|
on Business Economics |
| By: | Florian Englmaier (LMU Munich); Jose E. Galdon-Sanchez (Universidad Publica de Navarra); Ricard Gil (IESE Business School); Michael Kaiser (E.CA Economics); Helene Strandt (LMU Munich) |
| Abstract: | This paper empirically examines how management practices affect firm productivity over the business cycle. Using plant-level high-dimensional human resource policies survey data collected in Spain in 2006, we employ unsupervised machine learning to describe clusters of management practices (“management styles”). We establish a positive correlation between a management style associated with structured management and performance prior to the 2008 financial crisis. Interestingly, this correlation turns negative during the financial crisis and positive again in the economic recovery post-2013. Our evidence suggests firms with more structured management are more likely to have practices fostering culture and intangible investments such that they focus in long-run profitability, prioritizing innovation over cost reduction, while having higher adjustment costs in the short-run through higher share of fixed assets and lower employee turnover. |
| Keywords: | management practices; culture; unsupervised machine learning; productivity; great recession; |
| JEL: | M12 D22 C38 |
| Date: | 2025–10–15 |
| URL: | https://d.repec.org/n?u=RePEc:rco:dpaper:548 |
| By: | Alfredo D'Angelo; Marco Grazzi; Le Li; Daniele Moschella |
| Abstract: | The termination of an exporter-importer (E-I) relationship could challenge the company's export process. What are the consequences on the company's export performance in the foreign country? What role does export experience play in this relationship? The paper explores the overlooked phenomenon of E-I relationship termination and provides robust empirical evidence that the event has negative consequences on the firm's export performance in the foreign country. Despite this unsurprising, yet previously untested finding, our study shows a second important remark i.e., if the exporting firm has prior export experience, it is then able to cope with the negative effect of the termination event. Moreover, we find that the positive effect of prior export experience is only present in the early years of exporting. The results are based on a large longitudinal sample of French firms exporting to foreign buyers in EU countries. Findings are discussed along an in-depth case study to enhance robustness and comprehensiveness. |
| Keywords: | Exporter-Importer (E-I) relationship termination; Critical event; Export experience; Export performance |
| Date: | 2025–10–17 |
| URL: | https://d.repec.org/n?u=RePEc:ssa:lemwps:2025/34 |
| By: | Salomé Baslandze; Simon Fuchs |
| Abstract: | We study the role of supply chain disruptions in shaping consumer prices, focusing on both firms' own import shocks and strategic responses to competitors' disruptions. Using a newly constructed microlevel dataset that links transaction-level US import data from bills of lading with high-frequency consumer prices and sales from a consumer panel, we develop a novel approach to estimate the price effects of cost shocks and product availability. Motivated by a model of delivery delays, cost shocks, and firm pricing, we implement a shift-share identification strategy based on delivery shortfalls, port congestion, and freight and import costs. We find sizable pass-through elasticities: firms raise prices in response to higher import costs and delivery delays, especially when disruptions persist. We also identify strategic pricing: firms—including non-importers—increase prices in response to competitors' supply chain disruptions. Using our estimates and back-of-the-envelope calculations from the model, we show that strategic interactions significantly amplified the direct effects of supply chain shocks on consumer prices during the pandemic. |
| Keywords: | supply chains; inflation; delivery delays; strategic interactions; pass-through; inventory |
| JEL: | E31 F14 |
| Date: | 2025–09–24 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedawp:101962 |
| By: | Anastasios Evgenidis (Royal Holloway University London); Apostolos Fasianos (Brunel University of London) |
| Date: | 2025–10–16 |
| URL: | https://d.repec.org/n?u=RePEc:ifs:ifsewp:25/48 |
| By: | Memmen, Marvin; Ipsen, Leonhard; Schulz-Gebhard, Jan |
| Abstract: | The relationship between firm markups and inflation remains a topic of contention. Empirical findings suggest that many firms were able to maintain or increase their markups and profits amidst the recent wide-ranging cost shocks. This phenomenon, often referred to as sellers' inflation, raises two questions: i) why do firms change their price-setting strategies from previously competing for market shares via lower prices to raising prices in proportion or even excess of a price shock, and ii) why can they do so without impeding their market share and profitability? We argue that current supply-side explanations exhibit several theoretical and empirical shortcomings and instead propose a demand-based alternative based on the textbook argument of distorted price signals. We argue that higher price dispersion during periods of price shocks reflect informational costs for consumers and reduce consumers' price elasticity of demand by deranging the system of relative prices they oversee. Based on an agent-based model, we demonstrate that the combination of boundedly rational consumers and informational costs due to price dispersion enables firms to increase their markups and profits in response to wide-ranging cost-push shocks. As consumers increasingly struggle to monitor price changes, they become less able to adequately punish (or reward) firms for raising (or maintaining) prices. This straightforward mechanism offers a promising explanation for the emergence of sellers' inflation. |
