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on Business Economics |
| By: | Joze Damijan; Joep Konings; Saso Polanec |
| Abstract: | This paper documents that a large fraction of trade flows at the firm level consists of simultaneous imports and exports in identical products, narrowly defined at the 8-digit product classification, which we call Pass-On Trade, POT. We use data on imports and exports at the firm–product level for Slovenian manufacturing firms in the period 1994-2008, to show that, on average, 70 percent of all exporting firms engage in POT. This corresponds to more than 50 percent of all exported products. Thus, imported products that are exported again by the same firm is a statistical regularity of trade of Slovenian manufacturing firms. We document that the use of POT is increasing in firm size, product diversification, multinational status as well as firm productivity and profitability. We offer and explore empirically a number of explanations for POT. Among possible explanations, we find evidence on the importance of firms’ multinational networks and demand complementarities between firms’ own and POT products. The latter confirms the theoretical explanations for ‘Carry-Along Trade’ (CAT) as developed by the recent work of Bernard et al (2010, 2012). |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:ete:vivwps:31&r=bec |
| By: | Sala, Davide (Department of Business and Economics); Yalcin, Erdal (IFO Institute - Leibniz Institute for Economic Research) |
| Abstract: | As the firm gravitates to the core analysis of international trade models, the possibilities to learn from the theory of the multinational enterprise developed in international business studies increase. The managerial resources and capabilities that are so emphasized in this theory for export initiation have largely been neglected in the empirical studies of international trade. Probably not because they are unimportant, but rather because of the challenge to identify and measure them. We exploit Danish employer-employee matched data to overcome this barrier and analyze the impact of managers’ international experience together with other managerial characteristics on the likelihood that the firm starts exporting. We find that productivity and fixed costs associated to exporting are not the sole determinants of the selection of firms into international markets, but “managerial inputs” are as important. Our data allows us to identify managers’ export experience based on the CEOs’ historical career as documented in official registry statistics. This puts our study apart from earlier survey based studies which rely on self-assessments. |
| Keywords: | Export status; managerial promotions; international experience; self-selection |
| JEL: | D22 F23 M51 |
| Date: | 2012–09–06 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sdueko:2012_018&r=bec |
| By: | Makoto Kakinaka (International University of Japan); Hiroaki Miyamoto (International University of Japan) |
| Abstract: | This paper studies the role of extensive and intensive margins of labor adjustment overbusiness cycle in Japan. We find that the intensive margin accounts for much of total hours worked variation, and its contribution to the fluctuation of total hours worked is about 77%. This result is in sharp contrast with those in the U.S. and European countries where the extensive margin mainly accounts for the overall variability in total hours worked. The implication of a recent rise in non-regular employment for firms' labor adjustment behavior is also discussed. |
| Keywords: | intensive and extensive margins, labor adjustment, Japanese labor market |
| JEL: | C10 E32 J23 |
| Date: | 2012–09 |
| URL: | http://d.repec.org/n?u=RePEc:iuj:wpaper:ems_2012_14&r=bec |
| By: | Anderson, Simon P. (Dept. of Economics, University of Virginia); Foros, Øystein (Dept. of Finance and Management Science, Norwegian School of Economics and Business Administration); Kind, Hans Jarle (Dept. of Economics, Norwegian School of Economics) |
| Abstract: | In a Hotelling duopoly model, we introduce quality that is more appreciated by closer consumers. Then higher common quality raises equilibrium prices, in contrast to the standard neutrality result. Furthermore, we allow consumers to buy one out of two goods (single-purchase) or both (multi-purchase). Prices are strategically independent when some consumers multi-purchase because suppliers price the incremental benefit to marginal consumers. In a multi-purchase regime, there is a hump-shaped relationship between equilibrium prices and quality when quality functions overlap. If quality is sufficiently good, it might be a dominant strategy for each supplier to price high and eliminate multi-purchase. |
| Keywords: | Hotelling model with quality; multi-purchase; incremental pricing; content competition |
| JEL: | D00 D40 |
| Date: | 2012–08–28 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nhhfms:2012_009&r=bec |
| By: | L. Lambertini; A. Tampieri |
| Abstract: | We propose a model of environmental overcompliance in a duopoly setting where consumers are environmentally concerned and may patronise the product they buy, firms set their green investment to abate the impact of productivity on pollution and a government sets the environmental standard with the aim to maximise welfare. We show that, with no patronising consumers, overcompliance is unilateral by the firm with higher quality standard under Bertrand behaviour, whereas both firms may overcomply under Cournot competition if the environmental impact of production is sufficiently low. Conversely with patronising consumers, overcompliance is unilateral with low environmental impact of production under price competition, and both firm overcomply under quantity competition. |
