GM Opens New Data Center Modeled on Google, Facebook
blogs.wsj.com
BY STEVEN ROSENBUSH AND JEFF BENNETT To clear the way for the complex, located at GM?s technical center in Warren, Mich., GM had to unwind a massive IT services contract with Hewlett-Packard Co., and reverse an outsourcing model that goes back to its acquisition of EDS nearly 30 years ago. ?This is?
In November, Jive Software acquired Bay Area cloud-based, collaborative task manager, Producteev, to boost its social business platform. Going forward, as Alex wrote at the time, Salesforce.com and Jive will increasingly butt heads as they compete for mindshare in the enterprise. With Producteev's multi-platform task-management system, which allows users to create tasks from emails and collaborate around projects in teams, Jive acquired a service that was already beginning to compete with Asana and Salesforce.com's Do.com.
Today's get it now society wants more than just a cool phone with instant access to news, friends and family - they want dinner served up too.
Mealtime planning has shifted with the generations. In the 1950s, TV dinners became the convenient meal while takeout gained traction in the 70s. In the 1990s, speedy delivery became popular at pizza joints while in the Internet era, online ordering started gaining traction with techies and early adopters. Today, on-demand delivery is common for busy professionals and urbanites with a couple of clicks on a web site or through the tap of an app. Delivery helps drive revenue for local businesses, such as restaurants, across the U.S. by reaching more customers in the neighborhood. This new delivery focused mindset makes up Gen D -- the delivery generation.
Industry analysts see one of the key growth drivers for the restaurant industry and other retail or service-oriented businesses is through offering delivery. According to NPD Group, food delivery is a $75 billion business and a survey from The Boston Consulting Group (BCG) found that already nearly 10 percent of online shoppers want same day delivery in their online shopping experience. BCG also found that affluent millennials are willing to pay up to $10 for same day delivery.
While larger chains are struggling with the shift from next day to same day, local businesses are already profiting from Gen D.
Hoboken, New Jersey's Biggie's Clam Bar has been family-run for four generations. Today, delivery is a substantial 35 percent of their business mix and they have regulars who order delivery as often as others come into the restaurant. "We get online orders from business pros leaving their Manhattan office asking for dinner to be delivered when they arrive home," said Steve Ranuro, great-grandson of founder Joseph "Biggie" Yaccarino. "We have a personal connection with the folks who order online and find that they will order a wider selection of entrees off the menu while many of our in-store regulars stick with the burger or clams they always eat."
Ranuro noted that delivery helps keep Biggie's sales consistent, solving a real yield management problem for restaurant or store owners. "In the past, we might have a slow night when it rains or is less than ideal to travel. Now, our deliveries balance out the slower in-house periods of the day or week to keep our neighborhood customers engaged with Biggie's even when they're not in the restaurants."
Good quality food runs in the family also at De Pasada, a Mexican restaurant in Chicago serving up tortas, tacos, tostados and more. While the restaurant has a small web presence, the owners consider online delivery "free marketing for the business". Greg Espinoza convinced his father to add online delivery. He finds it more convenient for processing orders than fielding phone calls and the overall restaurant revenue is up approximately 30 percent.
In the restaurant business, it's essential to manage against expenses. With high real estate costs for New York City-based restaurants delivery has become an essential component of managing the bottom line. 3 Star Diner, which is open 24-hours, gets half of their revenue from delivery. Nicholas Kirakakis, who runs the diner with his father, found online delivery a natural extension of their core business. He's seen a generational shift of online orders coming primarily from younger customers, which also include emoticons like smiley faces in the special instructions. And he's smiling from the higher average online order.
Gen D also shops their neighborhood whenever possible. In a recent delivery.com customer survey of 5,400 people across the USA, more than 65 percent said they shop from local stores and neighborhood restaurants. These locavores also order dinner for delivery at least once a week.
The local delivery landscape is ever changing as Gen D wants everything delivered. delivery.com offers instant ordering from spirits/wine and grocery stores, which are also seeing an increase in sales through new customers in their respective neighborhoods. "Delivery brings us closer to our neighbors who are a few blocks away in Gramercy," said Michael Buckley, president, Gramercy Wine Cellars. "While many Manhattanites will pick up a bottle of wine from the shop closest to them, our customers are drawn to the convenience of online delivery, ordering a special scotch or robust red wine on their way out work of so it arrives when they get home."
From spirits to split pea soup delivery, Gen D empowers the local economy by driving incremental sales for small businesses. These entrepreneurs are the job creators, creating two thirds of all new jobs and accounting for half the sales in the U.S. according to BCG. With small businesses looking for new ways to thrive in today's economy, accessing Gen D with online delivery is the way to go.
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Follow Jed Kleckner on Twitter: www.twitter.com/deliverydotcom
Posted by missvinc on May 20, 2013 in Home, OUR BLOG
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After a trademark battle with Florida-based cosmetics company Kroma, the Kardashian sisters changed the name of their makeup line from Khroma Beauty to Kardashian Beauty.
The name of Kourtney, Khloe and Kim Kardashian?s new makeup line was recently tangled up in a legal battle.
It was a beauty battle for a name and the Kardashians lost.
Sisters Kourtney, Kim and Khloe renamed their Khroma Beauty line to Kardashian Beauty after nearly a yearlong trademark battle with a Florida cosmetics company similarly named Kroma.
The brand is managed by Santa Monica, a California based Boldface Licensing and Branding firm. It will be allowed to sell out its existing products under the Khroma name.
Boldface will pay about USD 5 million in royalties to Lee Tillet Inc that owns Kroma Makeup.
?We?re confident that it?s not the name that matters to our fans, but the Kardashian sisters? commitment to making this line a true reflection of their love for cosmetics, said Nicole Ostoya, Boldface?s chief executive officer.
Trouble for the reality star sisters began last June, when Kroma sent a cease-and-desist letter, demanding the Kardashians drop the Khroma name.
Boldface responded by filing suit against Kroma, seeking affirmation their name was not a trademark infringement. Kroma countersued, claiming the Kardashians? brand was costing them millions in lost sales.
Here is advice on how to correctly ?trademark and protect your brand legally to avoid the same pit falls as the Kardasians.
While the best defense against copycat competitors is to stay ahead of them with a continuous stream of innovative, highly differentiated, and superior products and services, it is equally important to seek as much legal protection as possible for your brand.
Trademark Law As a brand steward, you must be aware of the laws under which legal protection is available.? First, trademark law protects a brand?s identity.? That is, it protects names, titles, taglines, slogans, logos, other designs, product shapes, sounds, smells, colors or any other features that distinguish one source of products or services from another. Trademarks that protect services are often called service marks (?SM?).? There are also ?collective membership marks? (Boy Scouts of America) and ?certification marks? (UL approved).
