nep-cse New Economics Papers
on Economics of Strategic Management
Issue of 2007‒02‒17
twenty papers chosen by
Joao Jose de Matos Ferreira
University of the Biera Interior

  1. Intellectual evolution of strategic management and its relationship with ethics and social responsibility By Melé, Domenec; Guillen, Manuel
  2. Global Sensing and Sensibility A Multi-Stage Matching Assessment of Competitive Advantage from Foreign Sources of Innovation By Sofka, Wolfgang; Teichert, Thorsten
  3. Searching the heffalump: using traits and cognitive styles to predict entrepreneurial orientation By Cools, E.; Van den Broeck, H.
  4. Firm Competitive Strategies and the Likelihood of Survival. The Spanish Case By Raquel Ortega-Argilés; Rosina Moreno
  5. Interfirm Linkages and the Vertical Structure and Dynamics of the Danish Trucking and Congress Tourism Industries By Henrik Sornn-Friese
  6. Appendices to Internationally Comparable Science, Technology and Competitiveness Indicators By Robert H. McGuckin; Bart van Ark; Sean M. Dougherty; Robert Inklaar
  7. Market Structure and Innovation: A Dynamic Analysis of the Global Automobile Industry By Hashmi, Aamir Rafique; Van Biesebroeck, Johannes
  8. Export Orientation among New Ventures and Economic Growth By Hessels, S.J.A.; Stel, A.J. van
  9. The Export-Growth Relationship: Estimating a Dose-Response Function By Fryges, Helmut
  10. Intra and Inter-Organizational Knowledge Transfer Processes: Identifying the Missing Links By Markus C. Becker; Mette Præst Knudsen
  11. Strategic factor markets: Bargaining, scarcity, and resource complementarity By Adegbesan, Tunji
  12. Empresas Multinacionales e Integración By Corina Coppini
  13. Creativity and Industrial Cities: A Case Study of Baltimorenomenon By Zoltan J. Acs; Monika I. Megyesi
  14. The use of limited dependent variable techniques in strategy research: assessment and critique By Wiersema, M.; Bowen, H.P.
  15. América Latina y el Caribe: Integración e Inserción en los Mercados Internacionales By Giovanni E. Reyes
  16. Growth, Development, and Technological Change By Volker Grossmann; Thomas M. Steger
  17. Economic Development Strategies: Examples from Europe and Australia By Petra Behrens
  18. Managing with style: a qualitative study on how cognitive styles influence managerial behaviour By Cools, E.; Van den Broeck, H.
  19. Individual and organizational facets of change in the public and private sector: a comparative study By Bouckenooghe, D.; Devos, G.
  20. Competitive and Segmented Informal Labor Markets By Isabel Günther; Andrey Launov

  1. By: Melé, Domenec (IESE Business School); Guillen, Manuel (University of Valencia)
    Abstract: The main purpose here is to present an overview of the historical development of strategic management, through a critical review of the most relevant theoretical proposals, and to consider its links to ethics and corporate social responsibilities. From the very beginning of strategic management thought attempts have been made to fuse ethical aspects such as values of senior management or social values or social expectations to strategic management. More recently the stakeholder view of the firm has permitted the introduction of ethical theories into strategic management, and the resources-based view of the firm has lead to the consideration of competences, including moral virtues. Here it is argued that in spite of some advances, the integration of ethics into strategic management is not yet entirely satisfactory. Thus, it is suggested that new directions to focus the integration of ethics and strategic management are necessary.
    Keywords: Strategic management; Integrating ethics in management; Business ethics; Corporate social responsibility;
    Date: 2006–10–15
  2. By: Sofka, Wolfgang; Teichert, Thorsten
    Abstract: We focus on one of the core competitive capabilities of modern firms: the ability to deliver successful innovations in a globalized environment. Companies literally find themselves confronted with a world of ideas. The challenge remains to decide which impulses should be on top of the list and which at the bottom. Given limited resources and substantial investments, betting on the wrong horse can be risky and costly. Theoretically integrated in capability based view of the firm we investigate firms’ capabilities to assimilate, identify and prioritize valuable knowledge across national, cultural and social borders - a competence we call global sensing. We establish an analytical framework to examine whether global sensing activities generate competitive advantage. Consequently, we develop an empirical, multistage evaluation strategy. This strategy rests on a matching approach for a recent, broad sample of almost 1,700 German companies from both services and manufacturing. We find the strongest and most consistent support for global sensing as a strategic enabler for technological leadership. Apart from this strategic advantage we observe that foreign external sources of innovation are generally not superior to domestic ones.