| JEL: | L13 L51 Q50 |
| Date: | 2012–09 |
| URL: | http://d.repec.org/n?u=RePEc:bol:bodewp:wp847&r=bec |
| By: | Muntean, Mihaela |
| Abstract: | Business Intelligence (BI) is unanimous considered the art of gaining business advantage from data; therefore BI systems and infrastructures must integrate disparate data sources into a single coherent framework for real-time reporting and detailed analysis within the extended enterprise. Also the solution to a business problem is a process that includes business intelligence, BI, by itself, is rarely the complete solution to the problem. Therefore, BI tools must understand the process and how to be part of it. Subordinated to performance management, Business Intelligence approaches help firms to optimize business performance. Looking inside the business and at the environment in which they operate, managers are able to fundament the most productive and profitable decisions. The new trend of social BI in business analysis comes with an innovative approach in consolidating performance management. A data warehouse schema for social BI will be a good start for future debates. |
| Keywords: | business intelligence; performance management; social business intelligence; social data warehouse |
| JEL: | M00 L86 |
| Date: | 2012–05–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:41139&r=bec |
| By: | Mark Humphery-Jenner (University of New South Wales, Tilburg University); Zacharias Sautner (University of Amsterdam, Duisenberg school of finance); Jo-Ann Suchard (University of New South Wales) |
| Abstract: | We study the role of private equity firms in cross-border mergers and acquisitions. We find that private equity-owned firms are more likely to become targets in crossborder |
| Keywords: | G34; G32; G24 |
| Date: | 2012–03–29 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:20120031&r=bec |
| By: | Julien Bengui; Enrique G. Mendoza; Vincenzo Quadrini |
| Abstract: | This paper investigates whether the international globalization of financial markets allows for significant cross-country risk-sharing at the business cycle frequency. We find that cross-country risk-sharing is still limited and this is unlikely to be the result of financial frictions that limit state-contingent contracts. Part of the limited international risk sharing could be the consequence of frictions that de-facto reduce the short-term mobility of financial capital. But even with these frictions we find significant divergence between model predictions and the data. |
| JEL: | F36 F44 G15 |
| Date: | 2012–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18372&r=bec |
| By: | Robert E. Hall |
| Abstract: | According to the standard model, advertising is remarkably sensitive to profit margins. Firms advertise to stimulate demand for their products. They advertise high-margin products aggressively and low-margin ones hardly at all. In macroeconomics, variations in profit margins over the business cycle have a key role. A widening of margins can explain the rise in unemployment in recessions. A higher margin implies a lower real wage. A variety of models ranging from Keynesian to search-and-matching map a decline in wages to higher unemployment. But a rise in profit margins should expand advertising by a lot. Really a lot. Advertising should be highly counter-cyclical. Instead, it is somewhat pro-cyclical. The ratio of advertising spending to private GDP falls when the economy contracts. I show that wages do decline in recessions. The labor share of income falls. On the other hand, the behavior of advertising refutes the hypothesis that profit margins rise. Hence there must be another factor that lowers the wage without raising profit margins. The only influence that fits the facts is a rise in a product-market friction that has the same effect as an increase in sales taxes. |
| JEL: | D43 E12 E32 |
| Date: | 2012–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18370&r=bec |
| By: | Christian Pfeifer (Institute of Economics, Leuphana University Lüneburg and IZA Bonn, Germany); Simon Janssen (Department of Business Administration, University of Zurich); Philip Yang (Leibniz University Hannover, Institute of Labor Economics); Uschi Backes-Gellner (Department of Business Administration, University of Zurich) |
| Abstract: | We use a long panel data set for four cohorts of male blue-collar workers entering into an internal labor market to analyze the effect of age on the probability of participating in different employer-financed training measures. We find that training participation probabilities are inverted u-shaped with age and that longer training measures are undertaken earlier in life and working career. These findings are consistent with predictions from a human capital model that incorporates amortization period and screening effects. |
| Keywords: | Age; Human capital; Internal labor markets; Training |
| JEL: | J14 J24 M53 |
| Date: | 2012–08 |
| URL: | http://d.repec.org/n?u=RePEc:iso:educat:0080&r=bec |
| By: | Nooman Rebei |