Trademarks, like brands, build in strength over time.? The test for trademark infringement is ?confusing similarity.?? Put another way, if the average consumer believes both products to have come from the same source, there is infringement. Obviously, the more a consumer is familiar with a particular brand, the more defendable its mark.? That?s why it behooves a company to do the following:
?choose a distinctive mark, including a ?coined? name. (brand names range from generic and descriptive to suggestive and arbitrary or fanciful (?coined?).? Obviously it takes longer to build meaning for ?coined? names, but they are also more distinctive and easiest to protect legally.? Kodak, Xerox, and Exxon fall in that category.? Suggestive marks are the next most protectable.? Examples include Coppertone, Duracell, and Lestoil.? Even common words can be used as trademarks as long as they are not used descriptively.? These common words/phrases are also suggestive marks: Amazon (big), Road Runner (fast) and Apple (different, offbeat).? Descriptive marks are not protectable unless the brand creates a secondary meaning for the word.? Examples include Weight Watchers, Rollerblade, and Wite-out.? Generic marks, such as Shredded Wheat and Super Glue, are not protectable at all.)
?? ? avoid geographic names as a part of your mark ? they can be the basis of trademark refusal ?? ? register the mark ?? ? be consistent in its use of the mark ?? ? create strong trade dress (mentioned below) ?? ? widely advertise and distribute its trademarked products ?? ? do all of this over a long period of time.
Because the strength of a mark is dependant upon consumers? familiarity with it, it is much easier for a competitor to neutralize your mark soon after it has been introduced than after it has been in use for a long period of time.
Courts use the following tests to determine infringement: ?? ? strength of the trademark claiming infringement ?? ? similarity of the two marks ?? ? evidence of consumer confusion ?? ? care a consumer takes in comparing products ?? ? intent of the organization in using the potentially infringing mark. (Some drug and grocery stores have used generic brands that emulate a leading brand?s package shape, colors, typestyle, formulation, etc. side-by-side with the leading brand to imply that there are no differences between the two, encouraging consumers to purchase the lower priced generic item.? In this situation, there is clearly intent to emulate the leading brand and reduce the perceived differentiation and value advantage of that brand, but it is not clear that there is intent to deliberately cause confusion as to source.) ?? ? relatedness of the two businesses ?? ? overlap between communication and distribution channels
By using the mark in association with your products and services over time, you gain trademark protection.? Registering your mark (marks can be registered at the state and federal levels) provides additional protection. While common law and federal trademark statute protect an unregistered mark, registering your mark transfers the burden of proof to the second comer in challenging a mark?s registration.? With federal registration, you can sue infringers in Federal court.? Also, after five years of registration, the mark becomes incontestable.? Federal trademark registrations last ten years and can be renewed every ten years ad infinitum.
You can acquire trademark rights in one of two ways.? To acquire trademark rights based on use in commerce, you must be the first person or organization that uses the mark in conjunction with the products or services for which trademark protection is sought.? To acquire the mark base upon intent to use, you must apply to register the mark through the United States Patent and Trademark Office. Before choosing a trademark, first conduct a simple search to weed out marks that are not available.? This search can be done online for free.? (See online resources at the end of this chapter.)? After that, for the remaining candidates, conduct a full search through a law firm specializing in trademark law or an experienced trademark search firm.
Strong brands run the danger of becoming category descriptors.? Always use trademarks as adjectives, not verb or nouns.? If your brand is in danger of becoming a category descriptor, consider talking about your brand in the following way: ?Jell-O? gelatin,? ?Kleenex? facial tissue? and ?Xerox? photocopier? to differentiate the brand from the category.
What?s affecting me, my clients and other small-business owners this week.
Must-Reads
Tim Duy explains what Japan?s growth means for the rest of the world. And here are the social media lessons from a Gordon Ramsay nightmare gone viral.
The Economy: Cash Is Not Safe
Retail sales rise and household debt declines, driven largely by lower housing and credit card balances. Corporate earnings are at a historic high. The latest small-business confidence index ticks up. Builder confidence improves, too. But April?s producer prices and industrial production both fell, and the latest business inventories and sales numbers continue to show little improvement. A forecast predicts a plunge in gasoline prices. Business conditions in the New York region (pdf) deteriorate, and the New York Federal Reserve Bank says tight credit is restraining small-business growth. David Rosenberg explains why cash is your least safe bet, and Rex Nutting is convinced that everything is overvalued: ?No one?s sure when the reckoning will take place, but it?s likely to be ugly when it does.? Joseph Biden agrees with a 7-year-old?s suggestion to make the world a better place.
Washington: Sequestration Watch
The Congressional Budget Office says the deficit problem is solved for the next 10 years. Paul Krugman says the case for austerity has crumbled, but Keith Hennessey says it?s too soon to celebrate. Jared Bernstein submits the fourth installment of his ?sequester watch.? The Federal Reserve, whose policy has pushed some start-ups to be valued at a billion dollars, may ease up on monetary easing this summer. Here are a few buzzwords to watch as the Fed plots its exit strategy. Joe Weisenthal reveals the real reason people bash Ben S. Bernanke and John Maynard Keynes at conferences. A bunch of economists offer advice to graduates.
Your People: Hourly Workers
Alex Befekadu lists seven employee types that you should fire. Joanne Sammer takes a look at what constitutes a healthy work/life balance and how companies can achieve that goal. A study finds that freedom is the top reason for quitting and that millennials want to be entrepreneurs (but that doesn?t always mean starting businesses). Here are four steps to hiring hourly workers this summer. Crispin Jones explains the benefits of having a diverse workplace. Here are five ways to deliver bad news to employees (and the best ways to open a beer).
Finance: A Trip to Mars
Andr? Mouton believes that if venture capitalists aren?t interested in crowdfunding, maybe you should be (apparently, Donald Trump is interested). Jeff Hindenach explains why credit cards remain a viable option for small businesses. Kabbage expands its small-business financing (using QuickBooks data), and NASA is offering $9.8 million to small and midsize businesses for a trip to Mars. Joe Taylor gives advice for building a profitable banking relationship, but here are some alternatives if you cannot. And here are two helpful online valuation tools to find out how much your business is worth. Bayer HealthCare goes on a start-up hunt. Retiring baby boomers are driving the sales of small businesses.
Start-Up: Controlling Fear
Ken Oboh says start-ups should ditch their ?go big or go home? mentality. Peter Thiel?s first investment in Europe has gone to a London-based start-up in financial technology. A life coach explains how to control the fear of starting a small business. Two start-up founders were not afraid to sleep in a van for months on end. Here?s how start-ups can get cheap office space and three ways to jump-start your dreams. Morgan Hartley and Chris Walker explain why your city needs a start-up scene. A venture capital firm is eager to invest in start-ups in Charlotte, N.C. A start-up ?dream team? is looking for 45 young aspiring entrepreneurs from around the world to join a nine-week summer program in Silicon Valley. This is how one entrepreneur started three businesses by age 32.
