nep-cse New Economics Papers
on Economics of Strategic Management
Issue of 2012‒10‒27
twenty papers chosen by
Joao Jose de Matos Ferreira
University of the Beira Interior

  1. Absorptive Capacity and Innovation: When Is It Better to Cooperate? By Abiodun Egbetokun; Ivan Savin
  2. Disentangling the effects of organizational capabilities, innovation and firm size on SME sales growth By André van Stel; Lorraine Uhlaner; Haibo Zhou; Valerie Duplat
  3. R&D, Worker Training, and Innovation: Firm-level evidence By Xulia González; Daniel Miles-Touya; Consuelo Pazó
  4. Knowledge-bases, places, spatial configurations and the performance of knowledge-intensive professional service firms By Li, QC; Tether, BS; Mina, A
  5. Regional cluster policy: The Asian model vs. the OECD approach By Pessoa, Argentino
  6. Spatial spillovers from FDI agglomeration : evidence from the Yangtze River Delta in China By Tanaka, Kiyoyasu; Hashiguchi, Yoshihiro
  7. Investigating the impact of the technological environment on survival chances of employer entrepreneurs By André van Stel; José Maria Millan; Concepcion Roman
  8. Value Chain Relatedness: Strategic Complementarities and Firm Performance By Elisabeth Nocker; Harry P. Bowen; Christian Stadler
  9. Evolving localization patterns of company foundations - Evidence from the German MST-industry By Tobias Scholl; Thomas Brenner; Martin Wendel
  10. Determinantes de la capacidad de innovación en Pymes regionales By Carlos M. Jardón
  11. Developing High Performance: Performance Management in the Australian Public Service By Deborah Ann Blackman; Fiona Buick; Michael O'Donnell; Janine L. O'Flynn; Damian West
  12. Performance Appraisal: Dimensions and Determinants By Alberto Bayo-Moriones; Jose Enrique Galdon-Sanchez; Sara Martinez-de-Morentin
  13. Start-Up Size Strategy: Risk Management and Performance By André van Stel; Andrew Burke; José Maria Millan; Concepcion Roman
  14. Technology in the clean development mechanism: the role of host country characteristics. By Gisèle Schmid
  15. Do firm size and firm age affect employee remuneration in Dutch SMEs? By Jan de Kok
  16. Corporate governance and small & medium businesses By Bundaleska, Elena; Dimitrova, Makedonka; Nikolovska, Zdenka
  17. Does Competition Matter for Corporate Governance? The Role of Country Characteristics By Jean-Claude Cosset; Hyacinthe Y. Somé; Pascale Valery
  18. Business-Driven Innovation: Is it Making a Difference in Education?: An Analysis of Educational Patents By Dominique Foray; Julio Raffo
  20. “Regulation of Port Charges in Spain: Global versus Local Competition” By Xavier Fageda; Marta Gonzalez-Aregall

  1. By: Abiodun Egbetokun (Graduate College "Economics of Innovative Change", Friedrich Schiller University Jena); Ivan Savin (Graduate College "Economics of Innovative Change", Friedrich Schiller University Jena)
    Abstract: Cooperation can benefit and hurt firms at the same time. An important question then is: when is it better to cooperate. And how can an appropriate partner be selected? In this paper we present a model of inter-firm cooperation driven by cognitive distance, appropriability conditions and external knowledge. Absorptive capacity of firms develops as an outcome of the interaction between absorptive R&D and cognitive distance from voluntary and involuntary knowledge spillovers. Thus, we offer a revision of the original model by Cohen and Levinthal (1989) accounting for recent empirical findings and explicitly modeling absorptive capacity within the framework of interactive learning. We apply that to the analysis of firms' cooperation and R&D investment preferences. While the focus of this paper is limited to a static scenario, where the cognitive distance between cooperating firms is fixed and given exogenously, in Savin and Egbetokun (2012) we address the dynamic approach and provide more extensive simulation results.
