nep-cse New Economics Papers
on Economics of Strategic Management
Issue of 2012‒05‒02
sixteen papers chosen by
Joao Jose de Matos Ferreira
University of the Beira Interior

  1. Geography and high-tech employment growth in U.S. counties By Fallah, Belal; Partridge, Mark
  2. Virtual R&D Teams: A potential growth of education-industry collaboration By Nader Ale Ebrahim; Shamsuddin Ahmed; Zahari Taha
  3. What underlies localization and urbanization economies? Evidence from the location of new firms By Jordi Jofre-Monseny; Raquel Marín-López; Elisabet Viladecans-Marsal
  4. Innovation Barriers across Firms and Countries By Werner Hölzl; Jürgen Janger
  5. Effectiveness and Efficiency of SME Innovation Policy By Foreman-Peck, James
  6. Coordinating R&D activities in multinational companies: towards new tools and practices? By Lusine Arzumanyan; Ulrike Mayrhofer; Christopher Melin
  7. La competitividad internacional de la industria vinícola española durante la globalización del vino By José Miguel Martínez-Carrión; Francisco José Medina-Albadalejo
  8. The Two Faces of R&D and Human Capital: Evidence from Western European Regions By Johanna Vogel
  9. Performance-related pay in the public sector : a review of theory and evidence By Hasnain, Zahid; Manning, Nick; Pierskalla Henryk
  10. An organizational learning perspective on contract design By Lumineau, Fabrice; Frechet, Marc; Puthod, Dominique
  11. Environmental Innovations in Services. Manufacturing-Services Integration and Policy Transmissions By Giulio Cainelli; Massimiliano Mazzanti
  12. Transactions as a Source of Agglomeration Economies: Buyer-seller matching in the Japanese manufacturing industry By NAKAJIMA Kentaro
  13. Shadow of the contract: how contract structure shapes inter-firm dispute resolution By Lumineau, Fabrice; Malhotra, Deepak
  14. Risk spillovers in international equity portfolios By Matteo Bonato; Massimiliano Caporin; Angelo Ranaldo
  15. Foundations' Governance for Strategic Philanthropy By Giacomo Boesso; Fabrizio Cerbioni; Andrea Menini; Antonio Parbonetti
  16. Logistics costs and competitiveness: measurement and trade policy applications By Shepherd, Ben

  1. By: Fallah, Belal; Partridge, Mark
    Abstract: This paper investigates the role of geography in high-tech employment growth across U.S. counties. The geographic dimensions examined include industry cluster effects, urbanization effects, proximity to a research university, and proximity in the urban hierarchy. Growth is assessed for overall high-tech employment and for employment in various high-tech sub-sectors. Econometric analyses are conducted separately for samples of metropolitan and nonmetropolitan counties. Among our primary findings, we do not find evidence of positive localization or within-industry cluster growth effects, generally finding negative growth effects. We instead find evidence of positive urbanization effects and growth penalties for greater distances from larger urban areas. Universities also appear to play their primary role in creating human capital rather than knowledge spillovers for nearby firms. Quantile regression analysis confirms the absence of within-industry cluster effects and importance of human capital for counties with fast growth in high-tech industries.
    Keywords: High-tech industries; employment growth; regional growth
    JEL: O18
    Date: 2012
  2. By: Nader Ale Ebrahim (UM - University of Malaya - Department of Engineering Design and Manufacture, Faculty of Engineering, University of Malaya); Shamsuddin Ahmed (UM - University of Malaya - Department of Engineering Design and Manufacture, Faculty of Engineering, University of Malaya); Zahari Taha (UMP - Faculty of Manufacturing Engineering and Management Technology, University Malaysia Pahang - Education)
    Abstract: Introduction: With the advent of the global economy and high-speed Internet, online collaboration is fast becoming the norm in education and industry [1]. Information technology (IT) creates many new inter-relationships among businesses, expands the scope of industries in which a company must compete to achieve the competitive advantage. Information systems and technology allow companies to coordinate their activities in distant geographic locations [2]. IT is providing the infrastructure necessary to support the development of new collaboration forms among industry and education. Virtual research and development (R&D) teams represent one such relational form, one that could revolutionize the workplace and provide organizations with unprecedented levels of flexibility and responsiveness [3-4].