Management: Go to Bed
Todd Wasserman explains key performance indicators. Julia Kirby says that if you want to change the world, you should get to bed by 10 p.m. Here are eight easy ways for your business to go green, and Jim Smith explains what your business can learn from the?$1 cups at Starbucks. Communicating with energy is one of the five most important business skills. According to an American Express study, 70 percent of entrepreneurs say they purchase and source goods and services from other small businesses. A survey reveals the DNA of America?s small-business owners.
Marketing: The Ultimate Pitch
Here is how Lowe?s is making its customers smarter with six-second videos on Vine. Pamela Wilson has suggestions for getting customer testimonials that will convince even the most skeptical prospects. Mark Emond writes that there are four foundational elements of marketing analytics success. Suren Ter-Saakov explains what is important about competitive analysis. Diane Carlson warns not to make these business card mistakes. Jill Konrath says this is the ultimate sales pitch. A contract manufacturer shares eight marketing tips.
Around the Country: A $50,000 Challenge
An Alaskan town will vanish by 2017. In tornado-hit Joplin, Mo., employees of local businesses chip in again to rebuild. A new Colorado law provides recourse for discrimination against workers at companies that employ fewer than 15 people. Constant Contact joins with Staples and Score to host free webinars. CNBC?s new small-business show introduces a $50,000 challenge. In Chicago, mothers are showing their children the real estate ropes. In Pennsylvania, four businesses receive energy-efficiency and pollution-prevention grants, registration opens for a small-business expo on government contracting and a small-business conference plans a summer debut in Philadelphia.
Around the World: Manufacturers Coming to U.S.
The euro zone recession continues into its sixth quarter, and the social mood darkens. The United States oil boom leaves OPEC sidelined from demand growth. Japan?s economy expands faster than expected. A youth hockey brawl breaks out in Russia. China?s industrial production grew 9.3 percent in April. Jeffrey Telep and Joshua Snead report that global manufacturers are moving production to the United States. The proportion of British-based small businesses targeting the growing international market for low-carbon products has doubled in the past two years.
Social Media: Exclamation Points
Amanda McCormick wants to know how you are using social media to market your business. Dan Zarrella finds that exclamation points get more retweets but fewer clicks. LinkedIn bans users from promoting prostitution and escort services, but this is not why the social media service annoys Benedict Evans. Christopher Null wonders if Google Plus matters for small businesses.
Red Tape: Deficiencies
The Government Accountability Office finds 60 deficiencies in the Internal Revenue Service?s internal controls, and Jon Stewart weighs in. The Obama administration announces three advanced manufacturing innovation institutes. A survey reveals a lingering uphill battle for the new health care law, but Emily Maltby and Angus Loten wonder whether the law may create new entrepreneurs. Sarah Kliff explains what will happen if you don?t pay the tax penalty, and a small-business owner explains the hard facts of the health care law to employees.
Online: Call to Action!
Seth Godin explains why they call it a browser: ?Call it attention inflation. More time spent looking, less time spent clicking.? A company that provides legal services to small businesses is now accepting Bitcoin as payment (and Amazon introduces its own virtual currency). OpenSky becomes another ?interesting competitor? in the online marketplace. Here are some keyword strategies to draw people to your site, and here is how to use calls to action in your next e-mail campaign. Roger Kohl tells you everything you need to know about ?the scariest search engine? on the Internet. Here are Time magazine?s best Web sites of 2013, and here are 16 steps to hosting a successful webinar. Did you know that 70 percent of consumers trust online reviews?
Retail: Bike Lanes Are Good
Square unveils hardware for its point-of-sale iPad registers, Groupon officially introduces its own point-of-sale system, and PayPal unveils a program to compel small merchants to throw away their cash registers. Also, keep your eyes on these shopping-cart-mounted tablets that will detect nearby items and offer recipes in real time. Fred Lizza says cloud retail can transform your business, and these are the benefits of a cloud-based inventory management system. A survey finds restaurant sales and traffic improved in April. Restaurant marketers are waking up to a $50 billion breakfast opportunity, and millennials are propelling the growth of the sandwich industry. Bike lanes happen to be good for local businesses.
Mobile: Dead in the Water
Nearly 75 percent of all smartphones sold in the first quarter were Android-based, and this chart shows that the iPhone?s market share is ?dead in the water.? It is now estimated that the mobile marketing industry may employ 1.4 million people by 2015. Tobin Dalrymple suggests five ways to publish content on mobile. Here is a guide to mobile productivity apps, and Brian S. Hall shares six mobile apps created by nontech companies. Jon Gold explains why everyone is still confused by mobile management. BlackBerry will introduce BBM for iOS and Android this summer. A coming webinar looks at small-business adoption of mobile.
Technology: Texting to Landlines
Google is offering free unified storage across its services along with a way to send money by Gmail. Here is everything Google announced at its developer?s conference (which is also where the company?s chief executive said he wanted to start his own country). A company introduces texting to landlines. Michael del Castillo shares the lessons learned from five huge tech flops. Megan Totka suggests five customer relationship management tools for small businesses.?Windows Blue may leave customers seeing red.
Tweet of the Week
@dansinker ? How long does a keynote have to last before it?s considered a hostage situation?
The Week?s Best Quote
Charlie Hamilton shares a few lessons from the lemonade stand: ?Successful adults often worked when they were young. They mowed lawns, baby-sat, or had a lemonade stand. Learning how to work hard, provide good customer service, overcome challenges, ask for the sale, and understand the value of a dollar are invaluable life lessons that kids simply can?t get from a textbook.?
This Week?s Question: Would you buy a point-of-sale system from Groupon?
Gene Marks owns the Marks Group, a Bala Cynwyd, Pa., consulting firm that helps clients with customer relationship management. You can follow him on Twitter.
BRIDGEPORT, Conn. (AP) ? Investigators will look closely at a broken section of rail to see if it is connected to the commuter train derailment and collision outside New York City that left dozens injured, as the focus begins to shift toward cleanup and rebuilding ahead of challenging times for travelers and commuters along the Northeast Corridor.
A member of the National Transportation and Safety Board said Saturday that a fractured section of rail is of substantial interest to investigators and a portion of the track will be sent to a lab for analysis. Officials also said Saturday the incident was not the result of foul play.
It's not clear if the accident caused the fracture or if the rail was broken before the crash, the NTSB's Earl Weener said. He emphasized the investigation was in its early stages and said he won't speculate on the cause of the derailment. Data recorders on board are expected to provide the speed of the Metro-North trains at the time of the crash and other information, he said.
Seventy-two people were sent to the hospital Friday evening after a Metro-North train heading east from New York City derailed and was hit by a train heading west from New Haven. Most have been discharged.
Officials earlier described devastating damage and said it was fortunate no one was killed.
"I feel that we are fortunate that even more injuries were not the result of this very tragic and unfortunate accident," said U.S. Sen. Richard Blumenthal, who visited several patients in the hospital.
The crash damaged the tracks and threatened to snarl travel in the Northeast. The crash also caused Amtrak to suspend service between New York and Boston.
