nep-cse New Economics Papers
on Economics of Strategic Management
Issue of 2014‒11‒07
twenty papers chosen by
João José de Matos Ferreira
Universidade da Beira Interior

  1. Effect of Alliance Experience on New Alliance Formations and Internal R&D Capabilities By Gunno Park; Jina Kang
  2. Do Firms Benefit from Complementarity Effect in R&D and What Drives their R&D Strategy Choices? By Uwe Cantner; Ivan Savin
  3. Reducing Productivity and Efficiency Gaps: the Role of Knowledge Assets, Absorptive Capacity and Institutions By Neil Foster-McGregor; Johannes Pöschl; Ana Rincon-Aznar; Robert Stehrer; Michaela Vecchi; Francesco Venturini
  4. The Role of R&D Collaboration Networks on Regional Innovation Performance By Cilem Selin Hazir; James Lesage; Corinne Autant-Bernard
  5. The Role of Institutional Characteristics in Knowledge Transfer: A Comparative Analysis of Two Italian Universities. By Rossi, Federica; Fassio,Claudio; Geuna, Aldo
  6. The hidden costs of R&D collaboration By Sara Amoroso Author-1-Name-First: Sara Author-1-Name-Last: Amoroso
  7. Do distributors really know the product? Approaching emerging markets through exports By Francesca Checchinato; Lala Hu; Tiziano Vescovi
  8. 'Infrastructure and Industrial Development with Endogenous Skill Acquisition' By Pierre-Richard Agénor; Baris Alpaslan
  9. “Don’t throw the baby out with the bath water”. Network failures and policy challenges for cluster long run dynamics By Jérôme Vicente
  10. The roles of different intermediaries in innovation networks: A network-based approach By Annalisa Caloffi; Federica Rossi; Margherita Russo
  11. The Potential Contribution of Innovation Systems to Socio-Ecological Transition By Georg Licht; Bettina Peters; Christian Köhler; Franz Schwiebacher
  13. The Role of Product and Process Innovation in CGE Models of Environmental Policy By Claudio Baccianti; Andreas Löschel
  14. The effects of biased technological changes on total factor productivity: a rejoinder and new empirical evidence By Cristiano Antonelli; Francesco Quatraro
  15. Co-evolutionary Patterns in Regional Knowledge Bases and Economic Structure: Evidence from European Regions By Francesco Quatraro
  16. Knowledge-based Hierarchies: Using Organizations to Understand the Economy By Luis Garicano; Esteban Rossi-Hansberg
  17. The competitiveness of U.S. manufacturing By Diez, Federico J.; Gopinath, Gita
  18. Transition and FDI: A Meta-Analysis of the FDI Determinants in Transition Economies By Tokunaga, Masahiro; Iwasaki, Ichiro
  19. Japan’s foreign economic policy strategies and economic performance By Peter Drysdale and Shiro Armstrong
  20. Designing Experiments to Measure Spillover Effects By Sarah Baird; Aislinn Bohren; Craig McIntosh; Berk Ozler

  1. By: Gunno Park (Samsung SDS); Jina Kang (Technology Management, Economics, and Policy Program, College of Engineering, Seoul National University)
    Abstract: Although their advantages are well-known, technology alliance may not always positively affect innovative performance. Previous studies have found several explanations for this problem. Technology alliances often require excessive resources and capabilities to form and maintain relationships with partners. In addition, they cause a diversion of managerial attention and functions from internal R&D activities, yet many firms are often unequipped to deal with these problems. In this paper, we hypothesize that firms often execute an inefficient technology alliance strategy, thus negatively affecting their innovative capabilities and consequently reducing subsequent innovation performance. More specifically, we test whether firms with greater prior experience on technology alliances are more likely to execute inefficient technology alliance strategies. Second, we try to investigate negative effects of technology alliances on firms’ internal R&D capabilities. To test our hypotheses, we employ data from 9629 technology alliances in the US biotechnology and pharmaceutical industries. Implications from these analyses are offered for executives and technology alliance strategies. Specifically, we propose that firms should undertake technology alliances while considering the negative aspects and the firm’s limited resources.
    Keywords: Alliance Experience, Organizational Routine, Alliance Formation, Internal R&D Capability.
