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on Business Economics |
| By: | Wang, Jian-xiu; Hou, Dan-dan; Zhong, Shun-chang; You, Yun-tian |
| Abstract: | Research conducted worldwide has established that industrial agglomeration can improve firm productivity, regardless of policy and institutional factors. In this study, we utilize firm-level data from the Chinese Industrial Enterprises Database (CIED) for the period of 1998-2014 to analyze the relationship between induced-agglomeration policy and the productivity of firms operating within industrial parks while considering productivity and regional heterogeneities. To ensure the reliability of our results, we adopt various identification strategies that produce consistent outcomes. Additionally, we examine the impact of induced-agglomeration policy on firm survival in industrial parks by utilizing a Cloglog survival model. Our findings indicate that induced-agglomeration policy has a negative effect on the productivity of firms operating within industrial parks, with the negative effects diminishing as TFP increases and being stronger in less developed areas. We also find that induced-agglomeration policy can effectively enhance the lifespan of firms, particularly in less developed regions. We then point out policy optimization and other future research topics. |
| Keywords: | Keywords induced-agglomeration policy·productivity·survival·China |
| JEL: | C0 O25 O4 O40 |
| Date: | 2025–04–14 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:124377 |
| By: | Andre Diegmann (Halle Institute for Economic Research); Laura Pohlan (Institute for Employment Research (IAB)); Andrea Weber (Central European University) |
| Abstract: | We study how connections to German federal parliamentarians affect firm dynamics by constructing a novel dataset linking politicians and election candidates to the universe of firms. To identify the causal effect of access to political power, we exploit (i) new appointments to the company leadership team and (ii) discontinuities around the marginal seat of party election lists. Our results reveal that connections lead to reductions in firm exits, gradual increases in employment growth without improvements in productivity. Adding information on credit ratings, subsidies and procurement contracts allows us to distinguish between mechanisms driving the effects over the politician’s career. |
| Keywords: | Politicians, Firm Performance, Identification, Political Connections |
| JEL: | O43 L25 D72 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:crm:wpaper:2506 |
| By: | Kalina Manova; Andreas Moxnes; Oscar Perelló; Kalina B. Manova |
| Abstract: | This paper examines intermediation in production networks to unpack the firm attributes and matching costs that govern firm-to-firm networks and the gains from trade. Exploiting rich customs data for Chile, we show that exporters of all sizes use intermediaries, mix trade modes across buyers, and set lower prices on intermediated flows. We rationalize these facts in a model of network formation with suppliers of heterogeneous productivity and matchability, buyers of heterogeneous productivity, and intermediaries that reduce matching costs for a brokerage fee. Empirical evidence on trade activity across firms and countries corroborates the model, and informs how geographic distance, logistics and customs efficiency, formal institutions, and cultural-linguistic similarity shape network costs. Model estimation reveals that sellers’ attributes are negatively correlated, such that intermediaries enable highly productive sellers with low matchability to reach smaller buyers. This amplifies the welfare gains from intermediation due to wider and deeper network connectivity. |
| Keywords: | production networks, intermediation, productivity, matching costs |
| JEL: | F10 F12 F14 F23 L11 L14 L81 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11717 |
| By: | Fang, Tony (Memorial University of Newfoundland); Gunderson, Morley (University of Toronto); Hartley, John (Memorial University of Newfoundland) |
| Abstract: | Using data from a largely representative survey of 801 Atlantic Canadian employers, this paper conducts regression analyses to test associations between two diversity variables and five objective and subjective measures of firm performance: revenue change and employment change in the previous three years, projected revenue change and employment change over the next three years and projected provincial economic growth/decline over the next three years. We find that firms with an immigrant CEO and/or owner are more likely to forecast revenue growth, report recent employment growth, and forecast provincial economic growth. Employers who believe that a multicultural workforce enhances creativity are more likely to report recent employment growth and more likely to forecast provincial economic growth in the medium-term. This is consistent with most national studies, which tend to show immigrant-owned companies are more likely to create jobs and firm growth (Picot and Ostrovsky, 2021). |
