nep-cse New Economics Papers
on Economics of Strategic Management
Issue of 2015‒12‒08
forty-five papers chosen by
João José de Matos Ferreira
Universidade da Beira Interior

  1. Intellectual Property and Innovation in Information and Communication Technology (ICT) By Stefano Comino; Fabio Maria Manenti
  2. Research and Technology Organisations and Smart Specialisation By David CHARLES; Katerina CIAMPI STANCOVA
  3. Moving people with ideas - innovation inter-regional mobility and firm heterogeneity By Riccardo Crescenzi; Luisa Gagliardi
  4. Measuring regional innovation in one dimension: More lost than gained? By Matthias Siller; Christoph Hauser; Janette Walde; Gottfried Tappeiner
  5. The Role of Services in Enhancing Indian Manufacturing Exports: A Firm Level Analysis, 2000-01 to 2011-12 By Sonia Mukherjee
  6. Strategic Intelligence Monitor on Personal Health Systems Phase 3 (SIMPHS3) - Cross-case analysis: models of organisation By Fabienne Abadie; Wilhelmus Cornelis Graafmans; Francisco Lupianez Villanueva; Cristiano Codagnone
  7. The Role of Clusters and Public Policy in New Regional Economic Path Development By Asheim , Bjørn T.; Isaksen , Arne; Martin , Roman; Trippl , Michaela
  8. What is the causal effect of R&D on patenting activity in a professor’s privilege country? Evidence from Sweden By Ejermo , Olof; Källström , John
  9. International R&D Spillovers and Asset Prices By Gavazzoni, Federico; Santacreu, Ana Maria
  10. R & D Sector Outsourcing, Human Capital Formation and Growth in the Context of Developed versus Developing Economies By Sujata Basu
  11. Endogenous Capital- and Labor-Augmenting Technical Change in the Neoclassical Growth Model By Andreas Irmen; Amer Tabakovic
  12. Optimal Acquisition Strategies in Unknown Territories By Koska, Onur A.; Staehler, Frank
  13. Foreign competition and banking industry dynamics: an application to Mexico By Corbae, Dean; D'Erasmo, Pablo
  14. Measuring the use of human resources practices and employee attitudes : the Linked Personnel Panel By Kampkötter, Patrick; Mohrenweiser, Jens; Sliwka, Dirk; Steffes, Susanne; Wolter, Stefanie
  15. Where Has All the Skewness Gone? The Decline in High-Growth (Young) Firms in the U.S. By Ryan A. Decker; John Haltiwanger; Ron S. Jarmin; Javier Miranda
  16. Quality of Institutions and Total Factor Productivity in European Union By Adam P. Balcerzak; Michal Bernard Pietrzak
  17. Internalizing Global Value Chains: A Firm-Level Analysis By Laura Alfaro; Pol Antras; Davin Chor; Paola Conconi
  18. Intergenerational Mobility, Human Capital Composition and Distance to Technological Frontier By Sujata Basu
  19. A Search and Learning Model of Export Dynamics By Marcela Eslava; James Tybout; David Jinkins; C. Krizan; Jonathan Eaton
  20. Subsidies, financial constraints and firm innovative activities in developing economies By Simona Mateut
  21. Government Size, Institutions, and Export Performance among OECD Economies By Bournakis, Ioannis; Tsoukis, Christopher
  22. Comparing the Health Care Systems of High-Performing Asian Countries By Amanda Smullen; Phua Kai Hong
  23. Innovation across cities By Kwok Tong Soo
  24. Relativity and asymmetry in distance. The role of strategic distance in the internationalization decisions of Brazilian and Italian firms By Giovanna Magnani; Antonella Zucchella; Dinorà Eliete Floriani
  25. Learning Entrepreneurship from other Entrepreneurs? By Luigi Guiso; Luigi Pistaferri; Fabiano Schivardi
  26. Patents Rights and Innovation by Small and Large Firms By Galasso, Alberto; Schankerman, Mark
  27. Net employment growth by firm size and age in Italy By Francesco Manaresi
  28. Decentralisation and school autonomy impact on the quality of education: the case of two MENA countries By Josep-Oriol Escardíbul; Nehal Helmy
  29. Selectivity and Transparency in Social Banking: Evidence from Europe By Simon Cornée; Panu Kalmi; Ariane Szafarz
  30. Capital Theory ‘Paradoxes’ and Paradoxical Results: Resolved or Continued? By Mariolis, Theodore; Tsoulfidis, Lefteris
  31. Heterogeneity of markups at the firm level and changes during the great recession: the case of spain By Cristina Fernández; Aitor Lacuesta; José Manuel Montero; Alberto Urtasun
  32. Does green corporate investment really crowd out other business investment? By John P. Weche
  33. Are Competitors Forward Looking in Strategic Interactions? Evidence from the Field By Lackner, Mario; Stracke, Rudi; Sunde, Uwe; Winter-Ebmer, Rudolf
  34. Diversification and firm performance: A study of Indian manufacturing firms By Ravichandran, Archana; Bhaduri, Saumitra
  35. Multitask agents and incetives: the case of teaching and research for university professors By Marta De Philippis
  36. Environmental regulation and sustainable competitiveness: Evaluating the role of firm-level green investments in the context of the Porter hypothesis By Jana Stoever; John P. Weche
  37. Strategic behavior between a bank and a microfinance institution: The role of psychological distance and education level By Fall, François; Nguyen-Huu, Thanh Tam
  38. Patent Protection and the Industrial Composition of Multinational Activity: Evidence from U.S. Multinational Firms By Olena Ivus; Walter Park; Kamal Saggi
  39. The Determinants of Effective Tax Rates: Firms’ Characteristics and Corporate Governance By Ana Isabel Martins Ribeiro; António Cerqueira; Elísio Brandão
  40. The Role of Technological Conditions of Production in Explaining India's Manufacturing Growth, 1998-00 to 2007-08: Some Policy Perspectives By Alokesh Barua; Bishwanath Goldar; Himani Sharma
  41. Leadership, communication and innovation By Bel, Roland; Smirnov, Vladimir; Wait, Andrew
  43. Porter vs Krugman: History, Analysis and Critique of Regional Competiveness By Psofogiorgos, Nikolaos - Alexandros; Metaxas, Theodore
  44. Organizational Barriers to Technology Adoption: Evidence from Soccer-Ball Producers in Pakistan By David Atkin; Azam Chaudhry; Shamyla Chaudry; Amit Kumar Khandelwal; Eric Verhoogen
  45. Social Entrepreneurship in Russia: Key Players and Development Potentiality By Alena I. Nefedova

  1. By: Stefano Comino (University of Udine); Fabio Maria Manenti (University of Padua)
    Abstract: The aim of this study is to provide a structured review of the role of IPR in fostering innovation and economic growth in the European ICT sector. Typically IPR analysis of industries focuses on patents. In practice, however, IPR strategies are developed combining the use of different IP rights. The scope of analysis considers this and looks at the joint use of patents, trademarks and industrial designs, each protecting a different type of knowledge-based asset. Based on these characteristics, the focus of the research is to provide an overview of the mechanisms typically employed in order to appropriate the returns from R&D investments. For each formal IPR, we briefly review the main contributions to the economic literature, both theoretical and empirical, on the rationale for its existence and the effects it generates on firms’ behaviour and market outcomes. We then highlight the most important emerging issues. In the final section of the study, we focus on the software industry.
