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on Business Economics |
| By: | Balsmeier, Benjamin; Czarnitzki, Dirk |
| Abstract: | This study examines how industry-specific managerial experience affects firms' innovation performance in the context of different institutional environments. Based on firm-level data from 27 Central and Eastern European countries we identify a robust positive relationship between industry-specific experience of the top-manager and the decision to innovate as well as the share of new product-related sales. These effects are particularly pronounced for small firms operating outside the European Union or, more generally, in institutionally less developed countries. The results suggest that managerial experience affects firm innovations largely indirectly, for example, by reducing uncertainty about future returns on innovations or by providing knowledge about how to cope with institutional shortfalls potentially hampering the commercial success of new products. -- |
| Keywords: | Corporate Governance,Innovation,Managerial Experience |
| JEL: | G38 L25 O32 P26 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:14011&r=bec |
| By: | Mehmet Fatih Ulu |
| Abstract: | Firm-level data indicates a positive relationship between a firm’s revenues from a market and the number of markets penetrated by that firm, and previous presence in that market. After studying the role of different types of firm and market-specific shocks in firms’ selection decisions, I quantify an entry-cost-reducing effect of previous presence in a market, and increasing returns to being in more markets. I find that being in an additional market increases the demand in other markets between 1% and 3% across different sectors. Additionally, a variance decomposition between firm and market-specific heterogeneity and idiosyncratic uncertainty in firms’ selection problem indicates that 1) firm-specific heterogeneity explains more of the total residual variation in revenues from foreign markets as opposed to idiosyncratic variation in technology intensive indus- tries than less technology intensive ones and 2) the relative importance of idiosyncratic components diminishes as the level of per capita income of a destination market increases. |
| JEL: | C35 D21 D22 F14 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:tcb:wpaper:1401&r=bec |
| By: | Beatrice D'Ippolito (MTS - Management Technologique et Strategique - Grenoble École de Management (GEM)) |
| Abstract: | Scholars dedicated increasing attention towards appreciating how design has changed individuals' perception of new products, firms' understanding and formulation of strategy, or other relevant actors' approach to innovation and technology management. By emphasising the importance of design for the definition of consumers' needs, the restructuring of firms' organisational structures and strategies, and the evolution of firms' value creation processes, this review paper identifies relevant research gaps and questions that would benefit from future scholarly attention. In particular, it is suggested that such effort should address the analysis of: how design consumption can help better comprehend consumers' needs; what are the implications of design thinking on the skill sets of design professionals; the organisational structure of firms, including the reconfiguration of other business functions, and their strategy; and whether and how design thinking can shape firms' value creation processes and contribute to the formalisation of design tasks. |
| Keywords: | Design; strategy making; consumers' needs; value creation; literature review; firm competitiveness; research gaps |
| Date: | 2014–01–28 |
| URL: | http://d.repec.org/n?u=RePEc:hal:gemwpa:hal-00936947&r=bec |
| By: | Bertschek, Irene; Niebel, Thomas |
| Abstract: | Mobile internet access allows for flexibility with respect to working time and working place. We analyse whether employees' use of mobile internet access improves firms' labour productivity. Our data set comprises 2460 German firms and refers to the year 2010, when mobile internet started its diffusion process to firms on a large scale. The econometric analysis shows that firms' labour productivity significantly increases with the share of employees with mobile internet access. However, an instrumental variable approach reveals that mobile internet use does not cause higher labour productivity. -- |
| Keywords: | Mobile Internet,Labour Productivity,Firm-Level Data |
| JEL: | D22 L20 O33 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:13118&r=bec |
| By: | Capasso M.; Treibich T.G.; Verspagen H.H.G. (UNU-MERIT) |
| Abstract: | This study analyses the medium-term effect of RD expenditure on firm employment growth. Four cross-sectional waves of an innovation survey conducted in the Netherlands have been used to evaluate the effect on firm growth in the five years following the investment. Panel data fixed effect techniques, also allowing for selection bias corrections, indicate a positive influence of RD on growth. Limited dependent variable models have been used throughout the whole analysis to consider explicitly the cases of firms exiting the market in the analysed medium term. |
| Keywords: | Market Structure, Firm Strategy, and Market Performance: General; Firm Objectives, Organization, and Behavior: General; Management of Technological Innovation and R&D; |
| JEL: | L20 L10 O32 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:unm:unumer:2014001&r=bec |
| By: | Natasa Bilkic (University of Paderborn); Thomas Gries (University of Paderborn) |