| Keywords: | organizational performance, multiculturalism, management diversity, immigrant-owned businesses, employer survey, Atlantic Canada |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17810 |
| By: | Card, David (University of California, Berkeley); Devicienti, Francesco (University of Turin); Rossi, Mariacristina (University of Turin); Weber, Andrea (Central European University) |
| Abstract: | The gender wage gap rises with experience. To what extent do firm policies mediate this rise? We use administrative data from Italy to identify workers' first jobs and compute wage growth over the next 5 years. We then decompose the contribution of first employers to the rise in the gender wage gap, taking account of maternity events affecting a third of female entrants. We find that idiosyncratic firm effects explain 20% of the variation in early career wage growth, and that the sorting of women to slower-growth firms accounts for a fifth of the gender growth gap. Women who have a child within 5 years of entering work have particularly slow wage growth, reflecting a maternity effect that is magnified by the excess sorting of mothers-to-be to slower-growth firms. Many entrants change jobs within their first 5 years and we find that the male-female difference in early career wage growth arises from gaps for both movers and stayers. The firm components in wage growth for stayers and movers are highly correlated, and contribute similar sorting penalties for women who stay or leave. |
| Keywords: | maternity, firm effects, gender gaps, matched employer-employee data |
| JEL: | J00 J23 J24 J31 J38 J58 L13 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17860 |
| By: | Pinski, Marc; Hofmann, Thomas; Benlian, Alexander |
| Abstract: | We draw on upper echelons theory to examine whether the AI literacy of a firm’s top management team (i.e., TMT AI literacy) has an effect on two firm characteristics paramount for value generation with AI—a firm’s AI orientation, enabling it to identify AI value potentials, and a firm’s AI implementation ability, empowering it to realize these value potentials. Building on the notion that TMT effects are contingent upon firm contexts, we consider the moderating influence of a firm’s type (i.e., startups vs. incumbents). To investigate these relationships, we leverage observational literacy data of 6986 executives from a professional social network (LinkedIn.com) and firm data from 10-K statements. Our findings indicate that TMT AI literacy positively affects AI orientation as well as AI implementation ability and that AI orientation mediates the effect of TMT AI literacy on AI implementation ability. Further, we show that the effect of TMT AI literacy on AI implementation ability is stronger in startups than in incumbent firms. We contribute to upper echelons literature by introducing AI literacy as a skill-oriented perspective on TMTs, which complements prior role-oriented TMT research, and by detailing AI literacy’s role for the upper echelons-based mechanism that explains value generation with AI. |
| Date: | 2025–04–07 |
| URL: | https://d.repec.org/n?u=RePEc:dar:wpaper:154096 |
| By: | Paola Conconi; Fabrizio Leone; Glenn Magerman; Catherine Thomas |
| Abstract: | This paper provides a new explanation for the dominance of multinational corporations (MNCs) in international trade: after being acquired by an MNC, firms face lower entry frictions in countries in which their global parent already has a presence. We provide a model of firms’ export and import choices that delivers firm-level gravity regressions to isolate these “MNC network effects” from other channels through which multinational ownership can affect firms’ trade participation. We estimate the model combining rich administrative data for Belgium with data on MNCs’ global affiliate networks. Event study results reveal that acquired firms are more likely to start exporting to and importing from countries that belong—or that are exogenously added—to their parental network. The effects are stronger when new affiliates are geographically and culturally close to their direct parent, which can facilitate transfer of information about the global parent’s network. Combining the structure of our model with the empirical estimates, we find that MNC network effects have a large impact on firm growth. The effects of MNC ownership extend beyond the boundaries of the multinational: new affiliates are also more likely to start trading with countries that are geographically or culturally close to the MNC network, even if their parent has no affiliates there. |
| Keywords: | multinational corporations, production networks |
| JEL: | F10 F23 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11740 |