    Keywords: Virtual R&D teams, Collaboration, virtual teams, SMEs, Education
    Date: 2011
  3. By: Jordi Jofre-Monseny (Universitat de Barcelona & IEB); Raquel Marín-López (Universitat de Barcelona & IEB); Elisabet Viladecans-Marsal (Universitat de Barcelona & IEB)
    Abstract: The objective of this paper is to analyze why firms in some industries locate in specialized economic environments (localization economies) while those in other industries prefer large city locations (urbanization economies). To this end, we examine the location decisions of new manufacturing firms in Spain at the city level and for narrowly defined industries (three-digit level). First, we estimate firm location models to obtain estimates that reflect the importance of localization and urbanization economies in each industry. In a second step, we regress these estimates on industry characteristics that are related to the potential importance of three agglomeration theories, namely, labor market pooling, input sharing and knowledge spillovers. Localization effects are low and urbanization effects are high in knowledge-intensive industries, suggesting that firms (partly) locate in large cities to reap the benefits of inter-industry knowledge spillovers. We also find that localization effects are high in industries that employ workers whose skills are more industry-specific, suggesting that industries (partly) locate in specialized economic environments to share a common pool of specialized workers.
    Keywords: Agglomeration economies, manufacturing industries, localization economies, urbanization economies, specialization
    JEL: L25 L60 R12 R30
    Date: 2012
  4. By: Werner Hölzl (WIFO); Jürgen Janger (WIFO)
    Abstract: This paper studies differences in the perception of innovation barriers between innovative and non-innovative firms for 18 EU countries. The countries are grouped by their distance to the technological frontier using Community Innovation Surveys for the years 2002-2004 and 2004-2006. The results show that non-innovators interested in innovation are much more likely to perceive barriers than non-innovators that are not interested in innovation activities. With regard to differences between country groups there is a clear indication that innovation barriers related to the availability of skilled labour, innovation partners and knowledge are more important for firms located in countries close to the frontier, while the opposite is true regarding the availability of external finance. Although the share of innovators decreases with the distance to the technological frontier, the share of barrier-related innovators increases. The results demonstrate the usefulness of the innovation barrier approach to understand the determinants of innovative activity at the firm level and to priority-setting within innovation policies.
    Keywords: Innovation barriers, Europe, innovation policy
    Date: 2012–04–25
  5. By: Foreman-Peck, James (Cardiff Business School)
    Abstract: This paper assesses UK innovation policy impact on a large, population weighted, sample of both service and manufacturing SMEs. By focussing on self-reported innovation the study achieves a wider coverage of the effects of SME innovation policy than possible with more traditional indicators. Propensity score matching indicates that SMEs receiving UK state support for innovation were more likely to innovate than unsupported comparable enterprises. Innovating enterprises are shown to have grown significantly faster over the years 2002-4 when other growth influences are appropriately controlled. Combining these two results and comparing the outlays on SME innovation policy with the estimated effects suggests that policy was efficient as well as effective. There is evidence that SME tax credits were expensive compared with earlier support instruments. But the overall high returns estimated suggest that, even in times of public spending cuts, persisting with SME innovation policy would be prudent.
    Keywords: Innovation; State Aid; SME; Policy Evaluation
    JEL: L25 R38
    Date: 2012–01
  6. By: Lusine Arzumanyan (EA3713 - Centre de Recherche Magellan - Université de Lyon - Université Jean Moulin - Lyon III); Ulrike Mayrhofer (EA3713 - Centre de Recherche Magellan - Université de Lyon - Université Jean Moulin - Lyon III); Christopher Melin (EA3713 - Centre de Recherche Magellan - Université de Lyon - Université Jean Moulin - Lyon III)
    Abstract: Over the past few decades, scholars have shown a growing interest in the topic of innovation processes in multinational enterprises (MNE). Management systems of MNEs are complex, mainly because of the geographical dispersion of their activities. The internationalisation of the value-chain raises critical questions linked to the coordination of innovation processes. The objective of this paper is twofold: (1) to contribute to a better understanding of coordination mechanisms of innovation processes in multinational enterprises, and (2) to propose new tools and practices that can be used by MNEs to efficiently manage their innovation processes.
