nep-cse New Economics Papers
on Economics of Strategic Management
Issue of 2013‒10‒02
fifteen papers chosen by
Joao Jose de Matos Ferreira
University of the Beira Interior

  1. Entrepreneurial Orientation and Network Ties: Innovative Performance of SMEs in an Emerging-Economy Manufacturing Cluster By Theresia Gunawan; Jojo Jacob; Geert Duysters
  2. Stage of development, governance and performance of inter-firm innovation cooperation: a conceptual model and propositions By Romaric Servajean-Hilst
  3. What makes companies pursue an open science strategy? By Markus Simeth; Julio Raffo
  4. The Innovation Potential of Universities - An Explorative Analysis By Jörg Bühnemann; Steffen Burchhardt
  5. Why Size Maters: Investigating the Drivers of Innovation and Economic Performance in New Zealand using the Business Operation Survey By Les Oxley; Shangqin Hong; Philip McCann
  6. Innovation and upgrading in global production networks By Dev Nathan; Sandip Sarkar
  7. Industrial dynamics and clusters: a survey By Koen Frenken; Elena Cefis; Erik Stam
  8. Is Financial Support for Private R&D Always Justified? A Discussion Based on the Literature on Growth By Benjamin Montmartin; Nadine Massard
  9. Coagglomeration of formal and informal industry : evidence from India By Mukim, Megha
  10. How does geographical mobility of inventors influence network formation? By Ernest Miguelez
  11. Firms and gender: performance differentials between male and female firms By Domenico Depalo; Francesca Lotti
  12. Subsidiary managers' knowledge mobilizations: Unpacking emergent knowledge flows By Esther Tippmann; Pamela Sharkey Scott; Vincent Mangematin
  13. Back to Basics: Basic Research Spillovers, Innovation Policy and Growth By Ufuk Akcigit; Douglas Hanley; Nicolas Serrano-Velarde
  14. Measuring national innovation systems efficiency – a review of DEA approach By Maxim Kotsemir
  15. New strategies of industrial organization: outsourcing and consolidation in the mobile telecom sector in India By Sumangala Damodaran

  1. By: Theresia Gunawan (Maastricht School of Management and Technical University of Eindhoven, the Netherlands); Jojo Jacob (United Nation University- Maastricht Economic and Social Research Institute on Innovation and Technology (UNU MERIT), the Netherlands); Geert Duysters (Tilburg University, the Netherlands)
    Abstract: This study investigates the role of intra-cluster ties, extra-cluster ties, and entrepreneurial orientation in shaping firms’ innovative performance. We conduct our analysis on a primary data set of 120 SMEs in the Cibaduyut footwear-manufacturing cluster, Indonesia. We find that extra-cluster ties mediate the relationship between proactiveness and innovative performance. A combination of high extra-cluster ties and risk taking exert a positive impact on innovative performance. Surprisingly, we find that risk taking negatively moderates the influence of intra-cluster ties on innovative performance. Overall, the findings of this study point to the synergistic effects of entrepreneurial orientation and extra-cluster ties on innovative performance.
    Date: 2013–08
  2. By: Romaric Servajean-Hilst (CRG - Centre de recherche en gestion - Polytechnique - X - CNRS : UMR7176)
    Abstract: This paper presents a framework for the dyadic study of inter-firm innovation cooperation, beyond the boundaries of collaborative innovation projects. In order to understand how two firms can maximize the performance of their relationship, we performed a literature review combined with interviews with practitioners. The result of this study is a model associated with propositions on the interactions between its different elements, which are (i) the governance of the relationship, (ii) its performance, (iii) its level of development and (iv) the degree of innovation of the collaborative projects. This paper concludes by suggesting future researches and stating implications for managers.
