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on Economics of Strategic Management |
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Issue of 2017‒07‒30
nine papers chosen by João José de Matos Ferreira Universidade da Beira Interior |
| By: | Sara, Amoroso (Joint Research Centre, European Commission); Albert, Link (University of North Carolina at Greensboro, Department of Economics) |
| Abstract: | An increasing number of theoretical and empirical analyses address the role of innovation as one of the main sources of firm growth. More recently, studies have looked at the role of gen-der diversity as a possible determinant of innovation and entrepreneurial performance. How-ever, the relationship between gender and employment growth —a dimension of entrepreneurial performance— still remains unexplored to a large degree. This paper contributes to the empiri-cal literature on gender and entrepreneurial performance in several ways. First, it examines the role played by both innovation and gender ownership as determinants of employment growth rates of young, knowledge intensive entrepreneurial (KIE) firms. Second, it investigates the indirect impact of contributing factors —such as the characteristics of the market, knowledge-based capital, and human capital— on employment growth. And third, it relies on a rich new cross-sectional data set on young, KIE firms across European Union (EU) countries. The data set contains information not only on the gender of the firm’s founders, but also on the market environment, business strategy, and innovative and economic performance of firms. |
| Keywords: | innovation; entrepreneurship; employment growth; gender |
| JEL: | J16 L26 O31 |
| Date: | 2017–07–24 |
| URL: | http://d.repec.org/n?u=RePEc:ris:uncgec:2017_009&r=cse |
| By: | Bing Guo; David Pérez-Castrillo; Anna Toldrà-Simats |
| Abstract: | We study the effect of analyst coverage on firms’ innovation strategy and outcome. By considering three different channels that allow firms to innovate: internal R&D, acquisitions of other innovative firms, and investments in corporate venture capital (CVC), we are able to distinguish between the pressure and information effect of analysts. Using the data of US firms from 1990 to 2012, we find evidence that: i) an increase in financial analysts leads firms to cut R&D expenses, and ii) more analyst coverage leads firms to acquire more innovative firms and invest in CVC. We attribute the first result to the effect of analyst pressure, and the second to the informational role of analysts. In line with the previous literature, we also find that analyst coverage has a negative effect on firms’ future patents and citations; however, this negative effect becomes not significant when firms’ in-house R&D spending and external innovation channels are taken into account. We find that more financial analysts encourage firms to make more efficient investments related to innovation, which increase their future patents and citations. We address endogeneity with an instrumental variables approach and a difference-in-differences strategy where exogenous variation in analyst coverage comes from brokerage house mergers. |
| Keywords: | financial analysts, innovation, corporate venture capital, acquisition |
| JEL: | G34 G24 O31 |
| Date: | 2017–07 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:980&r=cse |
| By: | Kirill Borissov; Stefano Bosi; Thai Ha-Huy; Leonor Modesto |
| Abstract: | We extend the Lucas' 1988 model introducing two classes of agents with heterogeneous skills, discount factors and initial human capital endowments. We consider two regimes according to the planner's political constraints. In the meritocratic regime, the planner faces individual constraints. In the redistributive regime, the planner faces an aggregate constraint. We find that heterogeneity matters, particularly with redistribution. In the meritocratic regime, the optimal solution coincides with the BGP found by Lucas (1988) for the representative agent's case. In contrast, in the redistribution case, the solution for time devoted to capital accumulation is never interior for both agents. Either the less talented agents do not accumulate human capital or the more skilled agents do not work. Moreover, social welfare under the redistribution regime is always higher than under meritocracy and it is optimal to exploit existing differences. Finally, we find that inequality in human capital distribution increases in time and that, in the long run, inequality always promotes growth. |
| Keywords: | Human capital, Heterogenous patience and skills, Inequality and growth |
| JEL: | J24 O15 O40 |
| Date: | 2017–06–23 |
| URL: | http://d.repec.org/n?u=RePEc:eus:wpaper:ec2017_03&r=cse |
| By: | Buzard, Kristy (Maxwell School, Syracuse University, Syracuse, NY); Carlino, Gerald A. (Federal Reserve Bank of Philadelphia); Hunt, Robert M. (Federal Reserve Bank of Philadelphia); Carr, Jake (Geography Department, The Ohio State University, Columbus OH); Smith, Tony E. (Department of Electrical and Systems Engineering, University of Pennsylvania, Philadelphia, PA) |
| Abstract: | We employ a unique data set to examine the spatial clustering of about 1,700 private research and development (R&D) labs in California and across the Northeast corridor of the United States. Using these data, which contain the R&D labs’ complete addresses, we are able to more precisely locate innovative activity than with patent data, which only contain zip codes for inventors’ residential addresses. We avoid the problems of scale and borders associated with using fixed spatial boundaries, such as zip codes, by developing a new point pattern procedure. Our multiscale core-cluster approach identifies the location and size of significant R&D clusters at various scales, such as a half mile, one mile, five miles, and more. Our analysis identifies four major clusters in the Northeast corridor (one each in Boston, New York–Northern New Jersey, Philadelphia–Wilmington, and Washington, D.C.) and three major clusters in California (one each in the Bay Area, Los Angeles, and San Diego). |
| Keywords: | spatial clustering; geographic concentration; R&D labs; innovation |
