Monthly Archives: July 2026

Shaping Climate Adaptation Economics in a Warming World

Climate change is no longer viewed solely as a future environmental threat. Rising temperatures, more frequent heatwaves, floods, severe storms and sea-level rise are already affecting household livelihoods, business operations, supply chains and government finances around the world. As these impacts become more widespread, economists are increasingly examining how societies can adapt while maintaining economic stability and reducing long-term risks. A new review published in the Journal of Management Science and Engineering explores the growing role of economics in understanding and guiding climate adaptation.

The review, conducted by Xi Ming and Hongbo Duan from the School of Economics & Management at the University of Chinese Academy of Sciences, analysed 6,248 publications published between 1978 and 2025. Combining bibliometric mapping with an extensive review of empirical studies, theoretical frameworks and analytical methods, the researchers trace the evolution of climate adaptation economics from a relatively narrow focus on agriculture and natural disasters to a comprehensive field encompassing households, businesses, markets, international cooperation and social welfare. They also identify several priorities for future research, including the development of high-resolution adaptation databases, stronger causal evidence, improved models for deep uncertainty and climate damages, and greater attention to political economy, equity and cross-regional interactions.

The review shows that adaptation occurs across every level of society. Households respond to changing climate conditions by modifying consumption patterns, increasing the use of cooling technologies, adopting new farming practices or relocating to less vulnerable areas. Businesses, meanwhile, adapt by modernising production processes, diversifying supply chains, relocating operations, investing in new technologies and improving resilience against climate-related disruptions. These responses can reduce immediate economic losses while helping organisations remain competitive under increasingly volatile environmental conditions.

The authors emphasise, however, that the capacity to adapt is far from equal. Lower-income households, farmers in climate-sensitive regions and small and medium-sized enterprises often face significant financial, informational and institutional barriers that limit their ability to respond effectively. These disparities can widen existing economic inequalities if adaptation policies fail to account for differences in resources and access to support. The review argues that successful adaptation strategies must therefore strengthen resilience among the most vulnerable groups while ensuring that economic opportunities remain broadly accessible.

At the broader economic level, the researchers stress that adaptation should not be viewed as a replacement for climate mitigation. Adaptation helps reduce the damage caused by climate impacts that are already unavoidable, but relying too heavily on adaptation could weaken incentives to reduce greenhouse gas emissions and leave societies exposed to long-term climate risks. Conversely, mitigation alone cannot shield communities from the immediate effects of climate change that are already unfolding. According to the review, policies such as adaptation assistance, trade adjustments, migration, capital reallocation and industrial restructuring can reduce overall welfare losses. However, they may also create new economic and social tensions across regions, industries and population groups.

Ultimately, the authors conclude that climate adaptation extends well beyond protecting communities from extreme weather. It requires designing economic systems that enable households, businesses and entire regions to adjust effectively to a changing climate without worsening social inequality. By integrating stronger data, more rigorous evidence and a deeper understanding of uncertainty and distributional impacts, future research can help policymakers develop adaptation strategies that are both economically efficient and socially equitable, supporting resilience while complementing continued efforts to reduce global emissions.

More information: Xi Ming et al, Climate adaptation economics: Bibliometrics, methods, and mechanisms, Journal of Management Science and Engineering. DOI: 10.1016/j.jmse.2026.03.001

Journal information: Journal of Management Science and Engineering Provided by KeAi Communications Co., Ltd.

Why Deciding to Take a Sick Day Is More Complex Than It Seems

Leave a Reply

As winter illnesses circulate and cost-of-living pressures continue to mount, taking a sick day is not simply a matter of health for many Australians. New research led by the University of Technology Sydney (UTS) suggests that the decision to stay home when unwell is strongly shaped by job security, financial circumstances and gender rather than illness alone. Published in Applied Economics, the study examined how workers’ health and economic conditions influence the number of sick days they take. “Employers and policymakers often focus on reducing absence, but workers who attend while unwell may recover more slowly, spread infection to colleagues, and be less productive,” said lead researcher Dr Nancy Kong, a Senior Research Fellow at the UTS Centre for Health Economics Research & Evaluation.

Using data from more than 15,000 Australians who participated in the Household, Income and Labour Dynamics in Australia (HILDA) survey between 2005 and 2016, the researchers analysed patterns of sick leave before the disruptions caused by the COVID-19 pandemic. Dr Kong, together with Dr David Rowell from the University of Queensland and Professor Peter Zweifel from the University of Zurich, deliberately focused on the pre-pandemic period to avoid the overlapping effects of changing public health measures, workplace practices and leave policies. This allowed the team to isolate the relationship between employment conditions and sick leave behaviour more accurately.

