nep-bec New Economics Papers
on Business Economics
Issue of 2014‒12‒13
eight papers chosen by
Vasileios Bougioukos
Bangor University

  1. Appropriability mechanisms, innovation and productivity: Evidence from the UK By Hall B.H.; Sena V.
  2. Interjurisdictional Competition and Location Decisions of Firms By Hernandez-Murillo, Ruben
  3. Financial Frictions and Sources of Business Cycle By Marzie Taheri Sanjani
  4. Networking Related to Sustainability in Hungary By Hegyi, Adrienn; Homolka, Fruzsina; Sebők, András
  5. Network Competence and Open Innovation Behaviour in the Food Sector: An Empirical Investigation By Lefebvre, Virginie M.; Molnàr, Adrienn; Kühne, Bianka; Gellynck, Xavier
  6. By Choice and by Necessity: Entrepreneurship and Self-Employment in the Developing World By David Margolis
  7. Supplier fixed costs and retail market monopolization By Caprice, Stéphane; von Schlippenbach, Vanessa; Wey, Christian
  8. The adoption of information and communication technologies in the design sector and their impact on firm performance: Evidence from the Dutch design sector By Bashir, Sadaf; Matzat, U.; Sadowski, B. M.

  1. By: Hall B.H.; Sena V. (UNU-MERIT)
    Abstract: We use an extended version of the well-established Crepon, Duguet and Mairesse model 1998 to model the relationship between appropriability mechanisms, innovation and firm-level productivity. We enrich this model in several ways. First, we consider different types of innovation spending and study the differences in estimates when innovation spending rather than RD spending is used to predict innovation in the CDM model. Second, we assume that a firm simultaneously innovates and chooses among different appropriability methods formal or informal to protect the innovation. Finally, in the third stage, we estimate the impact of the innovation output conditional on the choice of appropriability mechanisms on firmsf productivity. We find that firms that innovate and rate formal methods for the protection of Intellectual Property IP highly are more productive than other firms, but that the same does not hold in the case of informal methods for the protection of a firmfs IP, except possibly for large firms as opposed to SMEs. We also find that this result is strongest for firms in the services, trade, and utility sectors, and negative in the manufacturing sector.
    Keywords: Firm Performance: Size, Diversification, and Scope; Technological Change; Research and Development; Intellectual Property Rights: General; Intellectual Property Rights;
    JEL: O34 O30 L25
    Date: 2014
  2. By: Hernandez-Murillo, Ruben (Federal Reserve Bank of St. Louis)
    Abstract: We examine the welfare properties of alternative regimes of interjurisdictional competition for heterogenous mobile firms. Firms differ not only in terms of the degree of mobility across jurisdictions but also in terms of productivity. Alternative taxation regimes represent restraints on the discretionary powers of taxation of local governments. We find that average welfare is higher under discretionary and more efficient taxation regimes (in the sense of minimizing deadweight losses from distortionary taxation) when firms are highly mobile. In this situation, further limiting competition by imposing a system of non-discretionary instruments can reduce average welfare by reducing the efficiency of the local governments at raising and allocating public funds. When firms face high moving costs, on the other hand, switching to a non-discretionary and less efficient taxation regime may increase welfare by preventing local governments from engaging in excessive redistribution of resources.
    Keywords: Firms location decisions; jurisdictions; tax competition.
    JEL: C72 H21 H32 H73
    Date: 2014–10–01
  3. By: Marzie Taheri Sanjani
    Abstract: This paper estimates a New Keynesian DSGE model with an explicit financial intermediary sector. Having measures of financial stress, such as the spread between lending and borrowing, enables the model to capture the impact of the financial crisis in a more direct and efficient way. The model fits US post-war macroeconomic data well, and shows that financial shocks play a greater role in explaining the volatility of macroeconomic variables than marginal efficiency of investment (MEI) shocks.
    Keywords: Business cycles;Financial intermediaries;General equilibrium models;DSGE, Bayesian Estimation, Financial Frictions, Sources of Business Cycle
    Date: 2014–10–23
  4. By: Hegyi, Adrienn; Homolka, Fruzsina; Sebők, András
    Abstract: Sustainability is arguably one of the greatest challenges to Hungary in the future. The question is how to meet this need and tackle this challenge that requires commitment from the different players of the supply chain. This aim of the work within the FP7 Salsa project was to detect, explore the importance of sustainability and categories of the sustainability by the actors of the network and identify those elements related to sustainability issues, which support the future success along the soya and beef supply chain. In Hungary majority of the soy and beef enterprises are classic SMEs. The topics was quite “hard” for the questioned SMEs, because in one hand it is an increasing needs for sustainability, but in the other hand the environmental concerns haven’t acquired as significant awareness in Hungary as in western countries within the European Union. The needs regarding sustainability can be identified mainly from farmers and wholesalers (particularly multinational companies)., but most of the cases significant activities or changes have not been made yet. The producers emphasized that they fulfill the sustainability requirement if it is a real needs from their customers or without risking their success of their businesses. The other frequently mentioned answer was that they dealt with the sustainable aspects if it supports the most efficient use of the natural resources or