nep-bec New Economics Papers
on Business Economics
Issue of 2017‒05‒07
eleven papers chosen by
Vasileios Bougioukos
Bangor University

  1. Firms' Global Engagement and Management Practices By Görg, Holger; Hanley, Aoife
  2. Price Discrimination and Dispersion under Asymmetric Profiling of Consumers By Paul Belleflamme; Wing Man Wynne Lam; Wouter Vergote
  3. Working Time Accounts and Turnover By Launov, Andrey
  4. The Internationalisation of Firms and Management Practices:A Survey of Firms in Viet Nam By Isao Kamata; Hitoshi Sato; Kiyoyasu Tanaka
  5. Assessing European firms’ exports and productivity distributions: the CompNet trade module By Antoine Berthou; Emmanuel Dhyne; Matteo Bugamelli; Ana-Maria Cazacu; Calin-Vlad Demian; Péter Harasztosi; Tibor Lalinsky; Jaanika Meriküll; Filippo Oropallo; Ana Cristina Soares
  6. Knowledge externalities and firm heterogeneity: Effects on high and low growth firms By Grillitsch, Markus; Nilsson, Magnus
  7. The Role Of Corporate Governance And Its Impact On Risk And Firm Performance Of Real Estate Industry: Pavilion Reit By Kamarulzaman, Fadzilah
  8. Firm Risk And Performance: The Role Of Corporate Governance Of Redtone International Berhad By khoo, roushin
  9. Firm Financing and Growth in the Arab Region By Soha Ismail; Juan Jose Cortina Lorente; Sergio L. Schmukler
  10. Firm Risk and Performance: The Role of Corporate Governance of Digi Telecommunication Berhad By Kiew, sockyan
  11. Very Simple Markov-Perfect Industry Dynamics : Empirics By Abbring, Jaap; Campbell, J.R.; Tilly, J.; Yang, N.

  1. By: Görg, Holger (Kiel Institute for the World Economy); Hanley, Aoife (Kiel Institute for the World Economy)
    Abstract: We investigate whether firms' "global engagement", either in the form of exporting or opening up affiliates abroad, is related to the change in their management performance. Using new and unique data from a recent large scale firm survey of management practices in Germany, we calculate management scores for firms as in Bloom et al. (2013). These indicate how structured management is in a given firm. We find that switching into exporting, and to a lesser degree opening up affiliates abroad, is related to improving management performance in the sense of firms applying more structured management practices.
    Keywords: management practices, global engagement, exporting, outward investment
    JEL: F2 L2 M2
    Date: 2017–03
  2. By: Paul Belleflamme (Aix-Marseille Univ. (Aix-Marseille School of Economics), CNRS, EHESS and Centrale Marseille); Wing Man Wynne Lam (University of Liège); Wouter Vergote (CEREC, University Saint-Louis)
    Abstract: Two duopolists compete in price on the market for a homogeneous product. They can use a 'profiling technology' that allows them to identify the willingness-to-pay of their consumers with some probability. If both firms have profiling technologies of the exact same precision, or if one firm cannot use any profiling technology, then the Bertrand paradox continues to prevail. Yet, if firms have technologies of different precisions, then the price equilibrium exhibits both price discrimination and price dispersion, with positive expected profits. Increasing the precision of both firms’ technologies does not necessarily harm consumers.
    Keywords: price discrimination, price dispersion, Bertrand competition
    JEL: D11 D18 L12 L86
    Date: 2017–04
  3. By: Launov, Andrey (University of Kent)
    Abstract: Working time account is an organization tool that allows firms smoothing their demand for hours employed. Descriptive literature suggests that working time accounts reduce turnover and inhibit increase in unemployment during recessions. In a model of optimal choice of hours by a firm I show that working time account does not necessarily guarantee lower turnover. Turnover may be reduced or increased depending on whether a firm meets economic downturn with surplus or deficit of hours and on how productive this firm is. The model predicts that working time accounts contributed positively to reducing turnover in Germany during the Great Recession.
