nep-cse New Economics Papers
on Economics of Strategic Management
Issue of 2007‒12‒01
ten papers chosen by
Joao Jose de Matos Ferreira
University of the Beira Interior

  1. Strategic Partnering with Chinese Companies: Hidden Motives and Treasures By Duysters, Geert; Saebi, Tina; Dong, Qinqin
  2. Aspirations, Enterprise Strategy and Sustenance of a Start-up in a Competitive Environment: A Study of Developments in Air Deccan By Dixit M.R.; Sharma Sunil; Karna Amit
  4. Determinants of alliance portfolio complexity and its effect on innovative performance of companies By Duysters, Geert; Lokshin, Boris
  5. Alterações estruturais na indústria transformadora portuguesa (1996-2004) By Natércia Mira
  6. Firm Growth and R&D Expenditure By Alexander Coad; Rekha Rao
  7. Firms' Stakeholders and the Costs of Transparency By Andres Almazan; Javier Suarez; Sheridan Titman
  8. Cluster Life-Cycles: An Emerging Synthesis By Edward M. Bergman
  9. The Effect of Venture Capital on Innovation Strategies By Marco Da Rin; María Fabiana Penas
  10. Skills required for innovation: A review of the literature By Petr Hanel

  1. By: Duysters, Geert (UNU-MERIT); Saebi, Tina (UNU-MERIT); Dong, Qinqin (Wuhan University of Technology)
    Abstract: In this paper we aim to investigate the key drivers of international alliance formation from the perspective of Chinese companies. Our results indicate that Chinese companies enter into alliances with Western companies mainly to get accesses to international markets and to develop their technological and managerial competences further. Therefore we can say that Chinese companies particularly value task-related criteria when selecting Western partners. Nevertheless we also find that Chinese companies also include 'soft' factors such trust, compatibility or reputation in their partner selection process. We therefore conclude that in searching for Western partners, Chinese companies try to find a combination of 'hard' competencies such as technology and other resources as well as more 'soft' attributes such as trust, mutual understanding and commitment.
    Keywords: Strategic alliances, China, Innovation, Internationalization
    JEL: F23 L24 O31
    Date: 2007
  2. By: Dixit M.R.; Sharma Sunil; Karna Amit
    Abstract: This paper studies the developments in Air Deccan, a start up in the Indian aviation industry and discusses the linkages among the aspirations of the entrepreneur, enterprise strategy and its sustenance in a competitive environment. It argues that the entrepreneur fails to sustain his/her enterprise and the aspirations if his strategic and operational choices and environmental responses to the choices create a resource or competence imbalance and constrain the entrepreneur. Based on its analysis and discussion, the paper delineates managerial themes like encyclopedic entrepreneurship, sustenance through co-sharing aspirations, managing first and fast mover advantages, dynamics of enterprise and its environment and competence management in start- ups.
    Date: 2007–11–23
  3. By: José Benítez-Amado (University of Granada); María Nieves Pérez-Aróstegui (University of Granada)
    Abstract: The effects of Information Technology (IT) on firm performance constitute one of the most recent lines of research. In developing this study, we take a Resource-Based View (RBV) as our basic theoretical focus. Adopting this paradigm means that IT alone is incapable of sustaining a competitive advantage (CA), making it necessary to analyze the existence of resources that complement IT to achieve greater organizational performance. The goal of this paper is to determine the combination of key resources, both exclusively IT resources and other organizational resources not necessarily belonging to this technology, to set a useful research agenda to contribute to the improvement of current knowledge of the IT effects on organizational performance.
    Keywords: Information Technology, organizational performance, RBV.
    JEL: M10
    Date: 2007–11–22
  4. By: Duysters, Geert (UNU-MERIT); Lokshin, Boris (UNU-MERIT)
    Abstract: Alliance formation is often described as a mechanism used by firms to increase voluntary knowledge transfers. Access to external knowledge has been increasingly recognized as a main source of a firm's innovativeness. In this paper we examine decisions to form alliance portfolios of foreign and domestic partners by three groups of firms: innovators (firms that are successful in introducing new products to the market), imitators (firms that are successful at introducing new products, which are not new to the market) and product non-innovators. We consider an alliance portfolio that includes different partnership types (competitor, customer, supplier, university/research center). We develop a measure of portfolio complexity which we define as the number and diversity of elements of the alliance portfolio with which a firm must interact. We then estimate models that explain portfolio complexity and its impact on firm's innovative performance. Using panel data on more than 1800 firms in the Netherlands we find that foremost innovators have a strong propensity to form portfolios consisting of international alliances. Being an innovator or imitator also increases the propensity to form a portfolio of domestic alliances, relative to non-innovators; but this propensity is not stronger for innovators. Innovators appear to derive benefit from both intensive (exploitative) and broad (explorative) use of external information sources. The former sourcing is more important for innovators, while the latter for imitators. Finally, alliance complexity is found to have an inverse U-shape relationship to innovative performance.
    Keywords: Innovation, R&D cooperation, Alliance portfolio
    JEL: O31 D74 P13 O32
    Date: 2007
  5. By: Natércia Mira (Universidade de Évora – Departamento de Economia)
