nep-cse New Economics Papers
on Economics of Strategic Management
Issue of 2014‒09‒25
fourteen papers chosen by
João José de Matos Ferreira
Universidade da Beira Interior

  1. A territorial approach to R&D subsidies: Empirical evidence for Catalonian firms By Agustí Segarra; Mercedes Teruel; Miquel Angel Bove
  2. Do specialists exit the firm outsourcing its R&D? By Wenjing Wang
  3. Low cost strategies to build dynamic capabilities: The creative approach of a French public transport operator By Milena Klasing Chen; Sophie Hooge
  4. Japanese Development Cooperation in a New Era: Recommendations for Network-Based Cooperation By Izumi Ohno
  5. A design theory for collaborative interorganizational knowledge management systems By Amandine Pascal; Catherine Thomas
  6. Optimal Sharing Strategies in Dynamic By Nisvan Erkal "; " Deborah Minehart
  7. Regulation, Competition, Diversification, Governance and Costs: An Empirical Analysis of Public Utility and Manufacturing Firms in Japan By Fumitoshi Mizutani; Eri Nakamura
  8. Intentionality and technological and institutional change: Implications for economic development By Muñoz, Félix; Encinar, María Isabel; Fernández-de-Pinedo, Nadia
  9. Local Knowledge Spillovers from International Science and Technology Cooperation: Evidence from EU-Tunisian Framwork Program Cooperation By Juliane Brach; Hatem M’henni
  10. Managerial Capital and Business R&D as Enablers of Productivity Convergence By Dan Andrews; Ben Westmore
  12. The influence of tourism seasonality on family business in peripheral regions By Gustavo Neves Lima; Ricardo Morais
  13. Competition and Screening with Skilled and Motivated Workers By F. Barigozzi; N. Burani
  14. Contracting in medical equipment maintenance services: An empirical investigation By Tian Chan; Francis de Véricourt; Omar Besbes

  1. By: Agustí Segarra (Research Group of Industry and Territory, Department of Economics – CREIP, Universitat Rovira i Virgili); Mercedes Teruel (Research Group of Industry and Territory, Department of Economics – CREIP, Universitat Rovira i Virgili); Miquel Angel Bove (Research Group of Industry and Territory, Department of Economics – CREIP, Universitat Rovira i Virgili)
    Abstract: Using a database of 2,263 responses to R&D public calls in Catalonia, during the period 2007–2010, this paper proceeds to analyse the potential interaction of the territorial and policy dimensions with the propensity to apply for, and be awarded, a public R&D subsidy. Controlling for characteristics at the firm and project level, we estimate models using a twostep procedure. In the first step, our results suggest that large firms which export and which belong to high-tech manufactures are more likely to participate in a public R&D call. Furthermore, both urban location and past experience of such calls have a positive effect. Our territorial proxy of information spillovers shows a positive sign, but this is only significant at intra-industry level. Membership of one of the sectors prioritized by the Catalan government, perhaps surprisingly, does not have a significant impact. In the second step, our results show that cooperative projects, SMEs or old firms shows a positive effect on the probability of obtaining a public subsidy. Finally, the cluster policy does not show a clear relationship with the public R&D call, suggesting that cluster policies and R&D subsidies follow different goals. Our results are in line with previous results in the literature, but they highlight the unequal territorial distribution of the firms which apply and the fact that policymakers should interlink the decision criteria for their public call with other policies.
    Keywords: Evaluation, R&D policies, territorial approach, clusters
    JEL: L53 L25 O38
    Date: 2014–09
  2. By: Wenjing Wang (Department of Economics and Business, Aarhus University, Denmark)
    Abstract: Do specialists exit the firm increasingly outsourcing its research and development (R&D) work? Although this question is critical in understanding how R&D outsourcing links to innovation performance, the answer is not yet clear. This paper proposes that the optimal level of firm’s internal employment of R&D specialists decreases with the deepening of R&D outsourcing but increases with the broadening of R&D outsourcing. These relations can be inferred from previous empirical studies as well as our theoretical analysis, and are supported by the empirical evidence from estimations of correlated random effects (CRE) Tobit, CRE selection and CRE fractional response models on a panel dataset of Danish firms.