The findings revealed a sharp contrast between permanent and non-permanent workers. Employees in casual and fixed-term positions took only about one sick day each year on average, compared with around four days for permanent staff. Even after accounting for factors such as occupation, education, job satisfaction, household circumstances, marital status and location, workers in insecure jobs still took roughly three fewer sick days annually. According to Dr Kong, this gap is unlikely to reflect better health. Instead, casual and fixed-term employees often face greater financial risks when taking time off, have limited access to paid sick leave, and may fear that refusing work while ill could reduce future shifts or even threaten their employment. “For a permanent employee, staying home with influenza might be inconvenient; but for a casual worker it may trigger financial stress,” she said.

Economic conditions also influenced workers’ willingness to take sick leave. Employees living in areas with higher unemployment generally took fewer sick days, suggesting that workers become more reluctant to be absent when jobs appear harder to replace. Even a five-percentage-point increase in local unemployment was associated with a measurable decline in sick leave, representing significant lost recovery time across an entire workforce. Wages produced a more complex pattern. Higher pay alone did not consistently increase sick leave, but among workers already in poorer health, higher earnings were linked to taking more time off. Dr Kong said this likely reflects the greater financial security, workplace support and leave entitlements available to higher-income employees, enabling them to recover without worrying about lost income.

The study also identified a persistent gender gap. Across every analysis, men took fewer sick days than women, averaging about half a day less each year—a difference of roughly 23%—even after controlling for health, employment and personal circumstances. Dr Kong said the gap may partly reflect differences in health needs, caring responsibilities and healthcare-seeking behaviour. Still, it also highlights the influence of workplace culture and gender expectations that encourage men to demonstrate toughness and reliability by working through illness. These social pressures may discourage employees from taking legitimate leave even when doing so would benefit both their own health and the wellbeing of colleagues.

Overall, the research suggests that sick leave rates should not be viewed simply as a measure of workforce health or commitment. Low levels of absenteeism may instead indicate financial insecurity, fear of job loss or workplace cultures that discourage employees from staying home when they are ill. Dr Kong said employers should avoid rewarding presenteeism or treating legitimate sick leave as a sign of poor commitment. At the same time, efforts to reduce stigma could also help narrow the gender gap. For policymakers, the findings highlight the importance of secure employment, accessible paid sick leave and workplace practices that allow employees to recover without risking their income. “A fair and effective sick leave system should support productivity while ensuring workers do not have to choose between protecting their health and protecting their income,” she said.

More information: Nancy Kong et al, Understanding sick leave: the interplay between health and economic incentives, Applied Economics. DOI: 10.1080/00036846.2026.2682558

Journal information: Applied Economics Provided by University of Technology Sydney

Initiative Is Not Enough to Improve Team Performance, According to World Cup Data

Leave a Reply

Team members’ initiative can help teams succeed, but only when it is supported by strong coordination, according to new research from Washington State University. The study found that initiative on its own did not directly improve team performance. Instead, teams performed best when players’ willingness to go beyond their assigned roles was matched by clear communication and coordinated action.

The study, published in Group & Organization Management, was co-authored by Jeremy Beus, professor of management at WSU’s Carson College of Business, and Erik Taylor of East Carolina University. Using data from the 2014 and 2018 FIFA World Cups, the researchers examined how individual initiative affected team outcomes in one of the world’s most competitive sporting environments.

To measure initiative, Taylor and Beus analysed GPS-generated heat maps from World Cup matches. These maps showed where players moved throughout a 90-minute game. Since each position has an expected range of movement, the researchers looked at how far players strayed from those typical areas. Goalkeepers were excluded, and players were compared only with others in similar roles, such as defenders with defenders, to ensure fair comparisons.

“We wanted to actually see the evidence of initiative, not just ask someone whether their teammates show it,” Beus said. However, when the researchers compared team-level initiative scores with match outcomes, they found that teams with higher initiative were no more likely to win than teams with lower initiative. Initiative alone, the data showed, was not enough.

Coordination proved to be the key factor. The researchers measured coordination through the frequency and success of passes between players. When initiative was paired with strong coordination, team performance improved. But when players acted independently without communicating, performance suffered. Beus noted that while initiative is usually valuable for individuals, in a highly interdependent team environment, it can lead to duplicated efforts, exposed gaps, or people unintentionally working against one another.

