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on Economics of Strategic Management |
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Issue of 2025–03–10
eleven papers chosen by João José de Matos Ferreira, Universidade da Beira Interior |
| By: | Altomonte, Carlo; El-Mallakh, Nevine; Sonno, Tommaso |
| Abstract: | We build a novel worldwide database merging information on patent-citations of firms paired with information on firms' affiliation to Business Groups (BGs). We exploit these data to document how BGs appropriate knowledge through standalone firm acquisition. First, we confirm that innovative standalone firms have a higher probability of becoming part of a BG. Second, we document how BGs tend to acquire firms that are on an upward trend in patents and citations. We also show that innovating activity significantly deteriorates post-acquisition, particularly for firms with high-quality, cited patents. Third, we show that such a deterioration in innovation activity is driven by acquired firms patenting within the same technological classes of the acquiring BG, while the latter does not hold for acquired firms patenting in different technologies than the BG's. We also find that acquisitions occurring in environments characterized by higher market concentration and more mature leading firms are associated with a relatively more pronounced reduction in innovation. These results generalize the defensive acquisition narrative, suggesting that BGs leverage these transactions as a strategic manoeuvre to solidify their market position in the face of potential competition. |
| Keywords: | business groups; innovation |
| JEL: | O30 |
| Date: | 2024–04–30 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:126757 |
| By: | Antonin Bergeaud; Max Deter; Maria Greve; Michael Wyrwich |
| Abstract: | We investigate the causal relationship between inventor migration and regional innovation in the context of the large-scale migration shock from East to West Germany between World War II and the construction of the Berlin Wall in 1961. Leveraging a newly constructed, century-spanning dataset on German patents and inventors, along with an innovative identification strategy based on surname proximity, we trace the trajectories of East German inventors and quantify their impact on innovation in West Germany. Our findings demonstrate a significant and persistent boost to patenting activities in regions with higher inflows of East German inventors, predominantly driven by advancements in chemistry and physics. We further validate the robustness of our identification strategy against alternative plausible mechanisms. We show in particular that the effect is stronger than the one caused by the migration of other high skilled workers and scientists. |
| Keywords: | patents, migration, Germany, iron curtain, innovation |
| Date: | 2025–02–19 |
| URL: | https://d.repec.org/n?u=RePEc:cep:cepdps:dp2076 |
| By: | Feiter, Tim Johannes |
| Abstract: | In times of digitalization and the democratization of information, individuals face information overload, misinformation, and missing orientation. Considering the corporate word, the question occurs, how individuals can create value through creative behavior considering the information flood. Therefore, this dissertation investigates the processes behind knowledge generation and the role of social interactions in fostering individual creativity, with a specific focus on innovation within organizations. Drawing on a multidisciplinary approach, the research explores three critical perspectives: network structures, the dynamic process of knowledge exchange, and the application of natural language processing (NLP) for identifying creative contributions. The first research question focuses on how knowledge and social network structures jointly enable future learning and innovation. The findings highlight that knowledge network saturation plays a significant role in creative behavior, particularly in determining the balance between explorative and exploitative search activities. This interaction between knowledge and social networks, where both can compensate for each other, offers a nuanced understanding of how organizations can leverage social dynamics and knowledge structures to stimulate creativity. The second research question examines the impact of knowledge exchange on innovative behavior throughout the idea journey. Through an analysis of online communities, this research demonstrates that changes in individual interests over time are critical to fostering creativity. The dissertation identifies key temporal patterns that enhance the likelihood of creative outcomes, emphasizing the importance of managing both knowledge diversity and depth during the ideation process. The third research question explores the potential of advanced NLP techniques to automatically identify creative behavior from textual data. The research proposes a transfer learning methodology