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on Economics of Strategic Management |
| By: | Raff, Horst; Ryan, Michael; Stähler, Frank |
| Abstract: | This paper examines the link between a firm’s owership of productive assets and its choice of foreign-market entry strategy. We find that, controlling for industry- and country-specific characteristics, the most productive firms (i.e., those owning the most assets) will enter through greenfield investment, less productive ones will choose M&A, and the least productive ones will export. In addition, the most productive firms are shown to prefer whole ownership to a joint venture. These predictions are confirmed in an econometric analysis of Japanese firm-level data. |
| Keywords: | Foreign direct investment, merger and acquisition, joint venture, greenfield investment, firm heterogeneity, productivity |
| JEL: | F12 F15 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cauewp:3875&r=cse |
| By: | Emmanuelle Auriol; Pierre M. Picard |
| Abstract: | The paper studies the impact of government budget constraint in a pure adverse selection problem of monopoly regulation. The government maximizes total surplus but incurs some cost of public funds. An alternative to regulation is proposed in which firms are free to enter the market and to choose their price and output levels. However the government can contract ex-post with the private firms. This ex-post contracting set-up allows more flexibility than traditional regulation where government commits to both investment and operation cash-flows. This is especially relevant in case of high technological uncertainties. |
| Keywords: | privatization, soft-budget constraint, adverse selection, regulation, natural monopoly |
| JEL: | D82 L33 L43 L51 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_1733&r=cse |
| By: | Tomaso Duso; Klaus Gugler; Burçin Yurtoglu |
| Abstract: | This paper applies a novel methodology to a unique dataset of large concentrations during the period 1990-2002 to assess merger control’s effectiveness. By using data gathered from several sources and employing different evaluation techniques, we analyze the economic effects of the European Commission’s (EC) merger control decisions and distinguish between blockings, clearances with commitments (either behavioral or structural), and outright clearances. We run an event study on merging and rival firms’ stocks to quantify the profitability effects of mergers and merger control decisions. We back up our results and methodology by using alternative measures for the merger’s profitability effects based on balance-sheet data and obtain consistent results. Our findings suggest that outright blockings solve the competitive problems generated by the merger. Remedies are not always effective in solving the market power concerns, at least not on average. Nevertheless, both structural (divestitures) and behavioral remedies do help restore effective competition when correctly applied to anticompetitive mergers during the first investigation phase. Yet, they are on the whole ineffective or even detrimental when applied after the second investigation phase. Finally, remedies - especially behavioral ones - seem to constitute a rent transfer from merging firms to rivals when mistakenly applied to pro-competitive mergers. <br> <br> <i>ZUSAMMENFASSUNG - (Wie wirksam ist die Europäische Fusionskontrolle?) <br> In diesem Beitrag wenden wir eine neue Methodologie auf einen einzigartigen Datensatz von großen Unternehmenskonzentrationen während der Jahre 1990- 2002 an, um die Wirksamkeit der Fusionskontrolle zu untersuchen. Wir benutzen Daten, welche von unterschiedlichen Quellen erfasst worden sind und setzen unterschiedliche Auswertungsmethoden ein, um die ökonomischen Effekte der Fusionskontrollentscheidungen der Europäischen Kommission zu analysieren. Wir unterscheiden zwischen Untersagungen, Genehmigung mit Auflagen (entweder Verhaltensauflagen oder strukturelle) und sofortige Genehmigung. Wir verwenden eine "event study" - Methodologie und untersuchen, wie die Aktienpreise sowohl der fusionierenden Unternehmen als auch der Wettbewerber auf die Ankündigung einer Fusion oder einer besonderen wettbewerbspolitischen Entscheidung reagieren, um die Rentabilitätseffekte von Fusionen und von Fusionskontrollentscheidungen quantitativ zu bestimmen. Wir stützen unsere Resultate und Methodologie, indem wir alternative Maße für die Rentabilitätseffekte der Fusion verwenden, die auf Bilanzdaten basieren und erreichen gleich bleibende Resultate. Unsere Analyse ergibt, dass sofortige