nep-cse New Economics Papers
on Economics of Strategic Management
Issue of 2007‒06‒30
nineteen papers chosen by
Joao Jose de Matos Ferreira
University of the Beira Interior

  1. Born Local: Two Avenues to Internationalization By Zoltan J. Acs; Siri Terjesen
  2. Firm Growth : a Survey By Alex Coad
  3. Knowledge Assisted Innovation By Benchimol, Guy
  4. Firm growth : a survey. By Alex Coad
  5. Production Subcontracting and Location By Adelheid Holl
  6. Linking Technical Education to Business Growth: A Case Study on Building Technical Skills in India By Basant Rakesh; Chandra Pankaj
  7. Knowledge Management System for Cluster Development in Small and Medium Enterprises By Pradorn Sureephong; Nopasit Chakpitak; Yacine Ouzrout; Gilles Neubert; Abdelaziz Bouras
  8. Comparative Advantage Structure of U.S. International Services By Makoto Hisanaga
  9. Fringe firms: Are they better off in a heterogeneous market? By Susanne Wied-Nebbeling
  10. Enterprise at the era of Knowledge Economy By Benchimol, Guy
  11. The Social Construction of Markets in a Transitional Economy: The Example of the Sugar Industry in China By Louis Augustin-Jean
  12. Technological Platforms and the Governance of Knowledge: Evidence from Italy and the UK By Consoli Davide; Patrucco Pier Paolo
  13. Measuring a Society’s Knowledge Base By Khumalo, Bhekuzulu
  14. The Role of R&D in Industrial Policy: Rise and fall of a research driven strategy for industrialisation By Olav Wicken
  15. Pre-empting Technology Competition Through Firm Acquisitions By Grimpe, Christoph; Hussinger, Katrin
  16. Norwegian Innovation and Industrial Structure: Insiders and Outsiders? By Tommy Clausen; Svein Olav Nås; Bart Verspagen
  17. The patterns of output growth of firms and countries: new evidence on scale invariances and scale specificities By Carolina Castaldi; Giovanni Dosi
  18. Multifactor Productivity and its Determinants: Al Empirical Analysis for Mexican Manufacturing. By Héctor Salgado Banda; Lorenzo E. Bernal Verdugo
  19. The influence of regional innovation systems on regional economic growth - Linking regional input-output analysis and agent based modelling By Frank Beckenbach; Ramón Briegel; Maria Daskalakis

  1. By: Zoltan J. Acs (School of Public Policy, George Mason University, Fairfax, Virginia, USA; Max Planck Institute of Economics, Jena, Germany); Siri Terjesen (Brisbane Graduate School of Business, Queensland University of Technology; Max Planck Institute of Economics, Jena, Germany)
    Abstract: Are firms born Global? Because knowledge spillovers that lead to new venture creation are geographically constrained we believe that firms are born local. It follows that the decision to create sustainable new ventures is independent from the decision to internationalize, even if that is the ultimate goal of the firm. We explore two avenues to internationalize new ventures, a direct path described in much of the extant literature and an intermediated one. New ventures face high entry barriers and intellectual property rights protection to internationalization, which are circumvented by intermediating activities using existing multinational enterprises as facilitators of internationalization. However, new ventures using the intermediated mode of internationalization face transaction costs and rent extraction from multinational enterprises. Therefore, sustainable new ventures face a strategic decision on how to internationalize.
    Keywords: International Entrepreneurship, Multinational Enterprises, Knowledge Spillovers, Intermediated Internationalization, International New Ventures, Foreign Direct Investment
    Date: 2007–06–25
  2. By: Alex Coad (CES - Centre d'économie de la Sorbonne - [CNRS : UMR8174] - [Université Panthéon-Sorbonne - Paris I], LEM - Laboratory of Economics and Management - [Sant'Anna School of Advanced Studies])
    Abstract: We survey the phenomenon of the growth of firms drawing on literature from economics, management and sociology. We begin with a review of empirical "stylised facts" before discussing theoretical contributions. Firm growth is characterized by a predominant stochastic element, making it difficult to predict. Indeed, previous empirical research into the determinants of firm growth has had a limited success. We also observe that theoretical propositions concerning the growth of firms are often amiss. We conclude that progress in this area requires solid empirical work, perhaps making use of novel statistical techniques.