    Keywords: inter-firm cooperation, absorptive capacity, cognitive distance, innovation, knowledge spillovers
    JEL: C63 D83 L14 O32 O33
    Date: 2012–10–15
  2. By: André van Stel; Lorraine Uhlaner; Haibo Zhou; Valerie Duplat
    Abstract: This paper focuses on certain drivers of SME sales growth related to knowledge and innovation. Building on the dynamic capabilities literature, we test whether two organizational capabilities (external sourcing and employee involvement in renewal activities) predict sales growth, and if so, whether such effects are mediated by process and/or product innovation. Based on survey data from a panel study of Dutch SMEs, and controlling for several firm characteristics (firm size, sector, age and family business), we conclude that external sourcing has direct effects on both product and process innovation, with an indirect effect (mediated by process innovation) on sales growth. In line with our hypothesis development, we also find that employee involvement, while positively affecting process innovation, has a negative effect on sales growth. Firm size moderates the effects of two of the variables (external sourcing and product innovation) on sales growth, with more positive effects found for the smallest firms, results supporting the nimbleness (versus resource-based) view.
    Date: 2012–10–11
  3. By: Xulia González; Daniel Miles-Touya; Consuelo Pazó
    Abstract: This paper analyzes the effects of R&D and on-the-job training on innovation performance in a sample of Spanish manufacturing firms. The role of formal R&D activities has been intensively investigated, but little reserch has been carried out on the role of human capital, as measured by firm-sponsored worker training, and even less has addressed the interaction between both activities. We analyze the complementarity between the effects of R&D and training on firm innovation success while distinguishing between large and small firms. Our findings suggest that R&D is a key factor in explaining firm innovation performance and that worker training investment also has a significant effect albeit one of less magnitude. The results confirm a complementary relationship: on-the-job training reinforces the effect of R&D on innovation performance.
    Keywords: R&D, Worker Training, Innovation, Probit
    JEL: L22 L11
    Date: 2012–09
  4. By: Li, QC; Tether, BS; Mina, A
    Date: 2012–06
  5. By: Pessoa, Argentino
    Abstract: Nowadays, policy makers in charge of designing innovation policies, especially at the regional level, are more and more looking at the cluster approach either with a view to accelerate the existing clusters or for providing the basis for the emergence of new ones. In fact, not only as a consequence of their appeal as an interactive and territorially embedded vision of innovation but also owing to a lot of other reasons, clusters are usually considered as key instruments for promoting competitiveness, industrial development, innovation and growth. But, although cluster policies have a potential for generating benefits, the presence of potential benefits from cluster initiatives is not per se a sufficient foundation or a validation for policymakers to get involved, since clustering is something that has been happening spontaneously during time. The key question is whether and how policymakers can add value through appropriate measures, beyond the outcomes that markets and market players produce on their own. While there is an extensive literature that focuses on the cluster analysis, the connection between clusters and policy has been mainly ignored. This paper tries to shed light on this issue, highlighting the key features of both the cluster concept and policy. It also aims at contributing to diminish the existing gap between theory and policy comparing two broad models of cluster policy: the Asian and the OECD approach.
    Keywords: agglomeration; clusters; cluster policy; innovation; competitiveness; externalities; regional economic development
    JEL: R58 R1 L26 R11
    Date: 2012–10–17
  6. By: Tanaka, Kiyoyasu; Hashiguchi, Yoshihiro
    Abstract: Foreign firms have clustered together in the Yangtze River Delta, and their impact on domestic firms is an important policy issue. This paper studies the spatial effect of FDI agglomeration on the regional productivity of domestic firms, using Chinese firm-level data. To identify local FDI spillovers, we estimate the causal impact of foreign firms on domestic firms in the same county and similar industries. We then estimate a spatial-autoregressive model to examine spatial spillovers from FDI clusters to other domestic firms in distant counties. Our results show that FDI agglomeration generates positive spillovers for domestic firms, which are stronger in nearby areas than in distant areas.