Blumenthal called the damage "absolutely staggering,"
Attention is slowly shifting to the cleanup, restoration ? and the upcoming work week.
Metro-North said train service will remain suspended between South Norwalk and New Haven until further notice. Railroad officials said rebuilding the two tracks and restoring train service "will take well into next week."
NTSB investigators arrived Saturday and are expected to be on site for seven to 10 days. They'll look at the brakes and performance of the trains, the condition of the tracks, crew performance and train signal information, among other things.
When the NTSB concludes the on-site phase of its investigation, Metro-North will begin to remove the damaged rail cars and remaining debris. The process requires specialized, heavy equipment that was expected to be in place Sunday, officials said. Only after the damaged train cars have been removed can Metro-North begin the work of rebuilding the damaged tracks and overhead wires.
"It is a significant undertaking that could take days to complete," MTA said in a statement.
The NTSB has allowed Metro-North to begin removing some of the track and wire from the scene.
Gov. Dannel P. Malloy said commuters should make plans for alternative travel through the area and urged them to consult the state Department of Transportation website for information.
Bridgeport Mayor Bill Finch said the disruption caused by the crash could cost the region's economy millions of dollars.
About 700 people were on board the Metro-North trains when one heading east from New York City's Grand Central Terminal to New Haven derailed at about 6:10 p.m. just outside Bridgeport, transit and Bridgeport officials said. Passengers described a chaotic, terrifying scene of crunching metal and flying bodies.
A spokeswoman for St. Vincent Medical Center said late Saturday that 46 people from the crash were treated there, with six of them admitted. All were in stable condition, she said.
A Bridgeport Hospital spokesman said 26 people from the crash were treated there, with three of them admitted. One was in critical condition and two were in stable condition, he said. The other 23 were released.
The MTA operates the Metro-North Railroad, the second-largest commuter railroad in the nation. The Metro-North main lines ? the Hudson, Harlem, and New Haven ? run northward from New York City's Grand Central Terminal into suburban New York and Connecticut.
The last significant train collision involving Metro-North occurred in 1988 when a train engineer was killed in Mount Vernon, N.Y., when one train empty of passengers rear-ended another, railroad officials said.
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Associated Press writers Michael Melia in Hartford, Conn., Susan Haigh in Fairfield, Conn., and Verena Dobnik in New York City contributed to this report.
DES MOINES, Iowa (AP) ? It's all about the odds, and one single ticket in Florida has beaten them all by matching all the numbers to win the highest Powerball jackpot in history at an estimated $590.5 million, lottery officials said early Sunday.
The lone winner was sold at a Publix supermarket location in Zephyrhills, Fla., according to Florida Lottery executive Cindy O'Connell. She told The Associated Press by telephone that more details would be released later.
The winner was not immediately identified publicly and she did not give any indication hours after Saturday's drawing whether anyone had already stepped forward with the ticket.
"This would be the sixth Florida Powerball winner and right now, it's the sole winner of the largest ever Powerball jackpot," O'Connell told AP. "We're delighted right now that we have the sole winner."
With four out of every five possible combinations of Powerball numbers in play, someone is almost sure to win the game's highest jackpot, a windfall of hundreds of millions of dollars ? and that's after taxes. Saturday night's winning numbers were 10, 13, 14, 22 and 52, with a Powerball of 11.
Estimates had earlier put the jackpot at around $600 million. But Powerball's online site said early Sunday that its latest tabulation of the tickets sold put the estimated jackpot at about an estimated $590.5 million.
Terry Rich, CEO of the Iowa Lottery, confirmed that the Powerball grand prize jackpot ? based on the winner sold in Florida ? had been reset at an estimated $40 million, or about $25.1 million cash value if a lump sum were elected.
The chances of winning the prize were astronomically low: 1 in 175.2 million. That's how many different ways you can combine the numbers when you play. But lottery officials estimated that about 80 percent of those possible combinations had been purchased recently.
"This would be the roll to get in on," Rich had said before the drawing, noting there were no guarantees and that's "the randomness of it, and the fun of it."
That didn't deter people across Powerball-playing states ? 43 plus Washington, D.C., and the U.S. Virgin Islands ? from lining up at gas stations and convenience stores Saturday for their chance at striking it filthy rich.
At a mini market in the heart of Los Angeles' Chinatown, employees broke the steady stream of customers into two lines: One for Powerball ticket buyers and one for everybody else. Some people appeared to be looking for a little karma.
"We've had two winners over $10 million here over the years, so people in the neighborhood think this is the lucky store," employee Gordon Chan said as he replenished a stack of lottery tickets on a counter.
The world's largest jackpot was a $656 million Mega Millions jackpot in March 2012. If $600 million, the jackpot would currently include a $376.9 million cash option.
Clyde Barrow, a public policy professor at the University of Massachusetts-Dartmouth, specializes in the gaming industry. He said one of the key factors behind the ticket-buying frenzy is the size of the jackpot ? people are interested in the easy investment.
"Even though the odds are very low, the investment is very small," he said. "Two dollars gets you a chance."
That may be why Ed McCuen has a Powerball habit that's as regular as clockwork. The 57-year-old electrical contractor from Savannah, Ga., buys one ticket a week, regardless of the possible loot. It's a habit he didn't alter Saturday.
"You've got one shot in a gazillion or whatever," McCuen said, tucking his ticket in his pocket as he left a local convenience store. "You can't win unless you buy a ticket. But whether you buy one or 10 or 20, it's insignificant."
Seema Sharma doesn't seem to think so. The newsstand employee in Manhattan's Penn Station purchased $80 worth of tickets for herself. She also was selling tickets all morning at a steady pace, instructing buyers where to stand if they wanted machine-picked tickets or to choose their own numbers.
"I work very hard ? too hard ? and I want to get the money so I can finally relax," she said. "You never know."
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Associated Press Radio Correspondent Julie Walker and AP writers Jeffrey Collins in Columbia, S.C., Betsy Blaney in Lubbock, Texas, Russ Bynum in Savannah, Ga., John Rogers in Los Angeles and Verena Dobnick in New York contributed to this report.
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Follow Barbara Rodriguez at http://twitter.com/bcrodriguez .
UNIONDALE, N.Y. (AP) ? A funeral has been scheduled for Wednesday for a 21-year-old Hofstra University student who was gunned down during a break-in at her apartment near the school's Long Island campus.
Nassau County police said Andrea Rebello, who was with her twin sister Jessica and several other students inside an off-campus house, was shot and killed Friday during an early morning home invasion that also left the armed intruder dead.
Rebello was a popular junior studying public relations. The shooting, which took place just steps from campus, cast a pall over the university community as it geared up for commencement on Sunday.
"Today is the last day of finals and this should be a happy day on campus; but it's not," said Hofstra freshman Scott Aharoni of Great Neck, as he passed through the area rife with yellow crime-scene tape Friday. "It's really sad."