    JEL: D23 L22 L24 O32
    Date: 2014–09
  2. By: Uwe Cantner (School of Economics and Business Administration, Friedrich-Schiller-University Jena); Ivan Savin (School of Economics and Business Administration, Friedrich-Schiller-University Jena)
    Abstract: This paper analyzes whether firms conducting internal R&D and acquiring external high-tech equipment experience a complementarity effect. For German CIS data we conduct a complete set of indirect and direct complementarity tests refining the analysis by looking at various types of innovations and industries. Complementary effects are found in the indirect but not so in the direct approach. In contrast to previous literature, we find the distinct R&D strategy choices to be significant drivers of innovative activity and we identify contextual variables explaining the joint occurrence of the two strategies.
    Keywords: complementarity, equipment with embodied technology, innovation, internal R&D, Pavitt's sectoral taxonomy
    JEL: O14 O31 O32 O33
    Date: 2014–10–06
  3. By: Neil Foster-McGregor (The Vienna Institute for International Economic Studies, wiiw); Johannes Pöschl (The Vienna Institute for International Economic Studies, wiiw); Ana Rincon-Aznar; Robert Stehrer (The Vienna Institute for International Economic Studies, wiiw); Michaela Vecchi; Francesco Venturini
    Abstract: Summary This study analyses the impact of knowledge assets on productivity and technical efficiency in the EU, as well as their role in the process of knowledge transfer. The analysis covers the role of the institutional and regulatory environment in affecting productivity and technical efficiency and how different regulations interact with both the accumulation of knowledge assets and the transfer of technology. Special emphasis is put on the analysis of trends and performance within the EU, across countries and sectors. The trends and performance of the EU at aggregate and sectoral levels are also contrasted with those of other major competitors, such as the United States, Japan or Korea. Further, the effects of the recent crisis on productivity and efficiency at firm level are explored.
    Keywords: competitiveness, industrial organisation, manufacturing, services
    JEL: O11 O12 O43 O57 L60
    Date: 2014–09
  4. By: Cilem Selin Hazir (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - École Normale Supérieure (ENS) - Lyon - PRES Université de Lyon - Université Jean Monnet - Saint-Etienne - Université Claude Bernard - Lyon I (UCBL)); James Lesage (Texas State University - Texas State University); Corinne Autant-Bernard (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - École Normale Supérieure (ENS) - Lyon - PRES Université de Lyon - Université Jean Monnet - Saint-Etienne - Université Claude Bernard - Lyon I (UCBL))
    Abstract: In this study, we consider R&D collaboration networks as a mechanism that modifies knowledge flows in space, and hence as another source of interaction among regional innovation processes. Our objective is to understand the relative role of spatial neighbors and network neighbors on patenting performance of regions. We make use of data on R&D collaborations supported by the European Union's Framework Programs (FP) and empirically investigate the patent activity of 213 European regions in the field of ICT during 2003-2009. Concerning the short length of the time frame we adopt a static modeling strategy and specify a spatial Durbin Model. As spatial neighbors intersect with network neighbors we decompose neighbor regions into three sets: spatially proximate regions that are not collaboration partners, spatially proximate regions that are collaboration partners, and distant collaboration partners. We express the weight matrix as a convex combination of these three sets and by means of gridding we compare how model fit changes as we move from a purely space based view to a purely network based view to express the dependence structure. The weight matrix that performs the best accords 60% weight to distant collaboration partners, 30% weight to proximate collaboration partners and 10% weight to proximate regions with whom there is no FP collaboration. This result reveals that the interaction (proximate and distant) among European regions within FP networks in the field of ICT is key for understanding dependence among their patenting performances.
    Keywords: R&D collaboration networks; innovation performance; spatial econometrics; ICT
    Date: 2014
  5. By: Rossi, Federica; Fassio,Claudio; Geuna, Aldo (University of Turin)
    Date: 2014–09
  6. By: Sara Amoroso Author-1-Name-First: Sara Author-1-Name-Last: Amoroso (European Commission JRC-IPTS)
    Abstract: The paper investigates the barriers to collaboration in terms of hidden transaction costs, by deriving the distribution of the operating costs and sunk costs associated with firms’ investment choices in R&D and innovation activities with or without a research partner. To retrieve both fixed and sunk costs of R&D and innovation activities with or without a research partner, we develop and estimate a structural dynamic monopoly model to quantify the linkages between R&D spending, innovation and cooperation investment choices, and endogenous productivity. We find that the sunk costs of innovations are smaller when collaborating with a research partner; the probability to spend in R&D or to innovate increases with the level of productivity, when collaborating in R&D and innovation; finally, we find that the sunk costs of innovation are 1.5 to 3 times smaller than the sunk costs of R&D. Additionally, the suggested structural framework of firm heterogeneity in cost functions offers a straightforward extension to policy impact evaluation.
