Essays on durable goods consumption and firm innovation

This dissertation comprises three individual chapters. Chapter Two examines how free riding across neighbors influenced the diffusion of color television sets in rural China. Chapter Three tests for asymmetric information between a firm’s management and other investors concerning its patent output. Chapter Four discusses how knowledge stocks influence a patenting firm’s later diversification. Chapter Two documents the existence of a type of network effects—free riding across neighbors—in the consumption of color television sets in rural China, which reduces the propensity of non-owners to purchase. I construct a model of the timing of the purchase of a durable good in the presence of free riding, and test its key implications using household survey data in rural China. Chapter Three tests for asymmetric information between a firm’s management and other investors about its patent output by examining insider trading patterns and stock price changes in R&D intensive firms. It demonstrates that management has considerable information about its patent output beyond what is known to investors. It also shows that the predictive power of insider trading patterns on patent output comes from purchases rather than sales. Chapter Four discusses two sequential channels through which knowledge stocks may influence a firm’s later diversification. One is that firms with more knowledge are more likely to enter a new industry. The other is that firms’ businesses have a better chance of surviving, conditional on being formed. By examining U.S. public patenting firms in manufacturing sectors for 1984-1996, I find that knowledge stocks predict the likelihood of new industry entry when controlling for firm size. However, this predictive power is weakened when diversification effects are included. On the other hand, a survival study of newly established segments shows that initial knowledge stocks have significant positive effects on segment survival, whereas diversification effects are insignificant.

The order selection and lot sizing problem in the make-to-order environment

This research is motivated by the need for considering lot sizing while accepting customer orders in a make-to-order (MTO) environment, in which each customer order must be delivered by its due date. Job shop is the typical operation model used in an MTO operation, where the production planner must make three concurrent decisions; they are order selection, lot size, and job schedule. These decisions are usually treated separately in the literature and are mostly led to heuristic solutions. The first phase of the study is focused on a formal definition of the problem. Mathematical programming techniques are applied to modeling this problem in terms of its objective, decision variables, and constraints. A commercial solver, CPLEX is applied to solve the resulting mixed-integer linear programming model with small instances to validate the mathematical formulation. The computational result shows it is not practical for solving problems of industrial size, using a commercial solver. The second phase of this study is focused on development of an effective solution approach to this problem of large scale. The proposed solution approach is an iterative process involving three sequential decision steps of order selection, lot sizing, and lot scheduling. A range of simple sequencing rules are identified for each of the three subproblems. Using computer simulation as the tool, an experiment is designed to evaluate their performance against a set of system parameters. For order selection, the proposed weighted most profit rule performs the best. The shifting bottleneck and the earliest operation finish time both are the best scheduling rules. For lot sizing, the proposed minimum cost increase heuristic, based on the Dixon-Silver method performs the best, when the demand-to-capacity ratio at the bottleneck machine is high. The proposed minimum cost heuristic, based on the Wagner-Whitin algorithm is the best lot-sizing heuristic for shops of a low demand-to-capacity ratio. The proposed heuristic is applied to an industrial case to further evaluate its performance. The result shows it can improve an average of total profit by 16.62%. This research contributes to the production planning research community with a complete mathematical definition of the problem and an effective solution approach to solving the problem of industry scale.

Three essays on self-employment transitions, organizational capital, and firm formation

This dissertation explores how economic, organizational, and personal factors affect self-employment transitions, occupational decisions, and firm formation activities of individuals at different positions in the skill distribution. The first essay of my dissertation studies how local unemployment rates differentially affect entry into self-employment by individuals at different places in the skill distribution. The empirical results show a positive correlation between local unemployment rates and entry into self-employment for low-ability workers, but not for high-ability workers. Including employer size to eliminate possible distortions showed that the positive association between unemployment and self-employment among low-ability workers is in fact driven by the small firm effect. Controlling for firm size yields a negative association between unemployment and self-employment among high-ability workers. Effects of organizational capital, human capital and physical capital, on the firm formation activities of people at distinct skill levels depend on the type of the industry which is chosen for the new firm. Two types of industries, capital-intensive and ability-intensive, are utilized to explore this hypothesis in the second essay. A capital-intensive industry requires more physical investment, and consequently more funds, whereas, an ability-intensive industry requires more human capital. It is shown that high human capital requirements are associated with higher earnings among the most able individuals, and therefore makes them more likely to found firms in an ability-intensive industry. Wealthy people are more likely to establish both capital-intensive and ability-intensive firms, even though the amount of funds necessary for two industry types differs. Moreover, entry into both industries is predicted to happen later in life due to the removal of entry barriers constituted by required investment spending using savings when old. Empirical mixed results are observed. The third essay investigates earning differentials between future entrepreneurs and their non-entrepreneurial colleagues. Results show that high-ability firm-owners in an ability-intensive industry were earning more than those that remained in wage-work, whereas, low-ability firm-owners in a capital-intensive industry were earning less than those remaining in paid-work.