Police are still investigating.
It wasn't clear who fired the fatal shots or how many rounds were fired, but authorities said police were involved in the shooting, which happened at about 2:30 a.m. A weapon was found inside the house, police said. The gunman has not yet been identified.
Rebello's father, Fernando, was too distraught to discuss the incident in detail outside the family's Tarrytown, N.Y., home Friday.
"It's my daughter, my baby daughter," he told the Journal News through tears. "She was so beautiful. I'm so confused.
"I don't know what to do," he said.
The Journal News reported that Wednesday's funeral Mass for Rebello at Teresa of Avila Church in Sleepy Hollow, N.Y., will be in Portuguese.
Hofstra's commencement ceremonies will go on as planned on Sunday despite the tragedy. Hofstra spokeswoman Karla Schuster said she expects school President Stuart Rabinowitz to acknowledge the shooting in his remarks.
The two sisters, another woman and another man were inside the two-story rental house when the gunman, wearing a ski mask, forced his way in, according to Nassau County Inspector Kenneth Lack. The intruder allowed the third unidentified woman to leave, and she called 911. Police provided no other details on the man who was in the house at the time of the break-in, except to say he was not injured.
A law enforcement official with knowledge of the investigation told The Associated Press the woman called 911 from near an ATM. The official was not authorized to discuss the investigation publicly and spoke to the AP on condition of anonymity.
Victoria Dehel, who lives four houses away, said she heard what sounded like fighting. At first she ignored it, figuring it was from rowdy students coming home from a bar.
Suddenly, "This girl was shrieking," followed by loud bangs just seconds later.
"It didn't sound good at all," Dehel said. "I turned to my boyfriend and I said, 'I think someone just got murdered.' It was awful."
Andrea Rebello and her sister were 2010 graduates of Sleepy Hollow High School, according to principal Carol Conklin-Spillane.
"They were smart happy beautiful young women," Conklin-Spillane said. "I speak about them together because they were very much a matched pair. They were best friends by choice."
Andrea Rebello quoted Benjamin Franklin and Bob Marley in a yearbook photo from the school.
"Believe some of what you hear and only half of what you see" was attributed to the founding father and "Love the life you live, live the life you love" was the citation for the reggae legend.
A police car was parked Friday in front of the Rebello house in Tarrytown, a well-kept ranch home.
Neighbor Jane Phelan said the twins' mother recently told her the sisters had moved out of a dormitory and into an off-campus house.
"It must be very hard on the parents and particularly on the surviving twin," her husband, Jack Phelan said.
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Associated Press writer Jim Fitzgerald in Sleepy Hollow, N.Y., contributed to this report.
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All Critics (56) | Top Critics (23) | Fresh (51) | Rotten (5)
'Gimme the Loot' is ... meandering and a little shallow. And even at 79 minutes it feels a little too long for what's essentially the film equivalent of a short story.
A thousand-watt jolt of mischief, a spunky, funky, ebullient indie that packs its 81 minutes with cinematic exhilaration.
It may be a slight movie, but it has its sunny charms.
A movie about teenage taggers in the Bronx should be fast and raw, scruffy and loose, and Adam Leon's Gimme the Loot is just that.
As it lopes along, the movie offers a warm but very sharp portrait of New York's have-nots and their uneasy relationship with the haves.
"Gimme the Loot" shouldn't be as appealing and exuberant as it is, it really shouldn't.
The film's strong suit is its use of locations.
The film is episodic and determinedly offbeat, funny at its best, boring at its worst.
Shot on the streets of New York in a loose, freeform style, this lively comedy-drama feels somewhat underdeveloped, leaving us doubtful about its realism.
It's a great deal of fun, emotionally touching, and even surprisingly old-fashioned.
Some of the movie doesn't exactly convince, and some of the scenes have an actors-improv feel to them, but there's always plenty of humour and energy.
Endlessly entertaining, refreshingly light-hearted and bursting with summer soul, Gimme The Loot joins the pantheon of great New York movies.
It's a shaggy dog story with a certain amount of charm but not nearly enough drama.
The movie is unpolished, and it matters not a jot, because Leon has written super roles for these kids and invests their relationship with such sly feeling.
Hickson walks the line between bravado and vulnerability, while Washington has a charisma, spark and beauty that should ensure this won't be the last we see of her.
Bolstered by a low-key but assured aesthetic and a soundtrack of vintage soul and doo-wop, the film is infectiously enjoyable, with frequently amusing insights and an affable shagginess.
Out of nowhere, Adam Leon might just have delivered the first great New York film of the decade.
Charming and engaging low-budget indie with a witty script, likeable characters, a strong sense of time and place and a pair of terrific performances from its two young leads.
Funny and freewheeling, it's a joy.
A slim, low-budget coming-of-age tale whose richness lies entirely in its interstices. A keenly observed work that celebrates the unfettered joys of youth, and rewards by reminding of the power of a simple tale told well.
Simultaneously real and hopeful, "Loot" has almost no plot, but when the setting is so fresh and the characters feel so raw and alive, who needs one?
Ghetto laughs with a sophisticated point of view.
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Olympic Glory sets his sights on Irish 2,000 Guineas ? Horseracing news
Olympic Glory has set his sights on the Tattersalls Irish 2,000 Guineas (Group 1) (Entire Colts & Fillies) at Curragh in Ireland. The all-important event is scheduled to take place next week and has attracted some quality stallions.
The young challenger was unable to make an impression in his most recent race, which was quite disappointing for his fans. He was rated as the favourite to succeed back then, but ended up way down in 11th?place. This was the first ever time when he dropped
out of the top three in his career.
According to his challenger Richard Hannon, ?He was drawn in the cheap seats and could never get competitive, but at least he came back without having had a hard race, so we have decided to take him to Ireland, where the stiff mile should suit him well.?
Overall, Olympic Glory has participated in a total of seven races until now and his performances in most of them have been outstanding. He has managed to maintain a decent strike rate, which proves that he is a consistent performer. He has succeeded in five
races whereas finished as a runner up once.
However, past record does not matter much, especially when the stallion is out of form. Therefore, the three-year-old colt needs to work hard on his form and fitness, if he wants to bounce back strongly.
Other than Olympic Glory, Hannon will be expecting a better performance from his trainee Maureen, who will be participating in the Etihad Airways Irish 1,000 Guineas. She is also a quality runner and has the ability to outshine her opponents.
The Irish filly has participated in a total of six races until now and she has managed to maintain a 50 percent winning percentage until now. Moreover, she has also secured the runner up position once in her career, which shows that she is quite capable
of fighting for top positions.
However, she saw a decline in form during her last outing, which would have disappointing for her fans. Although she was not rated as the favourite to succeed back then, yet she could have achieved a better result than sixth. So, she will be looking to improve
her performance next time around.
LAS VEGAS (AP) ? O.J. Simpson's former lawyer defended himself point-by-point Friday against allegations he botched the former football star's armed-robbery trial, after giving damaging testimony that Simpson actually knew his buddies had guns when they went to a hotel room together to reclaim some sports memorabilia.