    Keywords: R&D cooperation, transaction costs, dynamic structural model.
    JEL: D22 D23 L14 L60 O32
    Date: 2014
  7. By: Francesca Checchinato; Lala Hu; Tiziano Vescovi
    Abstract: Exports represent an entry mode into international markets that is less risky than more direct strategies, therefore it particularly fits SMEs (small-medium enterprises) that generally have a few resources to invest. In the case of emerging markets because of the high psychic distance, SMEs tend to rely on their distributors for the business operations in the new market. However, although this type of intermediary allows the access to the foreign distribution channel that is particularly complex in countries such as China, it can limit the market control and in some cases, the product expansion. Based on a qualitative research consisting of interviews and secondary data, we present two original case studies of Italian firms operating in the Chinese market. It is shown that in emerging markets, since distributors do not really analyze and know consumer expectations and behaviors, they may represent a barrier in the knowledge accumulation of foreign products in the new market. Managerial implications are discussed on the extent to which SMEs are not able to replicate marketing strategies used in other countries, but they should define a clear strategy that involves their distributors in the process of knowledge accumulation and brand value creation in the foreign market.
    Keywords: internationalization, export, SME, distributor, emerging markets.
    JEL: F23 M16 M31 D22
    Date: 2014–10
  8. By: Pierre-Richard Agénor; Baris Alpaslan
    Abstract: The link between infrastructure and industrial development is studied in an OLG model with endogenous skill acquisition. Industrial development is defined as a shift from an imitation-based, low-skill economy to an innovation-based, high-skill economy, where ideas are produced domestically. Imitation generates knowledge spillovers, which enhance productivity in innovation. Changes in industrial structure are measured by the ratio of the variety of imitation- to innovation-based intermediate goods. The model also distinguishes between basic infrastructure, which helps to promote learning by doing and productivity in imitation activities, and advanced infrastructure, which promotes knowledge networks and innovation. Numerical experiments, based on a calibrated version for a low-income country, show that changes in the level and composition of public investment in infrastructure may have significant effects on the structure of the labor force and the speed of industrial development.
    Date: 2014
  9. By: Jérôme Vicente
    Abstract: Cluster policies have been recently called into question in the aftermath of several empirical evidences. Disentangling how market and network failures arguments play together in cluster policy design, we look for more robust micro foundations of network structuring in clusters. Our aim is to show that, in spite of this growing skepticism, new opportunities for cluster policy exist. They require moving their focus from the “connecting people” one best way that gets through the whole of cluster policy guidelines, to more surgical incentives for R&D collaborations, which favor suited structural properties of local knowledge networks along the life cycle of clusters.
    Keywords: cluster policy, knowledge spillover, network failures
    JEL: B52 D85 O33 R12
    Date: 2014–10
  10. By: Annalisa Caloffi; Federica Rossi; Margherita Russo
    Abstract: Greater understanding of what factors promote the formation of innovation networks and their successful performance would help policymakers improve the design of policy interventions aimed at funding R&D projects to be carried out by networks of innovators. In this paper, we focus on the organizations that can play the role of intermediaries in the networks, facilitating the involvement of other participants and promoting communication and knowledge flows within the network. Based on an original empirical dataset, capturing the relationships between organizations involved in a set of publicly-funded programmes in support of innovation networks, we have tried to identify what are the main features of different types of intermediaries based on an analysis of their positions within networks of relationships. We have observed that agents that occupy broker positions – linking agents that are not connected to each other – are more likely to be found in technologically turbulent environments, while the agents that occupy intercohesive positions – bridging cohesive communities of network agents – operate in more stable contexts. Intermediaries in general are more likely to be local governments. However, besides this, it is not possible to clearly identify organizations that, by nature, are more likely to be either brokers or intercohesive agents: different innovation networks may require different organizations to mediate relationships between the other participants.
