Vertical integration and firm boundaries : the evidence

Since Ronald H. Coase's (1937) seminal paper, a rich set of theories has been developed that deal with firm boundaries in vertical or input–output structures. In the last twenty-five years, empirical evidence that can shed light on those theories also has been accumulating. We review the findings of empirical studies that have addressed two main interrelated questions: First, what types of transactions are best brought within the firm and, second, what are the consequences of vertical integration decisions for economic outcomes such as prices, quantities, investment, and profits. Throughout, we highlight areas of potential cross-fertilization and promising areas for future work

THE ROLE OF INTERDEPENDENCE IN THE MICRO-FOUNDATIONS OF ORGANIZATION DESIGN: TASK, GOAL, AND KNOWLEDGE INTERDEPENDENCE

Interdependence is a core concept in organization design, yet one that has remained consistently understudied. Current notions of interdependence remain rooted in seminal works, produced at a time when managers’ near-perfect understanding of the task at hand drove the organization design process. In this context, task interdependence was rightly assumed to be exogenously determined by characteristics of the work and the technology. We no longer live in that world, yet our view of interdependence has remained exceedingly task-centric and our treatment of interdependence overly deterministic. As organizations face increasingly unpredictable workstreams and workers co-design the organization alongside managers, our field requires a more comprehensive toolbox that incorporates aspects of agent-based interdependence. In this paper, we synthesize research in organization design, organizational behavior, and other related literatures to examine three types of interdependence that characterize organizations’ workflows: task, goal, and knowledge interdependence. We offer clear definitions for each construct, analyze how each arises endogenously in the design process, explore their interrelations, and pose questions to guide future research

Governance, regulation and financial market instability: the implications for policy

Just as the 1929 Stock Market Crash discredited Classical economic theory and policy and opened the way for Keynesianism, a consequence of the collapse of confidence in financial markets and the banking system—and the effect that this has had on the global macro economy—is currently discrediting the ‘conventional wisdom’ of neo-liberalism. This paper argues that at the heart of the crisis is a breakdown in governance that has its roots in the co-evolution of political and economic developments and of economic theory and policy since the 1929 Stock Market Crash and the Great Depression that followed. However, while many are looking back to the Great Depression and to the theories and policies that seemed to contribute to recovery during the first part of the twentieth century, we argue that the current context is different from the earlier one; and there are more recent events that may provide better insight into the causes and contributing factors giving rise to the present crisis and to the implications for theory and policy that follow

Caspase-8 activity has an essential role in CD95/Fas-mediated MAPK activation

Stimulation of CD95/Fas/APO-1 results in the induction of both apoptotic and non-apoptotic signaling pathways. The processes regulating these two opposing pathways have not been thoroughly elucidated to date. In this study, using quantitative immunoblots, imaging, and mathematical modeling, we addressed the dynamics of the DED proteins of the death-inducing signaling complex (DISC), procaspase-8, and cellular FLICE inhibitory proteins (c-FLIPs) to the onset of CD95-mediated ERK1/2 and p38 mitogen-activated protein kinase (MAPK) activation. We found that CD95 DISC-induced caspase-8 activity is important for the initiation of ERK1/2 and p38 MAPK activation. The long c-FLIP isoform, c-FLIPL, and the short c-FLIP isoform, c-FLIPR, inhibited MAPK induction by blocking caspase-8 processing at the DISC. Furthermore, we built a mathematical model describing CD95 DISC-mediated MAPK activation and apoptosis. The model quantitatively defined the dynamics of DED proteins, procaspase-8, and c-FLIP, which lead to caspase-8 activation and induction of apoptotic and non-apoptotic signaling pathways. In conclusion, the combination of biochemical analysis with mathematical modeling provides evidence for an important role of caspase-8 in CD95-mediated activation of MAPKs, while c-FLIP exerts a regulatory function in this process

Why do banks promise to pay par on demand?

We survey the theories of why banks promise to pay par on demand and examine evidence about the conditions under which banks have promised to pay the par value of deposits and banknotes on demand when holding only fractional reserves. The theoretical literature can be broadly divided into four strands: liquidity provision, asymmetric information, legal restrictions, and a medium of exchange. We assume that it is not zero cost to make a promise to redeem a liability at par value on demand. If so, then the conditions in the theories that result in par redemption are possible explanations of why banks promise to pay par on demand. If the explanation based on customers’ demand for liquidity is correct, payment of deposits at par will be promised when banks hold assets that are illiquid in the short run. If the asymmetric-information explanation based on the difficulty of valuing assets is correct, the marketability of banks’ assets determines whether banks promise to pay par. If the legal restrictions explanation of par redemption is correct, banks will not promise to pay par if they are not required to do so. If the transaction explanation is correct, banks will promise to pay par value only if the deposits are used in transactions. After the survey of the theoretical literature, we examine the history of banking in several countries in different eras: fourth-century Athens, medieval Italy, Japan, and free banking and money market mutual funds in the United States. We find that all of the theories can explain some of the observed banking arrangements, and none explain all of them

Cumulative Prognostic Score Predicting Mortality in Patients Older Than 80 Years Admitted to the ICU.

