The value of innovation:the interaction of competition, R&D and IP

This paper analyses market valuations of UK companies using a new data set of their R&D and IP activities (1989–2002). In contrast to previous studies, the analysis is conducted at the sectoral-level, where the sectors are based on the technological classification originating from Pavitt [Pavitt, K., 1984. Sectoral patterns of technical change. Research Policy 13, 343–373]. The first main result is that the valuation of R&D varies substantially across these sectors. Another important result is that, on average, firms that receive only UK patents tend to have no significant market premium. In direct contrast, patenting through the European Patent Office does raise market value, as does the registration of trade marks in the UK for most sectors. To explore these variations the paper links competitive conditions with the market valuation of innovation. Using profit persistence as a measure of competitive pressure, we find that the sectors that are the most competitive have the lowest market valuation of R&D. Furthermore, within the most competitive sector (‘science based’ manufacturing), firms with larger market shares (an inverse indicator of competitive pressure) also have higher R&D valuations, as well as some positive return to UK patents. We conclude that this evidence supports Schumpeter by finding higher returns to innovation in less than fully competitive markets and contradicts Arrow [Arrow, K., 1962. Economic welfare and the allocation of resources for invention. In: Nelson, R. (Ed.), The Rate and Direction of Inventive Activity. Princeton University Press, Princeton], who argued that, with the existence of IP rights, competitive market structure provides higher incentives to innovate.

The river, the railroad tracks, and the towers: How residents' worldview and use value transformed Wilton Manors into a diverse, gay-friendly, urban village

This case study examines the factors that shaped the identity and landscape of a small island-urban-village between the north and south forks of the Middle River and north of an urban area in Broward County, Florida. The purpose of the study is to understand how Wilton Manors was transformed from a “whites only” enclave to the contemporary upscale, diverse, and third gayest city in the U.S. by positing that a dichotomy for urban places exists between their exchange value as seen by Logan and Molotch and the use value produced through everyday activity according to Lefebvre. Qualitative methods were used to gather evidence for reaching conclusions about the relationship among the worldview of residents, the tension between exchange value and use value in the restructuration of the city, and the transformation of Wilton Manors at the end of the 1990s. Semi-structured, in-depth interviews were conducted with 21 contemporary participants. In addition, thirteen taped CDs of selected members of founding families, previously taped in the 1970s, were analyzed using a grounded theory approach. My findings indicate that Wilton Manors’ residents share a common worldview which incorporates social inclusion as a use value, and individual agency in the community. This shared worldview can be traced to selected city pioneers whose civic mindedness helped shape city identity and laid the foundation for future restructuration. Currently, residents’ quality of life reflected in the city’s use value is more significant than exchange value as a primary force in the decisions that are made about the city’s development. With innovative ideas, buildings emulating the new urban mixed-use design, and a reputation as the third gayest city in the United States, Wilton Manors reflects a worldview where residents protect use value as primary over market value in the decisions they make that shape their city but not without contestation.^

Business Service Management

Business Service Management describes the emerging discipline dedicated to the IT-enabled management of services as corporate assets. Business Service Management deals with the service orientation of the organisation and the provisioning and use of business services. The term business service describes an autonomous transformational capability that is offered to and consumed by external or internal customers for their benefit. The prefix ‘business’ stresses that such a service has a market value, requires the ability to be managed internally as a corporate asset and that its implementation is technology-agnostic. While business services (or so called capabilities) have attracted the attention of many vendors and organisations, a lack of understanding of the activities required for the successful management of such business services remains a critical issue. In order to fill this gap, a framework consisting of Service Lifecycle Management, Service Value Management, Service Relationship Management and Service Enablement is proposed. This Framework has the potential to provide organisations with the much needed guidance in their attempts to convert current IT-driven service initiatives into successful service-centric business models.

Are East Asian companies benefiting from western board practices?