    Keywords: Patents, copyright, trademarks, information and communication technologies, patent thickets, open source, software, mobile applications
    JEL: L11 L24 L96 O25 O31 O32 O34 O38 O52
    Date: 2015–11
  2. By: David CHARLES (University of Lincoln); Katerina CIAMPI STANCOVA (European Commission – JRC - IPTS)
    Abstract: Research and Technology Organisations (RTOs) have developed in many European countries at both national and regional levels to assist in the support of local industry, often around specific industrial technologies or sectors. With a core responsibility for technological upgrading they play a key role in regional and national innovation systems. Yet there is great variety in the form and mission of such RTOs, especially in terms of the degree of regional alignment, and whilst some regions are relatively well endowed with multiple RTOs, others are reliant on national RTOs in other regions or even other countries. These geographical challenges are also compounded by changes in the funding of RTOs with a shift to greater reliance on non-government funding and the search for funds from international sources such as global firms or Horizon 2020 projects. So whilst regions may see RTOs as critical regional assets, the RTOs may have a more nuanced attitude as their client base extends beyond national boundaries and they search for new sources of revenue. RTOs have an important role to play in smart specialisation (S3) though and three specific roles have been identified here. First, many RTOs have a policy role and have capabilities to identify industry needs and technological opportunities as a key input into the entrepreneurial discovery process. Second, RTOs, as increasingly international organisations, can facilitate the access to global knowledge for regional firms through their networks and research collaborations. Third RTOs often have a central role in the development of particular cluster groupings through their specialisation around core technologies, and as such can be a central player in the development of such clusters. But all three of these roles involve potential challenges and difficulties as the interests of the RTOs do not necessarily align with the needs of the region. The case studies in this report on RTOs in Spain, Finland, Italy, and the UK illustrate the variety of RTOs and the complexities of their relationships with regional hosts, but also some of the initiatives that are developing to support smart specialisation.
    Keywords: smart specialisation, research and technology organisations, regional innovation, research and innovation
    Date: 2015–11
  3. By: Riccardo Crescenzi; Luisa Gagliardi
    Abstract: This paper looks at the link between inter-regional mobility, innovation and firms’ behavioural heterogeneity in their reliance on localised external sources of knowledge. By linking patent data (capturing inventors’ inter-regional mobility) with firm-level data (providing information on firms’ innovation inputs and behaviour) a robust identification strategy makes it possible to shed new light on the geographical mobility-innovation nexus. The analysis of English firms suggests that firm-level heterogeneity – largely overlooked in previous studies - is the key to explain the innovation impact of inter-regional mobility over and above learning-by-hiring mechanisms. A causal link between inflows of new inventors into the local labour market and innovation emerges only for firms that make the use of external knowledge sources an integral part of their innovation strategies.
    Keywords: innovation; labour mobility; inter-regional migration; spillovers
    JEL: J61 O15 O31 R23
    Date: 2015–04
  4. By: Matthias Siller; Christoph Hauser; Janette Walde; Gottfried Tappeiner
    Abstract: In both academic literature and political discussions the concept of innovation is recognized as an essential ingredient in economic development and competitiveness for firms, regions, and nations. Innovation also ranks at the top of policy agendas in the field of regional policy. Therefore, the attractiveness of an appropriate innovation index for ranking regions and further developing them along a more or less objective measurement scale is evident. However, whether such rankings help convey a better understanding of innovation and its drivers, or whether they are merely a special type of ‘beauty contest’ with little substance is the focus of our analyses. To deny the latter, the innovation output indicators used for the composite index have to be appropriate representatives of the underlying innovation concept and each indicator has to be driven by the same impact factors. If this is not the case, interpretation of the index inevitably gives rise to partly inappropriate policy recommendations. In order to demonstrate this claim we elaborate a set of innovation indicators at the regional level based on the theoretical concept of the OECD document ‘The Measurement of Scientific and Technological Activities, Proposed Guidelines for Collecting and Interpreting Technological Innovation Data’ known as the ‘Oslo Manual’ (OECD, 2005) and their empirical implementation in the Community Innovation Survey. Additionally, innovation drivers well established in the literature are collected to estimate their impact on each innovation indicator as well as on the composite index derived from the innovation indicators. The question whether innovation should be measured as a multidimensional concept and investigated using various indicators or whether simplifying innovation to a one-dimensional concept is appropriate is clearly answered in favor of the multidimensional approach. Surprisingly, this is not due to the multidimensionality of the indicators themselves (all statistical measures indicate that the considered variables are sufficiently represented by one component), but to our first evidence that the innovation output indicators are driven by various impact factors and can therefore be influenced by various political strategies. According to these findings any type of innovation ranking is of very limited use.
    Keywords: Regional innovation, Innovation dimensions, Patent applications, Community Innovation Survey
    JEL: R11 O31 O33
    Date: 2015–11
  5. By: Sonia Mukherjee (Centre for International Trade and Development,Jawaharlal Nehru University)
    Abstract: In this paper, we try to examine and assess the contribution of services towards India’s manufacturing exports at the firm level. In other words, the role of services in shaping the international competiveness of the Indian Manufacturing Sector at the firm level is examined. Services are instrumental in connecting to the world market and can help firms to differentiate their products. However, only bits and pieces of the relation between services and exports have been analyzed in the earlier literature. Most of the earlier studies relating to services have explored the link between services and Total Factor Productivity. The relation between services and exports has not been explored at the firm level in case of India. This also gives a justification for conducting the present study. With now firm level databases available, it allows us to explore this part in details. For exploring this link, the firm level data was collected from the Centre for Monitoring of The Indian Economy (Prowess Database) for the years 2000-01 to 2011-12. The Manufacturing firms had used different types of services according to their needs and the expenditure for the all the different services were not the same. The expenses incurred by the manufacturing firms for services like business services, repairs and maintenance, Professional services, Research & Development and others etc. were added together to get total expenses on the services variable. Two alternative econometric methods (Panel Regression method and Tobit model) were used in our study. The findings confirm that services have contributed to enhanced export competitiveness of the Indian manufacturing firms. The paper looks at the firm specific factors like firm size, age, previous years export performance, group versus non-group, labor productivity and services that affected the export performance of the Indian manufacturing firms. The overall results show that the firm specific factors such as firm size, extent of use of services, group versus non-group firms, and previous years export performance played a positive role in improving the Indian manufacturing exports.