that demonstrates superior accuracy compared to traditional methods, offering a scalable solution for organizations seeking to evaluate large volumes of idea descriptions. This novel approach opens new avenues for utilizing artificial intelligence in innovation management. Overall, the dissertation contributes to innovation literature by providing theoretical and practical insights into knowledge generation processes, social networks, and AI-driven creativity assessment. These findings offer actionable strategies for organizations to cultivate environments that support creative individuals, enabling them to navigate the complexities of knowledge recombination and social interaction for successful innovation in times of information overload. |
| Date: | 2025–02–26 |
| URL: | https://d.repec.org/n?u=RePEc:dar:wpaper:153302 |
| By: | Casimiro, June Ann J.; Romualdo, Karenina B.; Santiago, Via Shane R. |
| Abstract: | This study investigates the innovation strategies of cultural micro, small, and medium enterprises (MSMEs) in Northern and Central Luzon, Philippines, operating within the domain of traditional cultural expressions, particularly traditional crafts and culinary crafts. These enterprises play a dual role in preserving cultural heritage and contributing to local economic development. As cultural and creative industries (CCIs) gain increasing recognition for their economic and social contributions, cultural MSMEs in developing regions face unique challenges. Through a qualitative case study approach involving nine MSMEs, the research explores innovations in products, processes, and business models. It also examines the motivations driving these innovations, barriers encountered, and opportunities for enhancing sustainability and competitiveness. Findings reveal that cultural entrepreneurs innovate to ensure economic viability, preserve cultural heritage, empower communities, and leave a lasting legacy. Their strategies respond to evolving consumer preferences, seek to expand market reach, and aim to modernize operations while maintaining the authenticity of their cultural products. However, challenges such as succession planning, diminishing artisanal skills, and limited access to financial resources constrain their capacity to scale, adopt new technologies, and remain competitive in both local and global markets. The study identifies key innovation strategies, including product and process diversification, technology integration, strategic marketing, and stakeholder collaboration. Many MSMEs adopt hybrid production models, blending traditional craftsmanship with mechanized processes to enhance efficiency without undermining cultural value. Partnerships with government agencies, universities, and private entities emerge as critical to fostering innovation ecosystems that support cultural entrepreneurship. Despite these efforts, significant barriers persist. The declining interest of younger generations in traditional crafts threatens the continuity of artisanal skills, compounded by the absence of formal training programs. Limited financial resources further hinder growth and modernization, restricting the ability of MSMEs to compete effectively. To address these challenges, the study advocates for a collaborative approach involving policymakers, industry stakeholders, and consumers to create an enabling environment for innovation and sustainability. Such a framework must include targeted support for skills development, financial accessibility, and market expansion. This research emphasizes the essential role of cultural MSMEs within the traditional cultural expressions domain and their contribution to the broader CCI ecosystem. It offers actionable insights for addressing structural barriers and leveraging opportunities to enhance the resilience and competitiveness of these enterprises. By empowering cultural MSMEs, the Philippines can preserve its rich cultural heritage while fostering economic growth and social development. Comments on this paper are welcome within 60 days from the date of posting. Email publications@pids.gov.ph. |
| Keywords: | entrepreneurship;MSMEs;culture;creative industries;innovation;strategy;cultural entrepreneurship;cultural and creative industries;CCI |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:phd:dpaper:dp_2024-48 |
| By: | Ismail Benslimane (ERMOT - Laboratoire "Etudes et recherches en Management des Organisations et des Territoires" [Fez] - USMBA - Université Sidi Mohamed Ben Abdellah); Sanae Benjelloun (ERMOT - Laboratoire "Etudes et recherches en Management des Organisations et des Territoires" [Fez] - USMBA - Université Sidi Mohamed Ben Abdellah) |