Since the Asian crisis, East Asian nations have strived to introduce corporate governance codes, directing companies how to best improve their corporate governance practices. However, these codes have not been universally accepted by East Asian companies. This study examines the adoption of major board-related corporate governance recommendations by large nonfinancial companies in seven East Asian nations and investigates whether improvements in these board governance mechanisms have been associated with increased operating performance and market value. The results indicate that family-owned companies started with worse board governance and have been least likely to improve their board governance since the crisis. Overall, bigger, faster growing, non-family-owned companies with less concentrated ownership have been more likely to improve their board governance. Splitting of the positions of Chairman and CEO, creation of audit and nomination committees and improvements in overall board governance were found to have a positive relationship with subsequent operating performance and/or market value.

Valuation methods for resident funded retirement villages in Australia : a practitioner's perspective

Designed for independent living, retirement villages provide either detached or semi-detached residential dwellings with car parking and small private yards. Retirement village developments usually include a mix of independent living units (ILUs) and serviced apartments (SAs) with community facilities providing a shared congregational area for village activities and socialising. Retirement Village assets differ from traditional residential assets due to their operation in accordance with statutory legislation. In Australia, each State and Territory has its own Retirement Village Act and Regulations. In essence, the village operator provides the land and buildings to the residents who pay an amount on entry for the right of occupation. On departure from the units an agreed proportion of either the original purchase price or the sale price is paid to the outgoing resident. The market value of the operator’s interest in the Retirement Village is therefore based upon the estimated future income from Deferred Management Fees and Capital Gain upon roll-over receivable by the operator in accordance with the respective residency agreements. Given the lumpiness of these payments, there is general acceptance that the most appropriate approach to valuation is through Discounted Cash Flow (DCF) analysis. There is however inconsistency between valuers across Australia in how they undertake their DCF analysis, leading to differences in reported values and subsequent confusion among users of valuation services. To give guidance to valuers and enhance confidence from users of valuation services this paper investigates the five major elements of discounted cash flow methodology, namely cash flows, escalation factors, holding period, terminal value and discount rate. Whilst there is dissatisfaction with the financial structuring of the DMF in residency agreements, as long as there are future financial returns receivable by the Village owner/operator, then DCF will continue to be the most appropriate valuation methodology for resident funded retirement villages.

Resident-funded retirement village valuations : complications with the application of the DCF

Retirement village assets are different from traditional residential assets due to their operation in accordance with statutory legislation. Designed for independent living, retirement villages provide either detached or semi-detached residential dwellings with car parking and small private yards with community facilities providing a shared congregational area for village activities and socialising. In essence, the village operator provides the land and buildings to the residents who pay an amount on entry for the right of occupation. On departure from the units an agreed proportion of either the original purchase price or the sale price is paid to the outgoing resident. As ongoing levies are typically offset by ongoing operational expenses the market value of the operator's interest in the retirement village is therefore predominantly based upon the estimated future income from deferred management fees and capital gain upon roll-over receivable by the operator in accordance with the respective residency agreements. Given the lumpiness of these payments, there is general acceptance that the most appropriate approach to valuation is through discounted cash flow (DCF) analysis. There is however inconsistency between valuers across Australia in how they undertake their DCF analysis, leading to differences in reported values and subsequent confusion among users of valuation services. To give guidance to valuers and enhance confidence from users of valuation services this paper investigates the five major elements of DCF methodology, namely cash flows, escalation factors, holding period, terminal value and discount rate.

Mortgagee sale obligations tightened

The enactment of the Property Law (Mortgagor Protection) Amendment Act 2008 (Qld), means that the obligations of a mortgagee exercising power of sale or a receiver selling have been substantially tightened in Queensland. Background As explained in the explanatory notes accompanying the legislation, with current global economic and financial circumstances, there were concerns about the position of mortgagors when mortgagees exercised their powers of sale. The objective of the amending legislation was to protect the interests of mortgagors by strengthening the statutory provisions relating to the duty of the mortgagee exercising power of sale to take reasonable care to ensure the property is sold at market value. The amending legislation was urgently passed without any consultation process.

