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on Economics of Strategic Management |
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Issue of 2016‒12‒04
fifteen papers chosen by João José de Matos Ferreira Universidade da Beira Interior |
| By: | Salome Baslandze (Einaudi Institute for Economics and Fina) |
| Abstract: | What is the impact of information and communications technologies (ICT) on aggregate productivity growth and sectoral reallocation? In this paper, I analyze the impact of ICT through facilitating knowledge diffusion in the economy. There are two opposing effects. The increased flow of ideas between firms improves learning opportunities and spurs innovation. However, knowledge diffusion through ICT also results in broader accessibility of knowledge by competitors harming innovation incentives. The nature of the tradeoff between these opposing forces depends on an industry's technological characteristics, which I call external knowledge dependence. Industries whose innovations rely more on external knowledge benefit greatly from knowledge externalities and expand, while more self-contained industries are more affected by intensified competition and shrink. This results in the reallocation of innovation and production activities toward more externally-focused, "knowledge-hungry" industries. I develop a general equilibrium endogenous growth model featuring this mechanism. Using NBER patent and citations data together with BEA industry-level data on ICT, I empirically validate the mechanism of the paper. Quantitative analysis from the calibrated model illustrates that it is important to account for both technological heterogeneity and the knowledge-diffusion role of ICT to explain U.S. trends in productivity growth and sectoral reallocation in recent decades. |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed016:1509&r=cse |
| By: | Autor, David; Dorn, David; Hanson, Gordon; Pisano, Gary; Shu, Pian |
| Abstract: | Manufacturing is the locus of U.S. innovation, accounting for more than three quarters of U.S. corporate patents. The rise of import competition from China has represented a major competitive shock to the sector, which in theory could benefit or stifle innovation. In this paper we empirically examine how rising import competition from China has affected U.S. innovation. We confront two empirical challenges in assessing the impact. We map all U.S. utility patents granted by March 2013 to firm-level data using a novel internet-based matching algorithm that corrects for a preponderance of false negatives when using firm names alone. And we contend with the fact that patenting is highly concentrated in certain product categories and that this concentration has been shifting over time. Accounting for secular trends in innovative activities, we find that the impact of the change in import exposure on the change in patents produced is strongly negative. It remains so once we add an extensive set of further industry- and firm-level controls. Rising import exposure also reduces global employment, global sales, and global R&D expenditure at the firm level. It would appear that a simple mechanism in which greater foreign competition induces U.S. manufacturing firms to contract their operations along multiple margins of activity goes a long way toward explaining the response of U.S. innovation to the China trade shock. |
| Keywords: | China; firms; import competition; innovation; patents; Trade |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11664&r=cse |
| By: | Gidehag, Anton (Örebro University School of Business); Lodefalk, Magnus (Örebro University School of Business) |
| Abstract: | We examine the link between new employees in leading positions and subsequent productivity in small- and medium-sized (SME) enterprises. Managers and professionals are likely to possess important tacit knowledge. They are also in a position to influence the employing firm. Exploiting rich and comprehensive panel data for Sweden in the 2001-2010 period and employing semi-parametric and quasi-experimental estimation techniques, we find that newly recruited leading personnel have a positive and statistically significant impact on the productivity of the hiring SME. Interestingly, our results suggest that professionals with experience from international firms and enterprise groups contribute the most to total factor productivity. Overall, the findings suggest the importance of mobility of leading personnel for productivity-enhancing knowledge spillovers to SMEs. |
| Keywords: | recruitment; knowledge spillovers; firm growth; productivity; SME |
| JEL: | D22 D24 D83 J24 J62 |
| Date: | 2016–10–31 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oruesi:2016_006&r=cse |
| By: | Jayati Sarkar (Madras School of Economics); Ekta Selarka (Assistant Professor, Madras School of Economics) |