    Keywords: Global innovation, global sensing, capability based view, matching estimation
    JEL: F23 O31 O32
    Date: 2006
  3. By: Cools, E.; Van den Broeck, H.
    Abstract: The aim of this study was to get more insight into what typifies Flemish entrepreneurs. We compared entrepreneurs with non-entrepreneurs for five traits (tolerance for ambiguity, self-efficacy, proactive personality, locus of control, need for achievement) and for cognitive styles. Additionally, we used these trait and cognitive characteristics to predict variances in entrepreneurial orientation (EO). Whereas the link between EO and organizational performance has been studied intensively, the examination of possible antecedents of EO remains a white space. We found that entrepreneurs (N = 177) score significantly higher on all traits than non-entrepreneurs (N = 60). For the cognitive styles (measured with the Cognitive Style Indicator), we found that non-entrepreneurs score higher on the knowing and planning style. No differences were found for the creating style. With regard to the link between the entrepreneur’s profile and EO, we found a significant contribution of tolerance for ambiguity and proactive personality to EO.
    Keywords: traits; cognitive styles; entrepreneurial orientation; entrepreneurs versus non-entrepreneurs
    Date: 2006–10–04
  4. By: Raquel Ortega-Argilés; Rosina Moreno
    Abstract: This paper analyses the impact that some managerial competitive strategies followed by a firm may have on its survival. We have not only considered the classic strategies related to the passive learning process defined by Jovanovic (e.g., R&D or advertisement expenses), but we have also taken into account the active learning process ideas given by Ericson and Pakes. This way, we study the effect of product and process innovative strategies, with a detailed desegregation of their functions, on firm’s survival likelihood. Several non-parametric, semi-parametric and parametric techniques are computed to check the effect of the active learning theory on business survival in a set of Spanish manufacturing firms (1990-2001).
    Keywords: firm survival, active learning theory, duration analysis.
    JEL: L11 M13
    Date: 2007–02
  5. By: Henrik Sornn-Friese
    Abstract: This paper questions the overall role of interfirm linkages in industrial dynamics. Studying Danish trucking and congress tourism, the paper addresses a number of particular questions concerning how industry responds to changing conditions. In trucking, the important interfirm linkages are pecuniary and entails nontrivial exchange among multiple dispersed agents, while in congress tourism Inter-organizational linkages are more strategic, with the activities of multiple agents forming together into products, without direct exchange.
    Keywords: Industrial dynamics and evolution; inter-organizational linkages; vertical industry structure and division of labor; trucking; tourism
    JEL: L14 L22 O14
    Date: 2006
  6. By: Robert H. McGuckin (The Conference Board); Bart van Ark (The Conference Board and University of Groningen); Sean M. Dougherty (OECD [formerly with The Conference Board]); Robert Inklaar (The Conference Board and University of Groningen)
    Abstract: Report on US National Science Foundation Grant SRS/SES 00-99594
    Keywords: R&D, research, development, innovation, BERD
    JEL: O30 O32 O47 O57
    Date: 2006–05
  7. By: Hashmi, Aamir Rafique; Van Biesebroeck, Johannes
    Abstract: The question that how market structure and innovation are related has been extensively studied in the literature. However, there is hardly any notable study on this question for the global automobile industry. We fill this gap by studying the relationship between market structure and innovation in the global automobile industry for the 1980-2005 period. We use the dynamic industry framework of Ericson and Pakes (Review of Economic Studies, 1995) and estimate the parameters of the model using a two-step procedure proposed by Bajari et al (Econometrica, forthcoming). Since the global auto industry has seen a lot of consolidation since 1980, mergers are an important ingredient of our model. After estimating the parameters of the model, we simulate the industry forward and study how changing market structure (mainly due to mergers) affects innovative activity at the firm as well as the industry level. Our findings are the following. (1) The effect of market structure on innovation in the global auto industry depends on the initial state of the industry. If the industry is not very concentrated, as it was in 1980, some consolidation may increase the innovative activity. However, if the industry is already concentrated, as in 2005, further consolidation may reduce the innovation incentives. (2) Mergers reduce the value of merging firms though they may increase the aggregate value of the industry. (3) Mergers between big firms eventually reduce consumers' utility.