    Keywords: China, Foreign investments, International business enterprises, Productivity, FDI, Multinational firms, Spillovers
    JEL: C21 F21 F23 R12 R58
    Date: 2012–06
  7. By: André van Stel; José Maria Millan; Concepcion Roman
    Abstract: In order to mitigate the negative consequences of the current economic and financial crisis, it is of utmost importance that existing jobs remain intact as much as possible. In this respect, it is crucial that firms which employ personnel, survive. In this paper we investigate the role of the technological environment in determining the survival chances of employer entrepreneurs, defined as ownermanagers of firms which employ personnel. We estimate survival models to analyse durations as an employer entrepreneur, using micro panel data from EU-15 countries drawn from the European Community Household Panel (ECHP). As indicators for the technological environment we use a country’s R&D expenditures, a country’s employment share of high-tech and knowledge-intensive sectors, and a country’s number of patent applications to the European Patent Office. We find strong support for a positive relationship between these indicators of the technological environment in country j and year t and survival chances of employer entrepreneurs in that same country and year. Our analysis also suggests that a selection effect may be part of the explanation in the sense that in a more advanced technological environment, relatively more ‘high-quality’ individuals select into entrepreneurship. An implication of our novel finding is that innovation policy may contribute to survival of employer entrepreneurs, thereby safeguarding wage jobs in Europe, and achieving a lower waste of resources associated with firm exit.
    Date: 2012–10–09
  8. By: Elisabeth Nocker (University of Innsbruck); Harry P. Bowen (McColl School of Business, Queens University of Charlotte); Christian Stadler (Warwick Business School, The Warwick University)
    Abstract: This study extends the literature on relatedness and firm performance to consider customer side as well as technological side relatedness. Recent studies indicate the importance of each source of relatedness but yield ambiguous findings regarding their impacts on performance. Conjecturing this ambiguity reflects methodological limitations related to prior studies? use of survey data to develop measures of relatedness, we instead develop a secondary data method to measure technological and customer relatedness for a large sample of U.S. firms from 1984 to 2004. Estimating a model in which relatedness and firm performance are simultaneously determined, we find that, unlike prior studies, each source of relatedness has a positive direct effect on firm performance and a positive indirect effect that reflects complementarity between each source of relatedness.
    Date: 2012
  9. By: Tobias Scholl (University Frankfurt); Thomas Brenner (Department of Geography, Philipps University Marburg); Martin Wendel (University Mainz)
    Abstract: We investigate company foundations in the German micro technology industry by means of a spatial-temporal micro-geographic analysis. In order to deal with our unusual detailed data, we develop a new distance-based framework for a logistic regression that is able to present results in a continuous space. Locations of company foundations are investigated with respect to their spatial proximity to similar firms, patent owner, related industries and research institutions and are benchmarked with the overall distribution of company foundations in Germany. We demonstrate that spatial proximity has a clear influence on where new companies are founded. Furthermore, the influence of proximity to different agents is not constant over times but evolves with the industry’s life cycle.
    Keywords: Spatial concentration, localization, clusters, MAUP, distance-based measures
    JEL: C40 M13 R12
    Date: 2012–10–18
  10. By: Carlos M. Jardón
    Abstract: The innovativeness is a core competence to innovate and therefore enhancing competitiveness, especially in small and medium enterprises (SMEs). Such capability is constrained by internal and external factors. This article discusses how the company combines these factors to improve innovativeness. The company produces a core competence called human resource management and technology from internal intellectual capital. In addition, the company organizes another competency called core resource management and territorial relations from tangible resources associated with territory and intellectual capital as a result of the relationship with the environment. Using partial least squares techniques applied to a sample of small and medium enterprises in a region in northwest Spain is shown that both factors influence innovativeness. This study helps to define what the factors that enhance innovativeness are and how those factors associated company, indicating which the process of building core competencies to improve their innovativeness is. As a result, the article suggests for thought to develop policies to support business innovation. Resumen: La capacidad de innovación es una competencia distintiva que permite innovar y, en consecuencia, potencia la competitividad, especialmente en las pequeñas y medianas empresas (PYME). Dicha capacidad se ve condicionada por factores internos y externos. Este artículo analiza como combina la empresa dichos factores para mejorar la capacidad de innovación. Por un lado, la empresa genera una competencia distintiva denominada gestión de los recursos humanos y tecnológicos a partir del capital intelectual interno. Por otro lado, organiza otra competencia distintiva denominada gestión de los recursos y relaciones territoriales a partir de los recursos tangibles asociados al territorio y del capital intelectual fruto de las relaciones con el entorno. Mediante técnicas de Mínimos cuadrados parciales aplicados en una muestra de pequeñas y medianas empresas en una región del noroeste de España se demuestra que ambos factores influyen en la capacidad de innovación. Este estudio contribuye a delimitar cuales son los factores que potencian la capacidad de innovación y como la empresa asocia esos factores, indicando cual es el proceso de construcción de competencias básicas para mejorar su capacidad de innovación. Como consecuencia, el artículo sugiere elementos de reflexión para elaborar políticas de apoyo a la innovación empresarial.