    Keywords: Research and development ; multinational company; coordination of activities.
    Date: 2011–09–01
  7. By: José Miguel Martínez-Carrión; Francisco José Medina-Albadalejo
    Abstract: This paper analyzes the international competitiveness of Spanish wine industry at the stage of 'wine globalization'. Examine the comparative advantage through the index of Revealed Competitive Advantage (RCA) or Balassa Index and explores the evolutionary behavior by type of wine and the relative weight of exports in volume, value and unit prices in the world market since the 1960's. It shows that Spanish wine industry is specialized in quality cheap wines, bulk wine and low cost wine despite the success of the export in recent decades. Although improved quality and increased exports of bottled wines with denomination of origin, the competitiveness of the Spanish wine industry is among the lowest in countries specialized.
    Keywords: Revealed Competitive Advantage (RCA), Wine world market, Spanish wine industry, International trade, Competitiveness
    JEL: F14 L66 N74 Q17
    Date: 2012–03
  8. By: Johanna Vogel
    Abstract: This paper investigates two channels through which research and development (R&D) and human capital may affect regional total factor productivity growth in the manufacturing sector, using panel data on 159 EU-15 regions from 1992 to 2005. Based on the endogenous growth model of Griffith, Redding and Van Reenen (2003), we allow R&D and human capital to influence productivity growth both directly, reflecting own innovation, and indirectly, reflecting imitation of frontier technology. Further, the model allows for conditional convergence to a long-run level of TFP relative to the frontier. We also develop an extension that captures geographically localised technology spillovers. Our preferred system-GMM estimates provide evidence of a positive and significant direct effect of human capital, and a positive and significant indirect effect of R&D on productivity growth. This may be interpreted as lending support to the recent focus of EU regional policy on raising educational attainment and R&D expenditures, although their channels of influence appear to differ. Our results also suggest that TFP convergence has taken place over our sample period and that geographic distance to the technology frontier matters.
    Keywords: Total factor productivity, Convergence, Human capital, Research and development, European regions
    JEL: O30 O47 I25 C23
    Date: 2012
  9. By: Hasnain, Zahid; Manning, Nick; Pierskalla Henryk
    Abstract: The objective of this paper is to provide a review of the theoretical and, in particular, empirical literature on performance-related pay in the public sector spanning the fields of public administration, psychology, economics, education, and health with the aim of distilling useful lessons for policy-makers in developing countries. This study to our knowledge is the first that aims to disaggregate the available evidence by: (i) the quality of the empirical study; (ii) the different public sector contexts, in particular the different types of public sector jobs; and (iii) geographical context (developing country or OECD settings). The paper's main findings, based on a comprehensive review of 110 studies of public sector and relevant private sector jobs are as follows. First, we find that overall a majority (65 of 110) of studies find a positive effect of performance-related pay, with higher quality empirical studies (68 of the 110) generally more positive in their findings (46 of the 68). These show that explicit performance standards linked to some form of bonus pay can improve, at times dramatically, desired service outcomes. Second, however, these more rigorous studies are overwhelmingly for jobs where the outputs or outcomes are more readily observable, such as teaching, health care, and revenue collection (66 of the 68). There is insufficient evidence, positive or negative, of the effect of performance-related pay in organizational contexts that that are similar to that of the core civil service, characterized by task complexity and the difficulty of measuring outcomes, to reach a generalized conclusion concerning such reforms. Third, while some of these studies have shown that performance-related pay can work even in the most dysfunctional bureaucracies in developing countries, there are too few cases to draw firm conclusions. Fourth, several observational studies identify problems with unintended consequences and gaming of the incentive scheme, although it is unclear whether the gaming results in an overall decline in productivity compared to the counterfactual. Finally, few studies follow up performance-related pay effects over a long period of time, leaving the possibility that the positive findings may be due to Hawthorne Effects, and that gaming behavior may increase over time as employees become more familiar with the scheme and learn to manipulate it.