| Abstract: | This paper explores the enigmatic relationship between management control and technological innovation, offering valuable insights. First, it aims to clarify the fundamental components of traditional management control (TMC), such as the cybernetic philosophy, the diagnostic use of control systems, financial information, the top-down approach, and positivist theory. Additionally, the paper seeks to highlight the paradoxical connection between these elements and the stochastic nature of innovation. Second, by emphasizing the necessity of shifting the paradigm that underpins contemporary management control (CMC), this approach steers the research toward a comprehensive analysis of its key components. These include the interactive use of control systems, the integration of non-financial information, a bottom-up approach, and the positioning of management control tools within the framework of instrumental theory. Such a configuration fosters innovation by promoting interactive communication, creativity, the development of new strategies, and the reduction of uncertainties. Third, the literature identifies two distinct typologies of innovation: incremental and radical. Each requires a unique process, which is further divided into phases, each with its own set of requirements. These requirements necessitate specific levers of control, which not only rethink and rehabilitate the role of traditional management control but also emphasize the importance of both TMC and CMC in supporting the innovation process. |
| Keywords: | Traditional management control, contemporary management control, levers of control, cybernetic regulation philosophy, dynamic change and learning philosophy, innovation processes, innovation typologies |
| Date: | 2025–01–24 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04912311 |
| By: | Wittmann, Florian; Schnabl, Esther; Zenker, Andrea |
| Abstract: | Policies aimed at supporting economically lagging regions have changed considerably in the past decades. This includes an increased link between innovation and regional policy, as well as more recently transformative policy. The WIR! Programme, funded by the Ministry of Research and Education in Germany, introduces several policy innovations in this regard, such as an explicit link between innovation and structural change, the emphasis on involving new (societal) actors, and a broad understanding of innovation. Although such innovations have the potential to provide a fresh start for policy-making, it remains an open question how applicants and programme administrations cope with a changing funding environment. This paper investigates - by examining applicant structure, project outlines, and funding decisions - how these new requirements are taken into account. While evidence in favour of a partial reorientation is found, the analysis reveals a strong continuity of established patterns and priorities, with many project outlines focusing mostly on technological innovation and relatively narrow stakeholder involvement. These findings suggest that while initiatives like WIR! may provide new impulses, it may take longer for applicants and programme management to adjust to changing policy paradigms. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:fisifr:312396 |
| By: | James Bessen; Xiupeng Wang |
| Abstract: | Investments in software, R&D, and advertising have surged, nearing half of U.S. private nonresidential investment. Yet just a few hundred firms dominate this growth. Most firms, including large ones, regularly invest little in capitalized software and R&D, widening this “intangible divide” despite falling intangible prices. Using comprehensive US Census microdata, we document these patterns and explore factors associated with intangible investment. We find that firms invest significantly less in innovation-related intangibles when their rivals invest more. One firm’s investment can obsolesce rivals’ investments, reducing returns. This negative pecuniary externality worsens the intangible divide, potentially leading to significant misallocation. |
| Keywords: | intangibles, R&D, software, innovation, obsolescence |
| JEL: | E22 O31 O32 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:cen:wpaper:25-15 |
| By: | Pia Andres |
| Abstract: | Should policymakers protect European firms by restricting imports of solar technology from China? Pia Andres finds that Chinese competition has resulted in many European firms going out of business, but it has also prompted more intense innovative activity among some of those that have survived. |
| Keywords: | Green Growth, Economic geography, Globalisation, Technological change |
| Date: | 2025–02–20 |
| URL: | https://d.repec.org/n?u=RePEc:cep:cepcnp:694 |
| By: | Jérémy Tantely Ranjatoelina (ONG Dry Forest); Manovosoa Finaritra (IST-T - Institut Superieur de Technologie D'antananarivo) |