    Keywords: Firm growth, size distribution, growth rates distribution, Gibrat's law, theory of the firm, diversification, "stages of growth" models.
    Date: 2007–06–19
  3. By: Benchimol, Guy
    Abstract: In the present world, change has become a necessity for any organization. This change may be the consequence of evolution of technology, market needs or users behaviour as well as, of course,environment (legal, geopolitical,climatic,cultural and so on); it imposes innovations into numerous fields such as products and services,processes and business models. To accomplish such innovations, knowledge management is a must from the front-end of the value chain until its concrete form that is from basic research to practical requirements. This strategic approach may be carried out through a "Project" state of mind and collaborative work for which KM provides the necessary tools.
    Keywords: knowledge; innovation; Real Time Marketing; networks; democratic corporation; participative innovation; K-Maps; human capital; basic research; thought leaders; Fuzzy Front End
    JEL: L21
    Date: 2007
  4. By: Alex Coad (Centre d'Economie de la Sorbonne)
    Abstract: We survey the phenomenon of the growth of firms drawing on literature from economics, management and sociology. We begin with a review of empirical "stylised facts" before discussing theoretical contributions. Firm growth is characterized by a predominant stochastic element, making it difficult to predict. Indeed, previous empirical research into the determinants of firm growth has had a limited success. We also observe that theoretical propositions concerning the growth of firms are often amiss. We conclude that progress in this area requires solid empirical work, perhaps making use of novel statistical techniques.
    Keywords: Firm growth, size distribution, growth rates distribution, Gibrat's law, theory of the firm, diversification, "stages of growth" models.
    JEL: L25 L11
    Date: 2007–05
  5. By: Adelheid Holl
    Abstract: Using data from a panel of Spanish manufacturing firms, I examine factors that explain firms’ production subcontracting decisions and test whether there is any evidence that production subcontracting is facilitated in areas typically associated with higher agglomeration economies. The results show that location matters. Firms in industry agglomerations are more likely to subcontract production activities. While in general, larger and older firms as well as high wage firms show a greater probability for production subcontracting, industry agglomeration particularly facilitates subcontracting for smaller and lower wage firms and it allows firms to respond to a greater degree to expansive demand conditions by taking advantage of subcontracting.
  6. By: Basant Rakesh; Chandra Pankaj
    Abstract: Education has been recognized as the most important source of competitive advantage for a nation. It is the key determinant of firm level productivity which in turn drives business growth and profitability. Technical knowledge, in particular, is required both for industrial as well as service development. Technical institutions contribute to the growth of business and industry in a variety of ways. The most influential and direct impact is through their graduates who bring in new skills and perspectives to firms. Industries also seek advanced training on specific topics as well as consultancy from technical institutions. Often these institutions collaborate with academics to design and develop new technologies. In this paper we have argued that technical education plays a crucial role in building these capabilities and consequently in the growth of industry. We use the case study of the Indian technical education system to explore the nature of this system, mechanisms used to govern it, linkages between the education regime and the industry, and the roles that different stakeholders play in ensuring that such a regime delivers sustained advantage to the society. We study the business growth in a few select sectors and the changing needs of technical skills therein. These sectors are agricultural implements, auto-components, chemicals, construction, garments and machine tools. We also illustrate the link between technological innovation and technical skills thereby pointing towards the trajectory of developing industrial competitiveness.