    Keywords: inter-firm innovation cooperation; governance; cooperation relationship development and performance
    Date: 2013–03–22
  3. By: Markus Simeth (Ecole Polytechnique Fédérale de Lausanne (EPFL), College of Management, Switzerland); Julio Raffo (World Intellectual Property Organization, Economics and Statistics Division, Geneva, Switzerland)
    Abstract: Whereas recent scholarly research has provided many insights about universities engaging in commercial activities, there is still little empirical evidence regarding the opposite phenomenon of companies disseminating scientific knowledge. Our paper aims to fill this gap and explores the motivations of firms that disclose research outcomes in a scientific format. Besides considering an internal firm dimension, we focus particularly on knowledge sourcing from academic institutions and the appropriability regime using a cost-benefit framework. We conduct an econometric analysis with firm-level data from the fourth edition of the French Community Innovation Survey (CIS4) and matched scientific publications for a sample of 2,512 R&D performing firms from all manufacturing sectors. The analysis provides evidence that the access to important scientific knowledge imposes the adoption of academic disclosure principles, whereas the mere existence of collaborative links with academic institutions is not a strong predictor. Furthermore, the results suggest that overall industry conditions are influential in shaping the cost-benefit rationale of firms with respect to scientific disclosure.
    Keywords: R&D, Industrial Science, Knowledge Disclosure, University-Industry collaboration
    Date: 2013–04
  4. By: Jörg Bühnemann (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg); Steffen Burchhardt (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg)
    Abstract: Knowledge-based innovations are a main driver for economic development of countries and a key factor in global competition. Most industrial countries aim to strengthen their innovative capacity breadthways. Beside large firms especially universities have the necessary potential (infrastructure and knowledge) to be regional drivers of innovations. They develop innovative ideas on their own and even more important support R&D-activities of the local economy. This paper offers a methodological framework for exploring the potential for commercialization within universities. The importance of inventions, publications and third-party funds as objective indicators is highlighted, and an additive value function is introduced to measure the potential for commercialization. Based on expert interviews at a technical university the required weights for all considered indicators are exemplarily identified. By applying different models to aggregate expert weights robust rankings of university units with respect to percapita and overall potential for commercialization were found. Based on these measures a central transfer unit could be able to allocate transfer-oriented resources properly. The specified scoring approach is a first step towards an EU-requested evaluation system.
    Keywords: knowledge transfer, potential for commercialization, patent, invention, university
    JEL: I23 O31 D81
    Date: 2013–09
  5. By: Les Oxley (University of Waikato); Shangqin Hong (University of Canterbury); Philip McCann (University of Groningen)
    Abstract: The economic performance of the New Zealand economy is something of an enigma. Although ranked number one (of 144 countries) for four important 'growth fundamentals' New Zealand is 'middle of the pack' when it comes to economic growth, productivity and innovation. So what is missing in this story of New Zealand performance? Using three iterations (2005, 2007 and 2009) of the Business Operations Survey, the paper seeks to answer the question using a bivariate probit regression (biprobit) approach applied to samples in excess of 2,000 unit record observations of New Zealand firms. The results suggest that factors such as firm size, high perceived quality product, investment/R&D capability, major technology change, application of formal IP protection and new export markets are systematically and positively related to innovation; while many external issues such as those related to geography, market structure, business environment, appear to have little influence. At the firm level, innovations in New Zealand are highly dependent on the firms’ internal ability to develop new technologies and market demand. (Small) size does matter in New Zealand where ultimately government may need to be involved to maintain a viable (minimum) scale for domestic R&D.
    Keywords: innovation; New Zealand Business Operations Survey (BOS); new economic geography (NEG).
    Date: 2013–09–23
  6. By: Dev Nathan; Sandip Sarkar
    Abstract: Abstract This paper deals with the role of innovation in upgrading within global production networks (GPNs). Because of the distribution of production segments across firms and countries, there is also a distribution of production knowledge. The paper looks at some ways of upgrading by developing economy firms – the roles of distributed knowledge, reverse innovation and new types of innovation, based on frugal engineering in emerging economies. Process changes could also be innovation, though, unlike product innovations, they are easily copied and spread. The paper points out the limits of current reverse innovation and also asks whether the separation of manufacturing from design has increased the speed of innovation. Before concluding, the paper looks at innovation in terms of the ‘adjacent possible’ in evolutionary analysis.
    Date: 2013
  7. By: Koen Frenken; Elena Cefis; Erik Stam
    Abstract: We review the literature on clusters and their effects on entry, exit and growth of firms as well on the evolutionary dynamics underlying the process of cluster formation. Our extensive review shows that there is strong evidence that clusters promote entry, but little evidence that clusters enhance firm growth and firm survival. The emergence of clusters is best understood as an evolutionary process of capability transmission between parent firms and their spinoffs, rather than as an outcome of localisation economies that would increase the performance firms in clusters compared to firms outside clusters. From a number of open questions we distil various future research avenues stressing the importance of understanding firm heterogeneity and the exact mechanisms underlying localisation economies.