A human capital framework : designed for convergence

The 21" century business environment is dominated by unprecedented change across a broad spectrum of social, economic, technological and cultural factors (Nowotny, Scott & Gibbons 2001). Among these, two broad trends -economic globalisation and rising knowledge intensity (Hart 2006)have come to distinguish organisational life. Under the weight of these transformational influences, the developed world, it seems, has arrived at a transformational moment. The far-reaching effects of the global financial crisis and its shadowy twin: the threat of a double dip recession, continue to exert an unsteadying influence on global and corporate finances. Growth in developed economies has slumped, share prices have declined, the market value of corporations has slipped and unemployment rates, in the vast majority of developed economies, have risen. Gross domestic product (GDP) growth has retreated from the strong growth experienced in the late 1990s to negative growth in 2009 and a sluggish and unsteady recovery in 2010. In response, the reach of Government in terms of its participation in markets has been extended, bringing with it the need to transition to new governance and regulatory arrangements. Ongoing concerns regarding the pace and sustainability of the recovery remains a front-of-mind concern with bailouts, buybacks, borrowings and BP dominating news services: 'We are witnessing the reweaving of the social, political and economic fabric that binds our planet, with long-term consequences that are as or more profound than those of the industrial era' (Tapscott & Williams 2006, p. 59).

Sensors for missions

An onboard payload may be seen in most instances as the “Raison d’Etre” for a UAV. It will define its capabilities, usability and hence market value. Large and medium UAV payloads exhibit significant differences in size and computing capability when compared with small UAVs. The latter have stringent size, weight, and power requirements, typically referred as SWaP, while the former still exhibit endless appetite for compute capability. The tendency for this type of UAVs (Global Hawk, Hunter, Fire Scout, etc.) is to increase payload density and hence processing capability. An example of this approach is the Northrop Grumman MQ-8 Fire Scout helicopter, which has a modular payload architecture that incorporates off-the-shelf components. Regardless of the UAV size and capabilities, advances in miniaturization of electronics are enabling the replacement of multiprocessing, power-hungry general-purpose processors for more integrated and compact electronics (e.g., FPGAs). Payloads play a significant role in the quality of ISR (intelligent, surveillance, and reconnaissance) data, and also in how quick that information can be delivered to the end user. At a high level, payloads are important enablers of greater mission autonomy, which is the ultimate aim in every UAV. This section describes common payload sensors and introduces two examples cases in which onboard payloads were used to solve real-world problems. A collision avoidance payload based on electro optical (EO) sensors is first introduced, followed by a remote sensing application for power line inspection and vegetation management.

Standardisation of plant and machinery valuation practices in Malaysia

Plant and machinery valuation is important to every company.s annual financial reporting. It is reported under the non-current assets section, and the valuers are generally employed to provide the up to date valuation of the non-current assets valuation such as property, plant and equipment that can make up to 80% of the total assets of a company. The valuation of plant and machinery is also important for other purposes such as securing loan facilities, sales, takeover, insurance and auction. The application of 2005 International Financial Reporting Standard (IFRS) has a subsequent impact on the financial sector, as a whole. The accountants have to choose between the Historical Cost approach and Market Value approach in determining the value of the client.s assets. In Malaysia, the implementation of IFRS has a domino effect on the financial system, especially for plant and machinery valuation for financial reporting. The comparison data for plant and machinery valuation is limited unlike land and building valuation. The question of Malaysian valuer.s ability to comply with the IFRS standard keeps rising every day, not just to the accountants, but also other related parties such as financial institutions, government agencies and the clients. This is happening because of different interpretations of premise of value for plant and machinery, as well as methods been used and differences in standards of reporting among the valuers conducting plant and machinery valuation. The root of the problem lies in the lack of practical guidelines governing plant and machinery valuation practices and different schools of thought among the valuers. Some follow the United Kingdom.s RICS guidelines, whilst some valuers are more comfortable with the United State.s USPAP rules, especially on the premise of value. This research is to investigate the international best practices of plant and machinery valuation and to establish the common valuation concept, awareness and application of valuation methodology and valuation process for plant and machinery valuation in Malaysia. This research uses a combination of the qualitative and quantitative research approach. In the qualitative approach, the content analyses were conducted from the international practices and current Malaysian implementation of plant and machinery valuation. A survey (quantitative approach) via questionnaire was implemented among the registered and probationary valuers in Malaysia to investigate their understanding and opinion relating to plant and machinery valuation based on the current practices. The significance of this research is the identification of international plant and machinery practices and the understanding of current practices of plant and machinery valuation in Malaysia. It is found that issues embedding plant and machinery valuation practices are limited numbers of resources available either from scholars or practitioner. This is supported by the general finding from the research survey that indicates that there are immediate needs for practical notes or guidelines to be developed and implemented to support the Malaysian valuers practising plant and machinery valuation. This move will lead to a better understanding of plant and machinery valuation, reducing discrepancies in valuation of plant and machinery and increased accuracy among practising valuers.