| Abstract: | Popular opinion suggests that malfunctioning, poorly designed incentive schemes in financial firms that encouraged greed and involved excessive salaries were responsible for the excessive risk taking that eventually led to the 2008 financial crash. In this paper we discuss this claim in a theoretical model. We use a modified version of delegated portfolio choice approach with performance contracts. If, in this modified model, we allow for the existence of destructive agents - when maximizing their private utility - each financial firm will take excessive risks. As a result the finance sector develops systemic risk. We define systemic risk as inefficient and excessive risk that is chosen in an endogenous and stable manner by the aggregate market. |
| Keywords: | delegated portfolio choice, systemic risk, destructive agent, adverse selection |
| JEL: | D82 D86 G14 |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:pdn:wpaper:76&r=bec |
| By: | Giuseppe Berlingieri |
| Abstract: | Giuseppe Berlingieri looks at the structural transformation of the US economy over the past 60 years. |
| Keywords: | Structural transformation, outsourcing, professional and business services, inputoutputtables, intermediates |
| JEL: | D57 L16 L24 L84 O14 O41 O51 |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepcnp:cep413&r=bec |
| By: | Mundt, Philipp; Milakovic, Mishael; Alfarano, Simone |
| Abstract: | The basic philosophy behind Gibrat's rule of proportionate effect has been to find some common mechanism in the growth process of business firms, based on the idea that growth rates are independent of size and drawn from the same distribution. After decades of research, however, it seems fair to say that the 'law' fails to provide a universal mechanism for the growth of firms. Here we take the position that it is more plausible for Gibrat's approach to apply to firm profitability rather than firm growth, in line with the classical idea of economic competition as a dynamic process of capital reallocation. Considering a sample of more than five hundred long-lived US corporations from virtually all sectors, we compare the statistical properties of growth and profit rates over a time span of thirty years, and find that profit rates and their volatilities are independent of size, which is not true of growth rates. We also find that the empirical densities of both profitability and growth can be described by exponential power (or Subbotin) distributions, but there are pronounced differences in their parameterizations and autocorrelation structures. We argue that a recently proposed diffusion process not only reproduces the cross-sectional distribution of profit rates, but is also consistent with the empirical time series of individual firms and their autocorrelations. In the natural sciences such a situation is commonly referred to as a statistical equilibrium, while econometricians speak of ergodicity and stationarity. Our economic interpretation of this property is that all surviving firms are subject to the same competitive pressures of capital reallocation, irrespective of their industry or particular line of business. They all face the same profitability benchmark and volatility, while their idiosyncratic efforts merely have an effect on the persistence of abnormal profits. In other words, survivors have to participate in the same game and can only choose to do so at different 'speeds'. We conclude with the empirical observation that the speed of convergence from abnormal profits to the system-wide average depends negatively on firm size, diversification, and capital intensity. -- |
| Keywords: | profit rates,diffusion process,statistical equilibrium,dynamic competition,persistence |
| JEL: | C16 L10 D21 E10 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:bamber:92&r=bec |
| By: | Hottenrott, Hanna; Rexhäuser, Sascha; Veugelers, Reinhilde |
| Abstract: | This study investigates productivity effects to firms introducing new environmental technologies. The literature on within-firm organisational change and productivity suggests that firms can get higher productivity effects from adopting new technologies if complementary organisational changes are adopted simultaneously. Such complementarity effects may be of critical importance for the case of adoption of greenhouse gas (GHG) abatement technologies. The adoption of these technologies is often induced by public authorities to limit social costs of climate change, whereas the private returns are much less obvious. We find empirical support for complementarity between green technology adoption and organisational change for a sample of firms located in Germany. The adoption of CO2 reducing and sustainable technologies innovations is associated with lower productivity. The simultaneous implementation of organisational innovations, however, increases the returns to the adoption of green technologies. -- |
| Keywords: | technical change,environmental innovation,organisational change,productivity |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:12043r&r=bec |
| By: | Lubos Pastor; Robert F. Stambaugh; Lucian A. Taylor |
| Abstract: | We empirically analyze the nature of returns to scale in active mutual fund management. We find strong evidence of decreasing returns at the industry level: As the size of the active mutual fund industry increases, a fund's ability to outperform passive benchmarks declines. At the fund level, all methods considered indicate decreasing returns, but estimates that avoid econometric biases are insignificant. We also find that the active management industry has become more skilled over time. This upward trend in skill coincides with industry growth, which precludes the skill improvement from boosting fund performance. Finally, we find that performance deteriorates over a typical fund's lifetime. This result can also be explained by industry-level decreasing returns to scale. |
| JEL: | G10 G23 J24 |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19891&r=bec |
| By: | René Bohnsack (University of Amsterdam Business School - University of Amsterdam Business School); Jonatan Pinkse (MTS - Management Technologique et Strategique - Grenoble École de Management (GEM)); Ans Kolk (Amsterdam Business School - University of Amsterdam) |
