nep-cse New Economics Papers
on Economics of Strategic Management
Issue of 2007‒03‒31
nine papers chosen by
Joao Jose de Matos Ferreira
University of the Beira Interior

  1. Do scale alliances with competitors improve product performace? A study of the Aircraft industry, 1949-2000 By GARRETTE, Bernard; DUSSAUGE, Pierre; CASTANER, Xavier; MULOTTE, Louis
  2. Location and R&D alliances in the European ICT industry By Narula, Rajneesh; Santangelo, Grazia D.
  3. Preferencing, internalization and inventory position By Lescourret, Laurence; Robert, Christian Y.
  4. Dynamics Downunder: Australian Economic Strategy and Performance from the Palaeolithic to the Twenty-first Century By Graeme Donald Snooks
  5. Which Factors Determine Academic Performance of Undergraduate Students in Economics? Some Spanish Evidence By Dolado, Juan José; Morales, Eduardo
  6. Essay on Internationalisation Potential of Nortwest Russian and Finnish Energy Clusters By Pavel Filippov; Vlad Yorkovsky
  7. Forecasting and Evaluating Network Growth By Norah Montes de Oca; Feng Xie; David Levinson
  8. Better-Reply Strategies with Bounded Recall By Andriy Zapechelnyuk
  9. Agent-Based Model of Price Competition and Product Differentiation on Congested Networks By Lei Zhang; David Levinson; Shanjiang Zhu