| JEL: | O31 R12 |
| Date: | 2017–07–18 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedpwp:17-18&r=cse |
| By: | Heidi Leonhardt; Maria Jutschen; Clive L. Spash |
| Abstract: | While research on alternatives to growth at the level of the economy as a whole is accumulating, few studies have related the criticism of growth to the business level. This paper starts to address this gap by investigating mechanisms of growth for small and medium sized enterprises (SMEs), presenting a case study that applies Q methodology and interviews with owner-managers of both growing and non-growing SMEs in Austria. Some mechanisms stimulating growth are identified across SMEs including contributing to innovativeness and motivation of employees. Others are only of relevance for some SMEs: competition, financial stability and a desire for market power. The owner-managers of non-growing SMEs hold values and pursue goals that free them from mechanisms of growth or prevent them from being triggered. Moreover, they exhibit a strong identification with their SME, operate in niche markets and strive for financial independence. This illustrates that a growth imperative is neither inevitable nor are growth mechanisms always operative, but depend upon structures and institutions. |
| Keywords: | SME growth, growth mechanisms, post-growth society, social ecological transformation |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwsre:sre-disc-2017_06&r=cse |
| By: | Leonhardt, Heidi; Jutschen, Maria; Spash, Clive L. |
| Abstract: | While research on alternatives to growth at the level of the economy as a whole is accumulating, few studies have related the criticism of growth to the business level. This paper starts to address this gap by investigating mechanisms of growth for small and medium sized enterprises (SMEs), presenting a case study that applies Q methodology and interviews with owner-managers of both growing and non-growing SMEs in Austria. Some mechanisms stimulating growth are identified across SMEs including contributing to innovativeness and motivation of employees. Others are only of relevance for some SMEs: competition, financial stability and a desire for market power. The owner-managers of non-growing SMEs hold values and pursue goals that free them from mechanisms of growth or prevent them from being triggered. Moreover, they exhibit a strong identification with their SME, operate in niche markets and strive for financial independence. This illustrates that a growth imperative is neither inevitable nor are growth mechanisms always operative, but depend upon structures and institutions. |
| Keywords: | SME growth, growth mechanisms, post-growth society, social ecological transformation |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wus009:5655&r=cse |
| By: | Takalo, Tuomas; Tanayama, Tanja; Toivanen, Otto |
| Abstract: | We build a structural model of the R&D subsidy process incorporating externalities, fixed costs of R&D, and financial market imperfections. We estimate the model using project level R&D and subsidy data from Finland. We conduct a counterfactual analysis of an optimal R&D tax credit policy, the first and second best policies, and laissez-faire with no support and compare them to the subsidy policy used in Finland. We find that the optimal R&D tax credit rate is 0.24, which is lower than the observed average R&D subsidy rate (0.36). R&D participation does not vary across regimes. The R&D investments and spillovers generated by the optimal R&D tax credit and subsidy policies are significantly higher than under laissez-faire but smaller than in the first and second best. Neither tax credits nor subsidies improve welfare compared to laissez-faire. |
| Keywords: | counterfactual; R&D subsidies; welfare |
| Date: | 2017–07 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:12155&r=cse |
| By: | Pamela Bombarda; Stefania Marcassa (Université de Cergy-Pontoise, THEMA) |
| Abstract: | We propose a model where firms have access to competing market strategies: export and multinational production. Due to technological appropriability issues, foreign affiliates import an intermediate input from the home headquarters. The presence of export and multinational production alters the standard results obtained for welfare in heterogeneous firm models, through a double truncation of the productivity distribution. The model is then calibrated to analyze counterfactual scenarios. We find that welfare gains from intra-firm trade range from 6 to 12 percent depending on country characteristics. |
| Keywords: | MNFs, multinational production, intra-firm trade, welfare. |
| JEL: | F12 F23 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ema:worpap:2017-15&r=cse |
| By: | Sukanya Kemp (University of Akron); Irina Chernikova (University of Akron) |
| Abstract: | How is success measured in the field of STEM education in US universities? Such a question can be difficult to answer because of the lack of uniformity among the relevant variables. Given the wide diversity in success indicators, and the fact that universities choose to pursue different aspects of educational outcomes, it is often difficult to compare performances and definitively point to one school as 'better' than another. In an attempt to measure university efficiency in the areas of engineering, natural, physical and health sciences, the authors use the non-stochastic frontier model of Data Envelopment Analysis (DEA), which is commonly used in Operations Research literature, to evaluate the efficiency of producers. In this initial research, the authors isolated the large public universities of Ohio as the subject of the analysis. They found that with the input-output structure defined by the data, certain universities clearly stood out as efficient compared to others in the dissemination of STEM education. A logistic regression isolated the inputs and outputs that had the strongest effects on the efficiency scores. |
| Keywords: | STEM education, University Performance, Data Envelopment Analysis, Efficiency |
| JEL: | A00 C67 |
| Date: | 2017–07 |
| URL: | http://d.repec.org/n?u=RePEc:sek:iacpro:4607921&r=cse |