nep-cse New Economics Papers
on Economics of Strategic Management
Issue of 2019‒09‒16
twelve papers chosen by
João José de Matos Ferreira
Universidade da Beira Interior

  1. R&D and firm resilience during bad times By Maria Garcia-Vega; Oscar Vicente-Chirivella
  2. Public Funding and Corporate Innovation By Mathias Beck; Martin Junge; Ulrich Kaiser
  4. Innovation union: Costs and benefits of innovation policy coordination By Teodora Borota; Fabrice Defever; Giammario Impullitti
  5. Animate the cluster or subsidize collaborative R&D? A multiple overlapping treatments approach to assess the impact of the French cluster policy By Mar, M.; Massard, N.
  6. The Impact of Social Capital Capabilities on Performance of Small and Medium Enterprises in Thailand By SUMITTRA JIRAWUTTINAN
  7. FDI and Duration of Intermediate Goods Imports: Empirical Evidence from Japanese affiliates in China By Chih-Hai Yang; Tadashi Ito; Toshiyuki Matsuura
  8. Foreign Direct Investment Spillovers Within and Between Sectors: Evidence from a Developing Economy By Oluwasheyi Oladipo
  9. Modular structure in labour networks reveals skill basins By Neave O'Clery; Eoin Flaherty; Stephen Kinsella
  10. R&D and firm resilience during bad times By Apoorva Gupta
  11. Helping SMEs internationalise through trade facilitation By Javier López González; Silvia Sorescu
  12. Does the eclectic framework explain the new start-ups? By Mercedes Gumbau

  1. By: Maria Garcia-Vega; Oscar Vicente-Chirivella
    Abstract: In this paper, we empirically investigate how technology transfers from universities to private firms influence firm innovativeness. Using data on R&D acquisitions from universities of more than 10,000 Spanish firms for the period 2005-2013 and applying propensity score matching techniques and DiD estimations, we find that technology transfers from universities strongly increase firm innovativeness. We next explore heterogeneous effects in order to analyse whether these gains are mediated by firm size and the business cycle. Our results suggest that the contribution of universities to firm innovation is particularly important for small firms, during the whole business cycle and it goes beyond its direct effect on innovation: We find that technology transfers from universities generate positive spillovers and enhance firms’ internal R&D capabilities. Our results suggest that the knowledge generated by universities makes an important contribution to economic growth through technology transfers, which makes firms more innovative. Hence, knowledge creation by universities provides an important public good.
    Keywords: Universities, Technology Transfers, Innovation, Firms
    Date: 2019
  2. By: Mathias Beck (KOF Swiss Economic Institute, ETH Zurich, Switzerland); Martin Junge (Ministry of Higher Education and Science, Copenhagen, Denmark); Ulrich Kaiser (University of Zurich Department of Business Administration Chair for Entrepreneurship)
    Abstract: We review and condense the body of literature on the economic returns of public R&D on private R&D and find that: (i) private returns to R&D appear to be large and larger than the returns to alternative investments; (ii) private R&D and R&D subsidies are positively correlated and there is no evidence for crowding out; (iii) R&D cooperation increases private R&D; (iv) there appear to exist complementarities between alternative sources of funding; (v) the mobility of R&D workers, particularly of university scientists, is positively related to innovation; (vi) there are many university spin-offs but these are no more successful than non-university spin-offs; (vii) universities constitute important collaboration partners and (viii) clusters enhance collaboration, patents and productivity. Key problems for economic policy advice are that the identification of causal effects is problematic in most studies and that little is known about the optimal design of policy measures.
    Keywords: Keywords: R&D subsidies, R&D tax credits, cooperation, labor mobility, returns to R&D, university spin-offs, R&D clusters, public-private knowledge transfer
    JEL: C54 J6 I28 O3 L52
    Date: 2018–01
  3. By: Inga Ivanova (National Research University Higher School of Economics); Oivind Strand (National Research University Higher School of Economics); Loet Leydesdorff (National Research University Higher School of Economics)
    Abstract: The innovation capacity of Norwegian innovation system, according Triple Helix model of innovations approach, is analyzed in terms of mutual information among geographical, sectorial, and size distributions of firms as dimensions of probabilistic entropy. Negative entropies can be considered as a consequence of synergy among these dimensions. Three different techniques for evaluation of temporal synergy evolution are used: R/S analysis, DFT, and geographical synergy decomposition. The calculations are based on data for all Norwegian firms registered between 2002 and 2014. The results suggest that the synergy at the level of both the country and its seven regions show non-chaotic oscillatory behavior and resonate in a set of natural frequencies.