Miami-based attorney Yale Galanter quickly found himself under withering cross-examination from a Simpson lawyer intent on proving that Galanter's word couldn't be trusted ? that he knew ahead of time of Simpson's plan and spent more effort covering up his involvement than representing Simpson.
The weeklong hearing concluded late Friday with Clark County District Judge Linda Marie Bell telling attorneys she will issue her decision in writing. She didn't specify a date.
Simpson was returned to prison custody. His attorneys, Patricia Palm and Ozzie Fumo, said they were optimistic that the judge would grant a new trial.
"I just think the evidence of his claims is overwhelming," Palm said.
Galanter took the stand as the state's star witness in a hearing on Simpson's claim that he was so badly represented at trial and on appeal that his conviction should be thrown out.
He spent most of the day on the defensive, with Simpson lawyer Tom Pitaro grilling him with accusations and pointed questions.
"Mr. Simpson never told me he was going to go to the Palace (Station) hotel with a bunch of thugs, kidnap people and take property by force," Galanter said at one point. "To insinuate I, as his lawyer, would have blessed it is insane."
Galanter conceded at one point that Simpson's conviction was his responsibility.
At another point, he conceded that he "misspoke" when he told the trial judge, Jackie Glass, that crucial audio recordings had been carefully analyzed by experts.
"Clearly I misspoke," Galanter said as Pitaro bored in. "I would never, ever ... I would just never intentionally mislead a judicial officer or a lawyer. I'm falling on that sword."
Galanter denied giving Simpson the go-ahead to retrieve the photos and footballs he believed had been stolen from him. He denied keeping Simpson in the dark about offers of plea deals that carried only a few years in prison. He said his client agreed all along with the decision not to put him on the stand to testify at his trial.
And he disputed Simpson's testimony from earlier this week when the former NFL star said he didn't know anyone in the hotel room had guns.
"When you look at the entire trial, I don't think I could have fought harder, done more," Galanter said. "I put every ounce of blood, sweat and soul into it."
At another point, he said: "Simpson brought a lot of baggage into the courtroom. It's not like the 12 jurors didn't know he was accused of murder and acquitted."
Simpson, 65, was found guilty in 2008 of kidnapping and armed robbery over the hotel room episode and was sentenced to nine to 33 years in prison. The conviction came 13 years to the day after his "trial of the century" acquittal in Los Angeles in the murders of his ex-wife and a friend of hers.
Galanter testified that Simpson confided to him that he had asked two men to bring guns to the hotel room in September 2007, and "he knew he screwed up."
On the stand, Galanter brought up the guns only after he paused and was reminded that Simpson had waived attorney-client privilege. "I'm very uncomfortable doing this," he said.
Testifying about events leading up to the incident, Galanter said he was surprised when Simpson told him over dinner in Las Vegas that he and several other men were planning a "sting" the next morning to take back the mementos.
Galanter said he advised Simpson not to take matters into his own hands: "I said, 'O.J., you've got to call the police.'"
Simpson testified that Galanter advised him that he was within his rights to retrieve the items, told him not to testify at the trial, and failed to tell him prosecutors had offered plea bargains.
During questioning about how much Galanter was paid for the case, the judge asked Pitaro where he was going with his questions.
"What Mr. Galanter has done is, this man has received over a half-million dollars and has put his interest, his financial interest, above the interest of his client," Pitaro said.
Galanter insisted he told Simpson at least three times that prosecutors discussed plea bargains. He said Simpson rejected them.
Simpson said, "No deal. No way," to an offer from the district attorney of five to seven years in prison, Galanter said. Later, during the trial, Simpson turned down a better offer, Galanter said.
"I went out in the hall and said to O.J., 'There is an offer of two to five.' He said, 'See if they will take a year,'" Galanter testified. "I discussed a year with them, and they said no and the trial went on."
If Simpson succeeds in getting his conviction thrown out, prosecutors will have to decide whether to retry him or offer a plea bargain. If he loses, he will be sent back to prison and will probably appeal. He will be 70 before he is eligible for parole.
BANGKOK (AP) ? Asian stock markets were mixed in holiday-thinned trading Friday as investors digested a slew of disappointing economic data and corporate results from the U.S.
Applications for unemployment benefits jumped to their highest level in six weeks, the U.S. Labor Department reported Thursday, while manufacturing slowed in the mid-Atlantic region.
The bright spot was applications for new construction, which reached a five-year peak, reinforcing "the patchy nature of the US economic recovery," Michael Hewson of CMC Markets said in a commentary.
Japan's Nikkei 225 index rose 0.6 percent to 15,119.53, reversing a lower opening. Australia's S&P/ASX 200 rose 0.5 percent to 5,189.70, pushed up by gains in BHP Billiton, the world's largest mining company. The stock rose 2.4 percent on bargain-hunting. Australia & New Zealand Banking Group rose 1.5 percent.
Benchmark in mainland China and Indonesia also rose while those in Taiwan, India, Singapore, New Zealand and the Philippines fell. Markets in Hong Kong and South Korea were closed for public holidays.
Evan Lucas of IG Markets in Melbourne said market declines could be explained by investors cashing in their gains following strong rallies. Japan's benchmark Nikkei 225 index has returned 45 percent so far this year. The Standard & Poor's 500 has delivered a terrific first four months. It's up 16 percent.
"There is always an uneasy feeling underlying the markets when they start making all-time highs," Lucas said.
Shares linked to gold, which has suddenly fallen afoul of investors like George Soros, dropped. Australia's Newcrest Mining was down 2.2 percent. Lao Feng Xiang, a Shanghai-listed major gold retailer, fell 0.9 percent.
Corporate earnings, which have been helping to power Wall Street to all-time highs, took a step back on Thursday after Wal-Mart, the world's largest retailer, reported a disappointing first-quarter profit and acknowledged a sales slump. Personal computer maker Dell posted dismal first quarter earnings.
Markets were also reacting to comments by John Williams, head of the Federal Reserve's San Francisco branch, who told an audience that the Fed could end its bond-buying program this year. But Williams' comments made clear that the Fed would only curtail its stimulus effort when the economy looked strong enough.
The Dow Jones industrial average fell to 15,233.22, a loss of 0.3 percent. The Standard & Poor's 500 dropped 0.5 percent to 1,650.47. Both indexes closed at record highs the day before. The Nasdaq composite index fell 0.2 percent to 3,465.24.
Benchmark oil for June delivery was down 30 cents to $94.87 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 86 cents to $95.16 per barrel on the Nymex on Thursday.
In currencies, the euro fell to $1.2864 from $1.2907 late Thursday in New York. The dollar rose to 102.30 yen from 102.06 yen.
___
Follow Pamela Sampson on Twitter at http://twitter.com/pamelasampson
LOUISVILLE, Ky. (AP) ? Officials say one U.S. Navy sailor was killed and several others were hurt in a training exercise at Fort Knox in Kentucky.