Annual miles drive used car prices

This paper investigates whether the net benefits from owning a vehicle, proxied by annual miles driven, explain the price declines observed over a vehicle's life. We first model the household decision on how much to drive each of its vehicles. Then we empirically establish that variation in household annual miles across brands explains observed price declines. Furthermore, the effect of vehicle age on annual miles decisions (and consequently on market value) depends on household characteristics and the composition of the vehicle stock owned.

Next Generation SHRM Research: From Covariation to Causation

[Excerpt] In response to the longstanding and repeated criticisms that HR does not add value to organizations, the past 10 years has seen a burgeoning of research attempting to demonstrate that progressive HR practices result in higher organizational performance. Huselid’s (1995)groundbreaking study demonstrated that a set of HR practices he referred to as High Performance Work Systems (HPWS) were related to accounting profits and market value of firms. Since then, a number of studies have shown similar positive relationships between HR practices and various measures of firm performance. While the studies comprising what I refer to as “first generation SHRM research” have added to what is becoming a more convincing body of evidence of the positive relationship between HR and performance, this body tends to lack sufficient data to demonstrate that the relationship is actually causal in the sense that HR practices, when instituted, lead to higher performance. This next generation of SHRM research will begin (and, in fact has begun) to focus on designing more rigorous tests of the hypothesis that employing progressive HRM systems actually results in higher organizational performance. This generation of research will focus on two aspects: demonstrating the HRM value chain, and proving causality as opposed to merely covariation.

Urban growth dilemmas and solutions in China: Looking forward to 2030

China’s urbanization and industrialization are occupying farmland in large amounts, which is strongly driven by land finance regime. This is due to the intensified regional/local competition for manufacturing investment opportunities that push local governments to expropriate farmland at low prices while lease land at high market value to property developers. The additional revenue obtained in this way, termed financial increment in land values, can drive local economic growth, and provide associated infrastructure and other public services. At the same time, however, a floating population of large numbers of inadequately compensated land-lost farmers, although unable to become citizens, have to migrate into the urban areas for work, causing overheated employment and housing markets, with rocketing unaffordable housing prices. This, together with various micro factors relating to the party/state’s promotion/evaluation system play an essential role leading to some serious economic, environment and social consequences, e.g., on migrant welfare, the displacement of peasants and the loss of land resources that requires immediate attention. Our question is: whether such type of urbanization is sustainable? What are the mechanisms behind such a phenomenal urbanization process? From the perspective of institutionalism, this paper aims to investigate the institutional background of the urban growth dilemma and solutions in urban China and to introduce further an inter-regional game theoretical framework to indicate why the present urbanization pattern is unsustainable. Looking forward to 2030, paradigm policy changes are made from the triple consideration of floating population, social security and urban environmental pressures. This involves: (1) changing land increment based finance regime into land stock finance system; (2) the citizenization of migrant workers with affordable housing, and; (3) creating a more enlightened local government officer appraisal system to better take into account societal issues such as welfare and beyond.