    Keywords: entry, exit, industrial cluster, localisation economies, product lifecycle, industry lifecycle, evolutionary economic geography, firm heterogeneity
    JEL: L10 L20 L26 R10
    Date: 2013–09
  8. By: Benjamin Montmartin (GREDEG CNRS; University of Nice-Sophia Antipolis, France); Nadine Massard (GATE Lyon Saint-Etienne; Jean Monnet University, Saint-Etienne, France)
    Abstract: Many economists have long held that market failures create a gap between social and private returns to Research and Development (R&D), thereby limiting private incentives to invest in R&D. However, this common belief that firms significantly underinvest in R&D is increasingly being challenged, leading the rationale behind public support for private R&D to be questioned. In this paper, we attempt to clarify the perspectives of two sources: the theoretical literature on endogenous growth, and its recent developments in integrating a geographical dimension, and the empirical literature that measures the social returns to R&D in relation to the private returns. Ultimately, we are able to clearly distinguish among different types of market failures and compare their relative impact on the gap between the private and social returns to R&D. Two main conclusions are reached. First, systematic firm underinvestment in R&D is not demonstrated. Second, even though instances of underinvestment do occur, they are mainly explained by surplus appropriability problems rather than by knowledge externalities. This suggests the need for a new policy mix that employs more demand-oriented instruments and is more concentrated on identifying efficient allocations among activities rather than merely increasing global private R&D investment.
    Keywords: Returns to R&D, market failures, R&D based growth, economic geography, R&D policy
    JEL: E61 O41 O38 R11
    Date: 2013–09
  9. By: Mukim, Megha
    Abstract: A large and growing informal sector is a major feature of developing countries. This paper analyzes coagglomeration patterns between formal and informal manufacturing enterprises in India. It studies (a) the causes underlying these patterns and (b) the positive externalities, if any, on the entry of new firms. The analysis finds that buyer-supplier and technology linkages explain much of formal-informal coagglomeration. Also, within-industry coagglomeration matters mostly to small- and medium-sized formal firm births. Traditional measures of agglomeration remain important in explaining new industrial activity, whether in the formal or the informal sector.
    Keywords: Microfinance,Water and Industry,Small Scale Enterprise,E-Business,Industrial Management
    Date: 2013–09–01
  10. By: Ernest Miguelez (World Intellectual Property Organization, Economics and Statistics Division, Geneva, Switzerland)
    Abstract: The goal of this paper is to assess the influence of spatial mobility of knowledge workers on the formation of ties of scientific and industrial collaboration across European regions. Co-location has been traditionally invoked to ease formal collaboration between individuals and firms, since tie formation costs increase with physical distance between partners. In some instances, highly-skilled actors might become mobile and bridge regional networks across separate locations. This paper estimates a fixed effects logit model to ascertain precisely whether there exists a ‘previous co-location premium’ in the formation of networks across European regions.
    Keywords: inventors’ mobility, technological collaborations, co-location, European regions, panel data
    JEL: C8 J61 O31 O33 R0
    Date: 2013–04
  11. By: Domenico Depalo (Bank of Italy); Francesca Lotti (Bank of Italy)
    Abstract: Many empirical analyses find that the performance of firms headed by women (female firms) varies with respect to those headed by men and that the greatest part of this gap is due to observable characteristics (i.e. gender) related to firms’ characteristics. In this paper we evaluate whether this finding also holds for Italy in terms of productivity and returns.The classification of firms by gender follows that prescribed in Law 215/92; for the purposes of this paper only partnerships and private and public corporations were considered, the sole legal forms for which balance sheets are available. Whilst male firms operate in almost all sectors, female firms tend to cluster in those areas where interpersonal relations are most important, namely the retail sector, restaurants, hotels etc.. In terms of performance, measured by profitability and productivity (and even when controlling by sector and company size), there do not appear to be any significant differences between male and female enterprises.