  6. By: Fabienne Abadie (European Commission – JRC - IPTS); Wilhelmus Cornelis Graafmans (European Commission – JRC - IPTS); Francisco Lupianez Villanueva (European Commission – JRC - IPTS); Cristiano Codagnone (European Commission – JRC - IPTS)
    Abstract: This SIMPHS3 report on models of organisation aims to identify key elements of the integrated care and independent living models implemented in 23 initiatives (cases) identified across 18 regions in 14 countries - 12 EU Member States plus Israel and the US. These cases cover diverse institutional, organisational, human (in terms of people involved in launching the initiatives) and socio-economic settings which allowed us to gather evidence on a variety of contextual conditions. In spite of having looked for deployed services, and despite a very thorough approach to the selection of cases, a number of cases still have to prove their viability and full deployment is still to be realised. In addition, one case focused on pre-commercial procurement of innovation in healthcare, so as to gain understanding of this rather new approach. This case is out of the scope of the analysis presented here.
    Keywords: Europe 2020, Digital Agenda for Europe, Digital Living, Digital Society, Digital Economy, Information Society Technologies, Health, Emerging ICT technologies, Personal Health Systems, Remote Monitoring and Treatment, SIMPHS3, SIMPHS, ageing, integrated care, independent living, case studies, facilitators, governance, impact, drivers, barriers, integration, organisation
    Date: 2015–11
  7. By: Asheim , Bjørn T. (UiS Business School/Centre for Innovation Research, University of Stavanger; CIRCLE, Lund University; BI-Norwegian Business School); Isaksen , Arne (University of Agder, Norway); Martin , Roman (CIRCLE, Lund University); Trippl , Michaela (CIRCLE, Lund University)
    Abstract: This chapter deals with the role of clusters and public policy in new regional economic path development. New path development is analysed from an institutional perspective by focussing on changes in the wider regional innovation system (RIS), including firms, universities and governmental agencies, and by placing emphasis on the role that public policy can play. We argue that new regional economic path development requires a broad-based policy approach that stimulates cross-fertilizing effects between different industrial activities within and beyond the region. While cluster policies are well suited to support the growth and sustainment of existing industries, policies for new path development should aim at regional diversification and variety creation, preferably based on existing strengths and expertise in the region. These ideas are central to the Constructing Regional Advantage (CRA) approach. Empirically, the chapter draws on case study research on two new regional economic growth paths in Sweden and Norway, namely the new media cluster in Southern Sweden and the Oslo Cancer cluster. While the first is an example of path renewal through combining knowledge bases, the latter is an example for new path creation based on scientific knowledge. The empirical analysis underlines the role that public policy can play in facilitating new regional economic path development.
    Keywords: new path development; cluster evolution; regional innovation policy; constructing regional advantage; Oslo Cancer Cluster; New Media
    JEL: O18 O20 O38 R11
    Date: 2015–12–02
  8. By: Ejermo , Olof (CIRCLE, Lund University); Källström , John (CIRCLE, Lund University)
    Abstract: We investigate the responsiveness of academic patenting to research and development (R&D) on the subject level at Swedish universities in panel data regressions. The general responsiveness to R&D is found to be higher than corresponding estimates found in US studies, especially when we adopt instrumental variable techniques that address endogeneity in the studied R&D-to-patent relationship. We also find that this responsiveness is not associated with lower quality of patents measured in terms of citations. A higher responsiveness from R&D to patenting is found in “Information technologies”, “Chemistry (science)”, “Electrical engineering, electronics & photonics” and “Chemical engineering”, “Medicine” and in “Microbiology” than in other common patenting fields. Our main result, that academia in Sweden contributes well to inventive activity support the view that the professor’s privilege may be a contributing factor.
    Keywords: research and development; patenting; academia; knowledge production functions; the professor’s privilege; Sweden
    JEL: C25 C26 I23 I28 O31 O32 O34 O38
    Date: 2015–12–01
  9. By: Gavazzoni, Federico (INSEAD); Santacreu, Ana Maria (Federal Reserve Bank of St. Louis)
    Abstract: We provide new empirical evidence of a relationship between asset prices and trade- Induced international R&D spillovers; in particular, we find that pairs of countries that share more research and development exhibit more highly correlated stock market returns and less volatile exchange rates. We develop an endogenous growth model of innovation and international technology diffusion that accounts for these empirical findings. A calibrated version of the model matches several important asset pricing and quantity moments, which helps explain some of the classical quantity–price puzzles highlighted in the literature on international macroeconomics.
    Keywords: Innovation; international diffusion; trade; asset prices; recursive preferences
    JEL: F3 F4 O3
    Date: 2015–12–02
  10. By: Sujata Basu (Centre for International Trade and Development,Jawaharlal Nehru University)
    Abstract: A skill-biased endogenous growth has model has been considered where Research and Development (R & D) producer of the advanced economy outsource its R & D activity to a relatively technologically backward economy. R & D producer of the advanced economy endogenously determines the equilibrium proportion of R & D activity which takes an intermediate value. An advanced economy relies on the innovation activity for its technology improvement. Whereas a backward economy depends on both the imitation and the innovation activities - innovation being more skilled-intensive than imitation. This paper theoretically examines the impact of R & D outsourcing from an economy which is in the innovation-only regime to an economy which is in the imitation-innovation regime. It shows that dependence on the imitation activities rises and as a consequence of which proportion of skilled human capital falls and both skilled and unskilled human capital shift away from the innovation to the imitation activities in the backward economy. This also leads to a higher wage rate of both skilled and unskilled human capital in the backward economy. As a result proportion of outsourcing from advanced economy to backward economy falls. However, growth rate of the backward economy initially rises and eventually declines as time progresses. In the long run backward economy will get into a low equilibrium trap and gap from the world technology frontier widens.
  11. By: Andreas Irmen (CREA, Université de Luxembourg); Amer Tabakovic (CREA, Université de Luxembourg)
    Abstract: The determinants of the direction of technical change and their implications for economic growth and economic policy are studied in the one-sector neoclassical growth model of Ramsey, Cass, and Koopmans extended to allow for endogenous capital- and labor-augmenting technical change. We develop a novel micro-foundation for the competitive production sector that rests on the idea that the fabrication of output requires tasks to be performed by capital and labor. Firms may engage in innovation investments that increase the productivity of capital and labor in the performance of their respective tasks. These investments are associated with new technological knowledge that accumulates over time and sustains long-run growth. We show that the equilibrium allocation is not Pareto-efficient since both forms of technical change give rise to an inter-temporal knowledge externality. An appropriate policy of investment subsidies may implement
    Keywords: the efficient allocation.