Untersagungen das von der Fusion verursachte Wettbewerbsproblem lösen können. Dagegen sind Auflagen nicht immer wirkungsvoll - mindestens nicht im Durchschnitt - um die durch die Fusion erzeugte Markmacht zu begrenzen. Dennoch helfen strukturelle Auflagen wie Abstoßungen von Kapitalvermögen und Verhaltensauflagen, einen "effektiven" Wettbewerb wieder herzustellen, wenn sie richtig auf wettbewerbswidrige Fusionen während der ersten Untersuchungsphase des Fusionskontrollverfahren angewendet werden. Jedoch sind sie im Durchschnitt erfolglos - wenn nicht sogar schädlich - wenn sie nach der zweiten Untersuchungsphase angewendet werden. Schließlich scheinen Abhilfemaßnahmen - besonders Verhaltensauflagen -, ein Rententransfer von den fusionierenden Unternehmen auf ihre Rivalen zu sein, wenn sie irrtümlich Wettbewerb steigernden Fusionen auferlegt werden.</i> |
| Keywords: | Mergers, Merger Control, Remedies, European Commission, Event Studies, Ex-post Evaluation |
| JEL: | L4 K21 G34 C2 L2 |
| Date: | 2006–07 |
| URL: | http://d.repec.org/n?u=RePEc:wzb:wzebiv:spii2006-12&r=cse |
| By: | Dass Rajanish; Lethil Nangmuansang |
| Abstract: | This report aims at identifying the various state administrative/commercial capital cities in the North East Region where IT-enabled service industry could be set up, and whether the necessary conditions conducive to the industry exist. It is also an attempt to rank the various cities in terms of their investment friendliness when it comes to the ITES industry. This report involves a macro environmental analysis where the focus is mainly on the STEEP sector of the business environment – social, technological, economic, environmental and political aspects that impact competitiveness. |
| Keywords: | BPO, ITES, North East, India, Policy formulation |
| Date: | 2006–07–26 |
| URL: | http://d.repec.org/n?u=RePEc:iim:iimawp:2006-07-07&r=cse |
| By: | V. CERASI - B. CHIZZOLINI - M. IVALDI |
| URL: | http://d.repec.org/n?u=RePEc:mil:wpdepa:1998-03&r=cse |
| By: | Lin, Ping; Saggi, Kamal |
| Abstract: | This paper develops a two-tier oligopoly model in which the entry of a multinational firm results in technology transfer to its local suppliers and also impacts the degree of backward linkages in the local industry. The model endogenizes the multinational’s choice between anonymous market interaction with its suppliers and contractual relationships with them under which the multinational transfer technology to its suppliers who in turn agree to serve the multinational exclusively. The multinational’s entry under an exclusive contract has a de-linking effect that can reduce the degree of competition among suppliers thereby leading to a decline in the level of backward linkages and local welfare. With its emphasis on the supply-side effects of the multinational’s entry on local industry, this paper complements existing studies of backward linkages that focus more on demand-side effects. |
| Keywords: | Multinational Firms, Backward Li es, Vertical Technology Transfer, Exclusivity |
| JEL: | F12 F23 L13 O14 O19 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:bubdp1:2943&r=cse |
| By: | Damian Grimshaw (Manchester Business School - [University of Manchester]); Marilyn Carroll (Manchester Business School - [University of Manchester]); Karen Jaehrling (IAT - Institut Arbeit und Technik - [Universität der Arbeit]); Philippe Méhaut (LEST - Laboratoire d'économie et de sociologie du travail - [CNRS : UMR6123] - [Université de Provence - Aix-Marseille I][Université de la Méditerranée - Aix-Marseille II]) |
| Abstract: | The hospital industry could be characterised on the one hand as under “industrial constraints” (just in time, 24 hours opening, and on the other hand as a service activity with, in departments, a high degree of patient oriented activities. Very similar pressure are exerted on hospitals in the three countries (UK, G and F): budget constraints and a trend to “quasi market” regulations (cf. Bartlett/LeGrand 1993); changes in the competitive structure linked with the increasing importance of private hospitals; a new demand for care arising from the ageing population and more complex diseases; new rules to control for the quality of care. Despite these similarities between the external demands and constraints, the organisation of care work and the division of labour remains very different between the countries. Section 1 presents a brief historical perspective of the nurse assistant in the three countries and the major contrast regarding the level and trends of employment. Section 2 analyses the training profiles and access to training. Section 3 describes the tasks performed and draws the job profile of a NA. Section 4 discusses the wage levels and structure and section 5 patterns of mobility. |
