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on Economics of Strategic Management |
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Issue of 2009‒05‒23
thirteen papers chosen by Joao Jose de Matos Ferreira University of the Beira Interior |
| By: | Francesco Quatraro |
| Abstract: | This paper analyzes the effects of the evolution of knowledge base in the manufacturing sectors on regional productivity growth. Knowledge is viewed as a heterogeneous asset, and an evolutionary perspective is adopted. The results of the empirical estimations corroborate the hypothesis that beyond the traditional measure of knowledge stock, knowledge coherence and variety matter in shaping productivity dynamics. The check for spatial dependence suggests that cross-regional externalities exert additional triggering effects on productivity growth, without debasing the effects of knowledge. Important policy implications stem from the analysis, in that regional innovation strategies should be carefully coordinated so as to reach a higher degree of internal coherence and exert positive effects on productivity. |
| Keywords: | knowledge, variety, regional growth, productivity |
| JEL: | O33 R11 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:0902&r=cse |
| By: | Bhattacharyya, Surajit; Saxena, Arunima |
| Abstract: | The Law of Proportionate Effect depicts that firm’s growth rate is independent of its size; Gibrat (1931). Some of the existing studies support the Gibrat’s Law: Hymer and Pashigian (1962), Mansfield (1962), among others. However, Gale (1972), Shepherd (1972) and recently Punnose (2008) report a positive relationship, while Haines (1970) and Evans (1987) observe an inverse relationship between firm size and profitability. Baumol (1959) opined that rate of return increases with firm size. Therefore, the extant empirical research on the firm size – performance relationship provides inconclusive results. Manufacturing firms’ data from the Steel and Electrical & Electronics (EE) industries are taken from CMIE Prowess database for the period 2004-05 to 2006-07. Results show that firm size affects current profitability: positively in the Steel and negatively in the other. Some more determinants of firm performance are explored. Retained earnings have negative impact on profitability in Steel but, positive in EE. Bank credit is found negatively significant in both the industries. Market share of firms and industry concentration ratio (CR4) although inconsistently are the other significant determinants of firms’ performance. Firms’ market value (Q) is found positively significant for both the industries. This signifies that high market value of firms reflects their goodwill, knowledge stock and prospective investment opportunities which positively influence the firms’ performance. The significance of having high brand equity which the corporate firms thrive for becomes apparent. Interestingly, the impact of size is affected by firms’ market value: firm size positively affects profitability both in Steel and EE. Furthermore, ineffectiveness of Law of Proportionate Effect is strengthened when tested over the combined data of Steel and EE firms. The short-run dynamism in firm performance is also impacted by presence of Tobin’s Q. |
| Keywords: | Gibrat’s law, firm size, profitability, Tobin’s Q, manufacturing firms. |
| JEL: | L6 M21 |
| Date: | 2009–01–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:13029&r=cse |
| By: | Uwe Cantner (Friedrich Schiller University Jena, Chair of Economics / Microeconomics); Kristin Joel (Friedrich Schiller University Jena, Chair of Economics / Microeconomics); Tobias Schmidt (Deutsche Bundesbank, Economic Research Centre) |
| Abstract: | The aim of this paper is to analyse the effects of knowledge management on the innovation success of firms in Germany. Using a matching procedure on data from the German Innovation Survey of 2003 ("Mannheim Innovation Panel"), we pair firms applying knowledge management with twin firms with similar characteristics not applying knowledge management. Our focus is on investigating the effects of knowledge management techniques on the economic success of firms with product and process innovations. The results of our matching analysis reveal that firms which apply knowledge management perform better in terms of higher-than-average shares of turnover with innovative products compared to their twins. We do not find a significant effect of knowledge management on the share of cost reductions with process innovation. |
| Keywords: | knowledge management, innovation, matching estimator |
| JEL: | O32 L23 L25 M11 |
| Date: | 2009–05–13 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2009-037&r=cse |
| By: | Anna Lejpras |
| Abstract: | This paper empirically investigates the antecedents of internationalization of SMEs, focusing on differences between the manufacturing and service sectors. Specifically, employing a bivariate probit model based on survey data of approximately 3,900 East German firms, I analyze which firm-related and external factors affect a firm's decision to export and/or relocate production or other operations abroad. Generally, I find that SMEs from the manufacturing sector do more exporting than service firms. The results reveal that size, having main competitors located abroad, and introducing a novel product all are significantly positively related to the internationalization of SMEs regardless of industry affiliation. However, manufacturing firms in the high-tech sector are far more likely to be engaged in internationalization activity than are service firms, regardless of whether the latter are high-tech. Locational conditions and cooperation activities are generally less important for internationalization of service firms, too, compared to their manufacturing counterparts. |
| Keywords: | Internationalization, Service, Manufacturing, Bivariate Probit Model |
| JEL: | M20 L25 R30 O30 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp886&r=cse |
| By: | Fernandez de Guevara, Juan; Maudos, Joaquin |
| Abstract: | This paper analyzes the effect of regional financial development and bank competition on firms’ growth using the Spanish provinces as a testing ground. Our results show that firms in industries with a greater dependence on external finance grow faster in more financially developed provinces. The results also show that bank monopoly power has an inverted-U effect on firms’ growth, suggesting that market power has its highest effect at intermediate values. The effect is heterogeneous among firms according to the financial dependence of the industry they belong to. This result is consistent with the literature on relationship banking which argues that bank competition can have a negative effect on the availability of finance for more informationally opaque firms. |