    Keywords: Competition and Innovation; Automobile Industry; Dynamic Games
    JEL: O31 L62 L13
    Date: 2007–02–13
  8. By: Hessels, S.J.A.; Stel, A.J. van (Erasmus Research Institute of Management (ERIM), RSM Erasmus University)
    Abstract: While it is generally acknowledged that entrepreneurship as well as export activity may both be important strategies for achieving national economic growth, it has remained unclear how export activity among new ventures is related to economic growth. This paper investigates whether the presence of export-oriented entrepreneurs is a more important determinant of economic growth than entrepreneurial activity in general. We focus on the national or macro-level and use data from the Global Entrepreneurship Monitor for a sample of 36 countries. An important advantage of using the macro-level is that indirect effects of exporting entrepreneurs that reach further than the performance of these firms themselves (e.g. spillovers) are captured in the analysis. To our knowledge, no attempt has been made thus far to link international activity of early-stage ventures to macro-economic out-comes. Our results suggest that export-oriented entrepreneurship is indeed more important for achieving high economic growth rates than entrepreneurial activity in general. This suggests that international activity by small and new firms strongly contributes to higher levels of competition and, consequently, to the emergence of highly dynamic economies and higher levels of economic growth.
    Keywords: Entrepreneurship;Export;Economic growth;Global Entrepreneurship Monitor;
    Date: 2007–01–26
  9. By: Fryges, Helmut
    Abstract: The relationship between individual firms’ export behaviour and firm performance has been studied extensively in the economic literature. However, most studies from the field of economics only distinguish between exporting and non-exporting companies, using the firms’ export status as a binary treatment variable and comparing the performance of exporting and non-exporting firms. This paper introduces the newly developed generalised propensity score (GPS) methodology to the literature of individual firms’ export behaviour. Instead of a binary treatment variable, the GPS method allows for continuous treatment, that is, different levels of the firms’ export activities. Based on the GPS methodology, a dose-response function is estimated, depicting the relationship between the firms’ pre-treatment export-sales ratio and their subsequent sales growth rate as a measure of firm performance.
    Keywords: Degree of internationalisation, continuous treatment, generalised propensity score, dose-response function, high-technology industries
    JEL: F23 L60 L86
    Date: 2006
  10. By: Markus C. Becker; Mette Præst Knudsen
    Abstract: Inspired by the resource- and knowledge-based views, much attention has been focused on knowledge transfer as a process of strategic importance. Still, many open questions regarding knowledge transfer processes need to be addressed to complete our understanding. For instance, what are the barriers to knowledge transfer, and what are the facilitators? A review of the literature reveals that it is divided into two streams: articles on intra-firm knowledge flows and articles on inter-firm knowledge flows. Part of the incompleteness of our understanding of knowledge transfer processes, we argue, derives from the fact that it is unclear in which way intra- and inter-firm knowledge flows are different. The paper investigates three questions: first, how knowledge transfer is defined differently in intra- and inter-firm knowledge flows; second: how barriers to knowledge transfer processes differ; and thirdly: what we need to know to be able to formulate a management view of organizational knowledge flows, whether intra- or inter-organizational. The concluding section argues five research questions whose answers may enable research to formulate a management view of knowledge flows.
    Keywords: Review; internal knowledge flows; external knowledge flows; definition; barriers to knowledge flows
    JEL: D83 L20 L22 O32
    Date: 2006
  11. By: Adegbesan, Tunji (IESE Business School)
    Abstract: Strategic factor market theory suggests that without luck or asymmetric expectations, firms can't appropriate gains from acquired resources. Adopting the bargaining perspective on resource advantage, we hold that this is only true in the absence of resource complementarity. We extend factor market theory to account for resource complementarity, and we show that firms can profit when they exhibit superior complementarity to target resources, even in the absence of asymmetric expectations. Thus we provide an alternative interpretation of managers' recent emphasis on externally acquired resources.
    Keywords: Complementarity; bargain perspective; value appropriation; resource acquisition; asymmetric expectation;
    Date: 2007–01–18
  12. By: Corina Coppini
    Abstract: La creciente globalización económica y política de fines de siglo provocaron transformaciones en todos los aspectos, inclusive en el plano de la producción y las inversiones internacionales directas realizadas por las empresas. Estas ocupan desde entonces un rol relevante en el escenario internacional, produciendo efectos favorables y desfavorables al interior de los países donde realizan sus inversiones. A continuación detallaremos este fenómeno y su incidencia sobre los procesos de integración. Como primer paso daremos un marco conceptual acerca de las características de empresa multinacional y de las inversiones externas.