| Keywords: | Low wage; Nurse assistant; Hospital; Division of labour; Comparison; Germany; France; the United Kingdom |
| Date: | 2006–07–17 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00085863_v1&r=cse |
| By: | Koetter, Michael |
| Abstract: | German banks experienced a merger wave throughout the 1990s. However, the success of bank mergers remains a continuous matter of debate. In this paper we suggest a taxonomy as how to evaluate post-merger performance on the basis of cost efficiency (CE). We categorise mergers a success that fulfill simultaneously two criteria. First, merged institutes must exhibit CE levels above the average of non-merging banks. Second, banks must exhibit CE changes between merger and evaluation year above efficiency changes of non-merging banks. We employ this taxonomy to characterise (successful) mergers in terms of various key-performance and structural indicators and investigate the implications for three important policy issues. Our main conclusions are twofold. First, approximately every second merger is a success. Second, the margin of success is narrow, as the CE differential between merging and non-merging banks is one percentage point. |
| Keywords: | Banks mergers, regulation, distress, cost efficiency, Germany |
| JEL: | G21 G28 G33 G34 L44 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:bubdp2:4267&r=cse |
| By: | Cristina de Fuentes Barberá (Universitat de València); María Consuelo Pucheta (Universitat Jaume I) |
| Abstract: | As a result of the publication of the Code of Corporate Good Governance in 1998, known as the Olivencia Code, some companies voluntarily created an audit committee, after the recommendation of the Code in which all companies, especially listed, were encouraged to create them. Therefore, the aim of this work is to analyse which factors are associated with voluntary audit committee formation of those companies listed on the Continuous Market through 1999. In particular we analyse the association of factors such as Board independence and size, auditor size, agency costs, economies of scale, institutional investors, the audit report and auditor tenure. We find that voluntary audit committee formation is positively correlated with the proportion of independent directors on the board of directors and the economies of scale. On the other hand, the results show that board size, auditor size, agency costs of equity and debts, institutional investors with shares on the board of directors, a qualified audit report and audit tenure are not factors associated with voluntary audit committee formation. A raíz de la publicación del Código de Buen Gobierno Corporativo en 1998, también conocido como Código Olivencia, algunas empresas crearon voluntariamente un comité de auditoría, tras la recomendación del Código en la que instaba a todas las empresas, sobre todo cotizadas, a la formación de los mismos. Así pues, el objetivo de este trabajo es analizar qué motivos indujeron a las empresas cotizadas en el mercado continuo durante 1999 a crear voluntariamente comités de auditoría. Concretamente, analizamos la asociación de factores como la independencia y tamaño del consejo de administración, el tamaño del auditor, los costes de agencia, las economías de escala de implementar un mecanismo de control, los inversores institucionales, el informe de auditoría y la duración del encargo de auditoría. Los resultados ponen de manifiesto que la formación voluntaria de comités de auditoría está positivamente correlacionada con el porcentaje de miembros independientes que tenga el consejo de administración y las economías de escala. Por otra parte, los resultados revelan que el número de miembros del consejo de administración, el tamaño de la firma auditora, los costes de agencia de la propiedad y de la deuda, la representación de inversores institucionales con participación accionarial en el consejo de administración, la recepción de un informe de auditoría con salvedades y la duración del encargo de auditoría no son factores que se asocien con la formación voluntaria de un comité de auditoría. |
| Keywords: | comité de auditoría; formación voluntaria; corporate governance audit committee; voluntary formation; corporate governance |
| JEL: | G34 M14 M42 |
| Date: | 2006–07 |
| URL: | http://d.repec.org/n?u=RePEc:ivi:wpasec:2006-08&r=cse |
| By: | Christa Hainz |