    Date: 2007–03–30
  7. By: Pradorn Sureephong (LIESP - Laboratoire d'Informatique pour l'Entreprise et les Systèmes de Production - [Université Claude Bernard - Lyon I][Université Lumière - Lyon II] - [Institut National des Sciences Appliquées de Lyon]); Nopasit Chakpitak (LIESP - Laboratoire d'Informatique pour l'Entreprise et les Systèmes de Production - [Université Claude Bernard - Lyon I][Université Lumière - Lyon II] - [Institut National des Sciences Appliquées de Lyon]); Yacine Ouzrout (LIESP - Laboratoire d'Informatique pour l'Entreprise et les Systèmes de Production - [Université Claude Bernard - Lyon I][Université Lumière - Lyon II] - [Institut National des Sciences Appliquées de Lyon]); Gilles Neubert (LIESP - Laboratoire d'Informatique pour l'Entreprise et les Systèmes de Production - [Université Claude Bernard - Lyon I][Université Lumière - Lyon II] - [Institut National des Sciences Appliquées de Lyon]); Abdelaziz Bouras (LIESP - Laboratoire d'Informatique pour l'Entreprise et les Systèmes de Production - [Université Claude Bernard - Lyon I][Université Lumière - Lyon II] - [Institut National des Sciences Appliquées de Lyon])
    Abstract: Many countries such as Canada, Japan, Korea and France gains their competitive advantage through the utilization of clusters development. A cluster contains many Small and Medium Enterprises (SMEs) operating in the same or similar industry strongly connected with each other to produce good and services.,In developing country , especially, Small and Medium Enterprises (SMEs) take very important role to their economic. Most governments, as facilitator, support cluster through initiate help and encourage SMEs' linkage to reach the concept of industry cluster. Many literature reviewed claimed that the most difficult processes in creating a cluster is the development and sustain the collaboration to connect these SMEs together. After some investigation, the problem of creating SMEs connection is information sharing at micro-economic level.. Knowledge sharing is one of the most important key success factors of cluster management to gain collaboration among SMEs since there are abundant of explicit and tacit knowledge within each SMEs in a cluster. Naturally, most firms do not want to share their business information and knowledge. In reality, however they needs these information to successfully manage their business cluster. It is crucial and necessary we find out what kind of information or knowledge they want to know and shareable among them in order to manage cluster successfully. Many operation management techniques already existed in many firms. One of the ways to help knowledge sharing operate successfully using information technology as a tool is directed to Knowledge Management System (KMS). This methods can help facilitate the communication and information ow and needs to be investigated further to help maintain the cluster collaboration and knowledge sharing.. This paper propose framework and methodology for analyzing, industry cluster for the sustain the lifecycle of cluster.
    Date: 2007–06–22
  8. By: Makoto Hisanaga (Institute of Economic Research, Kyoto University)
    Abstract: This paper is an investigation of the comparative advantage structure of United States (U.S.) international trade in services. It appears conclusively that the U.S. has a strong comparative advantage in knowledge-based services. For this study, the author adopts the Revealed Comparative Advantage (RCA) index to analyze the structure, and demonstrates that the variances in the RCA deviations indicate a similarity in the export structure between the U.S. and the world. The focus of this study is also on the role of the multinational companies. This view links microeconomic entities and the macroeconomic surroundings.
    Keywords: Trade in Services, Intellectual Property Rights, Comparative Advantage, Competitive Advantage, Revealed Comparative Advantage (RCA), Multinational Companies, Offshoring
    JEL: C02 F01 F23
    Date: 2007–06
  9. By: Susanne Wied-Nebbeling
    Abstract: This paper analyzes a market with three firms. One of them is the dominant firm and the two others are fringe firms. The formulation of demand allows a comparison between price competition with heterogeneous and homogeneous products. Because a parameterization is required to assure that market size is the same in both scenarios, no general conclusions can be drawn. But it can be shown that in large markets with relatively inelastic demand for the fringe firms’ products and a cost advantage of the dominant firm, the fringe firms are better off if they produce a heterogeneous product.