The findings also pointed to a threshold effect. Teams with a moderate proportion of high-initiative players who communicated well outperformed teams where initiative was either lacking or excessive. Beyond a certain point, uncoordinated initiative became a liability. While the exact World Cup thresholds may not apply directly to workplaces, Beus said the broader lesson is relevant for managers and team leaders: rewarding initiative in isolation can backfire unless teams also build a culture of communication. “Going the extra mile is great,” he said, “as long as everyone knows about it.”

More information: Erik Taylor et al, Channeling personal initiative through team coordination: A heat map analysis of soccer players’ aggregate behavioral initiative, Group & Organization Management. DOI: 10.1177/10596011241287845

Journal information: Group & Organization Management Provided by Washington State University

Research Shows Women Negotiate as Well as Men — and Create More Positive Experiences

Leave a Reply

Men and women achieve similar financial results in negotiations, but women are more likely to build stronger interpersonal relationships during the process, according to new research. Those stronger connections leave negotiating partners feeling more satisfied with the outcome and more willing to negotiate with the same woman again in the future. The findings challenge the long-held belief that women are at a disadvantage in negotiations and suggest that relationship-building may be an important but often overlooked strength.

The study, published in the Proceedings of the National Academy of Sciences, was co-authored by Charlotte “Charlie” Townsend, a post-doctoral associate at Cornell University, along with Laura J. Kray and Solene Delecourt of the University of California, Berkeley. “So much of negotiation research has really focused on men’s advantages,” Townsend said. “But if women are creating better relationship outcomes in negotiations, it makes a lot of sense that their partners would like to negotiate with them more than with men.” The researchers also found that women’s greater likability does not come at the expense of performance. Instead, comparable economic outcomes combined with stronger relationships could create more opportunities for future negotiations, leading to long-term financial benefits.

To explore gender differences in negotiation, the researchers conducted three separate studies. The first analysed an archival dataset containing more than 2,000 observations from a full-time MBA negotiation course. Students participated in face-to-face negotiation exercises and then evaluated their partners. Women consistently received higher ratings for building trust, acting fairly, meeting their partners’ needs, creating value for both sides, communicating effectively and listening carefully. These qualities contributed to higher overall satisfaction, even though the financial outcomes were essentially the same as those achieved by men.

The second study examined anonymous online negotiations in which participants were randomly paired and communicated only through chat. Because negotiators’ genders were never revealed, the researchers could determine whether differences stemmed from behaviour rather than stereotypes. Even under these conditions, participants negotiating with women reported greater satisfaction and viewed their partners more favourably, despite receiving similar economic results. The findings suggest that women naturally employ negotiation behaviours that strengthen relationships, regardless of whether their gender is known.

In the third study, researchers used an artificial intelligence model to analyse negotiation transcripts and identify behavioural differences. They found that women were slightly more likely to accept offers, a behaviour that generated more positive feelings among their negotiating partners. Importantly, women did not accept offers prematurely or settle for worse deals than men. Their willingness to close agreements appeared to enhance the overall experience without reducing their own financial outcomes.

According to Townsend, negotiations should not be judged solely by the size of the deal. The quality of the relationship established during the process also has meaningful consequences, particularly when future interactions are likely. People who leave negotiations feeling respected, heard and satisfied are more inclined to work together again. The study suggests that women’s ability to foster trust and positive relationships represents a valuable strength rather than a trade-off, offering lessons that negotiators of all genders can apply to achieve both successful outcomes and lasting professional relationships.

More information: Charlotte H. Townsend et al, People prefer to negotiate with women, even when outcomes are identical and gender is unknown, Proceedings of the National Academy of Sciences. DOI: 10.1073/pnas.2523202123

Journal information: Proceedings of the National Academy of Sciences Provided by Cornell University

Foreign Investment and the Rising Cost of Housing

Leave a Reply

Housing affordability in the United States has deteriorated sharply over the past decade. Between 2019 and 2025, average home prices climbed by about 60%, according to the Harvard Joint Center for Housing Studies. While rising demand, limited housing supply, and higher construction costs are widely recognised as contributing factors, new research suggests that foreign investment has also played a significant role. Research by Caitlin Gorback, Assistant Professor of Finance at the McCombs School of Business, found that an influx of overseas capital during the 2010s increased housing prices in areas that attracted the largest numbers of foreign buyers. However, the study also concludes that the broader affordability crisis cannot be explained by foreign investment alone, as housing supply across the country has consistently failed to keep pace with demand.