Recruitment, Selection and Retention of Managers In the Hotel and Restaurant Industry

The recruitment, selection, and retention of competent, reliable, and motivated managers has been the cornerstone of any successful organization. This is generally a complex assignment due to the subjectivity involved in determining what traits are needed to make a good manager. In order to determine the status of the hospitality industry with regard to managerial concerns, leaders in the hotel and restaurant industry were surveyed on these issues.

Reference gene selection and RNA preservation protocol in the cat flea, Ctenocephalides felis, for gene expression studies

This work was supported by a Knowledge Transfer Network BBSRC Industrial Case (#414 BB/L502467/1) studentship in association Zoetis Inc.

Large volume metrology instrument selection and measurability analysis

Metrology processes used in the manufacture of large products include tool setting, product verification and flexible metrology enabled automation. The range of applications and instruments available makes the selection of the appropriate instrument for a given task highly complex. Since metrology is a key manufacturing process it should be considered in the early stages of design. This paper provides an overview of the important selection criteria for typical measurement processes and presents some novel selection strategies. Metrics which can be used to assess measurability are also discussed. A prototype instrument selection and measurability analysis application is presented with discussion of how this can be used as the basis for development of a more sophisticated measurement planning tool. © Springer-Verlag Berlin Heidelberg 2010.

Consumer Behavior and Firm Competition

Understanding consumer behavior is critical for firms' decision making. How consumers make decisions about what they want and buy directly affect the profits of firms. Therefore, it is important to consider consumer behaviors and incorporate them into the model when studying the optimal strategy of firms and competition between firms. In this dissertation, I study rich and interesting consumer behaviors and their impact on firms' strategy in two essays. The first essay considers consumers' shopping cost which leads to their preference for one-stop shopping. I examine how store visit costs and consumer knowledge about a product affect the strategic store choice of consumers and, in turn, the pricing, customer service and advertising decisions of competing retailers. My analysis offers insights on how specialty stores can compete with big-box retailers. In the second essay, I focus on a well-established psychology phenomenon, cognitive dissonance. I incorporate the idea of cognitive dissonance into a model of spatial competition and examine its implications for selling strategy. I provide new insight on the profitability of advance selling and spot selling as well as the pricing of bundle and its components. Collectively, two essays in this dissertation introduce novel ways to model consumer behaviors and help to understand the impact of consumer behaviors on firm profitability and strategy.

(Table 1) Sample descriptions and results: Carbon, lipid, and kerogen analyses, at DSDP Leg 64 Holes

Pleistocene sediments in the Guaymas Basin, Gulf of California, have been intruded by sills and their organic matter thus subjected to thermal stress. Sediment samples from DSDP/IPOD Sites 477, 478, and 481, and samples of thermally unaltered materials from Sites 474 and 479 were analyzed to characterize the lipids and kerogens and to evaluate the effects of the intrusive thermal stresses. The lipids of the thermally unaltered samples are derived from microbial and terrestrial higher-plant detritus. The samples from the sill proximities contain the distillates, and those adjacent to the sills contain essentially no lipids. The pyrograms of the kerogens from the unaltered samples reflect their predominantly autochthonous microbial origin. When compared with the unaltered samples, the pyrograms of the altered kerogen samples reflect the thermal effects by a reduction in the complexity of the products. Kerogens adjacent to the sills produced little or no pyrolysis products. The effects of intrusions into unconsolidated, wet sediments resulted in in situ pyrolysis of the organic matter, as confirmed by these data.

(Table 1) Sample description and tetrapyrrole pigment yield at DSDP Leg 60 Holes

In order to provide a better understanding of the fate of sedimentary chlorophyll and chlorophyll degradation products in all kinds of environments, we have recently expanded our studies to include examination of sediments returned from Legs which are not rich in organic matter, nor are even primarily biogenic. Eight core samples from the Mariana Basin and Trench, obtained from DSDP Leg 60, were analyzed for products of chlorophyll diagenesis. To date, the sediment samples from the South Philippine Sea have been the most organically barren examined. Through elimination of the bias of examining only sediments rich in organic matter, we hope that the fate of chlorophyllous material on a more global scale will eventually be elucidated.

