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on Small Business Management |
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Issue of 2010‒07‒31
eight papers chosen by Joao Carlos Correia Leitao University of Beira Interior and Technical University of Lisbon |
| By: | Tatiana Plotnikova (DFG Research Training Program "The Economics of Innovative Change", Friedrich-Schiller-University Jena, Germany) |
| Abstract: | This paper investigates the determinants of success in the development of new drugs. In specific, it explores the factors of success in drug development programs at different stages of innovation process. We use economies of scale, scope, R&D competition and technological spillovers as explanatory variables and test whether the effect of these variables on the success of a project differs in relation to the discovery and development stages of innovation, respectively. Our main finding is that spillovers, including spillovers from collaboration, are important in explaining the success of projects during the discovery stage of innovation, while in the later development stage, the effects of competition outweigh any benefits from spillovers. |
| Keywords: | economies of scale and scope, spillovers, competition, R&D, innovation process |
| JEL: | O32 L25 L65 |
| Date: | 2010–07–26 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2010-045&r=sbm |
| By: | Dolores Anon Higon; Nicholas Vasilakos |
| Abstract: | This paper discusses the impact of foreign-ownership presence on the productivity performance of British-owned domestic retailers. In particular, we analyse the existence of productivity spillovers, in the form of knowledge transfer, by using establishment-level data from the Annual Respondents Dataset over the period 1997-2003. The results confirm the presence of such spillovers and highlight their positive and significant impact on the productivity of domestic firms, though these spillovers are mostly confined to the region in which foreign subsidiaries locate. There is also evidence that the productivity benefit from regional FDI spillovers increases with the absorptive capacity of domestic retailers. |
| Keywords: | FDI, Multinationals, Productivity, Retailing, Spillovers |
| JEL: | D24 F23 L25 L81 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:bir:birmec:10-23&r=sbm |
| By: | Aurora A.C. Teixeira (CEF.UP, Faculdade de Economia, Universidade do Porto; INESC Porto; OBEGEF); Margarida Catarino (IAPMEI; Faculdade de Economia, Universidade do Porto) |
| Abstract: | Despite the large number of publications related to business cooperation in R&D and the wide perception of the importance of intermediary institutions in the R&D cooperation process, empirical studies on its role are scarce, scattered and fragmented. Moreover, the academic work developed in this area is basically of a theoretical nature, whereas the international perspective of R&D cooperation is seldom approached. Departing from a unique database that includes 473 R&D cooperation projects developed within the 6th Framework Programme, involving firms and intermediaries from all European Union countries, this paper gauges the determinants of the importance attached to Intermediaries, through a direct survey to the organizations involved. Based on an estimation of the multivariate model, this study demonstrates that the importance given to Intermediaries depends more on project features than on the characteristics of the participating organizations. In particular, the nationality of participating organizations and the promoter emerged with a strong explanatory power: ceteris paribus, projects with at least one participant from the United Kingdom tend to assign greater importance to intermediaries in international R&D cooperation. Unambiguously, results evidence that the innovating capacity of an organization emerges (both positively and significantly) associated with a greater importance attached to Intermediaries. |
| Keywords: | R&D Cooperation; Intermediaries; International projects; Europe |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:por:fepwps:385&r=sbm |
| By: | Giulio Bottazzi (Sant'Anna School for Advanced Studies, Pisa); Tatiana Plotnikova (DFG Research Training Program "The Economics of Innovative Change", Friedrich-Schiller-University Jena, Germany) |
| Abstract: | This paper aims to investigate the effect of knowledge characteristics on the total factor productivity of firms developing drugs in the pharmaceutical industry. We decompose knowledge into knowledge associated with the technological firm portfolio and knowledge related to R&D projects, which represent drug development at the clinical testing stage. The latter is attributed to the knowledge of relevant markets where the drugs will be sold. The results show that the effect of technological coherence vs. market coherence and of accumulated knowledge on the productivity of firms differs. Productivity increases with the number of patents and decreases with the patent diversity and project portfolio coherence. When considering only the project knowledge, the diversity of the project portfolio positively affects productivity. |
| Keywords: | total factor productivity, diversity,,coherence, knowledge |
