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on Economics of Strategic Management |
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Issue of 2010‒02‒13
fourteen papers chosen by Joao Jose de Matos Ferreira University of the Beira Interior |
| By: | Bartling, Björn (University of Zurich); Fehr, Ernst (University of Zurich); Schmidt, Klaus M. (University of Munich) |
| Abstract: | In recent decades, many firms offered more discretion to their employees, often increasing the productivity of effort but also leaving more opportunities for shirking. These "high-performance work systems" are difficult to understand in terms of standard moral hazard models. We show experimentally that complementarities between high effort discretion, rent-sharing, screening opportunities, and competition are important driving forces behind these new forms of work organization. We document in particular the endogenous emergence of two fundamentally distinct types of employment strategies. Employers either implement a control strategy, which consists of low effort discretion and little or no rent-sharing, or they implement a trust strategy, which stipulates high effort discretion and substantial rent-sharing. If employers cannot screen employees, the control strategy prevails, while the possibility of screening renders the trust strategy profitable. The introduction of competition substantially fosters the trust strategy, reduces market segmentation, and leads to large welfare gains for both employers and employees. |
| Keywords: | job design, high-performance work systems, screening, reputation, competition, trust, control, social preferences, complementarities |
| JEL: | C91 D86 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4710&r=cse |
| By: | Serena Novero (Ceris - Institute for Economic Research on Firms and Growth, Moncalieri (Turin), Italy) |
| Abstract: | The aim of this work is to investigate the probability of success or failure of public interventions, made to support the development of some Italian firms. The great number of small and medium-size enterprises, placed in the Canavese area, north of Turin, Italy, has suffered, in the nineties, of a gap in technological innovation in their production. The Consortium for the Canavese Technological District (CCTD), a public local association established in 1993 specifically to support the firms of the area, has supplied them with some technological, innovative services, sustaining their growth. More exactly, some research centres, named Centres of Competence, were created, with the pre-existing structures of the Polytechnic of Turin and of the firm RTM (placed in Vico Canavese, Province of Turin): their targets were to supply innovative services to the local firms and to place technical machineries at the disposal of the local units, to support their innovation and competitiveness. The present research analyzes a central point: which has been the impact of these services? Which is the probability that a public o private intervention to innovate has success and brings economic growth to the involved firms? This objective is achieved with a Probit Model, built on a panel of 103 firms, that covers a 6-year range (from 1999 to 2004) and contains their balance-sheets data and the technical information regarding their collaborations with the Centres; the results highlight the role of a solid patrimonial stability, of the choice of the right innovations to apply to the production processes as well as the importance of a high previous technological status of the involved enterprises. |
| Keywords: | Innovation probability, Public interventions, Firms growth, Qualitative choice models |
| JEL: | C35 D92 H71 O31 |
| Date: | 2008–12 |
| URL: | http://d.repec.org/n?u=RePEc:csc:cerisp:200811&r=cse |
| By: | Jeroen de Jong; Mark Freel |
| Abstract: | This paper explores the geographical distance of innovation collaborations in high tech small firms. We test if absorptive capacity is a key determinant. Drawing on survey data from a sample of 316 Dutch high-tech small firms, engaging in 1.245 collaborations, we find most partners to be ‘local’. However, controlling for a variety of potential influences, higher R&D expenditure is positively related to collaboration with more distant organisations. |
| Date: | 2010–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:eim:papers:h201008&r=cse |
| By: | Bala Subrahmanya, M. H.; Mathirajan, M.; Krishnaswamy, K. N. |
| Abstract: | This paper probes the drivers, dimensions, achievements, and outcomes of technological innovations carried out by SMEs in the auto components, electronics, and machine tool sectors of Bangalore in India. Further, it ascertains the growth rates of innovative SMEs vis-à-vis non-innovative SMEs in terms of sales turnover, employment, and investment. Thereafter, it probes the relationship between innovation and growth of SMEs by (i) estimating a correlation between innovation sales and sales growth, (ii) calculating innovation sales for high, medium, and low growth innovative SMEs and doing a aggregate one-way ANOVA, and (iii) ascertaining the influence of innovation sales, along with investment growth and employment growth on gross value-added growth by means of multiple regression analysis. The paper brings out substantial evidence to argue that innovations of SMEs contributed to their growth. |
| Keywords: | Technological innovations, sales growth, auto components, electronics, machine tools, Bangalore |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2010-03&r=cse |
| By: | Athreye, Suma |