    Keywords: knowledge base, innovations, triple helix, cyclic processes
    JEL: O10 O30 R11
    Date: 2019
  4. By: Teodora Borota; Fabrice Defever; Giammario Impullitti
    Abstract: In this paper, we document large heterogeneity in innovation policy and performance between old and new EU member states, and present firm-level evidence on the close link between foreign direct investment (FDI) spillovers and eastern European firms' innovation. Guided by these facts and motivated by the pressing debate on further EU integration, we build a two-region endogenous growth model to analyse the gains from innovation policy cooperation in an economic union. The two regions, the West (the old members) and the East (the new post-2004 members), feature firms competing in innovation for market leadership, are integrated via free trade and costly technology transfer via FDI and have different innovation performance and policy. Calibrating the model to reproduce key features of the EU economy, we compare the outcomes of an East-West R&D subsidy war with a coop- eration scenario with unified subsidy across regions, and obtain three main results. First,we find that the dynamic gains spurring from the impact of cooperation on the economy's growth rate are sizable and substantially larger than the static gains obtained internalising the strategic motive for subsidies. Second, our model suggests that the presence of FDI and multinational production alleviates the strategic motive and increases the gains from cooperation. Third, separating FDI and innovation policy generates larger gains from cooperation, a policy complementarity driven by the knowledge spillovers carried by FDI.
    Keywords: Optimal innovation policy, growth theory, international policy coordination, EU integration, FDI spillovers.
    Date: 2019
  5. By: Mar, M.; Massard, N.
    Abstract: This paper examines the effectiveness of the French competitiveness cluster policy on participating SMEs in terms of innovation and economic performance. Using an original dataset, we construct different measures of treatment with crossover designs. The findings indicate substantial additionality effects on R&D and employment and weak or insignificant effects on other types of economic performance. While only adhering to clusters induces much stronger positive impacts on SMEs than only participating in R&D collaborative projects, the policy is most effective when the two treatments are simultaneously used. To achieve its impact on SMEs, the cluster policy should not overlook low-cost instruments such as animation actions and common services.
    JEL: C14 C21 O32 O38
    Date: 2019
  6. By: SUMITTRA JIRAWUTTINAN (Mahasarakham Business School)
    Abstract: The main aim of this study is to test the effect between social capital capabilities and SME performance via entrepreneurial capability as mediating variable on the relationship. The model is verified by collecting data from 340 small and medium enterprises in Thailand and mail survey questionnaire is used as instrument. The statistical analysis for testing the hypothesis is OLS multiple regression analysis. The results showed that four dimensions of social capital capabilities (network capability, trust, communication and collaboration) have positive effect on entrepreneurial capability and SME performance. All dimensions of social capital capabilities can explain predication of entrepreneurial capability at 40.70% and SME performance at 38.90 %. In addition, two independent variables such as trust and collaboration are fully support hypotheses. Overall, this study contributes to SME manager by exploring that social capital capabilities and entrepreneurial capability can be achieved SME performance
    Keywords: Social Capital Capabilities; Entrepreneurial Capability; SME performance, Small and Medium Enterprises
    Date: 2019–07
  7. By: Chih-Hai Yang (National Central University); Tadashi Ito (Gakushuin University); Toshiyuki Matsuura (Keio University)
    Abstract: This paper examines the duration of intermediate goods imports and its determinants for Japanese affiliates in China. In addition to product characteristics, we consider also the influences of affiliate and parent firm characteristics, as well as regional agglomeration. Based on a unique parent?affiliate?transaction matched panel dataset over the 2000?2006 period, we adopt a discrete-time hazard model to conduct empirical estimations. Results show that products with a higher upstreamness index, differentiated goods, and process-trade goods are less likely to be substituted for local procurement. Firms located in agglomerated regions with more foreign affiliates tend to shorten the duration of imports from their home country. In terms of parent-firm characteristics, multinational enterprises that have many foreign affiliates or greater foreign production experience continue to import intermediate goods for a longer duration.
    Keywords: Trade duration, FDI, Intermediate goods, Agglomeration
    Date: 2019–07
  8. By: Oluwasheyi Oladipo (State University of New York at Old Westbury)
    Abstract: With volatile global capital flows, the stability of FDI and its emergence as an important source of foreign capital for developing economies has renewed interest in its linkages with sustainable economic growth in developing countries. FDI is crucial as it influences production, employment, income, prices, imports, economic growth, balance of payments and the general welfare of the recipient country. Nigeria has attracted huge inflows of FDI over the last decade?from $1.14 billion in 2001 to $4.4 billion in 2016. Though FDI has been concentrated in the oil and gas sectors, the government is now seeking to channel it into the communication, manufacturing and financial services sectors.The broad objective of this study is to examine the spillover effect from oil FDI on the Nigerian economy: (i) is there positive micro linkage from the oil FDI on the domestic economy in Nigeria? (ii) are there positive spillover effects from oil FDI to domestic labor markets in Nigeria?We will trace which sectors/subsectors are recipients of these linkages. How have foreign oil multinationals helped the domestic firms in terms of technology transfer, and employment linkages? What are the linkages between the foreign oil companies and the domestic Petroleum Training Institute in terms of technology transfer on one hand and employment of the Institute?s graduates on other hand? Are the policies embarked upon to attract FDI and ensure its spillover to other sectors of the Nigerian economy sufficient to stimulate economic growth?