    Keywords: Correlated random effect models, employment of R&D specialists, R&D strategy, R&D outsourcing breadth and depth
    JEL: J21 M51 O32
    Date: 2014–09–03
  3. By: Milena Klasing Chen (CGS - Centre de Gestion Scientifique - MINES ParisTech - École nationale supérieure des mines de Paris); Sophie Hooge (CGS - Centre de Gestion Scientifique - MINES ParisTech - École nationale supérieure des mines de Paris)
    Abstract: Dynamic capabilities have been discussed as a way to achieve competitive advantage. However, research on the building of dynamic capabilities is still scarce. This article tackles the issue of potential federative guidance to manage this building and illustrates it through the low cost approach adopted by a public transport operator. Resulting of an oriented creativity method combined with the use of two divergent strategies of low cost product development, the company was able to make several improvements that contributed to build dynamic capabilities at both firm and industrial ecosystem levels: (1) reviewed its managerial system, making transversal projects that were previously hard to be launched; (2) increased its absorptive capability and quality of interaction with ecosystem's stakeholders, better targeting and acquiring external knowledge through collaborative explorations; and (3) dealt with the external barriers and core-rigidities at both firm and industrial ecosystem levels through two different and complementary ways of developing low-cost offer for public transport. Thus, low cost approach appears as an eligible federative guidance to build dynamic capability, similar investigation could benefit to other firms.
    Keywords: low cost; dynamic capability; public transport
    Date: 2014–06
  4. By: Izumi Ohno (National Graduate Institute for Policy Studies)
    Abstract: The landscape of international development has changed markedly, with the acceleration of global integration and the shaping of the post-2015 development framework. This paper discusses the new era of Japan’s development cooperation from two perspectives—broader and deeper partnerships with the private sector, as well as ‘cooperation and competition’ with Asian emerging donors. It proposes ‘network-based cooperation’ as a central pillar of Japan’s future development cooperation, based on the analyses of the nature of a new wave of internationalization of Japanese manufacturing foreign direct investment (FDI) which involves small-and medium enterprises (SMEs), as well as the extensive local human and organizational networks accumulated in Asia through sixty years of Japan’s official development assistance (ODA). Unique roles of Japan as a mature knowledge partner based on international comparative analysis and a quality leader in global business activity are also discussed. Japan should leverage its distinctive strengths in both the corporate and ODA sectors, and actively embark on the new era of development cooperation.
    Date: 2014–09
  5. By: Amandine Pascal (LEST - Laboratoire d'économie et de sociologie du travail - CNRS : UMR7317 - Aix Marseille Université); Catherine Thomas (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université Nice Sophia Antipolis (UNS))
    Abstract: This paper addresses the design problem of providing IT support to organizational knowledge creation within a geographical cluster. This study is based on a design science approach that serves to successfully introduce and implement a new IT artefact as a tool for interorganizational knowledge management. We draw on a case study of developing a portal for mapping competencies in an IT cluster in France. Abstracting from the experience of building this system, we developed an IS design theory for collaborative interorganizational knowledge management systems.
    Keywords: design science, design theory, knowledge management, cluster, interorganizational system
    Date: 2014–05–20
  6. By: Nisvan Erkal "; " Deborah Minehart
    Abstract: A question central to R&D policy making is the impact of competition on cooperation. This paper builds a theoretical foundation for the dynamics of knowledge sharing in private industry. We model an uncertain research process and ask how the incentives to license intermediate steps to rivals change over time as the research project approaches maturity. Such a dynamic approach allows us to analyze the interaction between how close the ?rms are to product market competition and how intense that competition is. We uncover a basic dynamic of sharing such that ?rms are less likely to share as they approach the product market. This dynamic is driven by a trade-o¤ between three e¤ects: the rivalry e¤ect, the duplication e¤ect and the speed e¤ect. We show that this dynamic can be reversed when duopoly pro?ts are su¢ ciently low. We also explore the implications of the model for patent policy and R&D subsidies, and discuss under what circumstances such policies should be directed towards early vs. later stage research.
    Keywords: Multi-stage R&D; innovation; knowledge sharing; licensing; dynamic games; patent
    Date: 2013
  7. By: Fumitoshi Mizutani (Graduate School of Business Administration, Kobe University); Eri Nakamura (Faculty of Economics, Shinshu University)
    Abstract: The main purpose of this study is to investigate how regulation, competition, governance structure, and business diversification strategy affect the cost structure of firms. By using 358 observations comprised of public utility firms and manufacturing firms from 1989 to 2002, we estimate the translog cost function. From our empirical analysis, the following results are obtained: (i) The regulation factor does not affect the cost structure. (ii) Compared with the regulation factor, the competition factor shows a quite clear effect on a firm' s cost reduction. (iii) As a company diversifies further from its core industry into other industries, all of the firm' s business costs increase, indicating an apparent lack of economies of scope. (iv) The governance factor has an important effect on a firm' s cost structure. As the ratio of foreign shareholders increases and there is more dependence on one main bank, the costs of a firm decrease.