    JEL: O31 O33 O41
    Date: 2015
  12. By: Koska, Onur A.; Staehler, Frank
    Abstract: This paper investigates the optimal acquisition strategy of a foreign investor, who wants to acquire one out of two local firms, under incomplete information. The response to acquisition offers is also a signal on firm productivity, affecting future competition. We identify a competition effect (firms compete for acquisition) and a revelation effect (firms reveal their productivities). These effects reduce the rejection profits and increase the acceptance probability. If the investor makes simultaneous offers, the revelation effect is a potential threat because a firm may signal low productivity, but may not be acquired. If, however, the investor makes offers sequentially, this threat does not exist, making sequential offers the optimal acquisition strategy.
    Keywords: Multinational Firms; Acquisition; Incomplete Information
    JEL: F23 G34
    Date: 2014–04–14
  13. By: Corbae, Dean (University of Wisconsin‒Madison); D'Erasmo, Pablo (Federal Reserve Bank of Philadelphia)
    Abstract: The authors develop a simple general equilibrium framework to study the effects of global competition on banking industry dynamics and welfare. They apply the framework to the Mexican banking industry, which underwent a major structural change in the 1990s as a consequence of both government policy and external shocks. Given the high concentration in the Mexican banking industry, domestic and foreign banks act strategically in the authors’ framework. After calibrating the model to Mexican data, the authors examine the welfare consequences of government policies that promote global competition. They find relatively high economy-wide welfare gains from allowing foreign bank entry.
    Keywords: Global banks; Foreign bank competition; Bank industry dynamics
    JEL: E60 F30 F41 G01 G21
    Date: 2015–09–18
  14. By: Kampkötter, Patrick; Mohrenweiser, Jens; Sliwka, Dirk; Steffes, Susanne; Wolter, Stefanie (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "This paper introduces a new data source available for HRM researchers and personnel economists, the Linked Personnel Panel (LPP). The LPP is a longitudinal and representative employer-employee data set covering establishments in Germany and designed for quantitative empirical HR research. The LPP offers a unique structure. First, the data set combines employer and employee surveys that can be matched to each other. Second, it can also be linked to a number of additional administrative data sets. Third, the LPP covers a wide range of firms and workers from different backgrounds. Finally, because of its longitudinal dimension, the LPP should facilitate the study of causal effects of HR practices. The LPP employee survey uses a number of established scales to measure job characteristics and job perceptions, personal characteristics, employee attitudes towards the organisation and employee behaviour. This paper gives an overview of both the employer and employee survey and outlines the definitions, origins and statistical properties of the scales used in the individual questionnaire." (Author's abstract, IAB-Doku) ((en))
    JEL: J24 J81 M12 M51 M52 M53 M54 M55
    Date: 2015–12–01
  15. By: Ryan A. Decker; John Haltiwanger; Ron S. Jarmin; Javier Miranda
    Abstract: The pace of business dynamism and entrepreneurship in the U.S. has declined over recent decades. We show that the character of that decline changed around 2000. Since 2000 the decline in dynamism and entrepreneurship has been accompanied by a decline in high-growth young firms. Prior research has shown that the sustained contribution of business startups to job creation stems from a relatively small fraction of high-growth young firms. The presence of these high-growth young firms contributes to a highly (positively) skewed firm growth rate distribution. In 1999, a firm at the 90th percentile of the employment growth rate distribution grew about 31 percent faster than the median firm. Moreover, the 90-50 differential was 16 percent larger than the 50-10 differential reflecting the positive skewness of the employment growth rate distribution. We show that the shape of the firm employment growth distribution changes substantially in the post-2000 period. By 2007, the 90-50 differential was only 4 percent larger than the 50-10, and it continued to exhibit a trend decline through 2011. The reflects a sharp drop in the 90th percentile of the growth rate distribution accounted for by the declining share of young firms and the declining propensity for young firms to be high-growth firms.
    Date: 2015–11
  16. By: Adam P. Balcerzak (Nicolaus Copernicus University, Poland); Michal Bernard Pietrzak (Nicolaus Copernicus University, Poland)
    Abstract: The key challenge for medium- and long-term policy in European Union countries is to use the potential of knowledge-based economy (KBE), which is a condition for maintaining high total factor productivity in Europe. For this reason, the relationship between quality of institutional system and total factor productivity in the EU countries has been examined. The quality of institutional system is defined here from the perspective of incentives that influence the use of the potential of KBE. In order to determine the level of effectiveness of the institutional system in the analyzed countries the method for linear ordering of objects was applied based on data from Fraser Institute. The main hypothesis of the article was formed as follow: the quality of institutional system in the context of KBE has significant influence on the level of total factor productivity in the EU. In order to verify the hypothesis, the parameters of the Cobb-Douglas production function were estimated, which allowed to evaluate TFP for EU countries. The calculation made in the article was based on Eurostat data. Then, the identification of the relationship between the quality of institutional system and the level of TFP was made with the application of panel model. The research made for the years 2000-2010 allowed to verify the hypothesis.
    Keywords: Knowledge-based economy, TFP, quality of intuitions, European Union, panel model
    JEL: D24 E02
    Date: 2015–12
  17. By: Laura Alfaro; Pol Antras; Davin Chor; Paola Conconi
    Abstract: In recent decades, technological progress in information and communication technology andfalling trade barriers have led firms to retain within their boundaries and in their domesticeconomies only a subset of their production stages. A key decision facing firms worldwide is theextent of control to exert over the di↵erent segments of their production processes. Building onAntr`as and Chor (2013), we describe a property-rights model of firm boundary choices alongthe value chain. To assess the evidence, we construct firm-level measures of the upstreamness ofintegrated and non-integrated inputs by combining information on the production activities offirms operating in more than 100 countries with Input-Output tables. In line with the model’spredictions, we find that whether a firm integrates upstream or downstream suppliers dependscrucially on the elasticity of demand for its final product. Moreover, a firm’s propensity tointegrate a given stage of the value chain is shaped by the relative contractibility of the stageslocated upstream versus downstream from that stage. Our results suggests that contractualfrictions play an important role in shaping the integration choices of firms around the world.
    Keywords: global value chains; sequential production; incomplete contracts
    JEL: F14 F23 D23 L20
    Date: 2015–09
  18. By: Sujata Basu (Centre for International Trade and Development,Jawaharlal Nehru University)
    Abstract: An endogenous skilled biased growth model has been considered to show that along the growth path wage gap widened and both upward and downward mobility fall. This implies that education becomes more correlated with initial conditions and less related with the cognitive ability. Growth occurs through the twin channels of technology - imitating from the world technology frontier and innovating on its own technology level - innovation being more skilled-intensive than imitation. An imperfect capital market has been considered where individual's education decision depends on the cognitive ability as well as on the parental income. Moreover, it is shown that growth enhancing education policy leads to absolute convergence of all the economies to the world technology frontier. In the imitation-innovation regime, life time utility gap within skilled as well as unskilled human capital rise due to parental income differences. Furthermore, life time utility gap within skilled human capital rises due to cognitive ability differences.