    Keywords: FDI, sectoral spillovers, economic development
    JEL: F21 O11 F35
    Date: 2019–06
  9. By: Neave O'Clery; Eoin Flaherty; Stephen Kinsella
    Abstract: Labour networks, where industries are connected based on worker transitions, have been previously deployed to study the evolution of industrial structure ('related diversification') across cities and regions. Beyond estimating skill-overlap between industry pairs, such networks characterise the structure of inter-industry labour mobility and knowledge diffusion in an economy. Here we investigate the structure of the network of inter-industry worker flows in the Irish economy, seeking to identify groups of industries exhibiting high internal mobility and skill-overlap. We argue that these industry clusters represent skill basins in which skilled labour circulate and diffuse knowledge, and delineate the size of the skilled labour force available to an industry. Deploying a multi-scale community detection algorithm, we uncover a hierarchical modular structure composed of clusters of industries at different scales. At one end of the scale, we observe a macro division of the economy into services and manufacturing. At the other end of the scale, we detect a fine-grained partition of industries into tightly knit groupings. In particular, we find workers from finance, computing, and the public sector rarely transition into the extended economy. Hence, these industries form isolated clusters which are disconnected from the broader economy, posing a range of risks to both workers and firms. Finally, we develop a methodology based on industry growth patterns to reveal the optimal scale at which labour pooling operates in terms of skill-sharing and skill-seeking within industry clusters.
    Date: 2019–09
  10. By: Apoorva Gupta
    Abstract: Can being innovative help firms to shield themselves from the disruptive effects of a crisis? Using firm-level data for the Spanish manufacturing sector, this paper finds that innovative firms suffered considerably less compared to non-innovative firms during the Great Recession. This effect is explained by innovative firms differentiating their products to adapt to an unexpected rapid decline in economic activity. The data does not support alternative mechanisms such as reduction in marginal cost of production with process innovation, better access to capital, difference in labour moving costs, or higher technological diversification for innovative firms. The results provide evidence of the role of R&D in making firms dynamically capable and resilient to large negative shocks, adding another element to its well established role of facilitating growth through innovation and learning.
    Keywords: R&D, crisis, resilience, product differentiation, dynamic capability
    Date: 2019
  11. By: Javier López González (OECD); Silvia Sorescu (OECD)
    Abstract: Small and medium-sized enterprises (SMEs) play an important role in generating economic activity and employment in developing and developed countries. However, partly due to remaining at-the-border trade costs, SMEs continue to be less represented in international trade – as direct exporters or importers – than larger firms. Drawing on cross-country data from the World Bank Enterprise Survey (WBES), together with the OECD Trade by Enterprise Characteristics (TEC), this paper looks at the relationship between the trade facilitation environment – as measured through the OECD Trade Facilitation Indicators (TFIs) – and various measures of international engagement of SMEs. While there are differentiated impacts across firm size for different trade facilitation areas, the analysis shows that firms of all sizes across both developed and developing economies benefit from improvements in the overall trade facilitation environment, helping them export and import. However, on aggregate, smaller firms benefit more from improvements in the overall trade facilitation environment relative to large firms. The analysis also suggests that some trade facilitation measures matter more in addressing fixed versus variable costs for SMEs and provides some guidance as to what trade facilitation policy reforms might be prioritised.
    Keywords: exporting, importing, inclusive trade, SMEs, trade costs, trade facilitation
    JEL: D22 F13 F14 L11 L25
    Date: 2019–09–11
  12. By: Mercedes Gumbau (University of Valencia)
    Abstract: Based on the eclectic theory, the paper analyzes which are the basic factors leading to the creation of new start-ups in society. It is argued that an ecosystem prone to entrepreneurship must own opportunities created by market conditions, human capital and resources such as access to capital or R & D and technology. Stability and economic growth act positively on the expectations of people who are in the situation of deciding whether or not to create the company they are projecting. But at the same time, macroeconomic conditions such as the behavior of demand or the degree of economic stability affect the context in which entrepreneurs identify opportunities and decide if they are going to undertake. Given this reverse causality, econometric estimations are carried out using panel data techniques, instrumental variables and simultaneous three-phase equations. Regional data are used in Spain over the period 2008-2014. The results also show that entrepreneurship of the small companies, as well as those of low technology sectors, is directly related to the availability of credit. And the entrepreneurship rate of large companies or high technological intensity is explained by the resources available to companies such as the availability of R & D capital or human capital as well as industrial diversity or demographic composition. Implications from the findings are discussed.
    Keywords: entrepreneurship
    Date: 2019–07

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