| Keywords: | economic growth; regional financial development; bank competition |
| JEL: | L11 D40 G21 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:15256&r=cse |
| By: | Paul Madden |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:man:sespap:0909&r=cse |
| By: | Stanley Nollen |
| Abstract: | Firms differ in the effects that foreign direct investment liberalizations have on their businesses, and in the responses they make to adjust to the liberalized business environment. In this study the authors investigate the perceived effects that FDI liberalizations have on the business of Indian information technology companies. Their results show that foreign-invested firms and firms that increased the number of their non-equity strategic alliances perceive more positive effects than firms with weaker foreign collaborations. Some but not all types of technology transfer through external markets from abroad make an additional contribution to the firm’s business after FDI liberalizations. |
| Keywords: | foreign direct investments; liberalization; Indian Information Technology firms; technology firms; multinational enterprise (MNE); Indian FDI policy liberalization; FDI policy liberalizations; impact of investment liberalization; WTO investment liberalization policies; impact of investment liberalization policies on Indian Information Technology firms. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:1946&r=cse |
| By: | Jeanne Hagenbach (Centre d'Economie de la Sorbonne); Frédéric Koessler (Paris-Jourdan Sciences Economiques (PSE)) |
| Abstract: | We consider situations in which individuals would like to choose an action which is close to that of others, as well as close to a state of nature, with the ideal proximity to the state varying across agents. Before this coordination game is played, a cheap-talk communication stage is offered to the indivisuals who decide to whom they reveal their private information about the state. The information transmission occurring in the communication stage is characterized by a strategic communication network. We provide an explicit link between players' preferences and the equilibrium strategic communication networks. A key feature of our equilibrium characterization is that whether communication takes place between two agents not only depends on the conflict of interest between these agents, but also on the number and preferences of the other agents with whom they communicate. Apart from some specific cases, the equilibrium communication networks are quite complex despite our simple one-dimensional description of preference heterogeneity. In general, strategic communication networks cannot be completely Pareto-ranked, but expected social welfare always increases as the communication network expands. |
| Keywords: | Cheap talk, coordination, incomplete information, networks. |
| JEL: | C72 D82 D83 D85 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:mse:cesdoc:09005&r=cse |
| By: | Wioletta Wereda (University of Poldasie); Alina Hagiu (Faculty of Economics of the University of Pitesti) |
| Abstract: | Generally, competitiveness of the economy defines importance of the national economy in the world market. It is a very complex notion assessed by various institutions using different indicators which actually reflect only selected aspects, such as prospects for economic development, technological progress, quality of public institutions, quality of the national business environment, quality of business legislation, level of prices as well as technical infrastructure. |
| Keywords: | competitiveness, performance, development, ranking. |
| JEL: | E00 G18 O5 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:pts:wpaper:e6&r=cse |
| By: | Roderik Ponds; Frank van Oort; Koen Frenken |
| Abstract: | This paper analyses the effect of knowledge spillovers from academic research on regional innovation. Spillovers are localized to the extent that the underlying mechanisms are geographically bounded. However, university-industry collaboration - as one of the carriers of knowledge spillovers - is not limited to the regional scale. Consequently, we expect spillovers to take place over longer distances. The effect of university-industry collaboration networks on knowledge spillovers is modelled using an extended knowledge production function framework applied to regions in the Netherlands. We find that the impact of academic research on regional innovation is mediated not only by geographical proximity but also by social networks stemming from collaboration networks. |
| Keywords: | knowledge production function, knowledge spillovers, university-industry collaboration, innovation, social networks |
| JEL: | C21 O18 O31 R11 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:0903&r=cse |
| By: | Daniela Pirvu (Faculty of Economics, University of Pitesti); Martina Eckardt (Andrássy University, Budapest) |
| Abstract: | In the last few years, many countries Central and Eastern European countries have reduced their corporate income tax rates with the purpose of attracting multinational companies. |
| Keywords: | competitiveness, corporate income taxes, foreign direct investments |
| JEL: | F5 H3 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:pts:wpaper:f1&r=cse |
| By: | Krafft Jackie; Quatraro Francesco (University of Turin); Saviotti Paolo |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:uto:labeco:200906&r=cse |
| By: | Jens Schmidt-Ehmcke; Petra Zloczysti |
| Abstract: | This paper analyzes research efficiency at the industry level in manufacturing for 13 European member and four nonmember countries during 2000 and 2004. A unique dataset was compiled that matches patent applications at the European Patent Office (EPO) to industry-specific R&D inputs from EU KLEMS. We find that Germany, the United States, and Denmark have the highest efficiency scores on average in total manufacturing. The main industries that are at the technology frontier are those involved in electrical and optical equipment and machinery. Separate frontier estimations for these industries, conducted without the constraint of a constant technology frontier, provide additional support for our results. |
| Keywords: | R&D efficiency, industry level, data envelopment analysis, manufacturing |
| JEL: | C14 L60 O31 O57 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp884&r=cse |