  19. By: Marcela Eslava (Universidad de Los Andes); James Tybout (Pennsylvania State University); David Jinkins (Copenhagen Business School); C. Krizan (U.S. Bureau of the Census); Jonathan Eaton (Brown University)
    Abstract: Customs record data reveal a number of patterns in relationships Colombian firms have with their U.S. buyers. We interpret these patterns in terms of a continuous-time model in which heterogeneous sellers search for buyers in a market. Success in selling to a buyer reveals information to the seller about the appeal of her product in the market, affecting her incentive to search for more buyers. Fit using the method of simulated moments, the model replicates key patterns in the customs records and allows us quantify several types of trade costs, including the search costs of identifying potential clients and the costs of maintaining business relationships with existing clients. It also allows us to estimate the effect of previous exporting activity on the costs of meeting new clients, and to characterize the cumulative effects of learning on firms' search intensities. Finally, we use our fitted model to explore the effects of these trade costs and learning effects on aggregate export dynamics
    Date: 2015
  20. By: Simona Mateut
    Abstract: This paper extends the investigation on the relationship between public subsidies and innovation to firms in developing economies. The analysis merges the innovation subsidy literature with the stream focusing on financial constraints for innovation. Innovation is defined broadly to include the introduction of new products or services and the upgrade of existing ones, which is relevant for developing economies. The results obtained using a range of econometric techniques and alternative measures of financial constraints suggest a positive correlation between public subsidies and the innovative activities of 11,998 firms across thirty Eastern Europe and Central Asia countries.
    Keywords: innovation, subsidies, financial constraints
    Date: 2015
  21. By: Bournakis, Ioannis; Tsoukis, Christopher
    Abstract: With a panel of 18 OECD countries, 1980-2005, we investigate the determinants of export performance, in particular the effects of the size of government and institutional features. In a model of endogenous extent of domestically-produced goods, government size has a non-linear effect on export performance; the export-maximising size of government (tax receipts) is around 40-45% of GDP; the best size of productive government spending is around 16% of GDP. Product market and labour market-related rigidities affect negatively the export performance both on their own and via a negative effect on the effectiveness of R&D and slow down the speed of adjustment. Among traditional variables, relative unit labour cost, R&D shares in GDP, TFP growth and human capital show up significantly and with the expected signs.
    Keywords: Export shares, government size, institutions, unit labour cost, competitiveness
    JEL: E02 F14 F41
    Date: 2015–11
  22. By: Amanda Smullen; Phua Kai Hong
    Abstract: The newly industrialised and high income economies of East Asia perform remarkably well on a range of health system indicators. We adopt an institutional lens to examine and compare the similarities and differences in health care financing and provision in the paired cases of Singapore, Malaysia, Taiwan and South Korea. This illuminates how, despite seemingly common global, regional and functional demands, reformers have responded through diverse means to different institutional constraints. Moreover, some of these cases illuminate the cognizance of reformers with respect to vulnerabilities in their own health care systems enabling effective, albeit ongoing, management.
    Keywords: institutions;health care;East Asia;policy reform;cognizance
    Date: 2015–03–28
  23. By: Kwok Tong Soo
    Abstract: This paper examines the distribution of patenting activity across cities in the OECD, using a sample of 218 cities from 2000 to 2008. We obtain three main results. First, patenting activity is more concentrated than population and GDP. Second, patenting activity is less persistent than population and GDP. Third, patenting exhibits mean-reversion, and is positively associated with GDP, the fragmentation of local government, and population density. Our results suggest that policymakers can influence the amount of innovative activity through the use of appropriate policies.
    Keywords: Patents, Zipf’s Law, transition probability, dynamic panel data
    JEL: R1 O3
    Date: 2015
  24. By: Giovanna Magnani (Department of Economics and Management, University of Pavia); Antonella Zucchella (Department of Economics and Management, University of Pavia); Dinorà Eliete Floriani (University of Vale do Itajaí)
    Abstract: Distance studies often assume geographic distance in absolute terms rather than relative to firms’ perceptions, and symmetric between two countries. By pair-wise comparing six case studies of Brazilian and Italian ventures, we address this gap. We find that geographic distance is relative to a firm’s prospective internationalisation plans and we identify a considerable asymmetry in perceptions of distance. Overall, our findings seem to go against the predictions of the stages models of internationalization which envision internationalization decisions based on proximity and similarity of markets, rather firms leverage on market dissimilarities and consider the strategic distance of target markets, in addition to psychic, institutional, geographic, and cultural distances.
    Keywords: distance; relativity; asymmetry; strategic markets; similarity.
    Date: 2015–11
  25. By: Luigi Guiso (EIEF); Luigi Pistaferri (Stanford University); Fabiano Schivardi (Bocconi University and EIEF)
    Abstract: We document that individuals who grew up in areas with high density of firms are more likely, as adults, to become entrepreneurs, controlling for the density of firms in their current location. Conditional on becoming entrepreneurs, the same individuals are also more likely to be successful entrepreneurs, as measured by business income or firm productivity. Strikingly, firm density at entrepreneur’s young age is more important than current firm density for business performance. These results are not driven by better access to external finance or intergenerational occupation choices. They are instead consistent with entrepreneurial capabilities being at least partly learnable through social contacts. In keeping with this interpretation, we find that entrepreneurs who at the age of 18 lived in areas with a higher firm density tend to adopt better managerial practices (enhancing productivity) later in life.
    Date: 2015
  26. By: Galasso, Alberto; Schankerman, Mark
    Abstract: This paper studies the causal impact of patents on subsequent innovation by the patent holder. The analysis is based on court invalidation of patents by the U.S. Court of Appeals for the Federal Circuit, and exploits the random allocation of judges to control for the endogeneity of the judicial decision. Patent invalidation leads to a 50 percent decrease in patenting by the patent holder, on average, but the impact depends critically on characteristics of the patentee and the competitive environment. The effect is entirely driven by small innovative firms in technology fields where they face many large incumbents. Invalidation of patents held by large firms does not change the intensity of their innovation but shifts the technological direction of their subsequent patenting.