| Abstract: | This paper provides evidence on the effect of women directors on the performance of family firms with a case study of India. Existing literature on the subject has primarily focused on widely held firms, notably in the US. Given that ownership structure and governance environment of family firms are distinctly different from those of non-family firms, the evidence on the relationship between women on board and firm performance in the context of widely held firms may not apply in the context of family firms. India provides an ideal setting for analyzing this question as the presence of family firms is pervasive and since 2013 India has instituted gender quotas on corporate boards. Using a data-set of 10218 firm year observations over a ten year period from 2005 to 2014 which spans the pre-quota and post-quota years, we find robust evidence that women directors on corporate boards positively impact firm value and that this effect increases with the number of women directors on board. However, we find that the positive effect of gender diversity on firm performance weakens with the extent to which the family exerts control through occupying key management positions on the board. In addition, women directors affiliated to the family have no significant effect on firm value, whereas - independent women directors do. Our results with respect to profitability are somewhat different; while as in the case of market value, women directors positively impact profitability with the positive effect driven by independent women directors, the effect does not vary with the extent of family control. Taken together, our results suggest that though gender diversity on corporate boards may positively impact firm performance in family firms in general, the extent of family control can have a significant bearing on this relationship. The findings from this study could be instructive for emerging economies like India in promoting gender-based quotas on corporate boards. |
| Keywords: | Board of Directors, gender diversity, promoter control, ownership, regulationClassification-JEL: G32, G34, G38 |
| Date: | 2015–10 |
| URL: | http://d.repec.org/n?u=RePEc:mad:wpaper:2015-130&r=cse |
| By: | Chen, Yunnan; Sun, Irene Yuan; Ukaejiofo, Rex Uzonna; Xiaoyang, Tang; Bräutigam, Deborah |
| Abstract: | The question of how to promote structural transformation is central in fostering sustainable growth and poverty reduction in low-income countries in Africa. Following China’s domestic economic transformation and its growing outward investments in the developing world, we seek to understand how Chinese investment in Africa, particularly in manufacturing, may help to foster industrialization and in turn the structural transformation of African economies. We focus on Chinese investments and partnerships in Nigeria, a salient destination for Chinese manufacturing foreign direct investment in Africa, and examine the potential mechanisms of technology transfer that might catalyze such transformation. We find some small but significant cases of potential technology transfer, particularly through technical partnerships between firms. However, the future potential of such mechanisms will depend on the initiative of Nigerian actors to leverage Chinese investment to their interest. |
| Keywords: | technology transfer, industrialization, supply chains, manufacturing, |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:1565&r=cse |
| By: | Sylvain Béal (CRESE - Centre de REcherches sur les Stratégies Economiques - UFC - UFC - Université de Franche-Comté, UBFC - Université Bourgogne Franche-Comté); Eric Rémila (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - CNRS - Centre National de la Recherche Scientifique - UCBL - Université Claude Bernard Lyon 1 - UL2 - Université Lumière - Lyon 2 - Université Jean Monnet - Saint-Etienne - PRES Université de Lyon - ENS Lyon - École normale supérieure - Lyon); Philippe Solal (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - CNRS - Centre National de la Recherche Scientifique - UCBL - Université Claude Bernard Lyon 1 - UL2 - Université Lumière - Lyon 2 - Université Jean Monnet - Saint-Etienne - PRES Université de Lyon - ENS Lyon - École normale supérieure - Lyon) |
| Abstract: | We provide a strategic implementation of the sequential equal surplus division rule (Béal et al., 2014). Precisely, we design a non-cooperative mechanism of which the unique subgame perfect equilibrium payoffs correspond to the sequential equal surplus division outcome of a superadditive rooted tree TU-game. This mechanism borrowed from the bidding mechanism designed by Pérez-Castrillo and Wettstein (2001), but takes into account the direction of the edges connecting any two players in the rood tree, which reflects some dominance relation between them. |
| Keywords: | Implementation,Bidding approach, Rooted tree TU-games, Sequential equal surplus division |
| Date: | 2015–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01376910&r=cse |
| By: | Rigobon, Roberto |
| Abstract: | This paper reviews the empirical literature on international spillovers and contagion. Theoretical models of spillover and contagion imply that the reduced form observable variables suffer from two possible sources of bias: endogeneity and omitted variables. These econometric problems in combination with the heteroskedasticity that plagues the data produces time varying biases. Several empirical methodologies are evaluated from this perspective: non-parametric techniques such as correlations and principal components, as well as parametric methods such as OLS, VAR, event studies, ARCH, Non-linear regressions, etc. The paper concludes that there is no single technique that can solve the full fledge problem and discusses three methodologies that can partially address some of the questions in the literature. JEL Classification: C30, F32, C10 |
| Keywords: | contagion, heteroskedasticity, identification |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20161975&r=cse |
| By: | Dan Andrews; Chiara Criscuolo; Peter N. Gal |