| Keywords: | Inflation, Markups, Agent-based modeling, Consumer behavior, Price dispersion |
| JEL: | E31 E71 D83 C63 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:bamber:330171 |
| By: | Lemos, Sara (University of Leicester); Portes, Jonathan (King's College London) |
| Abstract: | We study the labour market impact of immigration to the United Kingdom, focusing on the large inflows following the 2004 EU enlargement. Using the Lifetime Labour Market Database (LLMDB)—a longitudinal 1% sample of National Insurance records—we provide the first analysis of immigration’s effects on employment and wages based on high-quality administrative microdata. Exploiting individual, area and time fixed effects, as well as area-time, individual-time and individual-area fixed effects, we reduce endogeneity concerns that have limited previous work. We find limited aggregate impacts, but distributional consequences: existing immigrants—particularly those who were young or low paid—experienced modest negative employment effects, while natives faced little evidence of displacement. For wages, impacts were mixed: existing immigrants overall gained, but low-paid immigrants lost. The results suggest labour market adjustment operated through both substitution and complementarities across groups. More broadly, we provide a methodological framework for analysing the much larger and more diverse post-2021 immigration flows. |
| Keywords: | wages, employment, immigration, Central and Eastern Europe, UK |
| JEL: | J22 C23 |
| Date: | 2025–10 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18199 |
| By: | Huben Liu; Dimitris Papanikolaou; Lawrence D.W. Schmidt; Bryan Seegmiller |
| Abstract: | We use recent advances in natural language processing and large language models to construct novel measures of technology exposure for workers that span almost two centuries. Combining our measures with Census data on occupation employment, we show that technological progress over the 20th century has led to economically meaningful shifts in labor demand across occupations: it has consistently increased demand for occupations with higher education requirements, occupations that pay higher wages, and occupations with a greater fraction of female workers. Using these insights and a calibrated model, we then explore different scenarios for how advances in artificial intelligence (AI) are likely to impact employment trends in the medium run. The model predicts a reversal of past trends, with AI favoring occupations that are lower-educated, lower-paid, and more male-dominated. |
| JEL: | J23 J24 N3 O3 O4 |
| Date: | 2025–10 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:34386 |
| By: | Chaurey, Ritam (Johns Hopkins SAIS); Nayyar, Guarav (The World Bank); Sharma, Siddharth (The World Bank); Verhoogen, Eric (Columbia University) |
| Abstract: | Knowledge spillovers among firms are widely viewed as a key driver of agglomeration and growth, but are difficult to estimate cleanly. We randomly allocated an energy-efficient motor – a “servo'” motor – among leather-goods firms in Dhaka, Bangladesh, and tracked adoption, information flows, beliefs about energy savings, and other variables. We use the difference between actual exposure and expected exposure (from simulated randomization draws) to identify the effect of exposure. We find a robust positive effect of exposure to treated neighbors within a small geographic area (500 meters in our baseline specification) on information flows and adoption. A marginal value of public funds (MVPF) calculation taking learning spillovers into account yields a significantly larger value than one considering only treated firms and suggests that adoption subsidies would be a cost-effective policy intervention. |
| Keywords: | knowledge spillovers, social learning, technology adoption, energy efficiency |
| JEL: | O14 R11 L67 L23 O12 |
| Date: | 2025–10 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18183 |
| By: | Fioretti, Michele; Saint-Jean, Victor; Smith, Simon C. |
| Abstract: | Does shareholder visibility affect firms' prosocial behavior? What implications for other shareholders? Exploiting quasi-experimental variation from media coverage around Annual General Meetings and major crises (COVID-19 pandemic and Russian invasion of Ukraine), we show that prominent shareholders support costly prosocial initiatives when these yield reputational benefits. In contrast, less-visible financial blockholders oppose such expenditures at their portfolio firms and prefer to act themselves. Prosocial actions driven by reputational motives reduce investment, productivity, and profits by 1 - 3%, imposing costs on other shareholders. Our findings reveal new implications for minority investors of unobservable intra-shareholder conflicts that emerge when examining shareholder incentives. |