    Keywords: dominant firm, competitive fringe, price competition, heterogeneous products
    JEL: L11 L13
    Date: 2007–06–26
  10. By: Benchimol, Guy
    Abstract: Although left for a few decades the era Taylorism, we have done nothing but enter the era of the accoutable persons i.e. people who, making decisions, are able and have the will to justify them; there is a true request which started to appear in the field of the finance (in France, Law of Financial Safety echoing the law Sarbanes-Oxley in the United States) but which will not fail to extend gradually to the other fields by contagion because the financial field is only the reflection of what takes place within. These accountable persons will justify of as much better the decisions than those will have been made within the framework of a collaborative work; the justification can be based only on facts, reasoning and a context corresponding to a certain number of allowed values of reference by the concerned organization. These facts, this reasoning revealing new facts, these values of reference, all that constitutes knowledge i.e. a whole of signals or stimuli helping us with better perceiving and understanding the world which surrounds us. Either they are preexistent with the process of decision-making or are its consequence, this knowledge must be able to be communicated to any person entitled to justify the decision made even the not-decision (indeed, the fact of not making a decision when a problem has to be solved can paralyse the activity of various recipients to even have serious consequences and must be able to be justified as well as a decision). This need for justification has an indirect effect but great importance; when an activity is carried on and that one has accounts to report, its good execution is not enough to secure you against any critic because it is necessary to be able to show the cogency of this activity and the adopted step, taking into account the aim in view; there is thus a permanent questioning in the light of the evolution of the context and the environment. The justification starting from knowledge is thus not a simple obligation but a factor of progress, innovation and adaptation to the change thus of competitiveness. Let us quote a forum (1) which will interest those who are “seeking to comply with the requirements of this important legislation”; indeed, it offers free downloading of the Act itself and provides a compliance toolkit. In this e-book, you will find two parts: one to explain the conditions of organizing an e-enterprise and the second one to show how you might be able to working out knowledge in a dynamic way. For French speaking KB Members, we recommend interesting hints (2) written by Netegrity’s Didier Schreiber who underlines the consequences of this law from the point of view of IS and security devices. (1) (2) oi_sarbanes_oxley-481.html
    Keywords: capital intellectuel; information; réseau; production; réalité virtuelle; travail collaboratif; commerce électronique; portail; gestion; supply chain; organisation; modélisation; documents; Web services; agents intelligents; Corporate Performance Management; connaissances; métaconnaissances; K-Maps
    JEL: M20
    Date: 2006
  11. By: Louis Augustin-Jean
    Abstract: The entry of China into the WTO, in 2001, has generated a lot of research related to the marketization of China’s economy. This debate has overlooked a more important one, which is to analyse the shape taken by the organization of China’s economy, in relation to the reforms introduced by this country since the end of the 1970s and its integration into the world economy. In other words, the changes that are currently occurring, provide a unique chance to understand the role and the interaction of different agents in the (re)construction of a market. For this purpose, a specific industry has been selected. The choice of the sugar industry allows us to understand its organization from the basic producer (the farmer) up to the final consumer (the food industry). It also allows us to take into account the changes that are currently underway in the international market of sugar (due to changes in the sugar regime of the European Union, an increasing production in Brazil, etc.), which exert considerable pressure on an industry that is undergoing complete restructuring in China. Taking into account these changes, the paper makes use of the commodity value chain approach as well as of the sociology of organization. Based on a fieldwork conducted from 2004 to 2006, it shows that, while China’s central government seems committed to further liberalize its economy, the diverging interests of agents involved in the industry (farmers, mills, local and provincial authorities…) have in effect reinforced the role of the various levels of government agencies – despite the partial privatisation. It also shows that all the measures taken to protect the most vulnerable agents have led to increased instabilities and uncertainties in a market which, nonetheless, has been continuously expanding for the last 25 years.
    Date: 2007
  12. By: Consoli Davide; Patrucco Pier Paolo (University of Turin)
    Date: 2007–03
  13. By: Khumalo, Bhekuzulu
    Abstract: The quest to measure knowledge effectively will in no doubt lead to better knowledge policies of governments around the world in both developing and developed countries. This paper endeavours to seta sound theoretical base for measuring knowledge and does this by demonstrating that existing tools used by economists for measuring knowledge are largely self contradictory, they contradict existing theory. Knowledge to be measured effectively we must give knowledge its own units like weight and length have their own units, only then can we say how much knowledge one needs to carry out a particular task.
    Keywords: knowl; knowledge
    JEL: B41 O2 A1
    Date: 2006–10–09
  14. By: Olav Wicken (Centre for Technology, Innovation and Culture, University of Oslo)
    Abstract: R&D has played a central role in Norwegian public industrial policy for only a relatively short period. Before 1963, there was little interest in linking technological research policy to a wider national industrial strategy. During the mid 1960s, attempts were made to link public research more closely to industrial development, and the state became more engaged in funding industrial R&D. During the 1980s, governments increased public industrial R&D funding substantially, and for a short period of time research became a core element in national industrial policy. However, from the early 1990s the situation again changed. Public research policy lost its significance in wider national industrial strategies.
