Romel Mostafa

Recent Refereed Articles

• Mostafa, R., Klepper, S., (forthcoming), "Industrial Development through Tacit Knowledge Seeding: Evidence from the Bangladesh Garment Industry", Management Science.

  Abstract: We explore how the establishment of an industry pioneer through foreign seeding of industry knowledge can subsequently catalyze the growth of a developing country’s industry by involuntarily propagating the knowledge to subsequent entrants. As industry knowledge has tacit elements, we focus on mechanisms that enable experienced workers from the pioneer to seed the knowledge to new entrants. We examine the relationship between entrants’ characteristics and the mechanisms exploited to access the industry knowledge, and the impact of the mechanisms exploited on firm performance. Empirical findings from two historical episodes in the Bangladesh garment industry suggest that industry knowledge seeding was essential for the initial establishment and subsequent expansion of the industry. Our paper highlights the role of experienced workers’ mobility in building new firm capabilities and provides novel insights into industrialization in developing economies.

  Link(s) to publication:

  http://dx.doi.org/10.1287/mnsc.2016.2619

• Argyes, N., Mostafa, R., 2016, "Knowledge Inheritance, Vertical Integration, and Entrant Survival in the Early U.S. Auto Industry", Academy of Management Journal, August 59(4): 1474 - 1492.

  Abstract: A key finding in the literature on industry evolution and strategy is that knowledge “inherited” from the founder’s previous employer can be an important source of a new firm’s capabilities. We analyze the conditions under which knowledge that is useful for carrying out a key value chain activity is inherited, and explore the mechanism through which such an inheritance shapes an entrant’s strategies and, in the process, influences its performance. Evidence from the early U.S. auto industry indicates that employee spinoffs generated from incumbents that had integrated a key value chain activity were also more likely to integrate that activity than other entrants, which, we suggest, reflects the application of knowledge inheritance relative to that activity. Moreover, we find that the integration of this key activity, stimulated by knowledge inheritance, contributed to the establishment of defensible strategic positioning, thereby enhancing the survival duration of inheriting spinoffs. We thus link together the phenomena of knowledge inheritance, vertical integration, and strategic positioning to explain entrant performance. These three phenomena tend to be treated disparately in the literature, rather than in combination.

  Link(s) to publication:

  http://dx.doi.org/10.5465/amj.2013.0180

• Haisley, E., Mostafa, R., Loewenstein, G., 2008, "Myopic Risk-seeking: The Impact of Narrow Decision Bracketing on Lottery Play", Journal of Risk and Uncertainty, August 37(1): 57 - 75.

  Abstract: In two experiments conducted with low-income participants, we find that individuals are more likely to buy state lottery tickets when they make several purchase decisions one-at-a-time, i.e. myopically, than when they make one decision about how many tickets to purchase. These results extend earlier findings showing that “broad bracketing” of decisions encourages behavior consistent with expected value maximization. Additionally, the results suggest that the combination of myopic decision making and the “peanuts effect”—greater risk seeking for low stakes than high stakes gambles—can help explain the popularity of state lotteries.

• Haisley, E., Mostafa, R., Loewenstein, G., 2008, "Subjective Relative Income and Lottery Ticket Purchases", Journal of Behavioral Decision Making, July 21(3): 283 - 295.

  Abstract: Despite a return of only $.53 on the dollar, state lotteries are extremely popular, especially among the poor, who play the most but can least afford to play. In two experiments conducted with low-income participants, we examine how implicit comparisons with other income classes increase low-income individuals' desire to play the lottery. In Experiment 1, participants were more likely to purchase lottery tickets when they were primed to perceive that their own income was low relative to an implicit standard. In Experiment 2, participants purchased more tickets when they considered situations in which rich people or poor people receive advantages, implicitly highlighting the fact that everyone has an equal chance of winning the lottery.

• For more publications please see our Research Database