    Keywords: Innovation policy, innovation networks, social network analysis, intermediaries, brokers, intercohesion
    JEL: D85 O31 O32 O38
    Date: 2014–02
  11. By: Georg Licht; Bettina Peters; Christian Köhler; Franz Schwiebacher
    Abstract: European countries are currently faced with a variety of challenges, ranging from the new global distribution of economic activity, the diffusion of new, radical technologies to the aging of its population, youth unemployment and the aftermath of the economic and financial crisis. These challenges put the traditional growth model and the policies to foster it under strong pressure. This report summarizes the contributions of the wwwforEurope projects on the definition resp. redefinition of industrial, regional and innovation policy to characterise and stimulate the economies along a new growth path. It is argued that a new growth path needs a new vision on what Europe understands as competitiveness. The report highlights the history and the way forward of European industrial policy. As regional and innovation policy are fully intertwined with industrial policy for a new growth path, it sheds light on these domains as well. For example, the report investigates the role of clusters for the new growth path and the contribution of green innovation, especially in the energy sector, to employment creation. Finally, the report takes a look at the role of SMEs and universities, new players in the new growth model which are normally not included in discussions of competitiveness.
    Keywords: Environmental innovation, Social Innovation, Socio-Econological Transition, Europe
    JEL: O33 J23 L80 C21 C23
    Date: 2014–09
  12. By: Juana Sanchez
    Abstract: This paper presents a novel empirical study of innovation practices of U.S. companies and their relation to productivity levels using new business micro data from the Business Research and Development and Innovation Survey (BRDIS) for the years 2008-2011. The paper follows the work of Frenz and Lambert, who use factor analysis to reduce a set of inputs and outputs of innovation activities into four latent unobserved innovation modes or practices for OECD countries using Community Innovation Surveys (CIS). Patterns obtained with BRDIS data are very similar to those found by those authors in some OECD countries. Companies are grouped according to their scores across the four factors to see that in large, small and medium companies more than one mode of innovation practices prevails. The next step in the analysis links different types of innovation practices to levels of productivity using regression analysis. The four innovation modes have a statistically signi cant positive relation with the level of productivity, other things constant. The paper demonstrates the possibility of taking into account the multidimensionality of innovation without the use of composite indicators.
    Date: 2014–09
  13. By: Claudio Baccianti; Andreas Löschel
    Abstract: In the last two decades, large scale CGE models used for environmental policy assessment underwent an important upgrade to integrate endogenous technological progress. Nevertheless, several complexities of innovation are still neglected even if they are of primary interest for policymakers. This paper provides a review of the current state of the art in the CGE modelling literature through a special lens. We discuss how existing models deal with different types of innovation (i.e. product and process innovation) and how differences in innovation activities influence modelling results. We also emphasise the implications of product innovation in a multisector framework, which has received little attention in the literature.
    Keywords: CGE models, ecological innovation, economic growth path, green jobs, innovation, innovation policy, social innovation, socio-ecological transition, sustainable growth
    JEL: O41 O40 O47
    Date: 2014–10
  14. By: Cristiano Antonelli (Department of Economics, University of Turin - University of Turin); Francesco Quatraro (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université Nice Sophia Antipolis (UNS))
    Abstract: The paper by Ji and Wang (J Technol Transf, 2013) calls new attention on the analysis of the effects of the direction of technological change. The aim of this paper is to better articulate and test the theoretical arguments that the direction of technological changes has specific effects on the efficiency of the production process and to study the incentives and the processes that lead to its introduction. The decomposition of total factor productivity growth into the bias and the shift effects enables to articulate the hypothesis that the types of technological change whether more neutral or more biased reflect the variety of the innovation processes at work. The evidence of a large sample of European regions tests the hypothesis that regional innovations systems with a strong science base are better able to introduce neutral technological changes while regional innovation systems that rely more upon learning processes and tacit knowledge favor the introduction of directed technologies a form of meta-substitution that aims at exploiting the opportunities provided by the most intensive use of locally abundant factors.
    Date: 2014–01–06
  15. By: Francesco Quatraro (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université Nice Sophia Antipolis (UNS))
    Abstract: This paper analyses the co-evolutionary patterns of structural change in knowledge and economics. The former is made operational through an analysis of co-occurrences of technological classes in patent documents in order to derive indicators of coherence, variety and cognitive distance. The latter is made operational in a synthetic way by implementing shift-share analysis which decomposes labour productivity growth into effects caused by changes in the allocation of employment, those ascribed to intra-sector productivity growth, and those caused by interaction of these two components. The results of the analysis conducted on a sample of 227 European regions show that increasing variety is associated with the reallocation of the workforce across sectors whereas within-sector productivity is associated with high levels of both coherence and cognitive distance of the regional knowledge base.