Lt. David Lloyd, a spokesman for Naval Special Warfare Group Two in Virginia Beach, Va., said Friday morning that the accident happened Wednesday night. The six sailors assigned to the group were riding in a Humvee when the accident happened, though Lloyd says exactly what happened remained under investigation.
Lloyd says the exercise was part of tactical training, but he declined to release further details because they are considered sensitive.
Fort Knox is about 50 miles southwest of Louisville and is home to about 14,000 military personnel, including active duty members and reserves.
The U.S. Navy has used Fort Knox as a training ground since World War II.
Healthy companies and healthy regions: Connecting the dotsPublic release date: 16-May-2013 [ | E-mail | Share ]
Contact: T.J. Becker tjbecker@lowe.org 269-445-4257 Edward Lowe Foundation
In today's virtual world, it's easy to downplay the significance of place. Yet when it comes to regional prosperity, geography matters. Income and job growth is not random but rather spill over from one region to another, meaning that merely being next to a prosperous region will make your own economy more vibrant.
This may sound like a no-brainer, but until recently it's been hard to prove from a statistical perspective. Yet by using new models that factor in location and blending microeconomic ideas with macro ones, researchers at the Edward Lowe Foundation's Institute for Exceptional Growth Companies (IEGC), University of North Carolina at Charlotte and Northern Illinois University (NIU) have advanced the longstanding theory of regional income convergence and revealed new insights about the geographic dynamics of the U.S. economy.
Convergence theory maintains that capital and wealth shift over long periods of time, spreading from richer areas to lagging ones, which allows these poorer areas to catch up to national averages. Although income convergence is a geographic process, most studies have ignored geographic relationships, says Harrison Campbell, an associate professor of geography and public policy at UNC Charlotte and the study's principal investigator. "Some have looked at industry composition, and a few have looked at how neighboring regions affect each other, but none have looked at how individual companies affect convergence."
Leveraging data from IEGC, Campbell and fellow researchers Ryan James and Gary Kunkle studied 177 regions over a 20-year period (1990-2010). The team used both a traditional model and one with spatially explicit tools, which yielded two sets of results to compare. Key findings include:
Convergence is happening, but at a slower rate than previous studies have indicated about one-third slower (or 1.3 percent per year as opposed to 2 percent per year).
The economic health of one region has a definite spillover effect on neighboring regions.
Particular kinds of establishments, known as sustained growth companies, accelerate the convergence process through their ability to create jobs.
The presence of these sustained growth companies has a bigger impact in rural areas than non-rural areas.
Change Agents of Convergence
The concept of sustained growth companies builds upon previous research done by Kunkle, IEGC's research fellow. Although these companies represent different sizes, different industries and are located in different places, they share a common hallmark: the ability to generate repeated growth over long periods of time.
"Sustained growth companies are the hidden allocators of new jobs in the economy," says Kunkle. "This paper shows that they also play a significant role in allocating income growth as well and help determine which regions experience faster income growth than others. Thus, income growth is not limited just to owners and employees of sustained growth companies, but extends throughout their neighboring communities."
The fact that sustained growth companies have a larger impact in rural areas was a surprise, Campbell says. "Previous literature suggests that these firms will perform better if they cluster in urban areas. Yet our results reveal the opposite they had a negligible or slightly negative effect on income growth and convergence in metro areas."
The dramatic impact of sustained growth companies in rural areas might be explained by the fact that they are big fish in small ponds. "It doesn't matter how they land in that pond it could be a brand new startup, an expansion of a nearby company or a business that has relocated to the area but when they land, it's like a shot of adrenaline for the area," Campbell says. "What's also interesting is that concentration doesn't matter; the sheer presence of sustained growth companies makes an impact."
Innovative Modeling and Data
Critical to the study was developing an effective geographic model. To achieve this, the researchers leveraged new types of spatially explicit tools and introduced new geographic units: 177 economic areas defined by the U.S. Bureau of Economic Analysis. Smaller than a state and larger than an MSA, these multicounty areas approximate the extent of a labor market.
One of the benefits of the geographic model was that it produced far fewer outliers, which gave the researchers more confidence in their results. "The theory of income convergence is in itself geographical," says James, an economic geographer and assistant professor at NIU. "It suggests that capital is going to flow from capital rich areas to capital poor ones. Yet traditional models don't take into account the performance of neighboring regions, which is extremely important."
Another hallmark of the study: factoring in the role of individual business establishments. Past studies have looked at location attributes and regional conditions, such as population density, access to interstate highways, land quality and water supply, instead of looking at the individual actors responsible for economic growth.
The National Establishment Times Series (NETS) data set, which IEGC made available, was essential to studying the sustained growth company connection, Campbell observes: "This research couldn't have been done without it. NETS is an extraordinary data set that's potential is still unknown to most people. Past studies have relied on industries, which are like cruise ships; their averages turn very slowly because they consist of many different firms. In contrast, NETS enabled us to track individual U.S. establishments, the DNA of what really makes our economy run."
Moving forward
The researchers' findings provide statistical evidence that spatial relationships are extremely significant to regional prosperity. "So there's basis, at least for certain projects, for regions to start think beyond their own borders and work more cooperatively," says Campbell.
Connecting the dots between sustained growth companies and regional prosperity is equally important. "This study begs a whole new set of questions about how firms manage themselves," Campbell says. "If we can understand what makes the sustained growth companies tick, we may be able to reorient our approach to economic development and introduce policies that positively impact these important firms."
Other policy implications revolve around regional income convergence. "For example, many Southern states are right-to-work states states that were poor and are now starting to catch up. A question arises about how policies such as right-to-work status might impact a state or region's ability to grow its economy," Campbell explains.
"Part of IEGC's mission is to get unique establishment time-series data into the hands of capable researchers so they can shed new light on the U.S. economy and the role of exceptional growth companies," says Gregg Cole, information technology research leader at the Edward Lowe Foundation, which launched IEGC in 2011. "This study is a wonderful example of how researchers are using the data not only to make new discoveries, but also reexamine traditional observations and improve on previous models."
###
To read the full paper, "Firm Growth and Regional Income Convergence: Is There a Connection?" visit http://youreconomy.org/pages/insights.lasso
About Institute for Exceptional Growth Companies (IEGC): The Institute for Exceptional Growth Companies was created by the Edward Lowe Foundation through a three-year grant from the NASDAQ Educational Foundation. IEGC is creating new datasets and using existing data in innovative ways to track and better understand exceptional growth companies, their impact on community and economic development, and their relationship with equity funding sources. For more information, visit http://youreconomy.org/pages/iegc.lasso
Media contacts:
Edward Lowe Foundation/IEGC
T.J. Becker at 269-445-4257 or tjbecker@lowe.org
UNC Charlotte Public Relations
Buffie Stephens, 704-687-5830 or BuffieStephens@uncc.edu
Northern Illinois University Public Relations
Paul Palian, 815-753-7346 or ppalian@niu.edu
[ | E-mail | Share ]
?