    Keywords: globalization, regionalization, multinational
  13. By: Zoltan J. Acs; Monika I. Megyesi
    Abstract: Creativity is changing the way cities approach economic development and formulate policy. Creative metropolises base their economic development strategies, at least partly, on building communities attractive to the creative class worker. While there are countless examples of high-tech regions transforming into creative economies, traditionally industrial cities have received much less attention in this regard. This research draws on Baltimore to assess the potential of transforming a traditionally industrial region into a creative economy. It analyses Baltimore’s performance on dimensions of talent, tolerance, technology, and territory both as a stand-alone metropolitan area and in comparison to similar industrial metropolises. Using data from the US Census Bureau and research on creativity measures, this case study concludes that Baltimore has the opportunity to capitalize on the creative economy because of its openness to diversity, established technology base, and appealing territorial amenities. An important consideration in the transformation towards a creative economy is Baltimore's geographic proximity and access to the largest reservoir of creative talent in the US: Washington, DC.
    Keywords: creativity, creative class, creativity index, creative cities, talent, technology, tolerance, territory, bohemian index, gay index, old industrial cities, Baltimore, economic development, economic growth, entrepreneurship
    Date: 2007–02
  14. By: Wiersema, M.; Bowen, H.P.
    Abstract: Strategy researchers are increasingly turning their attention from examining the implications of strategic choices on firm performance to examining the factors that determine strategic choice at the firm level. This shift of research orientation has meant that researchers are increasingly faced with a limited dependent variable (LDV) that takes a limited number of usually discrete values. In such cases researchers typically use discrete LDV methods such as Logit or Probit and, in fact, the use of such methods has increased significantly in recent years. Despite their growing popularity, there appear to be widespread problems in the application, reporting, and interpretation of LDV methods and their results within the literature. We examined the use of LDV methods in 50 papers published since 2002 in two top-tier journals that are primary outlets for empirical strategy research (Strategic Management Journal and Academy of Management Journal). One particularly troublesome issue is the finding that researchers fail to correctly analyze moderating hypotheses, a situation that likely stems from a lack of familiarity with the nonlinear nature of LDV models. Based on our review of the literature, this paper provides an assessment of the use of the most common LDV methods, highlights problems and inconsistencies regarding their use and interpretation, and provides guidelines and suggestions for researchers seeking to use LDV statistical techniques.
    Keywords: empirical methods, limited dependent variable, strategy research
    Date: 2006–10–04
  15. By: Giovanni E. Reyes
    Abstract: La finalidad de este documento es presentar y discutir lo que se consideran son los rasgos más sobresalientes sobre la inserción de América Latina y el Caribe (ALC) en el comercio mundial. Para ello, en una primera instancia, se presentan las condicionantes principales de las economías latinoamericanas, su contexto. A continuación se trata el tema de la inserción en el comercio mundial a nivel regional, para luego hacerlo en función de los diferentes tratados o bloques de integración. Finalmente se indican conclusiones sobre la temática abordada. Los temas se trabajan con base en las relaciones detectadas entre el actual proceso de globalización y las economías latinoamericanas.2 Al abordar el tema con base en un enfoque comparativo entre naciones y/o tratados de integración y desde una perspectiva histórica, se sacrifica la especificidad de los estudios de casos. Con ello se resalta lo más significativo en términos de los efectos y respuestas, de las condiciones más permanentes y las de coyuntura, en relación con las condiciones sociales y económicas de Latinoamérica. El argumento central de la presentación consiste en sostener que el rasgo de mayor integración, contenido en el concepto de globalización, opera para las naciones de mayor poder económico y para los grupos sociales de las naciones en desarrollo que sí logran integrarse a las nuevas condicionantes.
    Keywords: latin america, social, economy, international trade, china, competitividad
  16. By: Volker Grossmann (University of Fribourg, CESifo and IZA); Thomas M. Steger (ETH Zurich and CESifo)
    Abstract: The theory of endogenous technical change has deeply contributed to our understanding of the fundamental sources of economic growth and development. In this chapter we survey important contributions in the field by focussing on the basic structure of endogenous growth models with horizontal as well as vertical innovation and emphasizing important implications for growth policy. We address issues like the scale effect problem, directed technological change to understand the evolution of wage inequality, long-run divergence between the innovating North and the imitating South due to inappropriate technology in the South, the relationship between trade and growth, competition and R&D, and the role of imperfect capital markets for R&D-based growth.