OBJECTIVES: To develop a scoring system model that predicts mortality within 30 days of admission of patients older than 80 years admitted to intensive care units (ICUs). DESIGN: Prospective cohort study. SETTING: A total of 306 ICUs from 24 European countries. PARTICIPANTS: Older adults admitted to European ICUs (N = 3730; median age = 84 years [interquartile range = 81-87 y]; 51.8% male). MEASUREMENTS: Overall, 24 variables available during ICU admission were included as potential predictive variables. Multivariable logistic regression was used to identify independent predictors of 30-day mortality. Model sensitivity, specificity, and accuracy were evaluated with receiver operating characteristic curves. RESULTS: The 30-day-mortality was 1562 (41.9%). In multivariable analysis, these variables were selected as independent predictors of mortality: age, sex, ICU admission diagnosis, Clinical Frailty Scale, Sequential Organ Failure Score, invasive mechanical ventilation, and renal replacement therapy. The discrimination, accuracy, and calibration of the model were good: the area under the curve for a score of 10 or higher was .80, and the Brier score was .18. At a cut point of 10 or higher (75% of all patients), the model predicts 30-day mortality in 91.1% of all patients who die. CONCLUSION: A predictive model of cumulative events predicts 30-day mortality in patients older than 80 years admitted to ICUs. Future studies should include other potential predictor variables including functional status, presence of advance care plans, and assessment of each patient's decision-making capacity

Sepsis at ICU admission does not decrease 30-day survival in very old patients: a post-hoc analysis of the VIP1 multinational cohort study.

BACKGROUND: The number of intensive care patients aged ≥ 80 years (Very old Intensive Care Patients; VIPs) is growing. VIPs have high mortality and morbidity and the benefits of ICU admission are frequently questioned. Sepsis incidence has risen in recent years and identification of outcomes is of considerable public importance. We aimed to determine whether VIPs admitted for sepsis had different outcomes than those admitted for other acute reasons and identify potential prognostic factors for 30-day survival. RESULTS: This prospective study included VIPs with Sequential Organ Failure Assessment (SOFA) scores ≥ 2 acutely admitted to 307 ICUs in 21 European countries. Of 3869 acutely admitted VIPs, 493 (12.7%) [53.8% male, median age 83 (81-86) years] were admitted for sepsis. Sepsis was defined according to clinical criteria; suspected or demonstrated focus of infection and SOFA score ≥ 2 points. Compared to VIPs admitted for other acute reasons, VIPs admitted for sepsis were younger, had a higher SOFA score (9 vs. 7, p < 0.0001), required more vasoactive drugs [82.2% vs. 55.1%, p < 0.0001] and renal replacement therapies [17.4% vs. 9.9%; p < 0.0001], and had more life-sustaining treatment limitations [37.3% vs. 32.1%; p = 0.02]. Frailty was similar in both groups. Unadjusted 30-day survival was not significantly different between the two groups. After adjustment for age, gender, frailty, and SOFA score, sepsis had no impact on 30-day survival [HR 0.99 (95% CI 0.86-1.15), p = 0.917]. Inverse-probability weight (IPW)-adjusted survival curves for the first 30 days after ICU admission were similar for acute septic and non-septic patients [HR: 1.00 (95% CI 0.87-1.17), p = 0.95]. A matched-pair analysis in which patients with sepsis were matched with two control patients of the same gender with the same age, SOFA score, and level of frailty was also performed. A Cox proportional hazard regression model stratified on the matched pairs showed that 30-day survival was similar in both groups [57.2% (95% CI 52.7-60.7) vs. 57.1% (95% CI 53.7-60.1), p = 0.85]. CONCLUSIONS: After adjusting for organ dysfunction, sepsis at admission was not independently associated with decreased 30-day survival in this multinational study of 3869 VIPs. Age, frailty, and SOFA score were independently associated with survival

Global patient outcomes after elective surgery: prospective cohort study in 27 low-, middle- and high-income countries.

BACKGROUND: As global initiatives increase patient access to surgical treatments, there remains a need to understand the adverse effects of surgery and define appropriate levels of perioperative care. METHODS: We designed a prospective international 7-day cohort study of outcomes following elective adult inpatient surgery in 27 countries. The primary outcome was in-hospital complications. Secondary outcomes were death following a complication (failure to rescue) and death in hospital. Process measures were admission to critical care immediately after surgery or to treat a complication and duration of hospital stay. A single definition of critical care was used for all countries. RESULTS: A total of 474 hospitals in 19 high-, 7 middle- and 1 low-income country were included in the primary analysis. Data included 44 814 patients with a median hospital stay of 4 (range 2-7) days. A total of 7508 patients (16.8%) developed one or more postoperative complication and 207 died (0.5%). The overall mortality among patients who developed complications was 2.8%. Mortality following complications ranged from 2.4% for pulmonary embolism to 43.9% for cardiac arrest. A total of 4360 (9.7%) patients were admitted to a critical care unit as routine immediately after surgery, of whom 2198 (50.4%) developed a complication, with 105 (2.4%) deaths. A total of 1233 patients (16.4%) were admitted to a critical care unit to treat complications, with 119 (9.7%) deaths. Despite lower baseline risk, outcomes were similar in low- and middle-income compared with high-income countries. CONCLUSIONS: Poor patient outcomes are common after inpatient surgery. Global initiatives to increase access to surgical treatments should also address the need for safe perioperative care. STUDY REGISTRATION: ISRCTN5181700