    Keywords: labour demand, working hours, working time accounts, turnover, Great Recession, Germany
    JEL: J23 J63
    Date: 2017–03
  4. By: Isao Kamata; Hitoshi Sato; Kiyoyasu Tanaka
    Abstract: This study examines the role of management practices in the internationalisation of domestic firms through directly exporting and/or supplying to local affiliates of multinationals. An original survey of manufacturing firms in Viet Nam was conducted, investigating their management practices such as human resource management and internationalisation status. The survey results shed light on similarities and dissimilarities among firms in several dimensions of management practices. Findings reveal that internationalised firms tended to be more enthusiastic about the formal training of production workers, the modernisation of production and operation, and product and process innovation. Differences in skills and experience requirements for newly employed managers were less recognizable, but internationalised firms tended to have managers who studied overseas. Furthermore, the use of public support to employee training, teamwork in production, and unionisation of employees did not show a significant difference between internationalised and non-internationalised firms.
    Keywords: Management practices, Firm heterogeneity, Global value chains
    JEL: F23 F61 M11 M50
    Date: 2017–05
  5. By: Antoine Berthou (Banque de France); Emmanuel Dhyne (National Bank of Belgium); Matteo Bugamelli (Banca d’Italia); Ana-Maria Cazacu (Banca Nationala a României); Calin-Vlad Demian (European Central Bank); Péter Harasztosi (Magyar Nemzeti Bank); Tibor Lalinsky (National Bank of Slovakia, Research Department); Jaanika Meriküll (Eesti Pank); Filippo Oropallo (ISTAT); Ana Cristina Soares (Banco de Portugal)
    Abstract: This paper provides a new cross-country evaluation of competitiveness,focusing on the linkages between productivity and export performance among European economies. We use the information compiled in the Trade module of CompNet to establish new stylized facts regarding the joint distributions of the firm-level exports performance and productivity in a panel of 15 countries, 23 manufacturing sectors during the 2000’s. We confirm that exporters are more productive than non-exporters. However, this productivity premium is rising with the export experience of firms, with permanent exporters being much more productive than starters. At the intensive margin, we show that both the level and the growth of firm-level exports rise with firm productivity, and that the bulk of aggregate exports in each country are made by a small number of highly productive firms. Finally, we show that during the crisis, the growth of exports by high productive firms sustained the current account adjustment of European “stressed” economies. This last result confirms that the shape of the productivity distribution within each country can have important consequences from the point of view of the dynamics of aggregate trade patterns.
    Keywords: Firm-level exports, productivity, firm heterogeneity
    JEL: F10 F14
    Date: 2016–12
  6. By: Grillitsch, Markus (CIRCLE, Lund University); Nilsson, Magnus (CIRCLE, Lund University)
    Abstract: Knowledge externalities affect high and low growth firms differently. The paper develops two theoretical arguments. The knowledge equilibrium argument postulates that knowledge externalities weaken high growth firms for the benefit of low growth firms until performance differences vanish. The knowledge competition argument claims that high growth firms are in a better position to identify, attract, and integrate knowledge, thereby benefiting more from knowledge externalities than low growth firms. Based on 188,936 observations of 32,736 Swedish firms from 2004 to 2011, it is analyzed whether knowledge centers enable high growth firms to surge ahead or low growth firms to catch up.
    Keywords: knowledge spillovers; externalities; firm growth; competitiveness; core-periphery
    JEL: O18 O30 P48 R10 R12
    Date: 2017–04–27
  7. By: Kamarulzaman, Fadzilah
    Abstract: The main purpose of this study is to identify corporate governance and its impact on firm performance of Real Estate Investment Trust over the period between 2011 and 2015. The study is to show how the firm performance influenced by corporate governance and risk performance. The information acquired from yearly report of Pavilion REIT Management Sdn. Bhd.( Pavilion REIT) from 2011 until 2015. The estimation of liquidity ratio and operating ratio used to see the general performance of Pavilion REIT in 5 years. The extra estimation is the asset size, this variable has a negative and no significant relationship with liquidity risk. To see the relationship of risk elements to the firm performances, this paper is using profitability ratio, liquidity ratio, activity ratio, leverage ratio, and Gross Domestic Product (GDP). This study will identify and explore about the risk that the company faced that affect the performances of the company like credit risk, liquidity risk and market risk. At the end of this study, the finding shows that the relationship between the corporate governance and risk performance and its impact on the Pavilion REIT Management Sdn. Bhd.’s financial performances. Thus to address this, the relationship between corporate governance, risk performance and firm performance are observed.