    Keywords: Regulation, Competition, Governance, Diversification Strategy, Japanese Firms
    Date: 2013
  8. By: Muñoz, Félix (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.); Encinar, María Isabel (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.); Fernández-de-Pinedo, Nadia (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.)
    Abstract: The interactive implementation of agents’ intentional actions generates new combinations that are at the base of structural change and complexity and produce unexpected consequences. An interesting case of study is provided by the absorption of new technology strategies for development. A common hypothesis is that development requires an institutional arrangement that allows for the exploitation of imported technology. However, historical examples (such as Cuba in the nineteenth century) show how the technological choices of highly innovative entrepreneurial élites may generate a trap of development even though institutions are conveniently adapted to accommodate new technology. To understand the nature of this type of development trap, we introduce a micro-meso-macro analytical approach based on Dopfer & Potts (2008). Institutions and technology are meso rule trajectories that coevolve in an emergence-dissemination-retention process that interacts with both micro units (purposeful entrepreneurs) and the emergent macro properties of the system (development). Within this framework, it is shown how such a strategy for development may result in underdevelopment. The explanation is that, under special circumstances, the de-coordination and re-coordination processes of meso trajectories may be unable to generate enough variety to feed the evolutionary process, and they thereby catch agents in such a “techno-institutional trap”.
    Keywords: intentionality; institutional change; techno-institutional traps; development
    JEL: B52 O10 O33 N16 N26
    Date: 2014–09
  9. By: Juliane Brach (Research Fellow at Maastricht School of Management and CEO at The Knowledge Company, Germany, E-Mail:; Hatem M’henni (Professor at University of Manouba, Tunisia, E-Mail:
    Abstract: This paper provides and in depth analyses of EU-Tunisian science and technology cooperation. Combining state-of-the-art theoretical background on research and innovation with profound knowledge of the Tunisian research and innovation system. We are discussing the rational of EU-TUN science and technology cooperation and the potential benefits and spillovers for Tunisia. Drawing on a unique data set from a 2012 survey among 137 Tunisian researchers and detailed data on Tunisian participation in the latest two framework programs, we can empirically test the role and materialization of such benefits for the case of EU-TUN science and technology cooperation. We apply both descriptive as well as initial econometric testing and provide policy recommendations at the political as well as at the level of the researcher/research institution.
    Date: 2014–08
  10. By: Dan Andrews; Ben Westmore
    Abstract: This paper explores the role of managerial capital and business research and development (R&D) in fostering multifactor productivity (MFP) convergence in a panel of 42 countries. The OECD long-term growth model is augmented to show that, in addition to trade openness, an economy’s speed of convergence to its long-run steady state level of MFP is an increasing function of the quality of its managerial capital and the size of its domestic R&D sector. The economic importance of these two enabling factors are examined in the context of a scenario, whereby MFP growth at the technological frontier is ½ percentage point higher (than in the baseline projection) per annum until 2060. This exercise shows that some countries benefit significantly more from higher frontier growth than could be expected based on their trade openness alone. In turn, evidence on the policy determinants of managerial capital and business R&D is reviewed, which highlights the importance of structural reforms and carefully-designed innovation policies. Capital managérial et R-D des entreprises, moteurs de la convergence de la productivité Ce document analyse le rôle que jouent le capital managérial et les activités de recherche et de développement (R-D) menées par les entreprises pour renforcer la convergence de la productivité multifactorielle (PMF) dans un groupe de 42 pays. Le modèle de croissance à long terme de l’OCDE est élargi pour montrer que, outre l’ouverture aux échanges, la vitesse de convergence d’une économie vers son niveau de stabilité de la PMF à long terme est une fonction croissante de la qualité de son capital managérial et de la taille de son secteur national de la R-D. L’importance économique de ces deux facteurs déterminants est examinée dans le contexte d’un scénario dans lequel la croissance de la PMF à la frontière technologique est supérieure de ½ point de pourcentage (à celle retenue dans la projection de référence) par an jusqu’en 2060. Cet exercice montre que certains pays qui ont atteint la frontière bénéficient d’une croissance beaucoup plus forte que ce à quoi on pourrait s’attendre en se basant uniquement sur leur ouverture aux échanges. Cette étude examine ensuite les éléments de l’action publique qui déterminent le capital managérial et la R-D des entreprises, révélant l’importance des réformes structurelles et de politiques soigneusement conçues en faveur de l’innovation.