    Abstract: The process of European integration seems to be difficult for portuguese firms, which have to meet several problems regarding a single market and a single currency. This paper focus on the evaluation of manufacturing industry capacity, in terms of their main structural change, to cope with the competitive pressures within an enlarged market. We tried to understand the role of investment decisions on the adaptability process of manufacturing firms. It’s not our intention to evaluate the impact of structural change on competitiveness and on productivity level, but only to understand if the nature and dimension of change, could be the starting point and a possible path of overwhelm the main competitive problems. By using WIFO taxonomies applied to the manufacturing industry, we found that Portugal (i) displays a small share in technology-driven industries (R&D intensive), while the major shares go to labour-intensive and marketing-driven industries, and (ii) still has a reduced share in high-skill and a high share in low-skill labour manufacturing. This reveals a specialisation in labour intensive and low-skill manufacturing that could affect the competitive process within an enlarged market.
    Keywords: Competitiveness, Adaptability, Structural Change, Specialisation Pattern
    JEL: L60
    Date: 2007
  6. By: Alexander Coad; Rekha Rao
    Abstract: We apply a panel vector autoregression model to a firm-level longitudinal database to observe the co-evolution of sales growth, employment growth, profits growth and growth of R&D expenditure. Contrary to expectations, profit growth seems to have little detectable effect on R&D investment. Instead, firms appear to increase their total R&D expenditure following growth in sales and growth of employment. In a sense, firms behave ‘as if’ they aim for a roughly constant ratio of R&D to employment (or sales). We observe heterogeneous effects for growing or shrinking firms however, suggesting that firms are less willing to reduce their R&D levels following a negative growth shock than they are willing to increase R&D after a positive shock.
    Keywords: Firm Growth, Panel VAR, R&D expenditure, Industrial Dynamics Length 32 pages
    JEL: L10 L20 O32
    Date: 2007–11
  7. By: Andres Almazan; Javier Suarez; Sheridan Titman
    Abstract: We develop a model of a firm whose production process requires it to start and nurture a relationship with its stakeholders. Because there are spillover benefits associated with being associated with a "winner," the perceptions of stakeholders and potential stakeholders can affect firm value. Our analysis indicates that while transparency (i.e., generating information about a firm's quality) may improve the allocation of resources, a firm may have a higher ex ante value if information about its quality is not prematurely generated. The costs associated with transparency arise because of asymmetric information regarding the extent to which stakeholders benefit from having a relationship with a high quality firm. These costs are higher when firms can initiate non-contractible innovative investments that enhance the value of their stakeholder relationships. Stakeholder effects of transparency are especially important for younger firms with less established track records (e.g., start-ups).
    JEL: D21 D23
    Date: 2007–11
  8. By: Edward M. Bergman
    Date: 2007
  9. By: Marco Da Rin; María Fabiana Penas
    Abstract: We examine a unique dataset of Dutch companies, some of which have received venture financing. The data include detailed information on innovation activities and other company characteristics. We analyse the role of venture finance in influencing innovation strategies. We find that venture capitalists push portfolio companies towards building absorptive capacity and towards more permanent in-house R&D efforts. By contrast, we find that public funding relaxes financial constraints, but does not lead to a build-up of absorptive capacity. Our results thus highlight the special role of venture capital in shaping companies' innovation strategies.
    JEL: G24 O32 O38
    Date: 2007–11
  10. By: Petr Hanel (CIRST, GREDI, Faculte d'administration, Université de Sherbrooke)
    Abstract: This review of the innovation literature seeks to identify the role of skilled labor in the process of innovation and technological change. After an introduction of main innovation theories, the role of skills is analyzed from several perspectives: (1) Independent innovator – entrepreneur; skills deployed and needed; the role of education (2)Firm –the contribution of skilled labor to innovation from within the firm and from external sources. (3) Regional systems of innovation - Endowment of regions and cities in human resources, regional/local labour markets and knowledge spillovers (4) National systems of Innovation- national institutions and policies regarding human resources, labour markets, education system and various aspects of economic and technological infrastructure. (5) Technological milieu. - skilled labor involved in innovation evolves in various environments such as scientific, technical and trade associations, formal and informal contacts. (6) Scientific base.- The role of industry-university and public-private research collaboration in innovation. (7) Is innovation skill-biased?. The second part of the study looks at findings of recent studies of innovation and technology adoption in Canadian manufacturing and services with regard to skilled labor. Also addressed is the impact of innovation on skills. The shortage of skilled labor is widely recognised as an obstacle to innovation and adoption new technologies, especially by firms that introduce the most original innovations and the most advanced technologies. Overall, the innovation literature offers little in terms of concrete general information on particular skills needed for successful innovation. The paper concludes with a critical assessment of shortcomings of innovation and related surveys with regard to information on skilled labor and its role in innovation and technology adoption.
    Keywords: Innovation; skills; national innovation systems; labour market; education of innovation; effect of innovation on skills
    JEL: O31 J24 J44 L6 L8
    Date: 2007

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