    Keywords: Innovativeness, regional SME, core competency
    JEL: M21 M14 M10
    Date: 2012–09
  11. By: Deborah Ann Blackman; Fiona Buick; Michael O'Donnell; Janine L. O'Flynn; Damian West
    Abstract: This paper provides a new conceptualisation of high performance government for the public sector. Despite the concerted focus on performance management in both the public and private sectors, the performance puzzle remains. In part, we argue, this is because of a failure to recognise the complex interactions across the micro, meso, and macro levels of performance management that characterise such systems in the public sector. We consider the current attention on system-wide 'high performance government', review the existing literature on high performance organisations, and high performance individuals and groups, and then posit a further, and to date missing, level of analysis - high performance governance. The report is part of a multi-year collaborative research project between the Australian National University, the University of Canberra, the University of New South Wales and the Australian Public Service Commission as part of the Ahead of the Game blueprint for reform in the Australian public service.
    Keywords: Public Sector, performance management, high performance organization, high performance government, reform
    Date: 2012–06
  12. By: Alberto Bayo-Moriones (Departamento de Gestión de Empresas-UPNA); Jose Enrique Galdon-Sanchez (Departamento de Economía-UPNA); Sara Martinez-de-Morentin (Departamento de Economía-UPNA)
    Abstract: The determinants of the dimensions that shape a formal system of performance appraisal are studied in relation to a sample of Spanish manufacturing establishments. In particular, the factors that influence the measures used to evaluate performance, the person who carries out such appraisal and its frequency are analysed. Our results show that the characteristics of the establishment exert a significant influence on the configuration of performance appraisal. Specifically, we find that the use of practices complementary to performance evaluation and the structural factors of the establishment are found to correlate closely with the dimensions of formal performance appraisal.
    Keywords: performance appraisal, monitoring, establishment characteristics, dimensions of appraisal
    JEL: M12 M5
    Date: 2012
  13. By: André van Stel; Andrew Burke; José Maria Millan; Concepcion Roman
    Abstract: Start-up size is a key strategic decision for entrepreneurs. Should entrepreneurs start up close to minimum efficient scale or should they take less risks and start-up on a smaller scale? Previously, this strategic decision appeared to be one of simply making a choice between a higher risk/reward larger start-up versus a lower risk/reward smaller scale start-up. However, recent research on the relationship between risk management and performance (Burke, 2009) indicates that in situations of greater uncertainty and where innovation is incremental, a lower risk small start-up size can enable greater reward through enhanced post start-up flexibility and agility. In this paper we provide the first statistical test of the efficacy of start-up size strategies. We focus on employer businesses that provide jobs. We find that employer businesses that originally adopted a small scale (own-account) start-up strategy have higher survival chances and entrepreneurial incomes than employer businesses that employed personnel immediately from start-up. We also find that prior entrepreneurial experience positively affects firm survival and entrepreneurial incomes. Given the high failure rates among start-ups and the associated difficulty for new enterprises to create sustainable jobs, the research results highlight how strategic choice in relation to firm start-up size and risk management can have an important bearing on new venture performance.