    Date: 2007–06
  15. By: Grimpe, Christoph; Hussinger, Katrin
    Abstract: This paper investigates the motive of pre-empting technology competition through mergers and acquisitions (M&A). Exploiting the patent application procedure at the European Patent Office we introduce a new measure for the possibility to create entry barriers in technology markets. Our results show significant evidence that firms engage in horizontal M&A to pre-empt competition in technology markets.
    Keywords: pre-empting technology competition, mergers and acquisitions
    JEL: G34 L20 O34
    Date: 2007
  16. By: Tommy Clausen (Centre for Technology, Innovation and Culture, University of Oslo); Svein Olav Nås (Norwegian Institute for Studies in Research and Education - Centre for Innovation Research); Bart Verspagen (Centre for Technology, Innovation and Culture, University of Oslo)
    Abstract: We examine the hypothesis that the Norwegian innovation system is locked-in to a specialization pattern of scale dependent, resource intensive industries, in which innovation depends mainly on the in-house activities of (a few) large firms. To this extent, we employ a sectoral empirical analysis using data on industrial dynamics and innovation in the Norwegian economy. Our results indicate that although the Norwegian economy has parts that are resourceand scale dependent, and also sectors in which the market structure is inert and concentrated, these characteristics are not systematically related to the level and nature of innovation activities. Our results indicate that innovation in Norway takes place in two main regimes: a highintensive and a low-intensive regime. This is not correlated systematically with industrial dynamics.
    Date: 2007–06
  17. By: Carolina Castaldi; Giovanni Dosi
    Abstract: This work brings together two distinct pieces of evidence concerning, at the macro level, international distributions of incomes and their dynamics, and, at the micro level, the size distributions of firms and the properties of their growth rates. First, our empirical analysis provides a new look at the international distribu- tions of incomes and growth rates by investigating more closely the relationship between the two entities and the statistical properties of the growth process. Second, we identify the statistical properties that are invariant with respect to the scale of observation (country or firm) as distinct from those that are scale specific. This exercise proposes a few major interpretative challenges regarding the correlating processes underlying the statistical evidence.
    Keywords: International distribution of income, international growth rates, firm growth, scaling laws, growth volatility, exponential tails
    Date: 2007–06–26
  18. By: Héctor Salgado Banda; Lorenzo E. Bernal Verdugo
    Abstract: We use data from the Annual Industrial Survey for 1996-2003. First, we estimate production functions by means of growth accounting exercises and panel data econometrics for the whole sector and for 14 comprehensive groups. Various measures of Multifactor Productivity (MFP) are constructed, as we consider diverse combinations of inputs with capital, labour, electricity and transport. This allows us to compare MFP growth rates between groups. Second, we analyse econometrically some of the determinants of MFP and Labour Productivity (LP) growth. We find that, on the one hand, there is some evidence of a positive relationship between market concentration and technology adoption; on the other hand, both technology adoption and human capital seem to be promoting productivity, whilst market concentration is exerting a negative influence on it. In sum, our results suggest that, once controlling for the effect on technology adoption, more concentration (conversely, less competition) has a negative impact on productivity.
    Keywords: Panel data, Productivity, Manufacturing, Competition
    JEL: C33 D24 L11
    Date: 2007–05
  19. By: Frank Beckenbach (Department of Economics, University of Kassel); Ramón Briegel (Department of Economics, University of Kassel); Maria Daskalakis (Department of Economics, University of Kassel)
    Abstract: In the focus of the research on regional innovation systems (RIS) is an interaction pattern of different regional agents and institutions on one side and an observation of regional outcomes (in terms of value added, employment etc.) attributed to the aforementioned interaction pattern on the other side. Neither how this interaction pattern comes about nor how this pattern generates the attributed regional outcome is usually investigated more closely. In this article we try to fill this gap in the research about RIS. In section II we specify the two focal points of the literature about RIS and the resulting research gap to bridge. In section III it is shown how input-output tables (IOT) can be used to map the regional interaction dynamics on the level of branches. This is supplemented by an agent-based modelling of the final demand dynamics resulting from the innovation activities of regional agents (section IV). Finally some conclusions for further research are drawn (section V).
    Keywords: Regional Innovation System, Multi-Agent-System, Input-Output-Analysis, Evolutionary Economics
    Date: 2007–05

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