EU update

This is the regular edition of the Bristows column on developments in EU law relating to IP, IT and telecommunications. This news article summarises recent developments that are considered important for practitioners, students and academics in a wide range of information technology, e-commerce, telecommunications and intellectual property areas. It cannot be exhaustive but intends to address the important points. This is a hard copy reference guide, but links to outside websites are included where possible. No responsibility is assumed for the accuracy of information contained in these links.     

Technological diversity,scientific excellence and the location of inventive activities abroad: the case of nanotechnology

Our contribution to the expanding literature on the globalization of research and innovation is to investigate the extent to which sector-specific developments in an emerging technology (such as increasing interdisciplinarity and complexity) affect inventive activities developed abroad. We look at how technological diversity and scientific excellence of host countries in the field of nanotechnology affect the development of inventive activities by US multinational companies (MNCs). We identify the most active US-based MNCs in nanotechnology-related patenting and examine location decisions of these companies and their international subsidiaries. Econometric results confirm our hypothesis that the technological breadth of host countries positively influences the expected number of inventions developed abroad by US MNCs. Science capabilities of countries also have a positive impact on the decision to invent abroad, while the influence of market specific factors is less clear. We interpret these results as suggesting that host country science capabilities are important to attract innovative activities by MNCs, but as the interdisciplinary and convergent nature of nanotechnology evolves, access to a broadly diversified knowledge base becomes important in increasing the relative attractiveness of host locations.

Teachers’ Perspectives on Hitting Back in School: Between Inexcusable Violence and Self-Defense

Israeli schools expressly forbid a student to hit back after being attacked. In semistructured interviews,71 Israeli educators were asked for their views on the hitting-back tactic. The interviews compared their attitude toward hitting back as teachers with their take on the matter as parents. The results, analyzed using grounded theory, show that most educators would not object if their children hit back in self-defense when attacked but would discipline students who hit back unless they can prove their claim of self-defense. Interviewees are much less inclined to discipline retaliators who do manage to prove self-defense but feel that investigations to verify self-defense under school conditions are impractical. To deter bullies, they say, teachers must declare their readiness to discipline everyone involved; otherwise, bullies will falsely claim self-defense. The discussion explores the implications of role theory on teachers’ attitudes.     

The Quality of Information Provided by Dual-Class Firms

When Google went public with a dual-class capital structure in which shares owned by the founders confer greater voting rights than shares issued to public investors, its cofounders, Larry Page and Sergey Brin, promised to provide investors with high-quality information about the company. Using the words of Warren Buffett, the chairman and CEO of Berkshire Hathaway, another dual-class firm, they promised shareholders, “We won’t ‘smooth’ quarterly or annual results: If earnings figures are lumpy when they reach headquarters, they will be lumpy when they reach you.” Page, Brin, and Buffett definitely understood the importance of quality information to their investors, especially in dual-class structures. But do dual-class companies really provide investors with credible financial information? Contrary to the assumption of agency theory that dual-class firms are less transparent, we find empirically that these companies do provide credible information to their investors. Our results suggest that the quality of financial reports, as measured by their ability to predict change in future earnings, is higher for dual-class companies than for their single-class counterparts. These findings may be explained by the unique relations created in dual-class firms in which the founders provide investors with higher-quality information in exchange for superior voting rights. The article contributes to the heated debate about the transparency of dual-class companies by providing policy makers with important insights on the quality of information provided by these companies. Our findings suggest that there is no need for stricter regulation with regard to disclosure of financial information by dual-class firms.     

Asakusa ‘Newtown’: the transformation of outcaste space in early modern Edo/modern Tokyo

This paper examines the historical transformation of urban outcaste areas into commoner neighbourhoods in early modern/modern Japan. Focusing on Tokyo's largest early modern outcaste community, an Asakusa area referred to as Shinchō (literally ‘Newtown’), the paper argues that a combination of factors, namely the historical processes of urbanization, status group consolidation, labour specialization, capital accumulation, and inter-status group network creation, created an elite stratum of neighbourhood residents who were reasonably well-integrated into the broader social and economic landscape of Edo by the late Tokugawa period. This movement towards desegregation in turn laid important foundations for the later administrative and conceptual incorporation of the Shinchō area into the broader metropolitan area. Wide-ranging entrepreneurial activities by members of this elite class in the early Meiji period further built on and propelled these changes although they also facilitated their eventual exodus from the community. Proto-capitalist development, however, while clearly capable of inducing an emancipatory effect for some key elites figures and while enabling the neighbourhood itself to become more closely identified with an emerging working class Asakusa, also worked to create a substratum of people subjected to a compounded form of discrimination that took place along both traditional status and newly emerging modern capitalistic lines.