  1. By: GARRETTE, Bernard; DUSSAUGE, Pierre; CASTANER, Xavier; MULOTTE, Louis
    Abstract: This paper investigates the performance impact of undertaking activities through scale alliances with competitors rather than undertaking these activities autonomously.
    Keywords: strategy; governance; alliance; cooperation; performance; scale economies; aircraft
    JEL: D74 L24
    Date: 2007–02–01
  2. By: Narula, Rajneesh (University of Reading Business School); Santangelo, Grazia D. (Facoltà di Scienze Politiche, Università degli Studi di Catania)
    Abstract: This paper shows empirically that in an intra-industry oligopolistic scenario the location of a firm's innovative activities plays an important role in determining its partner selection in R&D alliances. Such a role is mainly attributed to a strategic use of R&D alliances as a means to limit knowledge flows and protect competences, rather than to promote knowledge flows. By drawing on a novel dataset matching alliances and patent data for the European ICT industry, the econometric analysis shows that partners' prior co-location (at both national and sub-national regional level), previous ties and technological overlap matter in the choice of partner, while common nationality has a negative impact on alliance formation.
    Keywords: alliances, strategy, efficiency, R&D location
    JEL: D23 F23 O18 O32 R3
    Date: 2008
  3. By: Lescourret, Laurence (ESSEC Business School); Robert, Christian Y. (Ecole Nationale de la Statistique et de l’Administration Economique (ENSAE))
    Abstract: We present a model of market-making in which dealers differ by their current inventory positions and by their preferencing agreements. Under preferencing, dealers receive captive orders that they guarantee to execute at the best price. We show that preferencing raises the inventory holding costs of preferenced dealers. In turn, competitors post less aggressive quotes. Since price-competition is softened, expected spreads widen. The entry of unpreferenced dealers, or the ability to route preferenced orders to best-quoting dealers, as internalization does restore price competitiveness. We also show that a greater transparency may negatively affect expected spreads, depending on the scale of preferencing.
    Keywords: Internalization; Inventory Control; Market Microstructure; Preferencing; Transparency
    JEL: D43 L21
    Date: 2006–11
  4. By: Graeme Donald Snooks
    Abstract: This essay attempts to quantify and explain the economic performance of the Great South Land – later called Australia – from the first migrations some 60,000 years ago to the present, and beyond. A general dynamic theory – the ‘dynamic-strategy’ theory – has been employed to provide a new interpretation of ‘dynamics Downunder’. It is shown, among other things, that the bold attempt from the 1910s to the 1960s to turn aside from the traditional development policy of exogenously driven natural-resource exploitation in order to embark on an endogenously determined dynamic process, has broken down during the course of the present generation. This was mainly due to a failure of ‘strategic leadership’ on the part of recent Australian governments that have, quite rightly, dismantled the framework of protection, but have failed to replace it with the infrastructure of strategically relevant technological ideas. Once again Australia’s economic prosperity depends heavily on the fluctuating fortunes of the global economy. While in the nineteenth century this took the form of reliance on the prosperity of Britain, today it centres on the continuing growth of Japan and China. This critical problem has been exacerbated by misconceived monetary policies that are damaging the central endogenous dynamic mechanism. What then of the future? It all depends on whether strategic leadership can ever be rediscovered.
    Keywords: long-run dynamics, dynamic-strategy theory, inflation targeting, strategic leadership, strategic demand.
    Date: 2006–12
  5. By: Dolado, Juan José; Morales, Eduardo
    Abstract: This paper analyses the determinants of academic performance of first-year undergraduate students in Economics at Universidad Carlos III de Madrid, over the period 2001-2005. We focus on a few core subjects which differ in their degree of mathematical complexity. Type of school, specialization track at high school, and the grades obtained at the university entry-exam are among the key factors we examine. Our main finding is that those students who completed a technical track at high school tend to do much better in subjects involving mathematics than those who followed a social sciences track (tailor-made for future economics students) and that the latter do not perform significantly better than the former in subjects with less degree of formalism. Moreover, students from public schools are predominant in the lower and upper parts of the grade distribution while females tend to perform better than males.
    Keywords: academic performance; multinomial logit; pre-university determinants; quantile regressions
    JEL: I21 I29
    Date: 2007–03
  6. By: Pavel Filippov; Vlad Yorkovsky
    Abstract: Finnish and Russian energy clusters widely use resources and competences of each other. They can be considered as a good example of broader phenomenon which is internationalisation of clusters. Though these clusters are on very different development stages their internationalisation ambitions, geographical proximity and complementary resources encourage them to cooperate closely, and the scale of this cooperation is predicted to grow. The article investigates the current status of the concrete energy clusters cooperation, summarises the main reasons, benefits and barriers for their cooperation, and imposes some theoretical and practical questions related to internationalisation of clusters in general.
    Keywords: cluster, Northwest Russia, energy, international cooperation
    JEL: L14 L24 F15 F21
    Date: 2007–03–19
  7. By: Norah Montes de Oca; Feng Xie; David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota)
    Abstract: This research assesses the implications of existing trends on future network investment, comparing alternative scenarios concerning budgets and investment rules across a variety of performance measures. The main scenarios compare 'stated decision rules';, processes encoded in flowcharts and weights developed from official documents or by discussion with agency staff, with 'revealed decision rules', weights estimated statistically based on observed historical behavior. This research specifies the processes necessary to run the network forecasting models with various decision rules. Results for different scenarios are presented including adding additional constraints for the transportation network expansion and calibration process details. We find that alternative decision rules make only small differences in overall system performance, though they direct investments to very different locations. However, changes in total budget can make a significant difference to system-wide performance.
    JEL: R41 R42 R48
    Date: 2006
  8. By: Andriy Zapechelnyuk
    Abstract: A decision maker (an agent) is engaged in a repeated interaction with Nature. The objective of the agent is to guarantee to himself the long-run average payoff as large as the best-reply payoff to Nature?s empirical distribution of play, no matter what Nature does. An agent with perfect recall can achieve this objective by a simple better-reply strategy. In this paper we demonstrate that the relationship between perfect recall and bounded recall is not straightforward: An agent with bounded recall may fail to achieve this objective, no matter how long recall he has and no matter what better-reply strategy he employs.
    Keywords: Better-Reply Strategies; Regret; Bounded Recall; Fictitious Play; Approachability
    JEL: C73 D81 D83
    Date: 2007–03
  9. By: Lei Zhang; David Levinson; Shanjiang Zhu (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota)
    Abstract: Using consistent agent-based techniques, this research models the decision-making processes of users and infrastructure owner/operators to explore the welfare consequence of price competition, capacity choice, and product differentiation on congested transportation networks. Component models include: (1) An agent-based travel demand model wherein each traveler has learning capabilities and unique characteristics (e.g. value of time); (2) Econometric facility provision cost models; and (3) Representations of road authorities making pricing and capacity decisions. Different from small-network equilibrium models in prior literature, this agent-based model is applicable to pricing and investment analyses on large complex networks. The subsequent economic analysis focuses on the source, evolution, measurement, and impact of product differentiation with heterogeneous users on a mixed ownership network (with tolled and untolled roads). Two types of product differentiation in the presence of toll roads, path differentiation and space differentiation, are defined and measured for a base case and several variants with different types of price and capacity competition and with various degrees of user heterogeneity. The findings favor a fixed-rate road pricing policy compared to complete pricing freedom on toll roads. It is also shown that the relationship between net social benefit and user heterogeneity is not monotonic on a complex network with toll roads.
    Keywords: Network dynamics, road pricing, autonomous links, privatization, price competition, product differentiation, agent-based transportation model
    JEL: R40 R42 R48 D10 D21 D23 D24 D43 D83 D85 H21 H23 H44 L92 O33 C72
    Date: 2007

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