    Keywords: Labor Policies,Educational Sciences,E-Business,Tertiary Education,Economic Theory&Research
    Date: 2012–04–01
  10. By: Lumineau, Fabrice; Frechet, Marc; Puthod, Dominique
    Abstract: The contracting process is a crucial step in alliance development and its success. However, the existing literature reveals surprisingly little investigation into how organizational learning relates to the process of contract making. We therefore conducted an in-depth longitudinal study of the alliance contracting process in the animated film industry. First, our findings suggest that during the contracting process, firms can learn about the way to deal with the contracting process, about themselves and their partner, and about the transaction features. Second, the case analysis indicates a combination of experiential, vicarious, and inferential learning mechanisms. Combining these insights into the objects and the mechanisms of learning during the contracting process, we discuss how contracting and learning processes are related and analyze the role of the contracting process in supporting organizational learning. The findings show that the drafting of contractual clauses fosters learning and, in turn, this learning triggers new contractual negotiations. Hence we suggest that the alignment between transaction features and the choice of contractual governance results from learning during the contracting process. We then propose avenues for future research.
    Keywords: Contracting process; Strategic alliances; Organizational learning; Longitudinal case study
    JEL: D86 L14 M1 F51 D8 D83
    Date: 2011
  11. By: Giulio Cainelli; Massimiliano Mazzanti
    Abstract: We investigate the factors behind the almost unexplored realm of environmental innovation adoption in services, using an Italian dataset derived from CIS2008. It has been suggested the environmental innovations in services does not necessarily lead to greater sustainability. If services are examined through the lens of manufacturing-services integration and push and pull effects, the picture of sustainability in relation to services is somewhat gloomier. We test whether this integration is relevant for environmental innovations and whether, taking account of differences in innovation in different services industries, environmental policies for manufacturing may transmit ‘induced innovation’ effects to services. We show that the ‘drivers’ of environmental innovation in carbon abatement and energy efficiency vary across services industries, and that cooperation, training, EMS and public funding play a key role. The integration of services and manufacturing through push and pull effects, and the environmental policy transmission effect from manufacturing to services generally do not seem to have a major influence on the diffusion of environmental innovations. Where an effect is significant, it would seem to result in more negative than positive effects on eco-innovations. It seems likely that the structural EI deficits in manufacturing firms are transmitted to services through manufacturing-services integration. This is a crucial consideration for management and policy.
    Keywords: environmental innovation; services; push and pull effects; EU emission trading
    JEL: C21 L60 O13 O30 Q20 Q58 F23
    Date: 2012–04–25
  12. By: NAKAJIMA Kentaro
    Abstract: This paper empirically examines whether the geographical proximity of transaction partners improves firms' profits by using actual microdata on inter-firm transactions. I model the formation of transaction partners between newly entering firms and existing ones as a two-sided, many-to-many matching game with transferable utility and estimate the structural parameters of the model. The results show that the average distance to the transaction partners negatively affects firms' structural revenues. This strongly suggests that the existence of agglomeration economies results from inter-firm transactions that occur between geographically close firms. Furthermore, this effect is larger for entrant firms than for existing ones.
    Date: 2012–04
  13. By: Lumineau, Fabrice; Malhotra, Deepak
    Abstract: This paper investigates how contract structure influences inter-firm dispute resolution processes and outcomes by examining a unique dataset consisting of over 150,000 pages of documents relating to 102 business disputes. We find that the level of contract detail affects the type of dispute resolution approach that is adopted when conflict arises, and that different approaches are associated with different costs for resolving the dispute. We also find that the effect of contract choice on dispute resolution approach is moderated by the degree of coordination required in the relationship, and that the effect of dispute approach on costs is moderated by the degree of power asymmetry between the parties. Thus, even after controlling for various attributes of the exchange relationship and the dispute, the choice of contracting structure has important strategic implications.