    Keywords: courts; innovation; patents
    JEL: K41 L24 O31 O32 O34
    Date: 2015–11
  27. By: Francesco Manaresi (Bank of Italy)
    Abstract: We study how net employment growth rates differ by firm age and size. For this purpose, we exploit a long panel dataset collecting information for all Italian private firms with at least one employee. We find that firm size is not a crucial determinant of firm growth, once age is controlled for. Firms in their early years of life (up to 3 years) display higher growth rates and slightly higher exit rates than older firms. This up-or-out dynamic of Italian firms seem subdued if compared with the US, the other country for which a similar analysis is available. We also exploit the long time series to identify which types of firms are hit the most during economic downturns. Results show that older firms reduce net employment growth the most. The impact on younger firms seem partially cushioned by stronger selection at entry. Conditional on age, size turns out not to be significantly correlated with the drop in net employment growth rates during downturns.
    Keywords: employment growth, firm size, firm age
    JEL: D22 L25
    Date: 2015–11
  28. By: Josep-Oriol Escardíbul (Universidad de Barcelona & IEB); Nehal Helmy (The World Bank)
    Abstract: An effective institutional structure is a crucial tool for having a highly functioning education system and consequently, economic growth and development. We analyse the effects of decentralisation and school autonomy on the quality of education in two MENA countries (Jordan and Tunisia), by using the OECD PISA 2009 database. Results reveal that decentralisation has a positive impact on the quality of education in some decision-making areas, whereas most autonomy related variables are not significant. Accordingly, schools with more autonomy management and facing more competition do not lead to different results than others, while (public) ownership is positively significant only in Tunisia. However, private funding and accountability measures are positively associated with student achievement.
    Keywords: Education, decentralisation, school autonomy, Tunisia, Jordan, MENA, PISA
    JEL: H40 H52 I28
    Date: 2015
  29. By: Simon Cornée; Panu Kalmi; Ariane Szafarz
    Abstract: How do social banks signal their social commitment to motivated funders? This paper hypothesizes that two main channels are used, namely selectivity and transparency. We test these predictions using a rich dataset comprising balance-sheet information on 5,000 European banks over the 1998-2013 period. The results suggest that social screening leads social banks to higher project selectivity compared with mainstream banks. Social banks also tend to be more transparent than other banks. However, combining selectivity and transparency can result in excess liquidity. Overall, the empirical findings not only confirm our theoretical hypotheses, but also raise challenging issues on the management of social banks.
    Keywords: Social banks, Social enterprises, Social mission, European banks.
    JEL: G21 L33 M14 L31 D63 D82
    Date: 2015–12–01
  30. By: Mariolis, Theodore; Tsoulfidis, Lefteris
    Abstract: Capital theory controversies and ‘paradoxes’ showed that, due to price-feedback effects, the wage-production price-profit rate curves may display shapes inconsistent with the requirements of the neoclassical theory of value and distribution. Subsequent findings on a number of quite diverse actual single-product economies suggested that the impact of those effects is of limited empirical significance. This paper argues that, by focusing on the distributions of the eigenvalues and singular values of the system matrices, we can further study these issues and derive some meaningful theoretical results consistent with the available empirical evidence. Consequently, the real paradox, in the sense of knowledge vacuum and, thus, requiring further research, is the distributions of the characteristic values and not really the ‘paradoxes in capital theory’.
    Keywords: Capital Theory; Characteristic value distributions; Hyper-basic industry; Spectral decompositions; Wage-price-profit rate curves
    JEL: B21 B51 C67 D57
    Date: 2015–12–05
  31. By: Cristina Fernández (Banco de España); Aitor Lacuesta (Banco de España); José Manuel Montero (Banco de España); Alberto Urtasun (Banco de España)
    Abstract: We broaden the conceptual framework of estimating markups at the sectoral level developed by Roeger (1995), and extended by Crépon et al. (2005) with labour market imperfections, to account for firm-level heterogeneity derived from differences in productivity. We estimate this model with a comprehensive panel of Spanish non-financial corporations for the period 2001-2007 to find that perfect competition is widely rejected in the data. More interestingly, within each sector, firms with higher productivity present higher markups. Further, we use this empirical setting to estimate changes in firm-level markups over the course of the crisis (2008/2012). Our results indicate that for around 50% of sectors average markups increased, following a decrease in the number of firms, while for around 35% of industries the relevance of within-sector markup heterogeneity decreased at the same time that the variance of within-sector TFP increased. This last result suggests that the simple changes in the number and composition of competing firms cannot explain within-sector markups and we require additional factors to account for recent developments. For instance, we provide evidence that both an increase in consumer product substitutability and in fixed entry costs during the crisis might be a good explanation.
    Keywords: markups, production function, market power, heterogeneity
    JEL: C23 C26 D24 E31 L11 L16
    Date: 2015–12
  32. By: John P. Weche (Monopolies Commission and Leuphana University Luneburg, Germany)
    Abstract: Empirical studies on the link between green investment and other business investment at the firm level either focus on innovation specific types of investment or fail to consider the simultaneity of investment decisions. The analysis to be presented here offers a broad focus on different types of environmental protection investment and explicitly considers simultaneity issues, using newly created panel data for German manufacturing firms. Germany is an ideal case for testing the crowding-out hypothesis, due to its high level of environmental regulation and a significant presence of command-and-control style measures, which are especially under debate as a source of crowding-out. The estimation of a behavioral investment model supports a crowdingout of other business investment through environmental protection investment in general as well as its subcategories of add-on measures and investments in renewable energy. However, only the latter subcategory causes a crowding-out at the industry level.
    Keywords: green investment; business investment; renewable energy; crowding-out; manufacturing; Germany
    JEL: O32 O33 Q42 Q55
    Date: 2015–11
  33. By: Lackner, Mario (Department of Economics, University of Linz (JKU)); Stracke, Rudi (Department of Economics, University of Munich (LMU)); Sunde, Uwe (Department of Economics, University of Munich (LMU)); Winter-Ebmer, Rudolf (Department of Economics, University of Linz (JKU) and Institute for Advanced Studies, Vienna)
    Abstract: This paper investigates empirically whether decision makers are forward looking in dynamic strategic interactions. In particular, we test whether decision makers in multi-stage tournaments take heterogeneity induced changes of continuation values and the ability of their immediate opponent into account when choosing effort. Using data from professional and semi-professional basketball tournaments, we find that effort is negatively affected by the ability of the current opponent, consistent with the theoretical prediction and previous evidence. More importantly, the results indicate that the expected relative strength in future interactions does affect behavior in earlier stages, which provides support for the 'standard' view that decision makers are forward looking in dynamic strategic interactions.