| JEL: | D24 O32 L25 L65 |
| Date: | 2010–07–26 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2010-044&r=sbm |
| By: | Maria José Gil Moltó; Joanna Poyago.Theotoky; Vasileios Zikos |
| Abstract: | We examine the use of subsidies to R&D in a mixed and a private duopoly market. We show that the socially optimal R&D subsidy is increasing in the degree of spillovers but it is lower in the private duopoly. The optimal R&D subsidy leads to an increase in total R&D and production, however, it does not lead to the equalisation of per firm output and therefore to an efficient distribution of production costs. We also find that privatization of the public firm reduces R&D activity and welfare in the duopoly market. This result stands even when optimal R&D subsidies are provided. |
| Keywords: | mixed duopoly; process innovation; R&D subsidies; privatization; spillovers. |
| JEL: | L31 L32 O38 L13 L50 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:lec:leecon:10/19&r=sbm |
| By: | Gray, Elie (Toulouse Business School and Toulouse School of Economics (LERNA)); Grimaud, André (Toulouse School of Economics (IDEI, LERNA) and Toulouse Business School) |
| Abstract: | This paper exploits the formalization of a circular product differentiation model of Salop (1979) to propose an endogenous growth quality ladder model in which the knowledge inherent in a given sector can spread variously across the sectors of the economy, ranging from local to global influence. Accordingly, this affects the size of the pool of knowledge in which innovations draw themselves on in order to be produced. Therefore, the law of knowledge accumulation, and thus the growth rate of the economy, depend positively on the expected scope of diffusion of innovations, i.e. on the intensity of knowledge spillovers. This approach generalizes the endogenous growth theory as developed in the seminal models of Grossman & Helpman (1991) and Aghion & Howitt (1992), extending their analysis to the possibility of considering stochastic and partial knowledge spillovers. This framework allows us to mitigate the positive externality of knowledge and thus to apprehend the issue of the funding of research with more parsimony. We characterize the set of steady-state Schumpeterian equilibria as a function of the public tools. We provide an explanation for the fact that research effort can either be suboptimal or over-optimal, depending on the expected scope of knowledge. Accordingly, we find that the optimal public tool dedicated to foster R&D activity depends positively on it. |
| Keywords: | Schumpeterian growth, scope of diffusion of innovations, knowledge spillovers |
| JEL: | O30 O31 O41 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:ide:wpaper:22690&r=sbm |
| By: | Armando Silva (Instituto Politécnico do Porto - ESEIG) |
| Abstract: | Using a longitudinal database (1996-2003) at the plant level, this paper aims to shed light on the causal nexus between production-related subsidies and exports, in Portugal. Given that there is a selection of firms for subsidies we implement a propensity score matching approach in order to evaluate adequately the effects of subsidies on both the probability of domestic firms to begin exporting and on the probability of increasing the export share of already exporters. At one hand, we find no impact of subsidies on the ability of domestic firms to become exporters; at the other hand, some evidence of positive effects of subsidies are detected on export shares, especially for higher levels of subsidy per employee and for specific sectors as a clear sectoral heterogeneity is observed. Complementarily, some weak positive effects of subsidies are noticed in employment but no evidence is observed for firms´ sales or efficiency. |
| Keywords: | Subsidies, Exports, Portugal, Matching |
| JEL: | F13 F14 H29 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:por:fepwps:383&r=sbm |
| By: | Ernesto Tavoletti (University of Macerata) |
| Abstract: | <div style="text-align: justify;">This study aims at exploring the process of internationalization in the Italian fashion firms, focusing on strategy-structure fit and the governance role of the founding team in providing such a fit. It does so with a single case study of a leading fashion firm. It suggests that classic deterministic theories about strategy-structure fit in growing firms offer poor guide. The strategy is entirely \emergent" and inspired by the specific talents of the founding team. Evidence confirms the causal link between strategy and structure: company structure is network based and evolves according to the emerging strategy. However, the development route does not follow any deterministic model: Uppsala's model of incremental and cognitive internationalisation, especially in its revisited and network based form, appears to be the more appropriate reference for the case, characterised by creative dynamics that are constantly evolving, following the vision and strategy that are constantly provided by the founding team.</div> |
| Keywords: | network,fashion industry,strategy,founding team,internationalisation,structure |
| JEL: | L20 L21 F23 M10 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:mcr:wpaper:wpaper00029&r=sbm |