| Abstract: | Sustainable technologies challenge prevailing business practices, especially in industries that depend heavily on the use of fossil fuels. Firms are therefore in need of business models that transform the specific characteristics of sustainable technologies into new ways to create economic value and overcome the barriers that stand in the way of their market penetration. A key issue is the respective impact of incumbent and entrepreneurial firms' path-dependent behaviour on the development of such new business models. Embedded in the literature on business models, this paper explores how incumbent and entrepreneurial firms' path dependencies have affected the evolution of business models for electric vehicles. Based on a qualitative analysis of electric vehicle projects of key industry players over a five-year period (2006-2010), the paper identifies four business model archetypes and traces their evolution over time. Findings suggest that incumbent and entrepreneurial firms approach business model innovation in distinctive ways. Business model evolution shows a series of incremental changes that introduce service-based components, which were initially developed by entrepreneurial firms, to the product. Over time there seems to be some convergence in the business models of incumbents and entrepreneurs in the direction of delivering economy multi-purpose vehicles. |
| Keywords: | Sustainable technology; business models, evolution; path dependencies; electric vehicles |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:hal:gemptp:hal-00936886&r=bec |
| By: | William R. Kerr (University, NBER, and Bank of Finland.) |
| Abstract: | High-skilled immigrants are a very important component of U.S. innovation and entrepreneurship. Immigrants account for roughly a quarter of U.S. workers in these fields, and they have a similar contribution in terms of output measures like patents or firm starts. This contribution has been rapidly growing over the last three decades. In terms of quality, the average skilled immigrant appears to be better trained to work in these fields, but conditional on educational attainment of comparable quality to natives. The exception to this is that immigrants have a disproportionate impact among the very highest achievers (e.g., Nobel Prize winners). Studies regarding the impact of immigrants on natives tend to find limited consequences in the short-run, while the results in the long-run are more varied and much less certain. Immigrants in the United States aid business and technology exchanges with their home countries, but the overall effect that the migration has on the home country remains unclear. We know very little about return migration of workers engaged in innovation and entrepreneurship, except that it is rapidly growing in importance. |
| Keywords: | Immigration, innovation, entrepreneurship, diaspora |
| JEL: | F15 F22 J15 J31 J44 L14 L26 O31 O32 O33 |
| Date: | 2014–01 |
| URL: | http://d.repec.org/n?u=RePEc:wip:wpaper:16&r=bec |
| By: | Leonardo Iacovone, Vijaya Ramachandran, and Martin Schmidt |
| Abstract: | Many countries in Africa suffer high rates of underemployment or low rates of productive employment; many also anticipate large numbers of people to enter the workforce in the near future. This paper asks the question: Are African firms creating fewer jobs than those located in other parts of the world? And, if so, why? One reason may be that weak business environments slow the growth of firms and distort the allocation of resources away from better-performing firms, hence reducing their potential for job creation. The paper uses data from 41,000 firms across 119 countries to examine the drivers of job creation. We find that African firms, at any age, tend to be 20–24 percent smaller than comparable firms in other regions of the world. The poor business environment, driven by limited access to finance, and the lack of availability of electricity, land, and unskilled labor has some value in explaining this difference. Foreign ownership, the export status of the firm, and the size of the market are also significant determinants of employment levels. However, even after controlling for the business environment and for characteristics of firms and markets, about 60 percent of the size gap between African and non-African firms remains unexplained. Constraints imposed by the business environment and by market characteristics that limit the growth of African firms can be alleviated by policy reforms. But there appear to be constraints that are not captured by these measures--these require further research in order to design appropriate policies for job creation. |
| Keywords: | Africa, underemployment, finance, economic growth |
| JEL: | D22 D24 L2 L25 O12 O14 O55 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:cgd:wpaper:353&r=bec |
| By: | Cai, Hongbin; Wang, Miaojun; Yan, Se |
| Abstract: | Using a simple game-theoretical model, this paper provides a new explanation for why large firms in developing economies may willingly pay higher wages than market wage rate. We show that large firms can strategically create entry barriers to the modern sector by setting high wage standards. They may do so to reduce competition or to distort the government's resource allocation. Focusing on the latter case, we also show that the size of the primitive sector will be larger than the efficient level, and public resource allocation will be biased in favor of incumbent large businesses despite the benevolent nature of the government. Using a survey of Chinese industrial firms, we find that industrial concentration is positively correlated with the size-wage effect, and such effect is stronger in less developed provinces. These findings are consistent with our theoretical prediction. |
| Keywords: | size-wage effect; entry deterrence; government resource allocation |
| JEL: | J21 J31 J42 L11 |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:53538&r=bec |