    Keywords: Promotion tournament, multi-stage contest, elimination, forward-looking behavior, heterogeneity
    JEL: D84 D90 M51 J33
    Date: 2015–11
  34. By: Ravichandran, Archana; Bhaduri, Saumitra
    Abstract: The advantages and disadvantages of diversification and its impact on productivity or performance of a firm have been debated upon by academics and business professionals all over, although views on the topic still differ widely. While popular views are that related diversification increases value and unrelated diversification decreases value, the results of research conducted on the effects of overall diversification (without distinguishing between related and unrelated diversification) on productivity are of conflicting nature. This paper focuses on this relationship in the context of the Indian manufacturing sector. Along with this, it also expounds on the existence of an optimal diversification point for the Indian context. Data used is obtained from CMIE Prowess for the period 2003 to 2014 and standard econometric analysis on panel data is carried out to find the stated relationship. Tobin’s q is used as a measure of performance of the firm. The results show that highly diversified firms perform poorly on account of vertical diversification while horizontal diversification has a positive effect on performance.
    Keywords: productivity, diversification, Tobin’s q, related, unrelated
    JEL: D22 L25
    Date: 2015–06
  35. By: Marta De Philippis (Bank of Italy and London School of Economics)
    Abstract: This paper evaluates the behavioural responses of multitask agents to the provision of incentives skewed towards one task only. It studies the effects of significant research incentives for university professors on the way university faculty members allocate their efforts between teaching and research and on the way they select different types of universities. I first obtain different individual-level measures of teaching and research performance. Then, I estimate a difference in differences model, exploiting a natural experiment that took place at Bocconi University, which significantly strengthened incentives towards research. I find evidence that teaching and research efforts are substitute inputs in the professors' cost function: the impact of research incentives is positive on research activity and negative on teaching performance. The effects are driven by career concerns rather than by monetary incentives. Moreover, under the new incentive regime, lower ability researchers tend to leave universities and since teaching and research ability are positively correlated, this implies that bad teachers also tend to leave universities.
    Keywords: multitasking, incentives, teaching
    JEL: I2 J41 M5
    Date: 2015–11
  36. By: Jana Stoever (Hamburg Institute of International Economics and Hamburg University); John P. Weche (Monopolies Commission and Leuphana University Luneburg, Germany)
    Abstract: We investigate the impact of environmental regulation on firm performance and investment behavior. Exploiting the case of a German water withdrawal regulation that is managed on the state level, we analyze firms’ reactions to an increase in the water tax using a regression-adjusted difference-in-differences approach. We analyze the individual firm’s response to a change in environmental regulation, distinguishing between add-on and integrated environmental investments. This allows us to include intra-firm innovations into our analysis, which are likely to be of importance for increasing resource-efficiency. Our results show that the regulation in question shows no sign of affecting firms’ overall competitiveness. The results imply that the predicted negative impact of the regulation on firms’ economic performance that was brought up before the introduction of the tax, does not seem to weigh heavily in this case. Nevertheless, when placed into a sustainable competitiveness context, the regulation considered does not qualify as an appropriate policy tool for fostering green growth.
    Keywords: Environmental regulation, DID, green growth, green investment, Porter hypothesis, sustainable competitiveness, water withdrawal regulation
    JEL: L60 O31 O32 Q58 Q55
    Date: 2015–11
  37. By: Fall, François; Nguyen-Huu, Thanh Tam
    Abstract: In Hotelling's fundamental model (1929), the geographical distance and high transportation costs grant firms present in a market a certain power over local buyers in their neighborhoods. Starting from his model, this study shows that in the competition between a bank and a microfinance institution (MFI), geographical distance and transportation costs alone are no longer sufficient for attributing market power to the firms present. In fact, the introduction of psychological distance and education level in the model alter the Hotelling's results. Psychological proximity (trust) and the educational level of the client play determinant roles in dividing the credit market between a bank and an MFI.
    Keywords: spatial competition,bank,microfinance,market power
    JEL: G21 O17 C72 D43
    Date: 2015
  38. By: Olena Ivus (Queen's University); Walter Park (American University); Kamal Saggi (Vanderbilt University)
    Abstract: Using data on U.S. firms' technology licensing to local agents in developing countries, this paper examines the impact of patent protection on internal and arms-length technology transfer. The effects of protection vary across products according to their complexity. Consistent with theories of internalization, we find that patent reforms enable local firms to attract more arms-length technology transfer, especially of simple products which are relatively easy to imitate. Affiliated licensing also rises among simple products, but falls among complex products. The results withstand several robustness checks, including controlling for endogeneity by using colonial origin as an instrument, and are equally strong whether patent protection is measured by its intensity or by the timing of reforms. The results have significance for patent policy in the developing world, where access to knowledge is critical. Through arms-length technology contracts, proprietary knowledge diffuses beyond firm boundaries, enabling local agents to access not only the protected technology but also know-how.
    Keywords: International Technology Transfer, Licensing, Developing Countries, Product Complexity, Intellectual Property Rights, and Imitation Risk
    JEL: O3 F2
    Date: 2015–12–02
  39. By: Ana Isabel Martins Ribeiro (University of Porto, School of Economics and Management); António Cerqueira (University of Porto, School of Economics and Management); Elísio Brandão (University of Porto, School of Economics and Management)
    Abstract: Investors, managers and shareholders benefit from the study of what influences and determines corporate effective tax rates (ETRs) as this analysis may contribute to potential tax savings. Moreover, standard setters, regulators and policy makers have a crucial interest in identifying the main factors driving corporate taxes. Therefore, the purpose of our investigation and contribution is twofold. Firstly, we provide evidence of how ETRs are determined by firms’ financial and operational characteristics. Secondly, our objective is to show the role of Corporate Governance attributes in explaining ETRs. As the literature about this topic using non-US firms is not abundant, to address these questions we select a sample of 704 non-financial firms listed on the London Stock Exchange between 2010 and 2013. We estimate our econometric model by using GLS cross-section weights. Our results show that larger and more profitable firms have higher ETRs. On the contrary, capital intensity, leverage and R&D expenses have a negative impact on ETRs. Regarding ownership structure and board composition, our findings reveal that managerial ownership contributes to lower ETRs. On the other hand, more independent firms from controlling shareholders exhibit higher ETRs. Moreover, a larger number of board members and non-executive directors results in higher ETRs
    Keywords: Effective tax rate; Corporate Finance; Corporate Governance
    JEL: G30 H20
    Date: 2015–12
  40. By: Alokesh Barua (Centre for International Trade and Development,Jawaharlal Nehru University); Bishwanath Goldar (Institute of Economic Growth, Delhi); Himani Sharma (Madras School of Economics, Chennai)
    Abstract: In this paper we try to explain India’s manufacturing growth performance in terms of the technological conditions of production, namely, the returns to scale (RTS) and the elasticity of substitution (ES) between capital and labour at two – digit level of industrial classification. We use for this purpose the unit (plant) - level data as provided by the Annual Survey of Industries for the years 1998-99 to 2007 - 08. Most of the earlier estimates on RTS and ES were based on studies using aggregate time series or state-wise data. Since the unit-level data are now available, it allows us to verify the robustness of the earlier estimates. Insofar as the technological parameters of production function are defined at the level of firm, this gives a justification of conducting the present study. Three alternate specification of production function (Cobb-Douglas, CES and the translog) were used in our study. Our findings generally confirm the findings of earlier studies. Interestingly, we find relatively high elasticity of substitution in the labour-intensive industries (textiles, tobacco products and leather and leather products etc.) and relatively low elasticity of substitution in capital – intensive industries (machinery and equipment, telecommunication equipment etc.). The results suggest that there are scope for policy interventions to increase employment and growth. For instance, lowering the hiring cost of labour via labour market reforms may help increasing employment in the labour – intensive industries. Similarly, reallocating new capital investment from the capital – intensive industries to labour – intensive ones may improve the profitability of new investment. Finally, a multiple regression analysis has been undertaken by using industry-level panel data for the years 1998 to 2007 to explain if the variations in the growth rate in real value added across industries and over time are related to the technological parameters like RTS and ES. The results reveal that the returns to scale have positive impact on growth. Similarly, high elasticity of substitution has a positive effect on growth, but only for the capital intensive industries. Thus, resource reallocation may be oriented to take advantage of the variations in the technological parameters to maximize manufacturing growth. Length: 49 pages
    Date: 2015
  41. By: Bel, Roland; Smirnov, Vladimir; Wait, Andrew
    Abstract: We study the interplay between communication, leadership attributes and the probability of successful innovation. Although a firm requires both strong leadership and sufficient communication to overcome inertia, we posit that frequent communication – particularly amongst strong managers and in larger firms – can cause leaders to pull the firm in different directions, resulting in disagreement and a failure to successfully innovate. Using a uniquely detailed establishment-level data set we find that, on their own, firm size, regular communication and result-oriented leadership are all positively associated with innovation. However, as predicted by our model, the use of frequent communication in successfully innovating firms is moderated: (i) when leaders tend to be strongly focussed on results; and (ii) in larger firms.
