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on Business Economics |
| By: | Krenz, Astrid |
| Abstract: | I investigate the relationship between the extensive margins of imports and exports (the number of countries traded with and the number of goods traded) and firm productivity using a newly constructed and rich panel data set of German manufacturing firms for the years 2009-2014. I do for the first time construct a data set based on German trade data and firm data that accounts for the substantial change in the German register of firms statistics after 2012. The extensive margins are significantly and positively associated with firm-level productivity both for West and East German firms in cross-sectional estimations, which is in line with the previous literature. Productivity is higher in firms that import and export more goods and trade with more countries. However, results based on panel analyses reveal that especially for East German firms the relationship becomes insignificant when unobserved firm heterogeneity is controlled for. The results point to a high degree of firm heterogeneity, of factors that are relevant and differ within the firm only, for firms in East Germany. |
| Keywords: | Extensive margins of trade,Firm Productivity,Germany,Firm Heterogeneity |
| JEL: | F14 L25 L60 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cegedp:369&r=all |
| By: | Krenz, Astrid |
| Abstract: | Female-run firms are less likely to be exporters although they exert positive influence in various aspects in an economy and society. With a new and comprehensive data set on manufacturing plants, I investigate the exporter productivity premium of female-run firms in Germany. The results show that female-run firms gain a higher exporter-productivity premium than male-run firms. I find evidence for selection into exporting but no impact for learning from exporting for female-run exporting firms. These results give hint to discrimination barriers that female-run firms face when they are exporting as compared to male-run firm exporters. |
| Keywords: | Gender Inequality,Exporter-Productivity Premium,Germany,Firm Heterogeneity |
| JEL: | F14 L25 L60 O12 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cegedp:368&r=all |
| By: | Haraguchi, Junichi; Matsumura, Toshihiro |
| Abstract: | We investigate endogenous timing in a mixed duopoly with price competition and with social marginal cost differing from private marginal costs. We find that any equilibrium timing patterns--Bertrand, Stackelberg with private leadership, Stackelberg with public leadership, and multiple Stackelberg equilibria-- emerge. When the foreign ownership share in a private firm is less than 50%, public leadership more likely emerges than private leadership. Conversely, private leadership can emerge in a unique equilibrium when the foreign ownership share in a private firm is large. These results may explain recent policy changes in public financial institutions in Japan. We also find a nonmonotone relationship between the welfare advantage of public and private leadership and the difference between social and private marginal costs for a private firm. A nonmonotone relationship does not emerge in profit ranking. |
| Keywords: | public financial institutions, differentiated products, Bertrand, Stackelberg, payoff dominance |
| JEL: | H42 L13 |
| Date: | 2019–04–20 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:93450&r=all |
| By: | Andrea Andrenelli; Iza Lejárraga; Sébastien Miroudot; Letizia Montinari |
| Abstract: | Global value chains (GVCs) have sharpened the interdependencies between trade and foreign direct investment (FDI). Using a novel micro-level dataset covering about 27 000 corporate relationships of 147 multinational enterprises (MNEs) in 13 sectors, new evidence is provided on how firms organise their production globally by combining trade with investment, and on a range of non-equity, contract-based partnerships. The analysis leads to five stylised facts. First, MNE activities are a combination of trade, FDI and strategic partnerships. All firms rely on a mix of these different types of corporate relationships. Second, the configuration of trade, investment and strategic partnerships varies across sectors, firms and markets. The results highlight considerable firm-level heterogeneity within the same industry and across the different modes of entry. Third, investment performs various functions in GVCs. In addition to traditional forms of FDI such as “market-seeking” or “input-seeking”, investment “in capabilities” or “conglomerate” FDI also account for a relevant share of equity-based relationships. Fourth, support business functions emerge as key building blocks in GVCs, which suggests that policy reforms in transversal services sectors that support all GVCs should merit special attention. Fifth, GVCs display a clear geographical organisation. While domestic corporate relationships may lead to higher volumes of activities, in terms of the number of relationships MNEs have more partners abroad. Moreover, the large majority of GVC interactions take place within OECD countries. Overall, the complex and heterogeneous interlinkages observed in modern firm strategies highlight the importance of ensuring a level playing field for both trade and investment. |
| Keywords: | investment, multinational enterprises, Trade |
| JEL: | L23 L24 F23 |
| Date: | 2019–04–25 |
| URL: | http://d.repec.org/n?u=RePEc:oec:traaab:227-en&r=all |
| By: | Heyman, Fredrik; Norbäck, Pehr-Johan; Persson, Lars |