| Abstract: | Business groups in emerging markets perform better than unaffiliated firms. One explanation is that business groups substitute some functions of missing institutions, for example, enforcing contracts. We investigate this by setting up a model where firms within the business group are connected to each other by a vertical production structure and an internal capital market. Thus, the business group’s organizational mode and the financial structure allow a self-enforcing contract to be designed. Our model of a business group shows that only sequential investments can solve the ex post moral hazard problem. We also find that firms may prefer not to integrate. |
| Keywords: | business groups, self-enforcing contract, institutions, internal capital market |
| JEL: | G31 G32 G34 K49 L22 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_1763&r=cse |
| By: | Philippe Méhaut (LEST - Laboratoire d'économie et de sociologie du travail - [CNRS : UMR6123] - [Université de Provence - Aix-Marseille I][Université de la Méditerranée - Aix-Marseille II]) |
| Abstract: | Au début de l'année 2001, les organisations d'employeurs et les syndicats français avaient ouvert une négociation sur la formation professionnelle continue. Cette négociation, initiée par le Medef (la principale organisation d'employeurs) était partie intégrante d'un projet plus large, touchant à d'autres champs des relations professionnelles (l'indemnisation du chômage, les restructurations industrielles...) et visant à réformer en profondeur les relations industrielles. Après dix mois de discussions, la négociation échoua. Relancée en 2003, après le changement politique (victoire de la droite), la négociation a débouché sur un accord signé par tous les partenaires (une exception dans la situation française). En 2004, une loi a intégré et rendu obligatoire les principaux termes de l'accord qui réforme le système de formation continue. L'un des objectifs initiaux du Medef était d'introduire une plus grande part d'individualisation et de co investissement (entreprise/salarié) dans un système où l'espace ouvert à l'individu était faible et où la formation était presque totalement prise en charge par l'entreprise. Le compromis final apparaît assez éloigné de cet objectif même s'il apporte des nouveautés significatives par rapport au cadre antérieur. Les organisations de salariés ont su conserver, tout au long de la négociation, un front relativement uni alors que les organisations d'employeur ont connu des dissensions internes. Cet article analyse ce processus de réforme. Dans une première partie, on rappelle le cadre du système français de formation continue, original tant par sa construction (forte implication des partenaires sociaux au niveau interprofessionnel) que par son mode de financement (obligation de dépense pour la formation continue pesant sur l'entreprise). La deuxième partie analyse les positions en présence et les conditions de déroulement de la négociation. La troisième partie étudie les principales nouveautés introduites dans le système français et les situent en regard des objectifs patronaux et syndicaux. |
| Keywords: | Formation tout au long de la vie; FPC en entreprise; Législation de la FPC; Politique de la FPC; Partenaires sociaux; Analyse historique; France |
| Date: | 2006–07–17 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00085870_v1&r=cse |
| By: | James C. McGrath |
| Abstract: | Small payments of less than $5 have resisted the wave of electronification that has swept consumer payments in recent years. However, a number of innovations — both new technologies and new ways of doing business — have done much to make such electronic “micropayments” less expensive and more convenient. Now, having proven themselves in several online markets, micropayments are poised to make inroads at the physical point of sale. This paper looks at some of the success stories (and failures), both in the U.S. and abroad, to identify possible conditions for success and to gauge the outlook for the future. It finds that industry structure, the coordination of standards, and customer preferences and experiences have all influenced the development of these products. While different markets around the world have supported different types of solutions, the successful products have delivered clear utility to the consumer, along with compelling economics for the different parties in the value chain. With critical mass in sight, the future looks promising. |
| Keywords: | Electronic funds transfers |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedpdp:06-04&r=cse |