    Keywords: Credit Risk, Liquidity Risk, Profitability Risk and Macroeconomics
    JEL: G3
    Date: 2017–04–16
  8. By: khoo, roushin
    Abstract: This study aims at analyzing the relationship between corporate governance, REDtone firm liquidity and internal and external factor. In order to carry out the study a descriptive analysis through quantitative approach was used. Descriptive statistics analysis, we analyzed the firm’s annual report from year 2011 to 2015, SPSS and correlation helped confirm that the company corporate governance, firm performance and risk. Thus, the better the financial performance (ROA, ROE and liquidity) the lower the risk incurred.
    Keywords: corporate governance, liquidity, risk, ROA and ROE
    JEL: G3 G32
    Date: 2017–04–16
  9. By: Soha Ismail (The World Bank); Juan Jose Cortina Lorente; Sergio L. Schmukler
    Abstract: This paper provides a first analysis of the extent to which firms in the Arab region use capital markets to obtain financing and grow. It addresses two questions: First, how many and which firms issue equity, bonds, and syndicated loans in the Arab region? Second, how do these firms perform relative to non-issuing firms? To tackle these questions, a uniquely matched dataset of firm-level issuances and balance sheet information of 1,462 firms in the Arab region is constructed. Two main findings emerge from the analysis. (1) Over the last two decades, the amounts raised in equity, bond, and syndicated loan markets have considerably increased and been associated with an increasing number of issuing firms. (2) The typical issuing firm is larger, grows faster, is more leveraged, and holds more long-term debt relative to the typical non-issuer. Moreover, issuers seem to be initially larger than non-issuers in terms of assets, turnover, and the number of employees, and even grow faster over time. The firm size distribution of issuers lies to the right and shifts more rightwards over time compared to the distribution of non-issuers, indicating a divergence in firm size among listed firms.
    Date: 2017–11–05
  10. By: Kiew, sockyan
    Abstract: The purpose of this study is to examine the corporate governance, the impacts of firm performances and risk for telecommunication industry. This review additionally analysis the value of profitability and liquidity ratio. The research involved the relationship between the corporate governance, performances of company and the risk of Digi Telecommunication Berhad within a five year period which from 2011 until 2015. The companies were from the telecommunications sector and the data was obtained from the Digi company annual report. The ratios examined were the return on assets (ROA), return on equity (ROE) and current ratio, profitability, liquidity ratio and leverage of the company. A conclusion based solely on the profitability and liquidity ratios of company. The results support the proposition that analysis based on the profitability and liquidity ratios is best before reaching any conclusions regarding the financial liquidity positions and have significant relationship between the firm performances and risk of Digi companies.
    Keywords: Macroeconomic, Performance, Profitability, Liquidity, Liquidity Risk
    JEL: G3 G32
    Date: 2017–04–16
  11. By: Abbring, Jaap (Tilburg University, Center For Economic Research); Campbell, J.R.; Tilly, J.; Yang, N. (Tilburg University, Center For Economic Research)
    Abstract: This paper develops an econometric model of firm entry, competition, and exit in oligopolistic markets. The model has an essentially unique symmetric Markov-perfect equilibrium, which can be computed very quickly. We show that its primitives are identified from market-level data on the number of active firms and demand shifters, and we implement a nested fixed point procedure for its estimation. Estimates from County Business Patterns data on U.S. local cinema markets point to tough local competition. Sunk costs make the industry's transition following a permanent demand shock last 10 to 15 years.
    Keywords: demand uncertainty; dynamic oligopoly; firm entry and exit; nested fixed point estimator; sunk costs; toughness of competition; cunterfactual plicy analysis
    JEL: L13 C25 C73
    Date: 2017

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