    Keywords: productivity, R&D, management, long run growth, conditional convergence, management, productivité, R-D, croissance à long terme, convergence conditionnelle
    JEL: L20 O11 O30 O43 O47
    Date: 2014–09–05
  11. By: Jaan Masso; Kärt Rõigas; Priit Vahter
    Abstract: Export experience of managers and other top specialists is among the key drivers of export decisions in firms. We show evidence of this regularity based on employer-employee level data from the manufacturing industry in Estonia. We find that hiring managers and other high-wage employees with prior experience in exporting to a specific geographical region is associated with a higher probability of export entry to that region. However, there is little evidence of significant effects on export intensity. Notably, the relationship between export experience and a firm’s export decisions is usually stronger if the prior export experience is from an exporter that is located nearby in the product space. Our findings suggest that the contribution of prior trade experience of employees and the firm’s productivity as drivers of export market entry are of comparable magnitude.
    Keywords: export experience, export entry, labour mobility, learning-to-export
    JEL: F10 F14 J31
    Date: 2014
  12. By: Gustavo Neves Lima (Faculdade de Economia e Gestão, Universidade Católica Portuguesa - Porto); Ricardo Morais (Faculdade de Economia e Gestão, Universidade Católica Portuguesa - Porto)
    Abstract: In this conceptual article we explore the influence of tourism seasonality on family business in peripheral regions. We begin by reviewing the main characteristics of family business in peripheral regions. We proceed by reviewing literature on tourism seasonality as well as mitigation strategies at the macro level of analysis. As a corollary of such a literature review, we suggest a framework of strategies by which family businesses in peripheral regions may mitigate tourism seasonality. In particular, we combine an existing typology of coping, combating, and capitulating strategies with family business responses and service operations. We conclude by discussing the theoretical and practical implications of the framework.
    Keywords: family business, peripheral regions, tourism seasonality, mitigation strategies
    Date: 2014–07
  13. By: F. Barigozzi; N. Burani
    Abstract: We study optimal contracts offered by two firms competing for the exclusive services of one worker, who is privately informed about her ability and her motivation. Firms differ both in their production technology and in the mission they pursue and a motivated worker is keen to be hired by the mission-oriented firm. We find that the matching of worker types to firms is always Pareto-efficient. When the difference in firms’ technology is high, only the most efficient firm is active. When the difference is not very high, then agent types sort themselves by motivation: the mission-oriented firm hires motivated types and the profit-oriented firm employs non-motivated ones, independently of ability. Effort provision is higher when the worker is hired by the mission-oriented firm, but a compensating wage differential might exist: the motivated worker is paid less by the mission-oriented firm. Such an earnings penalty is driven entirely by motivation, is increasing in ability and is associated to low power of incentives.
    JEL: D82 D86 J31 M55
    Date: 2014–06
  14. By: Tian Chan (INSEAD); Francis de Véricourt (ESMT European School of Management and Technology); Omar Besbes (Columbia University)
    Abstract: Equipment manufacturers offer different types of maintenance service plans (MSPs) that delineate payment structures between equipment operators and maintenance service providers. These MSPs allocate risks differently and thus induce different kinds of incentives. A fundamental question, therefore, is how such structures impact service performance and the service chain value. We answer empirically this question. Our study is based on a unique panel data covering the sales and service records of over 700 diagnostic medical body scanners. By exploiting the presence of a standard warranty period, we overcome the key challenge of isolating the incentive effects of MSPs on service performance from the confounding effects of adverse selection. We found that moving an operator from a basic pay-per-service plan to a fixed-fee full-protection plan leads to both a reduction in reliability and an increase in service costs. We further show that the increase in cost is driven by both the operator and the service provider. Our results point to the presence of losses in service chain value in the maintenance of medical equipment, and provide the first evidence that a basic pay-per-service plan, where the risk of equipment failure is borne by the operator, can actually improve performance and costs.
    Keywords: Maintenance repair, service contracting, co-production, empirical operations management, service chain value, healthcare industry
    Date: 2014–09–10

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