Gorback’s research shows that from 2009 to 2018, the responsiveness of housing construction to rising prices declined substantially compared with previous decades. Economists describe this responsiveness as supply elasticity. During this period, every 1% increase in housing prices resulted in only a 0.26% increase in new housing supply nationwide. Builders were therefore unable to add enough homes to offset growing demand, allowing prices to continue climbing. According to Gorback, the housing supply landscape has changed dramatically over the past 20 years, making it increasingly difficult for new construction to relieve pressure on home prices.

Foreign investment accelerated after 2011, when countries such as Singapore introduced taxes on foreign homebuyers to cool their domestic housing markets. Similar measures were later adopted elsewhere, encouraging many international investors to redirect their money to the United States, one of the few major countries without comparable restrictions. Working with Benjamin Keys of the University of Pennsylvania, Gorback examined housing markets between 2011 and 2018 and found that neighbourhoods with larger foreign-born populations experienced home prices that averaged 6.7% higher than comparable neighbourhoods within the same city. Despite this increase in demand, housing supply in those areas expanded by only about 1%, contributing to further price growth.

The study also found that cities differ greatly in their ability to respond to increased housing demand. In cities where development is heavily constrained, higher demand translates mainly into higher prices. San Francisco is a prime example. There, a 1% increase in housing prices generated only a 0.06% increase in housing supply because strict regulations and limited land make new construction difficult. By contrast, Charlotte, North Carolina, has fewer barriers to development, allowing builders to construct more homes as demand rises. As a result, increased demand in Charlotte is reflected more in the number of new homes than in rapidly escalating prices.

These differences highlight the important role local governments play in determining housing affordability. Zoning regulations, permitting requirements, and development policies largely determine how quickly cities can expand their housing supply. Gorback argues that municipalities possess many of the tools needed to improve affordability if they are willing to reform outdated regulations. As more Americans return to urban areas, reversing decades of suburban growth, cities face increasing pressure to encourage housing construction while keeping prices within reach for ordinary households.

Baltimore provides an example of how policy changes can improve housing supply. The researchers identified Baltimore as having the most elastic housing market among the 100 largest U.S. cities they studied. Further investigation revealed that the city had modernised its permitting process during the mid-2010s, making it easier for developers to build new housing. The findings suggest that while foreign investment can increase housing demand and contribute to higher prices, the severity of its impact depends largely on how effectively local governments allow new housing to be built. In the long run, improving housing affordability will require not only managing investment demand but also removing barriers that prevent housing supply from expanding.

More information: Caitlin Gorback et al, Global Capital and Local Assets: House Prices, Quantities, and Elasticities, Review of Financial Studies. DOI: 10.1093/rfs/hhag040

Journal information: Review of Financial Studies Provided by University of Texas at Austin

Replying Quickly Can Increase Your Hiring Chances

Leave a Reply

Many job seekers hesitate before replying to a prospective employer, believing that responding too quickly could make them appear overly eager or desperate. However, new research published in Management Science suggests that this common assumption may actually hurt their chances. After analysing millions of real-world hiring interactions alongside controlled experiments, researchers found no evidence that delaying a response improves hiring outcomes. Instead, employers consistently favoured candidates who replied sooner. “People have this intuition that playing hard to get is somehow useful,” said co-author On Amir, a professor at the UC San Diego Rady School of Management. “We find the opposite is true.”

The research combined data from 11.6 million interactions on Fiverr, an online marketplace connecting employers with freelancers, with several experiments involving more than 8,600 participants. The findings revealed a remarkably strong relationship between response speed and hiring success. A delay of just one hour was linked to a 46% drop in the likelihood of being hired, while waiting an entire day reduced hiring chances by roughly 90%. Even when employers could see other information, such as ratings, reviews, and the quality of a candidate’s message, faster responses still made a significant difference.

The experiments helped explain why reply speed matters so much. Participants consistently viewed people who responded quickly as warmer, more competent, and, most importantly, more likely to be responsive in future interactions. Rather than judging only the message itself, employers appeared to treat response time as a signal of what it would be like to work with that person over the long term. According to co-author Einav Hart of George Mason University, “Speed is a signal. People see a quick response as a sign that you’ll be attentive to their needs in the future, not just right now.”