    Date: 2012–08–29
  14. By: Gisèle Schmid
    Abstract: Technology transfer is not an explicit objective of the Clean Development Mechanism (CDM). It however constitutes a potential co-benefit by helping to improve living conditions in developing countries. Understanding the drivers and barriers of technology transfer in CDM projects is therefore essential to direct investment flows in host countries and enhance the current CDM framework. In this respect, the contribution of this paper is twofold. First, it identifies stepping stones and stumbling blocks to technology transfer in the CDM. Higher applied tariff rates on environmental goods and services as well as burdensome administrative procedures to start a new business are found to be negatively associated with the likelihood of a technology transfer. The results are robust to the exclusion of large host countries from the sample, like China and India. Second, as an extension, the paper analyses the correspondence of these supporting factors and barriers with the likelihood of a transfer of the different types of technology (equipment, knowledge or both). The paper concludes with policy recommendations for Non-Annex I governments, and suggestions for improvements to the CDM to better assess technology transfer in offsetting projects.
    Keywords: Clean Development Mechanism (CDM), technology transfer, Non-Annex I countries
    Date: 2012–02
  15. By: Jan de Kok
    Abstract: Various studies have indicated the presence of firm size wage gaps and firm age wage gaps in the remuneration of employees. This study shows that a firm size wage gap also exists in the population of Dutch Enterprises with 1 – 100 employees, but that there is no sign of a firm age wage gap. The firm size wage gap can be partially explained by the age and educational level of the employee, as well as by the educational level of the entrepreneur. The usage of performance-related pay also varies with firm size (and not with firm age). This firm size effect can be explained fully by employee tenure (rather than age and education).
    Date: 2012–10–16
  16. By: Bundaleska, Elena; Dimitrova, Makedonka; Nikolovska, Zdenka
    Abstract: Corporate governance refers to a set of internal policies, rules, and procedures that a company follows on a regular basis to ensure that it operates in a fair, equitable, and appropriate manner for the benefit of the company, its management and its stakeholders. It is almost always thought about in the context of big publically listed companies. However, it is just as important for privately held, small and medium sized businesses to adhere to good corporate governance policies and practices. One of the reasons being their accountability as key economic drivers and job creators in most of the countries (example: in 2009, there were 27.5 million businesses in the United States, according to US Office of Advocacy estimates`1). As businesses grow and stakeholders increase, good corporate governance becomes even more important, as there are many people with vested interests. Yet many small and medium businesses do not necessarily pay attention to the concepts of corporate governance. Most of them do not even have the necessary structure and knowledge organize and implement it. This Paper discusses how corporate governance applies to small businesses. It explains the mechanisms related to sound corporate governance in big companies, such as well developed and implemented policies, procedures and processes, risk management systems, strategic planning, transparency and disclosure, reporting, employee management systems, etc. and recommends which of these mechanisms may be applicable and effective for small and medium businesses. As there is a buzz among the businesses that legislation requiring small and medium businesses to adhere to similar if not exact rules on corporate governance as big publically listed companies, is being considered, this Paper shall discuss whether the government should impose its will to the small and medium business environment, or leave it up to the discretion of the businesses. As a final note, having discussed all of the above, the Paper shall conclude that every company, no matter what size it is, will see the positive effects of implementing the principles of corporate governance. `1 Kobe, Kathryn. 2007. U.S. Department of Commerce, Census Bureau and Intellectual Trade Administration. (accessed September 10, 2011)
    Keywords: Corporate governance; small and medium sized businesses; regulation vs. deregulation
    JEL: G34
    Date: 2011–11
  17. By: Jean-Claude Cosset; Hyacinthe Y. Somé; Pascale Valery
    Abstract: We investigate the empirical relation between competition and corporate governance and the effect of country characteristics on this relation. We find that competition is associated with strong corporate governance, but only in less developed countries. We next examine the impact of corporate governance on firm value given the level of competition. We find that competition and corporate governance appear to be complements in explaining firm value in developing countries, while in developed countries they are substitutes.