| Abstract: | Recent studies document a 30-year decline in various measures of entrepreneurship in the U.S. Using detailed Swedish employer-employee data over the period 1990 to 2013, we find young firms to be more prominent in the Swedish business sector than in the U.S. business sector. Young Swedish firms, aged five years or less, account for more than half of all firms during this period. We also observe an increase in Swedish entrepreneurial activity for start-ups. However, increasing job destruction rates for young firms has implied a declining employment share for younger firms from the mid-2000s. Moreover, most of the job creation by young firms occurs in the expanding service sector. We discuss different explanations for why Sweden appears not to have the same strong decline in entrepreneurial activity as the U.S. has had during the last two decades. We argue that one important explanation is economic reforms in Sweden in the 1990s that mitigated several hurdles to entrepreneurship. |
| Keywords: | entrepreneurship; industrial structure and structural change; job dynamics; Matched employer-employee data |
| JEL: | J23 K23 L26 L51 |
| Date: | 2019–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13683&r=all |
| By: | Johannes Boehm (Département d'économie); null null (Centre for Economic Performance); John Morrow (King‘s College London [London]) |
| Abstract: | Multiproduct firms dominate production, and their product turnover contributes substantially to aggregate growth. Theories propose that multiproduct firms grow by diversifying into products which need the same know-how or capabilities, but are less clear on what these capabilities are. Input output tables show firms co-produce in industries that share intermediate inputs, suggesting input capabilities drive multiproduct production patterns. We provide evidence for this in Indian manufacturing: the similarity of a firm’s input mix to an industry’s input mix predicts entry into that industry. We identify the direction of causality from the removal of size-based entry barriers in input markets which made firms more likely to enter industries that were similar in input use to their initial input mix. We rationalize this finding with a model of industry choice and economies of scope to estimate the importance of input capabilities in determining comparative advantage. Complementarities driven by input capabilities make a firm on average 5% (and up to 15%) more likely to produce in an industry. Entry barriers in input markets constrained the comparative advantage of firms and were equivalent to a 10.5 percentage point tariff on inputs. |
| Keywords: | Multiproduct firms; Firm capabilities; Vertical input linkages; Comparative advantage; Economies of scope; Size-based policies |
| JEL: | F11 L25 M2 O3 |
| Date: | 2019–04 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/1dn2prktaq9p3949il1h9ds86b&r=all |
| By: | Budzinski, Oliver; Feddersen, Arne |
| Abstract: | The Formula One Championship (F1) is one of the biggest sports businesses in the world. But, however, it seems to astonish that only very few scholarly articles analyze the F1 business. The aim of this study is to contribute to closing two gaps in the existing literature: it contributes (1) to the (sports) economic analysis of the F1 business and (2) to the literature on competitive balance in non-team sports. Like competitive balance in team sport leagues, also for F1 racing three dimensions can be distinguished: (a) race-specific competitive balance, (b) within-season competitive balance, and (c) between-season competitive balance. In addition to classical tools and data, some new and F1 specific indicators, like average lead changes or leading distance, are employed. Also, pitfalls induced especially by the used data source or calculation method are highlighted. |
| Keywords: | Formula One Motor Racing,competitive balance,empirical industry study,sports economics |
| JEL: | L83 C01 L13 M21 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:tuiedp:121&r=all |
| By: | Dave, Chetan (University of Alberta, Department of Economics); Hamre, Sjur (Duke University); Kephart, Curtis (R-Studio); Reuben, Alicja (New York University Abu Dhabi) |
| Abstract: | We compare standard (laboratory) and non-standard (field) subject pool behavior in an extensive form public goods game with random punishment. Our experimental investigation is motivated by real-world ‘Activists’ encouraging public goods provision by firms; an activity known as corporate social responsibility. We find that relative to laboratory subjects, activists in Mumbai are more willing to settle at the Nash equilibrium of the game (which entails increased provision of public goods) and are more willing to punish non-cooperative firm behavior even if such punishments hurt their own payoffs. |
| Keywords: | Public goods; punishment; non-standard subject pool |
| JEL: | C92 C93 D64 |
| Date: | 2019–04–23 |
| URL: | http://d.repec.org/n?u=RePEc:ris:albaec:2019_006&r=all |
| By: | Ludwig von Auer; Tu Anh Pham |
| Abstract: | The literature on cartel stability sidelines antitrust policy, whereas the literature on antitrust policy tends to neglect issues of cartel stability. This paper attempts to connect these two interrelated aspects in the context of an augmented quantity leadership model. The cartel is the Stackelberg quantity leader and the fringe firms are in Cournot competition with respect to the residual demand. The antitrust authority decides on its own investigative effort and on the size of the fine that cartel members have to pay when they are detected. For testifying cartel members a leniency program is implemented. Our framework takes into account that these antitrust policy instruments are not costless for society. Our model demonstrates that the optimal antitrust policy exploits the inherent instability of a cartel to reduce its size. |
| Keywords: | antitrust, stability, Cournot fringe, oligopoly, leniency |
| JEL: | L13 L41 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:trr:wpaper:201907&r=all |