    Keywords: female entrepreneurship, gender economic differences
    JEL: J1 L11 L25
    Date: 2013–06
  12. By: Esther Tippmann (University College Dublin - University College Dublin); Pamela Sharkey Scott (Dublin Institute of Technology - Dublin Institute of Technology); Vincent Mangematin (MTS - Management Technologique et Strategique - Grenoble École de Management (GEM))
    Abstract: Knowledge flows are a key source of advantage for multinational corporations (MNCs). As research on subsidiary knowledge flows to date has mostly focused on organization-level investigations, often using quantitative methodologies, the nuances of knowledge flows practices and their micro-foundations require further theoretical development. Using detailed qualitative data on 40 cases of subsidiary managers' knowledge mobilizations, this paper unravels some of the micro-level practices of knowledge mobilizations in MNCs. We find that subsidiary manager's knowledge mobilization practices initiate a complex pattern of subsidiary knowledge inflows, pinpointing the significance of lateral and bottom up exchanges (locally as well as internationally) and the emergent nature of utilizing practices, specialist skills and expertise, as well as experience and advice to develop solutions. We use these insights to distinguish between two types of subsidiary knowledge flows: deliberate and emergent knowledge flows and highlight how their differences have profound implications for the investigation of subsidiary and MNC knowledge flows and their micro-foundations.
    Keywords: knowledge flow.; knowledge transfers; MNC/MNE; knowledge seeking behavior. middle managers; subsidiary
    Date: 2012
  13. By: Ufuk Akcigit (Department of Economics, University of Pennsylvania and NBER); Douglas Hanley (Department of Economics, University of Pennsylvania); Nicolas Serrano-Velarde (Bocconi University and IGIER)
    Abstract: This paper introduces a model of endogenous growth through basic and applied research. Basic research differs from applied research in the nature and the magnitude of the generated spillovers. We propose a novel way of empirically identifying these spillovers and embed them in a general equilibrium framework with private firms and a public research sector. After characterizing the equilibrium, we estimate our model using micro-level data on research expenditures by French firms. Our key finding is that standard R&D policies can accentuate the dynamic misallocation in the economy. We also find a strong complementarity between the property rights of basic research and the optimal funding of public research.
    Keywords: Innovation, basic research, applied research, research and development, government spending, endogenous growth, spillover
    JEL: O31 O38 O40 L78
    Date: 2013–09–18
  14. By: Maxim Kotsemir (Institute for Statistical Studies and Economics of Knowledge, National Research University — Higher School of Economics)
    Abstract: The paper reviews the application of the data envelopment analysis (DEA) method for measuring the efficiency of national innovation systems (NIS). The paper firstly visualizes the logic of DEA method and briefly summarizes the key advantages and main limitations of the DEA method. Further, this paper provides a comprehensive review of 11 empirical studies on cross-country analysis of NIS efficiency with DEA technique. In its main part the paper analyses the specifications of DEA models used in the reviewed studies, the content of the country samples, sets of input and output variables used and the resulting lists of efficient countries. The review detects general trends and differences in the sets of variables and the content of country samples. Moreover, this paper highlights the problem of “small countries bias” in the reviewed studies: situation when “small” (in terms of national innovation system scope and the level of development) countries (like Venezuela, Kyrgyzstan etc.) are included in the country sample, these “small” countries become the efficient ones. In general, empirical studies on cross-country analysis of national innovation systems efficiency using DEA method pay little attention to profound analysis of previous relevant studies. Therefore, this paper is among the first papers with deep review of such empirical studies
    Keywords: data envelopment analysis, DEA, national innovation systems, national innovation system efficiency, economic review, efficiency analysis, review of empirical studies
    JEL: C44 C61 P49 P51 P52 Q55
    Date: 2013
  15. By: Sumangala Damodaran
    Abstract: Abstract The paper discusses the experience of the mobile telecom sector in India in terms of its business organization. There is a high level of outsourcing of activities, including those such as network management, which would usually be included within the core competence of mobile telecom companies. This outsourcing strategy, pioneered by Bharti Airtel, has resulted in considerable cost savings and increased profits for a small number of core employees of the lead firm. At the same time, in some outsourced activities, such as tower construction, there is a large incidence of casual and contract labour, all forms of precarious employment of the informal variety. However, because of the high level of oligopolistic competition among mobile telecom service providers, some of the benefits of lower cost have been passed on to consumers in the form of low-cost services. But the Bharti Airtel outsourcing strategy is important in pushing the limits of what could be called core competence in a business model dominated by outsourcing.
    Date: 2013

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