| Abstract: | The paper asks how state of the art DSGE models that account for the conditional response of hours following a positive neutral technology shock compare in a marginal likelihood race. To that end we construct and estimate several competing small-scale DSGE models that extend the standard real business cycle model. In particular, we identify from the literature six different hypotheses that generate the empirically observed decline in worked hours after a positive technology shock. These models alternatively exhibit (i) sticky prices; (ii) firm entry and exit with time to build; (iii) habit in consumption and costly adjustment of investment; (iv) persistence in the permanent technology shocks; (v) labor market friction with procyclical hiring costs; and (vi) Leontief production function with labor-saving technology shocks. In terms of model posterior probabilities, impulse responses, and autocorrelations, the model favored is the one that exhibits habit formation in consumption and investment adjustment costs. A robustness test shows that the sticky price model becomes as competitive as the habit formation and costly adjustment of investment model when sticky wages are included. |
| Keywords: | Economic models , Labor markets , Prices , |
| Date: | 2012–08–28 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:12/211&r=bec |
| By: | Muriel Fadairo (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,Université Jean Monnet, Saint-Etienne, F-42000, France); Cintya Lanchimba Lopez (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,Université Jean Monnet, Saint-Etienne, F-42000, France) |
| Abstract: | This paper studies the performance of distribution networks as the result of a range of organizational choices made by the upstream firm. The analytical part of the paper surveys the vast literature devoted to franchising and to dual distribution. From this framework, several testable propositions are derived, linking the networks performance to the organizational choices. Three complementary criteria of performance are taken into account : the internationalization rate, the expansion rate, the market share. The paper provides evidence that these criteria are empirically related. Thus, a system of simultaneous equations is defined, free of endogeneity relating to the explanatory variables. The estimations on recent French data by means of the three-least squares method provide robust results, and show that the type of distribution network, the number of company-owned units in the network, the type of sector, and the choice to manage several networks simultaneously affect the performance in distribution systems. |
| Keywords: | Franchising, Organizational choices, Endogeneity, Simultaneous Equations |
| JEL: | C31 L14 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:gat:wpaper:1224&r=bec |
| By: | Kevin B. Moore |
| Abstract: | This paper uses data from the Survey of Consumer Finances (SCF) and the NBER TAXSIM model to estimate marginal and average tax rates for households that own businesses that are pass-thru entities. We examine how marginal and average tax rates vary by the size of business using four different measures of the size: net income, gross receipts, business value, and number of employees. The analysis also uses the long-time series of SCF cross-sections to examine how tax rates for business owners have evolved over the various changes in tax policy of the last two decades. |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2012-58&r=bec |
| By: | Muriel Fadairo (GATE Lyon Saint-Etienne - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - École Normale Supérieure - Lyon); Cintya Lanchimba Lopez (GATE Lyon Saint-Etienne - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - École Normale Supérieure - Lyon) |
| Abstract: | This paper studies the performance of distribution networks as the result of a range of organizational choices made by the upstream firm. The analytical part of the paper surveys the vast literature devoted to franchising and to dual distribution. From this framework, several testable propositions are derived, linking the networks performance to the organizational choices. Three complementary criteria of performance are taken into account : the internationalization rate, the expansion rate, the market share. The paper provides evidence that these criteria are empirically related. Thus, a system of simultaneous equations is defined, free of endogeneity relating to the explanatory variables. The estimations on recent French data by means of the three-least squares method provide robust results, and show that the type of distribution network, the number of company-owned units in the network, the type of sector, and the choice to manage several networks simultaneously affect the performance in distribution systems. |
| Keywords: | Franchising; Organizational choices; Endogeneity; Simultaneous Equations |
| Date: | 2012–09–03 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-00727382&r=bec |
| By: | Esther Goya (Faculty of Economics, University of Barcelona); Esther Vayá (Faculty of Economics, University of Barcelona); Jordi Suriñach (Faculty of Economics, University of Barcelona) |
