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on Economics of Strategic Management |
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Issue of 2008‒01‒19
seven papers chosen by Joao Jose de Matos Ferreira University of the Beira Interior |
| By: | Rajneesh Narula (Department of Economics, University of Reading Business School); Grazia D. Santangelo (Facoltà di Scienze Politiche, Università degli Studi di Catania) |
| Abstract: | This paper shows empirically that in an intra-industry oligopolistic scenario the location of a firm’s innovative activities plays an important role in determining its partner selection in R&D alliances. Such a role is mainly attributed to a strategic use of R&D alliances as a means to limit knowledge flows and protect competences, rather than to promote knowledge flows. By drawing on a novel dataset matching alliances and patent data for the European ICT industry, the econometric analysis shows that partners’ prior co-location (at both national and sub-national regional level), previous ties and technological overlap matter in the choice of partner, while common nationality has a negative impact on alliance formation. |
| Keywords: | Alliances, R&D location, strategy, co-location, knowledge flows |
| JEL: | D23 F23 O18 O32 R3 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:rdg:wpaper:em-dp2007-43&r=cse |
| By: | Christoph Grimpe (Centre for European Economic Research (ZEW), Mannheim); Ulrich Kaiser (University of Southern Denmark) |
| Abstract: | Determining the research and development (R&D) boundaries of the firm as the choice between internal, collaborative and external technology acquisition has since long been a major challenge for firms to secure a continuous stream of innovative products or processes. While research on R&D cooperation or strategic alliances is abundant, little is known about the outsourcing of R&D activities to contract research organizations and its implications for innovation performance. This paper investigates the driving forces of external technology sourcing through contract research based on arguments from transaction cost theory and the resource-based view of the firm. Using a large and comprehensive data set of innovating firms from Germany our findings suggest that technological uncertainty, contractual experience and openness to external knowledge sources motivate the choice for engaging in contract research activities. Moreover, we show that internal and external R&D sourcing are complements: the marginal contribution of internal (external) R&D is the larger the more firms spend on external (internal) R&D. |
| Keywords: | contract research, innovation; transaction cost theory; firm capabilities |
| JEL: | O32 C24 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:kud:kuieci:2008-01&r=cse |
| By: | U. Witt; C. Zellner |
| Abstract: | New knowledge with potential commercial value is created, replicated, and transferred in a distributed manner. The highly systemic nature of knowledge production and the need for any knowledge to be individually acquired and expressed in order to produce an effect, jointly constrain the dynamics of knowledge commercialization. This paper analyzes the nature of these constraints from an individualistic perspective, focusing particularly on the often neglected entrepreneurial aspects of the knowledge transfer. It explains how the constraints are overcome by organizational adaptations inside firms so that a sustained knowledge transfer into the commercial sphere of the innovation system can be secured. |
| Keywords: | Length 18 pages |
| JEL: | D23 D83 J24 M13 M51 O31 O40 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:esi:evopap:2007-19&r=cse |
| By: | Wilfred Dolfsma; Gerben van der Panne |
| Abstract: | In this paper we investigate which elements in both an industry’s structure and in an industry’s dynamics affect innovativeness. We use the most appropriate measure for innovativeness –new product announcements- to find specifically that dominance of large firms consistently affect industry innovativeness negatively. Other industry structure characteristics are surprisingly consistent across different model specifications. Our findings for indicators of industry dynamics are noteworthy for instance as they contrast with the ILC predication that firm entry will boost innovativeness. |
| Keywords: | Innovation, small vs large firms, industry structure, industry dynamics, Industry Life Cycle |
| JEL: | L1 O1 O3 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:use:tkiwps:0730&r=cse |
| By: | Grimpe, Christoph; Hussinger, Katrin |
| Abstract: | Over the last few years, worldwide mergers and acquisitions (M&A) have increased sharply both in terms of value and volume. This development has not only been driven by corporate acquirers but also to an increasing extent by private equity investors. In this paper, we analyze differences in acquisition motives for corporate and private equity investors. We pay particular attention to the importance of technological assets in M&A transactions and distinguish between the technological value of patents and their potential to block competitors in technology markets. Our empirical results for European firm acquisitions in the period from 1999 to 2003 show that both corporate and private equity investors pay a higher price for target firms with valuable patents. However, patents with a potential to block technology competitors seem to be only of interest to corporate investors, especially if these are closely related to the patent portfolio of the acquirer. |
| Keywords: | M&A, technology, patents, corporate and private equity investors |
| JEL: | G34 L20 O34 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:6814&r=cse |
| By: | Jacob Bikker; Janko Gorter |
| Abstract: | This paper investigates competition in the Dutch non-life insurance industry indirectly by measuring scale economies and X-inefficiency, assuming that strong competition would force insurance firms to exploit unused scale economies and to push down inefficiencies. We observe substantial economies of scale (on average 11%) that are larger for smaller firms. Despite considerable consolidation in the industry over the last decade, scale economies have increased, as the optimal scale has outgrown the actual one. Comparing estimates across aggregation levels, we find that scale economies are smaller for groups and lines of business than they are for firms. Besides scale, focus and organizational form are important cost determinants as well: generally, specialized insurers have lower costs and face greater economies of scale. Estimates of thick frontier efficiency point to huge cost differences across firms and within lines of business.Overall, our results suggest that there is a lack of competitive pressure in the Dutch non-life insurance industry. |
| Keywords: | Non-life insurance; economies of scale; market structure; concentration; competition; X-efficiency; total cost function; aggregation: insurance groups; firms and lines of business; |
| JEL: | D4 D61 G22 L1 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:dnb:dnbwpp:164&r=cse |
| By: | Jacob A. Bikker; Laura Spierdijk; Paul Finnie |
| Abstract: | Using a measure of competition based on the Panzar-Rosse model, this paper explains bank competition across 76 countries on the basis of various determinants. Studies explaining banking competition are rare and typically insuffciently robust as they are based on a limited number of countries only. Traditionally, market structure indicators, such as the number of banks and banking concentration, have been considered the major determinants of competition in the banking sector. However, we find that these variables have no significant impact on market power. Instead, we show that a country's institutional framework is a key factor in explaining banking competition. Extensive regulation, particularly antitrust policies, improves the competitive environment. The foreign investment climate, a proxy of contestability, also plays an important role. The fewer restrictions on foreign investments exist, the more competitive the banking sector becomes. In addition, activity restrictions make large banks less competitive and collusion markups are procyclical. Finally, competition is substantially weaker in countries with a socialist past, such as Central- and Eastern Europe. |
| Keywords: | banking competition, market structure, concentration, contestability, interindustry competition |
| JEL: | D4 G21 L11 L13 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:use:tkiwps:0729&r=cse |