| Abstract: | In this paper, we aim to bring the debate on the global productivity slowdown – which has largely been conducted from a macroeconomic perspective – to a more micro-level. We show that a particularly striking feature of the productivity slowdown is not so much a lower productivity growth at the global frontier, but rather rising labour productivity at the global frontier coupled with an increasing labour productivity divergence between the global frontier and laggard (non-frontier) firms. This productivity divergence remains after controlling for differences in capital deepening and mark-up behaviour, suggesting that divergence in measured multi-factor productivity (MFP) may in fact reflect technological divergence in a broad sense. This divergence could plausibly reflect the potential for structural changes in the global economy – namely digitalisation, globalisation and the rising importance of tacit knowledge – to fuel rapid productivity gains at the global frontier. Yet, aggregate MFP performance was significantly weaker in industries where MFP divergence was more pronounced, suggesting that the divergence observed is not solely driven by frontier firms pushing the boundary outward. We contend that increasing MFP divergence – and the global productivity slowdown more generally – could reflect a slowdown in the diffusion process. This could be a reflection of increasing costs for laggard firms of moving from an economy based on production to one based on ideas. But it could also be symptomatic of rising entry barriers and a decline in the contestability of markets. We find the rise in MFP divergence to be much more extreme in sectors where pro-competitive product market reforms were least extensive, suggesting that policy weaknesses may be stifling diffusion in OECD economies. |
| Keywords: | firm dynamics, knowledge diffusion, productivity, regulation, technological change |
| JEL: | O43 O57 O30 O40 M13 |
| Date: | 2016–12–02 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaac:5-en&r=cse |
| By: | Sjöholm, Fredrik (Lund University) |
| Abstract: | Foreign Direct Investment (FDI) has increased in importance over the last decades, globally as well as in Indonesia. We examine how such inflows of FDI affects value added in Indonesia. The effect is positive: foreign firms generate relatively high levels of value added and they also seem to have a positive impact on value added in local firms. Moreover, FDI contribute to a structural change of the economy towards more high-value added activities. High value added could lead to increased investments and higher tax revenues for the government. High value added could also benefit labor through higher wages, an effect that is empirically confirmed in Indonesia. |
| Keywords: | Foreign Direct Investment; Multinational Firms; Value Added; Industrial Development |
| JEL: | F23 F61 F63 |
| Date: | 2016–11–22 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1141&r=cse |
| By: | Corinne Luu (OCDE) |
| Abstract: | La productivité canadienne est inférieure à celle de nombreux pays de l’OCDE malgré quelques progrès ces dernières années. Il serait possible d’accroître l’efficience globale en renforçant la concurrence sur le marché intérieur afin de favoriser les futurs gains de productivité globale. Ces gains sont importants, de l’ordre d’un demi pour cent par an sur une période plutôt longue. Ce document porte principalement sur l’intensification de la concurrence dans les industries de réseau, comme l’énergie, les télécommunications, la diffusion audiovisuelle et les transports, qui jouent un rôle essentiel dans le processus de production de l’ensemble de l’économie. L’amélioration de la réglementation, l’augmentation de l’efficience et/ou le renforcement de la compétitivité-coût pourraient accroître la productivité dans ces secteurs, ainsi que dans les secteurs d’aval. La concurrence pourrait également être intensifiée par la réduction des obstacles aux échanges entre provinces et à la mobilité de la main-d’oeuvre, qui fragmentent un marché intérieur déjà petit. Ce document examine donc également les réformes possibles de l’Accord sur le commerce intérieur et les mesures visant à réduire les obstacles sectoriels aux échanges. Ce Document de travail se rapporte à l’Étude économique de l’OCDE du Canada 2016 (www.oecd.org/fr/eco/etudes/etude-econom ique-canada.htm). |
| Keywords: | concurrence, industrie de réseau, intégration, productivité, réglementation |
| JEL: | J44 L1 L3 L5 L66 L9 O43 Q18 |
| Date: | 2016–08–03 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:1322-fr&r=cse |
| By: | Catalina Martínez; Laura Cruz-Castro; Luis Sanz-Menéndez |
| Abstract: | This paper evaluates the effectiveness of a public programme intended to improve innovation capabilities in the private sector by subsidizing the hiring of R&D personnel. Using information from the programme management database, we study factors associated with the duration of contracts and their transformation into open-ended contracts, a basic aim of the programme. We explore the characteristics of subsidies, individuals, entities and projects related to the eventual stabilization of the new R&D employees, when the subsidies had ended. The programme was found to strengthen R&D capacity in recipient firms - above all in technology centres - yet only about half of the subsidized short term contracts had been converted into permanent contracts by the end of their second year. |
| Keywords: | Programme evaluation, company R&D and innovation, S&T employment, innovation policy, Spain |
| JEL: | O31 O38 H43 H83 Z18 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:ipp:wpaper:1510&r=cse |