| Abstract: | This paper uses a structural model to analyse the impact of innovation activities, including intra- and inter-industry externalities, on the productivity of Spanish firms. To the best of our knowledge, no previous paper has examined spillover effects by adopting such an approach. Here, therefore, we seek to determine the extent to which the innovations carried out by others affect a firm’s productivity. Additionally, firm’s technology level is taken into account in order to ascertain whether there are any differences in this regard between high-tech and low-tech firms both in industrial and service sectors. The database used is the Technological Innovation Panel (PITEC) which includes 8,611 firms for the year 2009. We find that low-tech firms make the most of a range of factors, including funding and belonging to a group, to increase their investment in R&D. As expected, R&D intensity has a positive impact on the probability of achieving both product and, more especially, process innovations. Finally, innovation output has a positive impact on firm’s productivity, being greater in more advanced firms in the case of process innovations. Both intra- and inter-industry spillovers have a positive impact on firm’s productivity, but this varies with the firm’s level of technology. Thus, innovations made by firms from the same sector are more important for low-tech firms than they are for their high-tech counterparts, while innovations made by the rest of the sectors have a greater impact on high-tech firms. |
| Keywords: | Productivity, innovation, industry spillovers. JEL classification: D24, O33. |
| Date: | 2012–09 |
| URL: | http://d.repec.org/n?u=RePEc:ira:wpaper:201214&r=bec |
| By: | Roxana Mihet |
| Abstract: | This paper investigates the effects of national culture on firm risk-taking, using a comprehensive dataset covering 50,000 firms in 400 industries in 51 countries. Risk-taking is found to be higher for domestic firms in countries with low uncertainty aversion, low tolerance for hierarchical relationships, and high individualism. Domestic firms in such countries tend to take substantially more risk in industries which are more informationally opaque (e.g. finance, mining, IT). Risk-taking by foreign firms is best explained by the cultural norms of their country of origin. These cultural norms do not proxy for legal constraints, insurance safety nets, or economic development. |
| Keywords: | Corporate governance , Corporate sector , Cross country analysis , Economic models , Manufacturing sector , |
| Date: | 2012–08–27 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:12/210&r=bec |
| By: | Carolin Haeussler; Matthew J. Higgins |
| Abstract: | Increases in alliance activity between research-intensive firms and incumbents is puzzling since it is challenging to contract upon highly uncertain R&D activities. Our paper extends prior research by exploring the relationship between firm capabilities and preferences for control rights. This link is important because the allocation of control rights has been shown to influence alliance outcomes. Using data based on a survey of biotechnology firms, we find that both current and future capabilities provide strong explanatory power for understanding preferences for control rights. Our results allow us to integrate aspects of the capabilities perspective into the property rights framework. |
| JEL: | D82 L14 M13 O32 |
| Date: | 2012–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18364&r=bec |
| By: | Johansson Magnus (IIE - Institute for Innovation and Entrepreneurship, Université de Gothenburg, Suède - Université de Gothenburg, Suède); Rani Jeanne Dang (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université de Nice Sophia Antipolis (UNS)); Rick Middel (IIE - Institute for Innovation and Entrepreneurship, Université de Gothenburg, Suède - Université de Gothenburg, Suède) |
| Abstract: | In a longitudinal real time case study over 14 months, we follow the process of radical innovation in an incumbent Swedish firm. Applying institutional theory and the concept of legitimacy, we try to shed new light on the firm process of developing and implementing radical ideas. We deconstruct the black box of individual actions undertaken in the process and trace the effect of these actions on the development and legitimacy for the radical idea. We find that when an idea lack top management support and the process of innovation are interrupted, lower level employees' action can have a defining impact of the survival. In the literature there is a perceived need for a consistent view on how to organize the bottom up processes of innovation within a firm. Emerging from the qualitative grounded analysis we thus formalize these actions undertaken in a radical innovation process. |
| Keywords: | Legitimacy, Radical Innovation, Actions |
| Date: | 2012–04–25 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00727515&r=bec |
| By: | Yuriy Gorodnichenko; Olivier Coibion; Gee Hee Hong |
| Abstract: | We study the cyclical properties of sales, regular price changes and average prices paid by consumers ("effective" prices) in a dataset containing prices and quantities sold for numerous retailers across a variety of U.S. metropolitan areas. Both the frequency and size of sales fall when local unemployment rates rise and yet the inflation rate for effective prices paid by consumers declines significantly with higher unemployment. This discrepancy can be reconciled by consumers reallocating their expenditures across retailers, a feature of the data which we document and quantify. We propose a simple model with household shopping effort and store-switching consistent with these stylized facts and document its implications for business cycles and policymakers. |
| Keywords: | Business cycles , Economic conditions , Economic models , Monetary policy , Prices , United States , |
| Date: | 2012–08–22 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:12/207&r=bec |