    Keywords: Product market competition, Corporate governance, Economic and financial development, Investor protection
    JEL: G30 L00 O16
    Date: 2012
  18. By: Dominique Foray; Julio Raffo
    Abstract: This paper analyses business-driven innovation in education by looking at education-related patents. It first draws a picture of the challenges for innovation in the formal education sector, which suffers from a poor knowledge ecology: science is hardly linked to core teaching and administrative practices. It then turns to a common indicator of innovation: patents. In the case of education, patents typically cover educational tools. An analysis of education-related patents over the past 20 years shows a clear rise in the production of highly innovative educational technologies by businesses, typically building on advances in information and communication technology. While this increase in educational innovations may present new opportunities for the formal education sector, the emerging tool industry currently targets the nonformal education rather than the formal education system. We shortly discuss why business entrepreneurs may be less interested in the market of formal education.<BR>Cet article porte sur l’innovation entrepreneuriale dans le secteur de l’éducation, à partir d’une analyse des dépôts de brevets dans le secteur éducatif. Premièrement, il propose un tableau des défis de l’innovation dans le secteur de l’éducation formelle, dont l’écologie du savoir est faible : la science y est peu liée avec le coeur des pratiques pédagogiques et administratives. L’étude porte ensuite sur un indicateur courant de l’innovation : les brevets. Dans le cas de l’éducation, les brevets couvrent généralement des « outils » éducatifs. L’analyse des brevets éducatifs durant les vingt dernières années montre une claire croissance de la production de technologies éducatives hautement innovantes par des entreprises privées, qui s’appuient souvent sur les progrès des technologies d’information et de communication. Bien que cette croissance des innovations éducatives puisse donner de nouvelles opportunités au secteur formel de l’éducation, l’industrie émergente d’outils éducatifs cible actuellement les secteurs informels d’éducation. Nous discutons brièvement les raisons pour lesquelles les entrepreneurs privés semblent moins intéressés par le secteur de l’éducation formelle.
    Date: 2012–10–03
  19. By: Marianne Fischman (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon Sorbonne); Emeric Lendjel (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon Sorbonne)
    Abstract: Recent research on maritime ports hinterlands points out the relevance of mass ground transport modes such as barge transport for enormous flows of containers to and from harbours, especially when a maritime port is located at the mouth of a river. Though, the modal share of container barge transport in French maritime ports (9% of TEU in Le Havre and 5% in Marseille in 2007) is significantly lower than elsewhere (32% in Rotterdam and 33% in Antwerp). Some reports and studies explain the viscosity of container barge transport flows as a result of several factors, generally concentrated around the seaport community. In continuation of previous seminal works, this paper adopts a neo-institutional approach (Williamson, 1985; 1996) of container barge transport to understand how the factors generating this viscosity are managed. Section 2 describes the characteristics of the transaction of container barge transport. Section 3 is devoted to its attributes (asset specificity, frequency, uncertainty). According to Williamson's (1996) remediableness criterion, the observed governance structure of a given transaction is presumed efficient and aligned to its attributes. Thus, Section 4 deals with observed governance structures of container barge transport chains with a focus on Le Havre, main French container seaport and shows how agents try to limit opportunism in ex-post haggling over quasi-rents or under-investments. Implementation of a new institutional environment to modify governance structures is analysed, and a comparison with currently implemented governance structures observed in Rhine is made. Finally, Section 5 suggests ways of dealing with the remaining coordination problems impeding the development of container barge transport in France.
    Keywords: container barge transport, transactional chain, transaction cost economics, interface seaport, governance structure
    Date: 2012
  20. By: Xavier Fageda (Faculty of Economics, University of Barcelona); Marta Gonzalez-Aregall (Faculty of Economics, University of Barcelona)
    Abstract: This article examines the determinants of traffic volumes and the revenues per tonne generated by Spain’s port authorities. The interest of the study lies on the strong differences between port authorities in a context of strict regulation but that provides some scope for price competition. We find that port charges influence the amount of traffic that a port is able to generate. Furthermore, we find clear evidence of local price competition and report mixed results for global competition. Revenues per tonne are higher in ports operating more international regular lines and with multinational terminal operators, while they are lower in ports with nearby competing facilities and where the market share of the dominant shipping firm is high.
    Keywords: ports, revenues, traffic, prices JEL classification: -
    Date: 2012–10

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