Interestingly, the researchers also uncovered a gap between what people claimed they valued and how they actually made hiring decisions. When asked directly, many participants said receiving a response later the same day would be perfectly acceptable. Yet when selecting between candidates, they consistently chose those who replied much sooner. This suggests that response speed influences hiring decisions on a subconscious level, even if employers do not realise how heavily they weigh it.

The researchers caution, however, that the findings should not be interpreted as a simple rule to respond as quickly as possible. While speed sends a positive signal, it is only one part of the impression a candidate creates. “Speed matters because people use it as information,” Amir explained. “But there isn’t an equal sign between speed and responsiveness. Authenticity matters, too.” Employers also valued replies that felt thoughtful, personalised, and genuinely engaged with the conversation.

That distinction may become even more important as artificial intelligence makes instant responses easier than ever. Automated messages can eliminate delays, but they may also lack the personal touch that employers appreciate. In the experiments, participants became less favourable toward fast replies when they believed the responses had been generated automatically or by AI. The overall message from the research is clear: responding promptly can improve your chances of being hired, but the response should also be sincere, relevant, and demonstrate genuine interest rather than simply arriving first.

More information: Einav Hart et al, Speed Is a Signal: When Faster Replies Increase Hiring Likelihood, Management Science. DOI: 10.1287/mnsc.2024.06185

Journal information: Management Science Provided by University of California – San Diego

When Sales Channel Transformation Drives Performance

Leave a Reply

Companies that can quickly adapt their sales systems to changing market conditions are more likely to improve their financial performance—but only when their sales channels are structured and managed effectively. That is the conclusion of a study involving 356 predominantly European companies conducted by researchers from the University of Cologne, HEC Paris, the University of Mannheim and the University of Manchester. Led by Dr Boas Bamberger, the research, published in the International Journal of Research in Marketing, found that sales system agility alone does not guarantee stronger profits. Instead, its success depends on how well companies organise and coordinate their sales channels.

Rapid changes driven by the COVID-19 pandemic, geopolitical trade tensions and AI-powered digitalisation have forced businesses to rethink how they reach customers. A Duke University survey found that 61 per cent of companies introduced new sales channels between 2020 and 2023. Yet becoming more agile remains difficult. A 2024 Quantive survey reported that about 90 per cent of companies struggle with organisational agility. The challenge stems from the fact that many sales systems depend on external partners whose priorities may not always align with those of the company. Changes to sales structures can create mistrust, resistance, reduced information sharing or even competition between partners, generating costly friction that can offset the benefits of greater flexibility.

To examine when agility actually improves business performance, the researchers surveyed senior sales managers, primarily from business-to-business companies, and compared their responses with objective financial data. They developed a seven-point scale to measure sales system agility based on three capabilities: detecting market changes quickly, making timely decisions and continuously refining sales structures. Their analysis showed that agility by itself had no statistically significant relationship with operating profit. Instead, profitability increased only when sales channel design and management minimised the costs associated with organisational change.

The financial impact can be substantial. Among companies with an average annual turnover of approximately €460 million, a one-point increase in sales system agility was associated with operating profit gains of as much as €52 million. Around €37 million of that improvement was linked to having an effective sales channel structure, while roughly €15 million resulted from strong channel management. These findings suggest that companies should view agility not as a standalone capability but as one that depends on complementary organisational practices.

The study found that the right mix of direct and indirect sales channels plays an important role. Company-owned channels reduce transaction costs, provide direct market feedback and allow businesses to adjust quickly, particularly for customer engagement before a purchase and support afterwards. Indirect channels, such as independent sales partners, remain valuable for completing sales because commission-based incentives encourage partners to promote the company’s products. However, overlapping channels targeting the same customers should be avoided, as internal competition between partners increases conflict and makes rapid adaptation more difficult.

Effective channel management is equally important. Companies benefit from retaining central authority over key decisions such as pricing, product ranges and sales territories while continuously coordinating activities across their partner network. This combination of centralised control and ongoing orchestration helps maintain stability even as sales systems evolve. “Agility does not happen automatically,” said Dr Boas Bamberger. “The rapid adaptation of the sales system only pays off if the channel structure and management are aligned with it.” Professor Dr Arnd Vomberg of HEC Paris added that companies should carefully review their sales channel mix, clarify responsibilities across company-owned and partner channels, and eliminate unnecessary overlap before pursuing greater agility.

More information: Boas Bamberger et al, When does sales system agility lead to organizational performance? International Journal of Research in Marketing. DOI: 10.1016/j.ijresmar.2026.05.002

Journal information: International Journal of Research in Marketing Provided by University of Cologne