| Keywords: | shareholder value, wealth, conflict, warm glow, reputation, exit and voice, social responsibility, charitable donations, covid, Ukraine, Russia |
| JEL: | G32 G41 M14 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:cbscwp:329627 |
| By: | Ambre Nicolle; Christos Genakos; Tobias Kretschmer (Cambridge Judge Business School, University of Cambridge) |
| Abstract: | Can entire markets strategically confuse consumers to raise market prices? Using a detailed dataset covering virtually all mobile phone tariffs and their handsets in the United Kingdom between January 2010 and September 2012, we study the evolution of quality-adjusted prices and find that they increased until December 2010, even though the industry was mature, technologically homogeneous, and competitive. Upon exploring the role of several salient factors, such as differentiation and product proliferation by firms that may have affected this evolution, we argue that the primary driver is the implementation of obfuscation strategies by firms. The observed price increase is significantly correlated with the rate at which operators implemented dominated tariffs (ie tariffs for which there is a cheaper alternative from the same operator), indicating that firms use obfuscation strategies to reduce product transparency, thereby elevating overall prices. Importantly, the presence of dominated tariffs raises not only the prices of these contracts but also those of efficient ones, distinguishing our findings from a behavioral price discrimination strategy that would only affect inattentive consumers. Our exploratory study is one of the first to offer suggestive evidence of obfuscation as an industry-wide supply-side phenomenon. |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:jbs:wpaper:202503 |
| By: | Kampmann, David |
| Abstract: | In many US Tech corporations such as Meta, Alphabet, and SpaceX, founders still hold shareholder voting control. How can we better understand the concentration of insider control in Tech? Drawing on quantitative and qualitative data to examine the rise of US start-up investments post-dotcom, this article demonstrates that a small group of new venture capital (VC) entrants played a key role in advancing founder control in Tech to win deals against established VC firms and make outsized capital gains. I argue that the VC market follows a winners-take-all logic, which facilitated the uptake of founder control in Tech via dual-class shares because of the success of new VC entrants and early founder-controlled tech firms exiting between 2010 and 2014, and the growing investments by nontraditional, “passive” investors post-2010. This matters because the winners-take-all logic reinforces capital concentration among leading VCs while many Tech monopolies are now controlled by a small tech elite fraction. |
| Keywords: | saving and capital investment; ratings and ratings agencies; technology; ideology; G24 investment banking; O16 financial markets; USA; corporate finance and governance; brokerage; competition; venture capital; political economy and comparative economic systems; corporate governance |
| JEL: | J1 F3 G3 |
| Date: | 2025–10–15 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:129826 |
| By: | Cerkez, Nicolas; Cunningham, Wendy; Gupta, Sarika; Lung, Felix |
| Abstract: | A large share of workers in Sub-Saharan Africa earn a living through informal, low productivity household enterprises. While structural transformation toward formal wage employment is viewed as the long-term path to improving livelihoods, progress has been slow. In the meantime, small enterprises will remain a key source of employment for many years to come, making it important to better understand how to help such enterprises thrive. This paper uses original survey data from 1, 526 poor individuals across Liberia, Niger, and Senegal to examine the aspirations and constraints of urban household enterprise owners. The results suggest that most surveyed business owners voluntarily started their businesses, are satisfied with their jobs, and aspire to and have plans to expand their businesses. Most report that they earn more than they could as wage earners, with wage earners confirming the observations. However, a combination of family and business constraints and shocks may hinder their ambitions, ability to act on their goals, and realization of those goals. That said, two-thirds of micro-enterprise owners said they would accept a wage job if it offered wages on par with their current earnings. This suggests that households will continue to prefer firm ownership in the short run until structural transformation can improve earning potential of wage employment in the long term. The results suggest that household enterprise owners require a dual policy approach: one that improves current enterprise conditions while advancing longer-term structural reforms to expand access to quality wage employment. |
| Date: | 2025–10–20 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wbrwps:11235 |