The intellectual structure of the strategic management field: an author co-citation analysis

This paper complements a recent study by Ramos-Rodriguez and Ruiz-Navarro (2004) that investigated the intellectual structure of the strategic management field through co-citation analysis. By using authors as the units of analysis and incorporating all the citations that are included in the Science Citation Index and the Social Science Citation Index, we trace the evolution of the intellectual structure of the strategic management field during the period 1980–2000. Using a variety of data analytic techniques such as multidimensional scaling, factor analysis, and Pathfinder analysis, we (1) delineate the subfields that constitute the intellectual structure of strategic management; (2) determine the relationships between the subfields; (3) identify authors who play a pivotal role in bridging two or more conceptual domains of research; and (4) graphically map the intellectual structure in two-dimensional space in order to visualize spatial distances between intellectual themes. The analysis provides insights about the influence of individual authors as well as changes in their influence over time. Copyright © 2007 John Wiley & Sons, Ltd.     

On the Measurement of Changes in Product Quality in Marginal Intra-Industry Trade

There is a long established thread of the international trade literature concerned with the measurement of intra-industry trade (IIT). Two distinct strands of the literature have developed: First, measures of marginal IIT that are concerned with the adjustment implications of volume-based changes in IIT; second, measures of vertical and horizontal IIT that are concerned with quality-based differences in IIT. This paper marries the two literatures to provide a new perspective on the smooth adjustment hypothesis debate and suggests the use of the marginal product quality index, a new measure of changes in quality in matched trade changes that complements dynamic measures of volume-based IIT. JEL no.  F19     

LIFETIMES OF MACHINERY AND EQUIPMENT: EVIDENCE FROM DUTCH MANUFACTURING

This paper estimates service lifetimes for capital assets in Dutch manufacturing industries, using information on asset retirement patterns. A Weibull distribution function is estimated using a non-linear regression technique to derive service lifetimes for three selected asset types: transport equipment, machinery and computers. For this purpose, benchmark capital stock surveys for different two-digit industries are linked to annual discard surveys. On average the estimated lifetimes are 6, 9 and 26 years for transport equipment, computers and machinery, respectively. However, these estimates vary across industries. A comparison of our estimates with Canadian, U.S. and Japanese estimates shows notable differences in the lifetimes of all the asset types, with machinery showing the largest difference.     

On the measurement of product quality in intra-industry trade: An empirical test for China

A relatively recent development in the intra-industry trade (IIT) literature is the measurement of the simultaneous import and export of quality-differentiated products, commonly known as vertical and horizontal IIT. A recent paper from Azhar and Elliott [Azhar, A. K. M. & Elliott, R. J. R. (2006), On the Measurement of Product Quality in Intra-Industry Trade, Review of World Economics, Vol 142 no 3, pp 476–495] analyses various approaches for disentangling vertical and horizontal IIT and suggests a complementary methodology. To investigate the robustness and sensitivity of the existing approaches we examine data on the nature of trade flows between China and its East Asian neighbours and show that in 2002 China tended to export low quality versions of its manufactured goods to Malaysia, Thailand and the Philippines.     

Strategic investments in Japanese corporations: do foreign portfolio owners foster underinvestment or appropriate investment?

This paper investigates the effect of foreign ownership on strategic investments in Japanese corporations. Foreign owners are typically portfolio investors who frequently buy and sell shares and hold diversified portfolios of small stakes in many firms. Prior research has presented two conflicting perspectives on the role of such investors: (a) their frequent trading leads to pressure for short‐term returns that fosters underinvestment; (b) their active trading fosters appropriate investments. We investigated the relationship between foreign ownership and strategic investments using dynamic panel data analysis of a sample of 146 Japanese manufacturing firms from 1991 to 1997. We found that foreign ownership enhances strategic investments (in R&D and capital intensity) to a greater extent when firms have growth opportunities than when they lack such opportunities. We conclude that foreign ownership fosters appropriate investment. Copyright © 2006 John Wiley & Sons, Ltd.     

What price loyalty? A fresh look at loyalty programs in the credit card industry

There is controversy about the effects of loyalty programs in the customer relationship management literature. Although some managers and researchers believe that customer loyalty created through loyalty programs leads to higher firm profits, others have found evidence that loyalty programs do not have a positive effect on firm's profits. In this article, we present our findings regarding the effect of reward cards and affinity cards on customer profitability in the context of credit card industry. We find surprising evidence that customers who own either a reward card or an affinity card generate significantly less profit than those customers who do not have these cards. Equally puzzling is the fact that these customers also have lower average lifetime with the firm. This leads us to a puzzle as to why these practices are widely prevalent in the industry. We find that loyalty cards provide value to the issuers in terms of risk management. They serve as a mechanism to reduce the risk associated with more profitable customers by attracting less risky customers. Thus, through loyalty cards the financial institution is able to balance out the total risk of the portfolio of customers by acquiring customers, who although less profitable, are less risky.     

Impact of institutions on social network formation: communist party membership and social network investment in China

Using the 2003 wave of China General Social Survey (2003CGSS), we study the influence of the communist party on individual’s social networks in urban China and, thereby, present a case of socio-political institutions being an important ingredient in social network formation. We adopt a counterfactual framework and estimate the effect of communist party membership on social network investment as an average treatment effect. We find the treatment to be significant.     

Governance and growth of professional service firms

We argue that partnerships are the optimal governance structure for professional service firms (PSFs) based on our analysis of their need for collegial controls, the use of tacit knowledge, and an investigation of agency costs. However, these factors and the resulting choice of partnership as a governance structure constrain the ability of PSFs to successfully pursue growth strategies. In addition, their growth potential is further circumscribed by diversification limitations, as well as reputational and resource constraints.