    Keywords: Contractual Governance; Disputes; Framing; Interest-Based Negotiation and Rights-Based Negotiation; Control and Coordination; Power
    JEL: L14 K40 K42 L22 K41 M10
    Date: 2011
  14. By: Matteo Bonato; Massimiliano Caporin; Angelo Ranaldo
    Abstract: We define risk spillover as the dependence of a given asset variance on the past covariances and variances of other assets. Building on this idea, we propose the use of a highly flexible and tractable model to forecast the volatility of an international equity portfolio. According to the risk management strategy proposed, portfolio risk is seen as a specific combination of daily realized variances and covariances extracted froma high frequency dataset, which includes equities and currencies. In this framework, we focus on the risk spillovers across equities within the same sector (sector spillover), and fromcurrencies to international equities (currency spillover). We compare these specific risk spillovers to a more general framework (full spillover) whereby we allow for lagged dependence across all variances and covariances. The forecasting analysis shows that considering only sector- and currency-risk spillovers, rather than full spillovers, improves performance, both in economic and statistical terms.
    Keywords: Risk spillover, portfolio risk, currency risk, variance forecasting, international portfolio, Wishart distribution
    JEL: C13 C16 C22 C51 C53 G17
    Date: 2012
  15. By: Giacomo Boesso (Department of Economics and Management, University of Padova, Italy); Fabrizio Cerbioni (Department of Economics and Management, University of Padova, Italy); Andrea Menini (Department of Economics and Management, University of Padova, Italy); Antonio Parbonetti (Department of Economics and Management, University of Padova, Italy)
    Abstract: This paper examines whether effective governance plays a major role in driving foundations’ strategy when it comes to making the choice between reactive or proactive philanthropy models. More specifically, we investigate the relationships between philanthropic strategy (expressive, receptive, proactive and collaborative) and [a] board capital (competences and networks), [b] board processes (planning, control, evaluation, etc.), and [c] chairman power (entrenchment and tenure).
    Keywords: board capital, board processes, CEO power, corporate governance, foundation, foundation of banking origins, philanthropic strategy
    JEL: M14 G30 L31
    Date: 2012–04
  16. By: Shepherd, Ben
    Abstract: This paper examines the issue of measuring logistics costs from an applied trade policy research perspective, as well as identifying logistics-intensive sectors. It focuses on currently available data at the macro- and firm-levels. Data sources considered include national accounts, national input-output tables, the International Comparison Project, firm-level data, and production and trade data. Although current data exhibit a number of weaknesses compared with “custom” logistics costs data—notably in terms of sectoral definition—they nonetheless make it possible to conduct some preliminary empirical analysis that can inform future measurement efforts. First, the paper finds that there is little systematic evidence of a link between the size of the logistics sector and economic outcomes, such as trade openness. Second, the relationship between the size of the logistics sector and logistics performance is non-monotonic. Third, the size of the logistics sector only increases in per capita income up to a certain point, before the relationship turns negative. These findings suggest that measures of sectoral size—such as logistics costs relative to GDP—may be of limited use to researchers and policymakers because they do not have an unambiguous interpretation in terms of performance or economic outcomes. Fourth, however, direct indicators of price and performance are more clearly related to economic outcomes, and have a more straightforward relation with per capita income. The emphasis going forward should therefore be on compiling data that capture logistics performance most accurately, rather than sector size. Finally, the paper uses input-output data to identify logistics-intensive sectors, and finds suggestive evidence that improvements in logistics performance could lead to sectoral reallocations in favor of relatively heavy industries in developing countries, which is consistent with the goal of export diversification.
    Keywords: Logistics; Trade policy; Data and measurement
    JEL: F13 L90
    Date: 2011–11–03

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