    Keywords: Recombinant knowledge, Coherence, Variety, Regional structural change, Shift-share analysis,
    Date: 2014–07–15
  16. By: Luis Garicano; Esteban Rossi-Hansberg
    Abstract: We argue that incorporating the decision of how to organize the acquisition, use, and communication of knowledge into economic models is essential to understand a wide variety of economic phenomena. We survey the literature that has used knowledge-based hierarchies to study issues like the evolution of wage inequality, the growth and productivity of firms, economic development, the gains from international trade, as well as offshoring and the formation of international production teams, among many others. We also review the nascent empirical literature that has, so far, confirmed the importance of organizational decisions and many of its more salient implications.
    Keywords: Knowledge, hierarchies, wage inequality, international trade
    Date: 2014–10
  17. By: Diez, Federico J. (Federal Reserve Bank of Boston); Gopinath, Gita (Harvard University)
    Abstract: We study the competitiveness of U.S. manufacturing. For the period 1999–2012 we find little support for a significant offshoring reversal. We show that the share of domestic demand that is met by imports and the terms of trade show no signs of reversal, even in sectors dominated by imports from China. We do, however, find some evidence consistent with the U.S. shale-gas energy revolution raising the competiveness of U.S. energy-intensive sectors.
    Keywords: competitiveness; U.S. manufacturing; reshoring; onshoring
    JEL: F41 L60
    Date: 2014–06–01
  18. By: Tokunaga, Masahiro; Iwasaki, Ichiro
    Abstract: In this paper, we conduct a meta-analysis of studies that empirically examine the relationship between economic transformation and foreign direct investment (FDI) performance in Central and Eastern Europe and the former Soviet Union over the past two decades. More specifically, we synthesize the empirical evidence reported in previous studies that deal with the determinants of FDI in transition economies, focusing on the impacts of transition-factors. We also perform meta-regression analysis to specify the determinant factors of the heterogeneity among the relevant studies and the presence of publication selection bias. We find that the existing literature reports a statistically significant non-zero effect as a whole, and a genuine effect is confirmed in the study area of the determinants of FDI beyond the publication selection bias.
    Keywords: foreign direct investment (FDI), FDI determinants, transition economies, meta-analysis, publication selection bias
    JEL: E22 F21 P33
    Date: 2014–10
  19. By: Peter Drysdale and Shiro Armstrong (East Asian Bureau of Economic Research)
    Abstract: The economic rise of Japan in the 1980s was underpinned by commitment to catching up through domestic reform and accommodated externally within the framework of the postwar multilateral institutions like the GATT/WTO. Regional cooperative processes like APEC later complemented that framework, encouraging unilateral reform across the region. Following the bursting of the asset bubble in the early 1990s and the onset of the Asian Financial Crisis, Japan turned from reliance on the multilateral system to policies based on preferential bilateralism in trade policy to secure its regional trading interests. Japan’s bilateral trade agreements have been largely ineffective in supporting the kind of deep-seated reform to regulatory institutions and competition policies needed to sustain long-term productivity growth. The evidence suggests that Japanese productivity has underperformed against its peers in the industrial world and Asia. Instead of using foreign economic policy as an instrument of domestic reform and productivity enhancement Japan has used bilateral deals largely as political and strategic tools. Re-establishing a link between Japan’s domestic reform agenda and its economic diplomacy is important for structural reform and national economic success, as is a more sure-footed engagement with China.
    JEL: F14 F15 F55
    Date: 2014–10
  20. By: Sarah Baird (Elliott School of International Affairs, George Washington University); Aislinn Bohren (Department of Economics, University of Pennsylvania); Craig McIntosh (International Relations & Pacific Studies, University of California, San Diego); Berk Ozler (Economic Research, World Bank, Wash DC)
    Abstract: This paper formalizes the design of experiments intended specifically to study spillover effects. By first randomizing the intensity of treatment within clusters and then randomly assigning individual treatment conditional on this cluster-level intensity, a novel set of treatment effects can be identified. We develop a formal framework for consistent estimation of these effects, and provide explicit expressions for power calculations. We show that the power to detect average treatment effects declines precisely with the quantity that identifies the novel treatment effects. A demonstration of the technique is provided using a cash transfer program in Malawi.
    Keywords: Experimental Design, Networks, Cash Transfers
    JEL: C93 O22 I25
    Date: 2014–09–16

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