AAAS and EurekAlert! are not responsible for the accuracy of news releases posted to EurekAlert! by contributing institutions or for the use of any information through the EurekAlert! system.
Healthy companies and healthy regions: Connecting the dotsPublic release date: 16-May-2013 [ | E-mail | Share ]
Contact: T.J. Becker tjbecker@lowe.org 269-445-4257 Edward Lowe Foundation
In today's virtual world, it's easy to downplay the significance of place. Yet when it comes to regional prosperity, geography matters. Income and job growth is not random but rather spill over from one region to another, meaning that merely being next to a prosperous region will make your own economy more vibrant.
This may sound like a no-brainer, but until recently it's been hard to prove from a statistical perspective. Yet by using new models that factor in location and blending microeconomic ideas with macro ones, researchers at the Edward Lowe Foundation's Institute for Exceptional Growth Companies (IEGC), University of North Carolina at Charlotte and Northern Illinois University (NIU) have advanced the longstanding theory of regional income convergence and revealed new insights about the geographic dynamics of the U.S. economy.
Convergence theory maintains that capital and wealth shift over long periods of time, spreading from richer areas to lagging ones, which allows these poorer areas to catch up to national averages. Although income convergence is a geographic process, most studies have ignored geographic relationships, says Harrison Campbell, an associate professor of geography and public policy at UNC Charlotte and the study's principal investigator. "Some have looked at industry composition, and a few have looked at how neighboring regions affect each other, but none have looked at how individual companies affect convergence."
Leveraging data from IEGC, Campbell and fellow researchers Ryan James and Gary Kunkle studied 177 regions over a 20-year period (1990-2010). The team used both a traditional model and one with spatially explicit tools, which yielded two sets of results to compare. Key findings include:
Convergence is happening, but at a slower rate than previous studies have indicated about one-third slower (or 1.3 percent per year as opposed to 2 percent per year).
The economic health of one region has a definite spillover effect on neighboring regions.
Particular kinds of establishments, known as sustained growth companies, accelerate the convergence process through their ability to create jobs.
The presence of these sustained growth companies has a bigger impact in rural areas than non-rural areas.
Change Agents of Convergence
The concept of sustained growth companies builds upon previous research done by Kunkle, IEGC's research fellow. Although these companies represent different sizes, different industries and are located in different places, they share a common hallmark: the ability to generate repeated growth over long periods of time.
"Sustained growth companies are the hidden allocators of new jobs in the economy," says Kunkle. "This paper shows that they also play a significant role in allocating income growth as well and help determine which regions experience faster income growth than others. Thus, income growth is not limited just to owners and employees of sustained growth companies, but extends throughout their neighboring communities."
The fact that sustained growth companies have a larger impact in rural areas was a surprise, Campbell says. "Previous literature suggests that these firms will perform better if they cluster in urban areas. Yet our results reveal the opposite they had a negligible or slightly negative effect on income growth and convergence in metro areas."
The dramatic impact of sustained growth companies in rural areas might be explained by the fact that they are big fish in small ponds. "It doesn't matter how they land in that pond it could be a brand new startup, an expansion of a nearby company or a business that has relocated to the area but when they land, it's like a shot of adrenaline for the area," Campbell says. "What's also interesting is that concentration doesn't matter; the sheer presence of sustained growth companies makes an impact."
Innovative Modeling and Data
Critical to the study was developing an effective geographic model. To achieve this, the researchers leveraged new types of spatially explicit tools and introduced new geographic units: 177 economic areas defined by the U.S. Bureau of Economic Analysis. Smaller than a state and larger than an MSA, these multicounty areas approximate the extent of a labor market.
One of the benefits of the geographic model was that it produced far fewer outliers, which gave the researchers more confidence in their results. "The theory of income convergence is in itself geographical," says James, an economic geographer and assistant professor at NIU. "It suggests that capital is going to flow from capital rich areas to capital poor ones. Yet traditional models don't take into account the performance of neighboring regions, which is extremely important."
Another hallmark of the study: factoring in the role of individual business establishments. Past studies have looked at location attributes and regional conditions, such as population density, access to interstate highways, land quality and water supply, instead of looking at the individual actors responsible for economic growth.
The National Establishment Times Series (NETS) data set, which IEGC made available, was essential to studying the sustained growth company connection, Campbell observes: "This research couldn't have been done without it. NETS is an extraordinary data set that's potential is still unknown to most people. Past studies have relied on industries, which are like cruise ships; their averages turn very slowly because they consist of many different firms. In contrast, NETS enabled us to track individual U.S. establishments, the DNA of what really makes our economy run."
Moving forward
The researchers' findings provide statistical evidence that spatial relationships are extremely significant to regional prosperity. "So there's basis, at least for certain projects, for regions to start think beyond their own borders and work more cooperatively," says Campbell.
Connecting the dots between sustained growth companies and regional prosperity is equally important. "This study begs a whole new set of questions about how firms manage themselves," Campbell says. "If we can understand what makes the sustained growth companies tick, we may be able to reorient our approach to economic development and introduce policies that positively impact these important firms."
Other policy implications revolve around regional income convergence. "For example, many Southern states are right-to-work states states that were poor and are now starting to catch up. A question arises about how policies such as right-to-work status might impact a state or region's ability to grow its economy," Campbell explains.
"Part of IEGC's mission is to get unique establishment time-series data into the hands of capable researchers so they can shed new light on the U.S. economy and the role of exceptional growth companies," says Gregg Cole, information technology research leader at the Edward Lowe Foundation, which launched IEGC in 2011. "This study is a wonderful example of how researchers are using the data not only to make new discoveries, but also reexamine traditional observations and improve on previous models."
###
To read the full paper, "Firm Growth and Regional Income Convergence: Is There a Connection?" visit http://youreconomy.org/pages/insights.lasso
About Institute for Exceptional Growth Companies (IEGC): The Institute for Exceptional Growth Companies was created by the Edward Lowe Foundation through a three-year grant from the NASDAQ Educational Foundation. IEGC is creating new datasets and using existing data in innovative ways to track and better understand exceptional growth companies, their impact on community and economic development, and their relationship with equity funding sources. For more information, visit http://youreconomy.org/pages/iegc.lasso
Media contacts:
Edward Lowe Foundation/IEGC
T.J. Becker at 269-445-4257 or tjbecker@lowe.org
UNC Charlotte Public Relations
Buffie Stephens, 704-687-5830 or BuffieStephens@uncc.edu
Northern Illinois University Public Relations
Paul Palian, 815-753-7346 or ppalian@niu.edu
[ | E-mail | Share ]
?
AAAS and EurekAlert! are not responsible for the accuracy of news releases posted to EurekAlert! by contributing institutions or for the use of any information through the EurekAlert! system.
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