| Abstract: | It is commonly believed that the business environment in developing countries does not allow productive technology-based entrepreneurship to flourish. In this paper, we draw on the experience of Indian software firms where entrepreneurial growth has belied these predictions. This paper argues that the business models chosen by Indian firms were those that best aligned the country’s abundant labour resources and advantages to global demand. Many potentially higher value added opportunities struggled to attain success, but the qualitative value of experimental failures and the capability gaps they exposed was invaluable for collective managerial learning in the industry. Second, the paper also shows that the presence of growth opportunities and the success of firms stimulated institutional evolution to promote entrepreneurial growth. Last we show that the distinctive aggregate contribution of entrepreneurial firms was that they outperformed business houses and multinational subsidiaries in their more productive use of available capital resources whilst achieving similar levels of growth in output and employment. This paper draws upon an earlier shorter paper co-authored with Mike Hobday and titled 'Overcoming Development Adversity: How Entrepreneurs Led Software Development in India'. |
| Keywords: | Technology entrepreneurship, institutions and economic development, Indian software, intellectual property rights |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2010-04&r=cse |
| By: | Ernest Miguelez (Faculty of Economics, University of Barcelona); Rosina Moreno (Faculty of Economics, University of Barcelona) |
| Abstract: | TWe investigate the importance of the labour mobility of inventors, as well as the scale, extent and density of their collaborative research networks, for regional innovation outcomes. To do so, we apply a knowledge production function framework at the regional level and include inventors’ networks and their labour mobility as regressors. Our empirical approach takes full account of spatial interactions by estimating a spatial lag model together, where necessary, with a spatial error model. In addition, standard errors are calculated using spatial heteroskedasticity and autocorrelation consistent estimators to ensure their robustness in the presence of spatial error autocorrelation and heteroskedasticity of unknown form. Our results point to the existence of a robust positive correlation between intra-regional labour mobility and regional innovation, whilst the relationship with networks is less clear. However, networking across regions positively correlates with a region’s innovation intensity. |
| Keywords: | Speed Limits; inventors’ mobility, networks of co-inventors, knowledge production function, spatial econometrics, European regions |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:ira:wpaper:201001&r=cse |
| By: | Coccia Mario (Ceris - Institute for Economic Research on Firms and Growth, Moncalieri (Turin), Italy) |
| Abstract: | The purpose of this paper is to forecast and analyse, by a demographic perspective, the organizational behaviour of public research labs. The research focuses on the biggest Italian public research body. Demographic models of growth, based on different human resource policies, show the uncertain and retrogressive evolutionary change of Italian public research bodies that would halve their research personnel over the forecast horizon. These results provide vital information to the public management about the weaknesses and environmental threats in order to support decisions for improving the strategic change and survival of public research institutions over time. |
| Keywords: | Organizational Studies, Forecasting, Public Research Institutions, Internal Demography |
| JEL: | I20 J11 J26 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:csc:cerisp:200909&r=cse |
| By: | Bjuggren, Carl Magnus (Ratio); Daunfeldt, Sven-Olov (Ratio); Johansson, Dan (Ratio) |
| Abstract: | Empirical studies demonstrate that most net job-growth originates from a small number of high-growth firms (HGFs). The purpose of this paper is to analyze whether firm ownership – private non-family, or family – matters for being classified as a HGF, using data covering all firms in Sweden during 1993-2006. We find that ownership and changes of ownership are correlated with being a HGF, and that the method of measuring growth affects the results. In line with previous research, the age and size of firms, as well as belonging to an enterprise group, are also correlated with being a HGF. |
| Keywords: | high-growth firms; gazelles; firm growth; firm ownership; family firms; rapid firm growth |
| JEL: | D24 L25 L26 |
| Date: | 2010–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0147&r=cse |
| By: | Kathuria, Vinish; Seethamma Natarajan, Rajesh Raj; Sen, Kunal |
| Abstract: | Empirical studies on total factor productivity growth (TFPG) in developing countries highlight trade open-ness, research and development and market structure as being the most important determinants of TFPG. The role of institutions remains overlooked in the literature on the determinants of TFPG. In this paper, we look into the role of institutional quality as captured by effective state-business relationships (SBRs) in influencing TFPG, using Indian manufacturing as a case-study. By SBRs we mean a set of highly institutionalised, responsive and public interactions between the state and the business sector. To compute TFPG, we use firm level data for both the formal and informal manufacturing sector. We correct for the simultaneity bias associated with the production function approach for TFPG estimation by employing a method developed by Levinsohn and Petrin. We propose measures of effective SBRs for 15 Indian States over the period 1994-2005, and then use them in TFP growth equations to estimate the effect of SBR on TFPG. The results indicate that SBR has positively affected the TFP growth of Indian industry. The effect however is primarily for the formal sector. |
| Keywords: | State-business relations; Indian Manufacturing; Total Factor Productivity Growth |
| JEL: | D24 O14 |
| Date: | 2010–01–21 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20314&r=cse |