the better quality of the product. Sustainability was associated with costs. The participants all agree that the cost of sustainability can be fairly high. However there is a significant need for sustainable production and products in Hungary, they do everything to meet the requirements of the sustainability standards. But in that case the members of the supply chain can see clearly the profitability of their investment in sustainability. Based on the results we could conclude that there is a harmonized, good business relation between the stakeholders within the Hungarian soy and beef supply chains. The power relations are different within the soy and the beef chains. Within the beef supply chains the wholesalers make the rules, and in spite of this, within the soy supply chain the bargaining power depends on the size of the soy production per year and on the market trends. Finally we could conclude that there is a real need from the players of the supply chains for collaboration, because only with the collective changing will contribute to enhance sustainable development in Hungary.
    Keywords: sustainability, soy and beef supply chain, networking, Agribusiness, Food Consumption/Nutrition/Food Safety, Industrial Organization, Research Methods/ Statistical Methods,
    Date: 2013–09
  5. By: Lefebvre, Virginie M.; Molnàr, Adrienn; Kühne, Bianka; Gellynck, Xavier
    Abstract: In today business world where knowledge and resources are increasingly spread among organizations, enterprises often develop a wide variety of relationships with other organizations in order to access new technologies, know-how and resources. Increasingly, the use of external resources for innovation – also referred as inbound open innovation in literature – is seen as a key factor to remain innovative and hence competitive. While the impact of open innovation on the firm’s innovativeness and performance has received quite some attention by scholars, the mechanisms that push firm to open up their innovation process remain under investigated. The aim of this paper is to contribute to fill in this gap by developing and testing empirically a research framework on the firm specific factors impacting the firm’s degree of openness. In order to reach the research objective, an extensive literature review was performed based on which several research hypotheses were developed. A web-questionnaire was then designed and distributed to the CEOs of food SMEs in Europe. A major result of this study is that network competence – defined as the firm’s ability to establish and use relationships with other organization – drives the firm’s openness in terms of ambidexterity (i.e. new versus existing relationships) and breadth (number of external sources or search channels that the firm relies upon in its innovative activities).
    Keywords: Open innovation, network competence, low-tech sector, Agribusiness, Agricultural and Food Policy, Food Consumption/Nutrition/Food Safety, Research and Development/Tech Change/Emerging Technologies,
    Date: 2013–09
  6. By: David Margolis (EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon-Sorbonne, Paris School of Economics - Université Paris I - Panthéon-Sorbonne, IZA - Institute for the Study of Labor)
    Abstract: Over half of all workers in the developing world are self-employed. Although some self-employment is chosen by entrepreneurs with well-defined projects and ambitions, roughly two thirds results from individuals having no better alternatives. The importance of self-employment in the overall distribution of jobs is determined by many factors, including social protection systems, labor market frictions, the business environment, and labor market institutions. However, self-employment in the developing world tends to be low productivity employment, and as countries move up the development path, the availability of wage employment grows and the mix of jobs changes.
    Keywords: self-employment, entrepreneurship, development
    Date: 2014–06
  7. By: Caprice, Stéphane; von Schlippenbach, Vanessa; Wey, Christian
    Abstract: Considering a vertical structure with perfectly competitive upstream firms that deliver a homogenous good to a differentiated retail duopoly, we show that upstream fixed costs may help to monopolize the downstream market. We find that downstream prices increase in upstream firms' fixed costs when both intra- and interbrand competition exist. Our findings contradict the common wisdom that fixed costs do not affect market outcomes.
    Keywords: Fixed Costs,Vertical Contracting,Monopolization
    JEL: L13 L14 L42
    Date: 2014
  8. By: Bashir, Sadaf; Matzat, U.; Sadowski, B. M.
    Abstract: This paper analyzes processes and effects of ICT enabled innovation in the Dutch design sector. Although the adoption of Information and Communication Technologies (ICT) is considered as vital in the design sector, little is known about whether and how ICTs affect the firm performance of small and medium-sized companies (SMEs) in the industry. In introducing a conceptual distinction between ICT supporting the information processing and communication, the paper first examines the determinants of ICT adoption. Next, we analyze the effects of ICT adoption on product and process innovation as well as on firm performance, focusing on the mediating role of the innovation processes. The analyses rest on survey data of a sample of 189 Dutch companies in the Web, Graphic, and Industrial Design Sector in the Netherlands. The results indicate that information processing role of ICT supports the exploitation and communication role facilitates the exploration in organizational learning. The exploitation enables process innovation while exploration enables product innovation. Lastly, Information processing technologies and product innovation are important determinants of superior firm performance.
    Date: 2014

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