    Keywords: Innovation; Communication; Leadership: Inertia
    Date: 2015–12
  42. By: Minzoni Angela (LGI - Laboratoire Génie Industriel - EA 2606 - Ecole Centrale Paris); Eléonore Mounoud (LGI - Laboratoire Génie Industriel - EA 2606 - Ecole Centrale Paris)
    Abstract: This paper presents a co-design process in which operations managers and researchers engage in designing within the aim of radically innovate the operations' management thinking focusing on the whole operation's environment and system, beyond operation's optimization. Organization's operating models have a key influence on the organization's governance and strategy. The design of operating models is thus pivotal for organizations and a key stake for those whose operations are based on high speed information and sophisticated knowledge, such as intangible services like banking, financial, insurance or internet services. A main challenge is to produce new knowledge and tools to address specific intangible services' operating models at a time where service systems' operations cannot any more be understood and planned under a mechanistic view of pre-established continuous chains of standardized micro tasks. The focus in this paper is specifically on the challenges related to pass from a static and mechanistic middle and back office operation's system view to a dynamic, living system like operation's model. The design process itself is designed as an iterative action-learning process.
    Keywords: Super-vision,Sustainability,Business models,Participatory design
    Date: 2015–07–27
  43. By: Psofogiorgos, Nikolaos - Alexandros; Metaxas, Theodore
    Abstract: The subject of this study is to determine the competitiveness through an interdisciplinary approach of the theories of the new economic geography and regional economy. This article describes in detail the theory of competitiveness, which is defined differently by many authors, with particular emphasis on opposing views of Michael Porter and Paul Krugman. One of the first writers who stressed the importance of the geographical position was Michael Porter. In his model, the author emphasizes that the geographical concentration of firms enhances productivity, innovation and export sector. Following this theory, many authors have focused on the research of the "location problem ", which led to better connection of economics and geography. The result of these activities is the new guidelines that have been developed, such as the new theory of economic geography and regional economy. The new economic geography is mainly related to the Nobel prized, Paul Krugman, whose theories often conflict with those of Porter. This study initially sets out the views of both authors, in terms of competitiveness and then attempts to make a comparative analysis between the theories they developed.
    Keywords: Michael Porter, Paul Krugman, Regional Competitiveness
    JEL: R11 R19 R38
    Date: 2015–12
  44. By: David Atkin (Department of Economics, MIT, USA); Azam Chaudhry (Department of Economics, Lahore School of Economics, Pakistan); Shamyla Chaudry (Department of Economics, Lahore School of Economics, Pakistan; The Rimini Centre for Economic Analysis, Italy); Amit Kumar Khandelwal (Columbia Graduate School of Business, Columbia University, USA); Eric Verhoogen (Department of Economics, Columbia University, USA; The Rimini Centre for Economic Analysis, Italy)
    Abstract: This paper studies technology adoption in a cluster of soccer-ball producers in Sialkot, Pakistan. We invented a new cutting technology that reduces waste of the primary raw material and gave the technology to a random subset of producers. Despite the arguably unambiguous net benefits of the technology for nearly all firms, after 15 months take-up remained puzzling low. We hypothesize that an important reason for the lack of adoption is a misalignment of incentives within firms: the key employees (cutters and printers) are typically paid piece rates, with no incentive to reduce waste, and the new technology slows them down, at least initially. Fearing reductions in their effective wage, employees resist adoption in various ways, including by misinforming owners about the value of the technology. To investigate this hypothesis, we implemented a second experiment among the firms that originally received the technology: we offered one cutter and one printer per firm a lump-sum payment, approximately equal to a monthly wage, conditional on them demonstrating competence in using the technology in the presence of the owner. This incentive payment, small from the point of view of the firm, had a significant positive effect on adoption. We interpret the results as supportive of the hypothesis that misalignment of incentives within firms is an important barrier to technology adoption in our setting.
    Date: 2015–07
  45. By: Alena I. Nefedova (National Research University Higher School of Economics)
    Abstract: This article presents an overview of different approaches to the definition of social entrepreneurship and contains the findings of a survey on the process of its development in Russia. Whereas this type of business is institutionalized in the economy of the U.S. and certain European nations, where special laws are developed for it and significant tax benefits are afforded in certain cases, it is in its initial state in Russian society. Its development in the Russian economy will largely depend on the actions taken by the key players in the emerging organizational field and not solely on socio-economic and historical conditions. A series of expert interviews at the first study stage resulted in identification of the key players, in particular, ‘Our Future’ – the foundation for regional social programs that served as the monopolistic source of financial support for social entrepreneurship during the study. To find out what social entrepreneurship model is taking shape in Russia, 186 applications completed by different organizations seeking social entrepreneurship financing support were reviewed. The applications were made during a three year period of the Foundation’s business. The review suggested that the Foundation mostly backs up those social programs capable of becoming independent from external financial sources
    Keywords: social entrepreneurship, organizational field, non-profit entities, new institutionalism
    JEL: L26
    Date: 2015

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