| By: | Coulibaly, Mantiaba; Sauvée, Loïc |
| Keywords: | Alliance; Brand; Governance; Network; Value; |
| JEL: | G34 |
| URL: | http://d.repec.org/n?u=RePEc:ner:dauphi:urn:hdl:123456789/2198&r=cse |
| By: | Frank Bickenbach; Wan-Hsin LIU |
| Abstract: | This paper investigates the role of personal relationships for doing business in the Greater Pearl River Delta, China. First, it discusses the interplay of formal and informal (relationship-based) institutions from the point of view of institutional economics, with a focus on economies with weak formal contracting and property rights institutions. Second, it describes the institutional environment for doing business in China, and in the PRD in particular. Third, it uses data obtained from a survey among executives of Hong Kong electronics SMEs with business operations in the PRD to gain insights into their perceptions on the importance and the motives of using personal relationships for business in PRD in general, and on the impact of personal relationships on different strategic business decisions (on location, partner, and formal governance structures) for companies’ production as well as innovation activities. The results confirm the importance of personal relationships for doing business in the PRD, in general. There is evidence of substantial differences as to the role of personal relationships between production and innovation activities |
| Keywords: | personal relationships, formal and informal institutions, production, innovation, China, company survey |
| JEL: | L20 L63 P0 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1589&r=cse |
| By: | Sutter, Matthias (Department of Economics, School of Business, Economics and Law, Göteborg University); Czermak, Simon (Department of Public Finance, University of Innsbruck); Feri, Francesco (Department of Public Finance, University of Innsbruck) |
| Abstract: | We present an experiment on strategic thinking and behavior of individuals and teams in oneshot normal-form games. Besides making choices, decision makers have to state their firstand second-order beliefs. We find that teams play the Nash strategy significantly more often, and their choices are more often consistent by being a best reply to first order beliefs. We identify the complexity of a game and the payoffs in equilibrium as determining the likelihood of consistent behavior according to textbook rationality. Using a mixture model, the estimated probability to play strategically is 62% for teams, but only 40% for individuals.<p> |
| Keywords: | Strategic sophistication; beliefs; experiment; team decision making; individual decision making |
| JEL: | C72 C91 C92 |
| Date: | 2010–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0430&r=cse |
| By: | Reiner, Christian (University of Salzburg) |
| Abstract: | This article focuses on the role of Technology Transfer Offices (TTOs) in regional development in three Austrian regions that represent different types of regional economies. TTOs can be defined as “bridging institutions” between academia and business. The value added by this approach emerges due to empirical results demonstrating that the variety of TTO functions and their respective spatial-profile of activities depend heavily on the regional context. Regional economic structure and regional policy systematically shape the spatial profile of TTO activities. The distinction between active and passive TTOs emerged as an important one regarding their potential regional economic development impact. While passive TTOs merely facilitate already existing contacts of the academic staff, active TTOs generate new university-industry linkages. These additionally created contacts are heavily biased towards the regional level. Intellectual property rights (IPR)-related TTO activities show a rather weak regional impact. This might prove problematic for policy makers that foster the patent-oriented commercialization of knowledge as a means to intensify knowledge spillovers from the universities to regional or national firms. |
| Keywords: | Universities; Technology transfer offices; regional innovation systems; regional policy; Austria |
| JEL: | I23 I28 O33 O34 R11 R58 |
| Date: | 2010–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:ris:sbgwpe:2010_005&r=cse |
| By: | Tetsuya Shimomura; Tadashi Matsumoto |
| Abstract: | Globalisation and subsequent competition among cities have triggered a profound change in the mode of the governance of cities. It is often described as a shift from a managerial mode of governance, which had been primarily concerned with provision of social welfare services and control of private activities, to that of entrepreneurialism, strongly characterised by a pro-economic growth strategic approach. Subsequently, attractiveness has been increasingly regarded as a key factor for urban policies, since attractive cities are competitive and able to attract newly-emerging businesses and highly-skilled workforces that are the driving force in the global economy. Today, enhancing urban attractiveness is high on the agenda of urban policy in many OECD countries. A city?s attractiveness is determined by a wide range of elements. The OECD report “Competitive Cities: A New Entrepreneurial Paradigm in Spatial Development” (OECD, 2007) analysed various elements contributing to urban attractiveness (e.g. flagship redevelopment, cultural facilities, international events, etc.). Among various findings, it emphasises that it is important for a city to enhance its distinctiveness by identifying and building up urban assets that are unique to the city. In particular, many cities have recognised that attractive physical environment of cities can enhance their uniqueness and distinctiveness. |
| JEL: | H41 H76 R11 R33 R53 R58 |
| Date: | 2010–01–29 |
| URL: | http://d.repec.org/n?u=RePEc:oec:govaab:2010/1-en&r=cse |