives the main conditions under which the internal capital market can perform this support function under idiosyncratic and systemic stresses. The empirical evidence uses both aggregate evidence on foreign claims worldwide, and firm-level evidence on the behaviour of banking groups‟ affiliates, compared to standing alone national banks.multinational banking, financial stability, regulation and supervision, internal capital markets, financial crises

Network industries in the new economy

In this paper we discuss two propositions: the supply and demand of knowledge, and network externalities. We outline the characteristics that distinguish knowledge- intensive industries from the general run of manufacturing and service businesses. Knowledge intensity and knowledge specialisation has developed as markets and globalisation have grown, leading to progressive incentives to outsource and for industries to deconstruct. The outcome has been more intensive competition. The paper looks at what is potentially the most powerful economic mechanism: positive feedback, alternatively known as demand-side increasing returns, network effects, or network externalities. We present alternative demand curves that incorporate positive feedback and discuss their potential economic and strategic consequences. We argue that knowledge supply and demand, and the dynamics of network externalities create new situations for our traditional industrial economy such that new types of economies of scale are emerging and "winner takes all" strategies are having more influence. This is the first of a pair of papers. A second paper will take the argument further and look at the nature of firms' strategies in the new world, arguing that technology standards, technical platforms, consumer networks, and supply chain strategies are making a significant contribution to relevant strategies within the new economy

Understanding collaborative supply chain relationships through the application of the Williamson organisational failure framework

Many researchers have studied supply chain relationships however, the preponderance of open markets situations and ‘industry-style’ surveys have reduced the empirical focus on the dynamics of long-term, collaborative dyadic relationships. Within the supply chain the need for much closer, long-term relationships is increasing due to supplier rationalisation and globalisation (Spekman et al, 1998) and more information about these interactions is required. The research specifically tested the well-accepted Williamson’s (1975) Economic Organisations Failure Framework as a theoretical model through which long term collaborative relationships can be

Sustainable business models: integrating employees, customers and technology

This Special Issue of the Journal of Business & Industrial Marketing has the same title as the 23rd International Conference CBIM 2018 (June 18-20, 2018, Madrid, Spain) “Sustainable Business Models: Integrating Employees, Customers and Technology”. In this edition of International Conference, following a competitive blind review process, papers from 126 authors and 25 countries were ultimately accepted. The best papers of the Conference were invited to submit to this Special Issue and we were also open to direct submissions from other authors. We present here the 17 accepted papers for publication in this Special Issue

Integrating supply chains: An investigation of collaborative knowledge transfers

This paper aims to empirically investigate the impact upon performance of explicit knowledge transfer in the integrated supply chain between a manufacturer and its external suppliers and customers. Literature derived hypotheses were evaluated using International Manufacturing Strategy Survey data from 338 companies. Valid and reliable scales were created via confirmatory factor analysis, and effects upon inventory performance tested via regression techniques. Whilst knowledge transfers from upstream and downstream directions were positively related to a manufacturer's performance, knowledge derived from customers was more powerful. Furthermore, integrated knowledge transfer- the combination of knowledge emanating from both suppliers and customers- had the strongest link to performance. The implications for practioners are that integrating knowledge across supply chains could be more far reaching than the exchange of assets, data and information usually considered in supply chain literature. Furthermore the current generalized approach to managing external knowledge is inadequate. This study expands upon existing literature by including directional implications as to which knowledge inflows are most valuable. For academics, this paper supports and extends existing literature by considering the supplier-manufacturer-customer triad in unison. The focus goes beyond asset, data and information exchange towards the leveraging of external knowledge. Relevant perspectives and dimensions were adopted from the knowledge management stream in order to add conceptual depth. Several areas of knowledge-based supply chain research have been identified as potential opportunities for further investigation.Supply Chain; Knowledge Management; Empirical Research: