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on Economics of Strategic Management |
| By: | Martynova,M.; Renneboog,L. (TILEC (Tilburg Law and Economics Center)) |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubtil:200529&r=cse |
| By: | McCahery,J.A.; Vermeulen,E.P.M. (TILEC (Tilburg Law and Economics Center)) |
| Date: | 2004 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubtil:200424&r=cse |
| By: | Jaak Leimann (School of Economics and Business Administration at Tallinn University of Technology); Antti Ainamo (Jaakko Pöyry Consulting); Janne Tienari (Lappeenranta University of Technology) |
| Abstract: | Management consulting started to evolve in Estonia around 40 years ago. The development was affected by the consulting practice and literature mostly from the United States and neighbouring Finland. The most important factors in the development of the consulting sector in Estonia were direct contacts and cooperation of Estonian and Finnish management experts. As a result, the Estonian management theorists and practicioners were of the top level in the whole Soviet Union and affected the management-related thinking and practice in many other management knowledge centres in the Soviet Union. The development of management consulting between 1970 and 1990 formed a good basis for contemporary management consulting and development after Estonia regained its independence from the Soviet rule in 1991. |
| Keywords: | historical research, management consulting, iron wall, American model, consulting practice, consulting project, conference, theory-building, internationalisation |
| JEL: | L84 N01 P20 |
| URL: | http://d.repec.org/n?u=RePEc:ttu:wpaper:tutwpe05/125&r=cse |
| By: | Bertrand, Olivier (University of Toulouse); Zitouna, Habib (Ècole Supérieure des Sciences Èconomiques et Commerciales de Tunis (Tunisia)) |
| Abstract: | This paper investigates the effects of horizontal acquisitions on the performance of target firms in the 1990's. Using French manufacturing firm-level data, we examine two main indicators of performance: the profit and the productive efficieny. We distinguish domestic from cross-in-difference estimation techniques associated to a matching propensity score procedure. We find that M&A do not increase the profit of French target firms. These results suggest that firms probably redistribute efficiency gains at the upstream and/or downstream production stage. There is no evidence of an increase in market power. In addition, the consequences of domestic and cross-border M&A significantly differ. Efficiency gains are stronger for cross-border M&A. This conclusion is however true only for extra-Europan Union operations. The achievement in the European economic integrtion certainly explains the absence of difference between European and domestic acquisitions. Finally, our results cast some doubt on the frequent discrimination attitude towards foreign takeovers and the fears of their impact on firms' performance and the hos country's welfare. |
| Keywords: | Multinational Firms; Foreign Direct Investment; Mergers and Acquisitions; Take-Overs; Firms' Performance |
| JEL: | F23 L10 L20 |
| Date: | 2005–10–24 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0647&r=cse |
| By: | Julian Franks (London Business School, Sussex Place Regent’s Park, London NW1 4SA, England, jfranks@london.edu); Colin Mayer (Saïd Business School, University of Oxford, Park End Street, OX1 1HP Oxford, England, colin.mayer@sbs.ox.ac.uk); Hannes F. Wagner (Munich School of Management, Ludwig Maximilians University of Munich, Schackstrasse 4, D-80539 Muenchen, Germany, hwagner@bwl.uni-muenchen.de) |
| Abstract: | The ownership of German corporations is quite different today from that of Anglo-American firms. How did this come about? To what extent is it attributable to regulation? A specially constructed data set on financing and ownership of German corporations from the end of the 19th century reveals that, as in the UK, there was a high degree of activity on German stock markets with firms issuing equity in preference to borrowing from banks, and insider and family ownership declining rapidly. However, unlike in the UK, other companies and banks emerged as the main holders of equity, with banks holding shares primarily as custodians of other investors rather than on their own account. The changing pattern of ownership concentration was therefore very different from that of the UK with regulation reinforcing the control that banks exercised on behalf of other investors. |
| Keywords: | Evolution of ownership, German stock markets, financial regulation |
| JEL: | G32 N23 N24 |
| Date: | 2005–10 |
| URL: | http://d.repec.org/n?u=RePEc:trf:wpaper:65&r=cse |
| By: | Fumio Hayashi; Koji Nomura |
| Abstract: | This paper constructs a multi-sector model to take explicit account of the very sharp change in the relative price between non-IT and IT goods. The model is calibrated to the Japanese economy, and its solution path from 1990 on is compared to Japan's macroeconomic performance in the 1990s. Compared to the one-sector analysis of Japan in the 1990s in Hayashi and Prescott (2002), our model does slightly better or just as well in accounting for Japan's output slump and does worse in accounting for the capital-output ratio. We also show that, to revive a 2% long-term growth in percapita GDP, Japan needs to direct 10% of private total hours to the IT sector. |
| JEL: | E2 O4 O5 |
| Date: | 2005–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11749&r=cse |
| By: | Karsten Neuhoff; Michael Grubb; Kim Keats |
| Abstract: | Successful cap and trade programs for SO2 and NOx in the US allocate allowances to large emitters based on a historic base line for a period of up to thirty years. National Allocation Plans in Europe allocate CO2 allowances in an iterative approach first for a three then for a five-year period. The potential updating of the base line creates perverse incentives for operation and investment. Some allowances are also reserved for new entrants further distorting the scheme. We use analytic models and numeric simulations for the UK power sector to illustrate and quantify how these effects contribute to an inflation of the allowance price while reducing utilisation and investment in efficient technologies. The inflated allowance prices are likely to increase the European allowance budget and emissions, e.g. through the Linking Directive. As a result opportunity costs of emitting CO2 are reduced relative to an efficient cap and trade program. |
| Keywords: | : Emission Trading, Allowance Allocation, Investment Decision, Operation, Inefficiencies. |
| JEL: | D24 D92 Q28 L10 |
| Date: | 2005–11 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:0552&r=cse |
| By: | Goergen,M.; Manjon,M.C.; Renneboog,L. (TILEC (Tilburg Law and Economics Center)) |
| Date: | 2004 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubtil:200414&r=cse |
| By: | Sarbajit Chaudhuri (Dept. of Economics, Calcutta University) |
| Abstract: | The paper is purported to analyze the impact of skill formation on the skilled-unskilled wage inequality using a few variants of the HOS-type framework. It shows that the effect of skill formation on the wage inequality depends crucially upon the technologies of production of the economy and institutional nature of the markets for unskilled labour. In the extreme case when all unskilled labour markets are distorted any attempt of skill formation unequivocally accentuates the wage gap and may increase the level of unemployment of unskilled labour. These results point out that the empirical evidence as found in Beyer, Rojas and Vergara (1999) and the World Development Report (1995) that skill formation has contributed in reducing the skilled-unskilled wage gap in some developing countries lack solid theoretical bearing. The paper suggests that institutional reform programs, designed for the removal of labour market distortions, should be given high priority along with skill improvement measures to improve the skilled-unskilled wage inequality in the developing countries. |
| Keywords: | Skilled labour, unskilled labour, wage inequality, skill formation, institutional reform programs |
| JEL: | D50 J31 I28 |
| Date: | 2005–11–09 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpla:0511009&r=cse |
| By: | Damme,E. van (TILEC (Tilburg Law and Economics Center)) |
| Date: | 2004 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubtil:200407&r=cse |
| By: | Luis J. Álvarez (Banco de España, Alcalá 48, 28014 Madrid, Spain); Ignacio Hernando (Banco de España, Alcalá 48, 28014 Madrid, Spain) |
| Abstract: | This paper reports the results of a survey carried out by the Banco de España on a sample of around 2000 Spanish firms to deepen the understanding of firms’ price setting behaviour. The main findings may be summarised as follows. Most Spanish firms are price setters that use predominantly state-dependent rules or a combination of time- and statedependent rules when reviewing their prices. Changes in costs are the main factor underlying price increases, whereas changes in market conditions (demand and competitors’ prices) are the main driving forces of price decreases. The degree of price flexibility is directly related to the share of energy inputs over total costs and to the intensity of competition, whereas it is inversely linked to the labour share. The three theories of price stickiness that receive the highest empirical support are implicit contracts, coordination failure and explicit contracts. |
| Keywords: | Price setting; price stickiness; survey data. |
| JEL: | D40 E31 |
| Date: | 2005–10 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20050538&r=cse |
| By: | Goergen,M.; Martynova,M.; Renneboog,L. (TILEC (Tilburg Law and Economics Center)) |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubtil:200517&r=cse |
| By: | Irene Brambilla |
| Abstract: | This paper looks empirically into the behavior of multinational firms in international oligopolistic markets with trade balance constraints. I show how a particular form of non-tariff barrier applied at the firm level can lead to an increase in trade flows in the presence of intra-firm strategic trade. In my application, I estimate a model of demand, supply and trade policy in the automobile sector in Argentina and Brazil during 1996-1999. I measure the economic impact of a trade balance constraint that was in effect during that period and I compute predicted economic outcomes for the full adoption of a customs union, as has been agreed as part of the Mercosur negotiations, separating the sometimes opposing impacts of the removal of non-tariff barriers and the adoption of a common external tariff. Results show that the elimination of non-tariff barriers dominates the leveling of tariffs. Imports from outside of Mercosur increase under the new regime even though tariffs against these goods become more discriminatory, and exports from Brazil to Argentina decrease once the trade balance constraint is removed. |
| JEL: | F12 F13 F15 |
| Date: | 2005–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11745&r=cse |
| By: | Ting Zhu (Carnegie Mellon University); Vishal Singh (Carnegie Mellon University); Anthony J. Dukes (School of Economics and Management, University of Aarhus) |
| Abstract: | This paper analyzes the competition between two spatially differentiated multi-product retailers who encounter entry from a dominant discount retailer. Our primary objective is to determine how entry affects the pricing and relative profits of the incumbent stores and the role played by the location of the entrant. The new entrant has partial overlap in product assortment with the incumbents and is assumed to have lower procurement costs for the common goods. Consumers are heterogeneous in their location, economic status (shopping costs and valuations), as well as purchase basket or the types of products demanded. Results show that in the post entry equilibrium, the prices for the products not offered by the discounter are higher than the pre entry prices. More interestingly, contrary to the conventional wisdom we find that the store that is closer to the new entrant is better off compared to the incumbent located further away. The intuition for these results is that the discounter with its low price draws away the poor consumers – the price sensitive segment – out of the market for the items it carries. This in turn softens price competition between the incumbents for these items. Furthermore, the new entrant’s unique product offering attracts more consumers to visit the location it occupies, which introduces positive demand externalities to the neighboring retailer, leading to an increase in sales for the non-competing products. We provide empirical evidence for our results and discuss implications for retailers facing competition from large discount stores. |
| Keywords: | entry; retail competition; agglomeration |
| JEL: | L13 L81 M31 |
| Date: | 2005–05 |
| URL: | http://d.repec.org/n?u=RePEc:kud:kuieci:2005-05&r=cse |
| By: | Ruys,P.H.M. (TILEC (Tilburg Law and Economics Center)) |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubtil:200524&r=cse |
| By: | Christian Lorenz (Institute of Public Economics, Muenster University) |
| Abstract: | Coordination Failure Diagnostics (CFD) is a model that analyses real market processes with the help of time pattern analysis and investigates whether they operate efficiently (See www.wiwi.uni-muenster.de/cfd). The CFD cartel-audit should enable the detection of cartels via characteristic market process patterns. This is based on the assumption that existing cartels cause failures in the observed process patterns. The CFD cartel-audit attempts to draw conclusions from these process patterns in order to find hidden cartels and to engage antitrust agencies into additional more detailed audits. |
| Keywords: | cartel, cement, collusive marker, market screening, price fixing |
| JEL: | L13 L41 L61 D43 |
| Date: | 2005–11–09 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpio:0511003&r=cse |
| By: | Lal, Kaushalesh (United Nations University, Institute for New Technologies) |
| Abstract: | The study identifies and analyses the factors that influenced the adoption of new technologies in SMEs. Information and communication technologies (ICTs) have been used as proxy of new technologies. The findings of the study suggest that industry-specific characteristics such as skill- and export-intensiveness have bearings on the type of ICT adoption. The size of operation measured in terms of sales turnover influenced the adoption of new technologies. The results also suggest that there are marginal differences in the labour productivity and profitability of firms that adopted varying degree of ICTs. In view of the fact that that MFA provisions are no more available to garments sector firms since January 1, 2005, the government needs to embark on providing technological, physical, and communication infrastructure at a globally competitive rate so that SMEs can withstand onslaught posed by large domestic firms and MNCs. |
| Keywords: | small and medium enterprises, SMEs, technological change, information and communication technologies, ICT, India, competitiveness, technology policy, industrial policy |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:unuint:200506&r=cse |
| By: | Benito Arruñada |
| Abstract: | Recent decisions by the Spanish national competition authority (TDC) mandate payment systems to include only two costs when setting their domestic multilateral interchange fees (MIF): a fixed processing cost and a variable cost for the risk of fraud. This artificial lowering of MIFs will not lower consumer prices, because of uncompetitive retailing; but it will however lead to higher cardholders’ fees and, likely, new prices for point of sale terminals, delaying the development of the immature Spanish card market. Also, to the extent that increased cardholders’ fees do not offset the fall in MIFs revenue, the task of issuing new cards will be underpaid relatively to the task of acquiring new merchants, causing an imbalance between the two sides of the networks. Moreover, the pricing scheme arising from the decisions will cause unbundling and underprovision of those services whose costs are excluded. Indeed, the payment guarantee and the free funding period will tend to be removed from the package of services currently provided, to be either provided by third parties, by issuers for a separate fee, or not provided at all, especially to smaller and medium-sized merchants. Transaction services will also suffer the consequences that the TDC precludes pricing them in variable terms. |
| Keywords: | Credit cards, payment systems, regulation, interchange fees |
| JEL: | K21 K23 L14 L41 |
| Date: | 2005–10 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:899&r=cse |
| By: | William R. Latham (Department of Economics,University of Delaware); Helen Bowers |
| Abstract: | In the market for corporate control, a potential market failure of asymmetric or inadequate information arises if any of the market participants (the acquiring or target firms’ management, boards of directors or shareholders) have insufficient knowledge about the real market value of a target firm. This failure may be mitigated by the market’s participants choosing to purchase additional information about the value of the target firm. An opinion by a third party regarding this value is known as a “fairness opinion.” Although it is often the case that at least one party to an acquisition obtains a fairness opinion, the issue of whether they provide any informational value is still debated. US court rulings have increased the potential costs to firms and their boards of directors of making merger and acquisition decisions without sufficient information, thus potentially raising the value of fairness opinions. The paper examines factors influencing the decisions of firms engaged in merger and acquisition activity during the 1980-2002 period to obtain or not to obtain fairness opinions. For each transaction information is available on the primary industry in which the acquiring and target firms operate and on the numbers and types of additional information, including fairness opinions, each of the parties to the transaction sought during the progress of the transaction. Our results show that for the acquiring firm in an acquisition, the likelihood of purchasing fairness opinions is influenced significantly by (1) the market values of the acquirer and the target firm, (2) the volatility of excess returns of both firms, (3) whether or not the transaction is a “cash” deal, (3) the degree of asymmetric information as measured by the similarity of the acquirer and target firms, (4) the amount of monopoly power the target firm has, (5) whether the acquisition is “hostile,” and (6) whether other financial advisory services have been purchased by either firm. Finally, strong evidence is found indicating that (7) the behavior of acquiring firms, whether incorporated in Delaware or not, has been significantly altered since the 1985 Van Gorkom v. Smith decision by a Delaware court regarding fairness opinions. Our results for target firms are not as strong as those for acquirers, nor are the results for financial advisory services more broadly defined. |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:dlw:wpaper:05-17&r=cse |
| By: | Geradin,D.; McCahery,J.A. (TILEC (Tilburg Law and Economics Center)) |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubtil:200520&r=cse |