Seawater carbonate chemistry, sample density and Strongylocentrotus purpuratus size, filtering and respiration rate during experiments, 2011

Anthropogenic CO2 emissions are acidifying the world's oceans. A growing body of evidence is showing that ocean acidification impacts growth and developmental rates of marine invertebrates. Here we test the impact of elevated seawater pCO2 (129 Pa, 1271 µatm) on early development, larval metabolic and feeding rates in a marine model organism, the sea urchin Strongylocentrotus purpuratus. Growth and development was assessed by measuring total body length, body rod length, postoral rod length and posterolateral rod length. Comparing these parameters between treatments suggests that larvae suffer from a developmental delay (by ca. 8%) rather than from the previously postulated reductions in size at comparable developmental stages. Further, we found maximum increases in respiration rates of + 100 % under elevated pCO2, while body length corrected feeding rates did not differ between larvae from both treatments. Calculating scope for growth illustrates that larvae raised under high pCO2 spent an average of 39 to 45% of the available energy for somatic growth, while control larvae could allocate between 78 and 80% of the available energy into growth processes. Our results highlight the importance of defining a standard frame of reference when comparing a given parameter between treatments, as observed differences can be easily due to comparison of different larval ages with their specific set of biological characters.

(Table 1) Sample locations and clay mineral data of sediment surface samples from the Barents Sea region

A new surface sediment sample set gained in the western Barents Sea by the MAREANO program has been analysed for basic clay mineral assemblages. Distribution maps including additional samples from earlier German research cruises to and off Svalbard are compiled. Some trends in the clay mineral assemblages are related to the sub-Barents Sea geology because the Quaternary sediment cover is rather thin. Additionally, land masses like Svalbard and northern Scandinavia dominate the clay mineral signal with their erosional products. Dense bottom water, very often of brine origin, that flows within deep troughs, such as the Storfjorden or Bear Island Trough, transport the clay mineral signal from their origin to the Norwegian-Greenland Sea.

Estimation of Sample Size and Power For Quantile Regression

Quantile regression (QR) was first introduced by Roger Koenker and Gilbert Bassett in 1978. It is robust to outliers which affect least squares estimator on a large scale in linear regression. Instead of modeling mean of the response, QR provides an alternative way to model the relationship between quantiles of the response and covariates. Therefore, QR can be widely used to solve problems in econometrics, environmental sciences and health sciences. Sample size is an important factor in the planning stage of experimental design and observational studies. In ordinary linear regression, sample size may be determined based on either precision analysis or power analysis with closed form formulas. There are also methods that calculate sample size based on precision analysis for QR like C.Jennen-Steinmetz and S.Wellek (2005). A method to estimate sample size for QR based on power analysis was proposed by Shao and Wang (2009). In this paper, a new method is proposed to calculate sample size based on power analysis under hypothesis test of covariate effects. Even though error distribution assumption is not necessary for QR analysis itself, researchers have to make assumptions of error distribution and covariate structure in the planning stage of a study to obtain a reasonable estimate of sample size. In this project, both parametric and nonparametric methods are provided to estimate error distribution. Since the method proposed can be implemented in R, user is able to choose either parametric distribution or nonparametric kernel density estimation for error distribution. User also needs to specify the covariate structure and effect size to carry out sample size and power calculation. The performance of the method proposed is further evaluated using numerical simulation. The results suggest that the sample sizes obtained from our method provide empirical powers that are closed to the nominal power level, for example, 80%.

Impact of selection and demography on the diffusion of lactase persistence.

The lactase enzyme allows lactose digestion in fresh milk. Its activity strongly decreases after the weaning phase in most humans, but persists at a high frequency in Europe and some nomadic populations. Two hypotheses are usually proposed to explain the particular distribution of the lactase persistence phenotype. The gene-culture coevolution hypothesis supposes a nutritional advantage of lactose digestion in pastoral populations. The calcium assimilation hypothesis suggests that carriers of the lactase persistence allele(s) (LCT*P) are favoured in high-latitude regions, where sunshine is insufficient to allow accurate vitamin-D synthesis. In this work, we test the validity of these two hypotheses on a large worldwide dataset of lactase persistence frequencies by using several complementary approaches. Methodology We first analyse the distribution of lactase persistence in various continents in relation to geographic variation, pastoralism levels, and the genetic patterns observed for other independent polymorphisms. Then we use computer simulations and a large database of archaeological dates for the introduction of domestication to explore the evolution of these frequencies in Europe according to different demographic scenarios and selection intensities. Conclusions Our results show that gene-culture coevolution is a likely hypothesis in Africa as high LCT*P frequencies are preferentially found in pastoral populations. In Europe, we show that population history played an important role in the diffusion of lactase persistence over the continent. Moreover, selection pressure on lactase persistence has been very high in the North-western part of the continent, by contrast to the South-eastern part where genetic drift alone can explain the observed frequencies. This selection pressure increasing with latitude is highly compatible with the calcium assimilation hypothesis while the gene-culture coevolution hypothesis cannot be ruled out if a positively selected lactase gene was carried at the front of the expansion wave during the Neolithic transition in Europe.