    Keywords: endogenous technical change, economic growth, horizontal innovations, scale effects, vertical innovations
    JEL: O10 O30 O40
    Date: 2007–01
  17. By: Petra Behrens (School of Economics and Finance, Queensland University of Technology)
    Abstract: By looking at very different aspects of regional economic development theory and policy as well as geographical areas, this paper provides a foundation of economic strategies applicable to many regions. The focus is set on a flexible and holistic approach to be able to include a wide range of economic development and wellbeing indictor and to offer an alternative to the neoclassical development framework. The European regional policy is used as an example to analyse policy in a theoretical economic development framework. The Australian example is a practical case study of a small rural shire showing the issues individual regions are facing when they are dealing with regional development on a local level.
  18. By: Cools, E.; Van den Broeck, H.
    Abstract: Our study aims to contribute to an enhanced understanding of how cognitive styles, being individual preferences for perceiving and processing information, influence managerial behaviour using a qualitative approach. Based on content analysis of written testimonies of 100 managers, we found interesting differences between managers with a knowing, planning, and creating style with regard to both task-oriented behaviour (decision making) and people-oriented behaviour (conflict management, interpersonal relationships). Although the tasks of different managers are largely the same, our study demonstrates that not all managers execute their job in the same way. Our results complement previous quantitative research on the link between cognitive styles and managerial behaviour. Although there is a wide theoretical and empirical interest in cognitive styles, qualitative studies that might provide further support to the practical relevance of cognitive styles for organisations is currently lacking. Because of the pivotal role of strong management and executive leadership on employee attitudes and financial performance, it is important to better understand the manager’s characteristics. Our results may contribute to increased managerial self-awareness about the impact of their individual preferences on their management style.
    Keywords: cognitive styles; managerial job; qualitative study
    Date: 2006–10–04
  19. By: Bouckenooghe, D.; Devos, G.
    Abstract: This study compares individual (i.e., readiness to change and locus of control) and organizational aspects of change (i.e., participation in decision making and risk-taking reward orientation) in Belgian public and private sector organizations. This empirical research is based on perceptions of 930 managers and 629 employees collected through a questionnaire survey from a variety of public (n = 35) and private sector organizations (n = 21). In total 1,559 responses were collected from the private (n = 827) and the public sector (n = 732). The hypotheses tested were that; in the public sector people report (a) a lower level of readiness to change (i.e., emotional involvement and commitment to change); (b) a lower level of internal locus of control; (c) a lower risk-taking reward orientation; and (d) a higher level of participation in decision-making in comparison to the private sector. Two-way analyses of variance, private versus public and managerial versus non-managerial position of respondents, were performed. Results yielded significant main effects for sector on locus of control, risk-taking reward orientation and readiness to change, and contribute to the debate on similarities and differences between public and private sector management. Some main effects can not be interpreted in a straightforward manner, since significant interaction effects were observed between sector and hierarchical position for locus of control, risk-taking reward orientation, commitment to change, and emotional involvement. In brief, the hierarchical position of respondents is an important moderator variable that helps to explain differences between both sectors. To conclude, the findings of this inquiry have noteworthy theoretical and managerial implications that are discussed throughout this paper.
    Keywords: readiness to change, locus of control, participation in decision making, risk-taking reward orientation, public and private sector comparison.
    Date: 2006–10–04
  20. By: Isabel Günther (Universität Göttingen); Andrey Launov (Universität Würburg)
    Abstract: It has recently been argued that the informal sector of labor markets in de- veloping economies shows a dual structure with part of the informal sector being competitive to the formal sector and part of the informal sector being the result of market segmentation. To test this hypothesis, we formulate an econometric model which allows for a heterogeneous informal sector with unobserved individ- ual sector a±liation in the informal sector and which takes into account selection bias induced by the employment decision of individuals. Our empirical results for the urban labor market in C^ote d\'Ivoire show the existence of both competitive and segmented employment in the informal sector.
    Keywords: developing economy, informal labor market, segmentation, comparative advantage, selection bias, latent structure, finite mixture models
    JEL: J42 O17
    Date: 2007–01–09

This nep-cse issue is ©2007 by Joao Jose de Matos Ferreira. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.