| By: | Ritwik Banerjee; Nabanita Datta Gupta (Department of Economics and Business Economics, Aarhus University, Denmark); Marie Claire Villeval |
| Abstract: | We conduct an artefactual field experiment to examine various spillover effects of Affirmative Action policies in the context of castes in India. We test a) if individuals who compete in the presence of Affirmative Action policies remain competitive in the same proportion after the policy has been removed, and b) whether having been exposed to the policy generates unethical behavior and spite against subjects from the category who has benefited from the policy. We find that these policies increase substantially the confidence of the lower caste members and motivate them to choose significantly more frequently a tournament payment scheme. However, we find no spillover effect on confidence and competitiveness once Affirmative Action is withdrawn: any lower caste’s gain in competitiveness due to the policy is then entirely wiped out. Furthermore, the strong existing bias of the dominant caste against the lower caste is not significantly aggravated by Affirmative Action. |
| Keywords: | Affirmative Action, castes, competitiveness, unethical behavior, field experiment |
| JEL: | C70 C91 J16 J24 J31 M52 |
| Date: | 2016–11–29 |
| URL: | http://d.repec.org/n?u=RePEc:aah:aarhec:2016-11&r=cse |
| By: | Annick Pamen Nyola (LAPE - Laboratoire d'Analyse et de Prospective Economique - UNILIM - Université de Limoges - IR SHS UNILIM - Institut Sciences de l'Homme et de la Société); Alain Sauviat (LAPE - Laboratoire d'Analyse et de Prospective Economique - UNILIM - Université de Limoges - IR SHS UNILIM - Institut Sciences de l'Homme et de la Société); Amine Tarazi (LAPE - Laboratoire d'Analyse et de Prospective Economique - UNILIM - Université de Limoges - IR SHS UNILIM - Institut Sciences de l'Homme et de la Société) |
| Abstract: | Using a unique hand-collected dataset of 1,251 European Union banks and their 20,850 foreign affiliates hosted in 154 countries, this paper investigates how both host country and home country regulation affects their decision on how to go abroad to both developed and developing countries. Controlling for various factors, we find that host country banking regulation is an important factor in explaining organizational form (subsidiaries versus branches), but that such a factor is strongly influenced by the level of development of the host country. While banks are very careful in limiting their expansion to the relatively safest world countries, they are more likely to open branches rather than subsidiaries in countries with stringent activity restrictions and capital requirements; especially when they are relatively less efficient. Additionally, retail-oriented banks tend to prefer to operate subsidiaries in the most developed countries and competitive markets. |
| Keywords: | Banking regulation,EU banks,Internationalization,Foreign branch,Foreign subsidiary |
| Date: | 2016–09–21 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01369658&r=cse |
| By: | Dar-Brodeur, Afshan; Baldwin, John R.; Yan, Beiling |
| Abstract: | This paper asks whether research and development (R&D) drives the level of competitiveness required to successfully enter export markets and whether, in turn, participation in export markets increases R&D expenditures. Canadian non-exporters that subsequently entered export markets in the first decade of the 2000s are found to be not only larger and more productive, as has been reported for previous decades, but also more likely to have invested in R&D. Both extramural R&D expenditures (purchased from domestic and foreign suppliers) and intramural R&D expenditures (performed in-house) increase the ability of firms to penetrate export markets. Exporting also has a significant impact on subsequent R&D expenditures; exporters are more likely to start investing in R&D. Firms that began exporting increased the intensity of extramural R&D expenditures in the year in which exporting occurred. |
| Keywords: | Business performance and ownership, Manufacturing, Research and development, Science and technology |
| Date: | 2016–11–28 |
| URL: | http://d.repec.org/n?u=RePEc:stc:stcp3e:2016386e&r=cse |
| By: | Maurizio Cisi (Department of Management, University of Torino, Italy); Francesco Devicienti (Department of Economics and Statistics (Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche), University of Torino, Italy); Alessandro Manello (Department of Economics and Statistics (Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche), University of Torino, Italy); Davide Vannoni (Department of Economics and Statistics (Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche), University of Torino, Italy) |
| Abstract: | Using a large sample of Italian small and medium enterprises (SMEs), we investigate the effect of membership in a formal business network (“contratto di rete†) on firms’ economic performance. We find that network participation has a positive effect on value added and exports, but not on profitability. The advantages of networking are stronger in the case of: smaller SMEs, firms operating in traditional and in more turbulent markets, firms located in less developed areas and firms not already exploiting the weaker ties offered by industrial districts. Network characteristics, such as size, geographical dispersion and diversity, are also found to influence performance. |
| Keywords: | Formal Business Network, Small and Medium Firms, Economic Performance |
| JEL: | D22 L24 L25 M21 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:tur:wpapnw:039&r=cse |