| Abstract: | Bush-taxi is an institution in Africa. In Madagasikara, it is the main way of transportation between different localities for the majority of the population. Before 2013, the industry was fragmented between a multitude of cooperatives which differentiated each other very little, particularly in terms of business model. In 2013, the industry was disrupted by the entry of Cotisse Transport company on the market. This new entrant burst on the industry with an innovative business model. This research seeks to answer the question "How to enter an existing market with an innovative business model?" After an exploration of business model innovation literature in entrepreneurial context and of the few existing references about bush-taxis in Madagascar, this qualitative, exploratory and abductive research highlights the classic business model of bush-taxi cooperatives before 2013, as well as the Cotisse Transport one. It discusses the entry of a new entrant on an existing market with an innovative business model and the implications of the implementation of such a business model innovation. |
| Abstract: | Le taxi-brousse est une institution en Afrique. À Madagasikara, c'est le principal moyen de transport entre les différentes localités pour la majorité de la population. Avant 2013, l'industrie était fragmentée entre une multitude de coopératives très peu différenciées les unes des autres, en particulier en matière de business model. En 2013, l'industrie a été bouleversée par l'entrée sur le marché de l'entreprise Cotisse Transport. Ce nouvel entrant a fait irruption dans l'industrie avec un business model innovant. Cette recherche cherche à répondre à la question "Comment entrer sur un marché existant avec un business model innovant ?". Après une exploration de la littérature sur l'innovation de business model en contexte entrepreneurial et des quelques références existantes sur l'industrie du taxi-brousse à Madagasikara, cette recherche qualitative, exploratoire et abductive met en lumière le business model classique des coopératives de taxi-brousse avant 2013, ainsi que celui de Cotisse Transport. Elle discute l'entrée d'un nouvel entrant sur un marché existant avec un business model innovant, et les implications de la mise en œuvre de cette innovation par le business model. |
| Keywords: | Business model, Innovation, Bush taxi, Case study, Madagascar, Business model innovation, Base of the Pyramid BoP, Business model / modèle d’affaires, Taxi-brousse, étude de cas, Business model innovant, Innovation - modèles d'entreprise, Base de la Pyramide BOP |
| Date: | 2025–01–21 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04905570 |
| By: | Estrin, Saul; Herrmann, Andrea; Levesque, Moren; Mickiewicz, Tomasz; Sanders, Mark |
| Abstract: | We present a Schumpeterian growth model with new venture creation, under uncertainty, which explains the tradeoff between speed-to-breakeven, revenue-at-breakeven and relates this to the level of innovation. We then explore the tradeoffs between these outcomes empirically in a unique sample of 331 information and communication technology (ICT) ventures using a multi-input, multi-output stochastic frontier model. We estimate the contribution of financial capital and labor input to the outcomes and the tradeoffs between them, as well as address heterogeneity across ventures. We find that more innovative (and therefore more uncertain) ventures have lower speed-to-breakeven and/or lower revenue-at-breakeven. Moreover, for all innovativeness levels, new ventures face a tradeoff between speed-to-breakeven and revenue-at-breakeven. Our results suggest that it is the availability of proprietary resources (founder equity and labor) that helps ventures overcome bottlenecks in the innovation process, and we propose a line of research to explain the (large) unexplained variation in venture creation efficiency. |
| Keywords: | entrepreneurship; innovation; new venture creation; proprietary resources; stochastic frontier analysis; schumpeterian growth model |
| JEL: | O31 L29 |
| Date: | 2024–11–15 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:126789 |
| By: | Cirera, Xavier; Vargas Da Cruz, Marcio Jose; Soares Martins Neto, Antonio; Lee, Kyungmin; Gomes Nogueira, Caroline |
| Abstract: | This paper explores new firm-level data to examine the gender gap in technology adoption and the associated effect on firm performance. The data show a small difference in technology sophistication between firms managed by women and those managed by men, but there are larger differences in terms of labor productivity. Firms with female top managers are just as likely to adopt the most sophisticated technologies for general business functions that are common across all firms except for enterprise resource planning. However, firms managed by women adopt advanced technologies less frequently for sector-specific business functions. The study also finds that firms with higher technology sophistication tend to have higher productivity and the returns to the use of more sophisticated technologies are larger in businesses managed by women, which helps to narrow the productivity gap between firms managed by women and those managed by men. |
| Date: | 2024–05–15 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wbrwps:10771 |