Rivalry,strategic groups and firm profitability

An analysis of the U.S. pharmaceutical industry during the period 1963–82 finds that a substantial decline in industry profitability is not explained by changes in the number and size distribution of firms, in segment interdependence and in strategic distance. In contrast, declining industry profitability is strongly associated with increasing rivalry. This increasing rivalry is associated with changes in strategic group structure and a concomitant shift from within group rivalry to between group rivalry.     

Deposit rate ceilings and monetary transmission in the US

Establishing the existence and nature of changes in the conduct and transmission of monetary policy is key in understanding the remarkable macroeconomic performance of the US since the mid-1980s. This paper presents evidence on a phenomenon of disintermediation occurring during the major recessions in the 1960s and 1970s, but absent ever since, and shows that disintermediation is closely linked to the existence of deposit rate ceilings under regulation Q. In a monetary DSGE model that incorporates deposit rate ceilings as occasionally binding constraints, the regulation alters the behavior of money aggregates and exacerbates the drop in economic activity following a monetary tightening. The results of a threshold VAR lend support to the main theoretical predictions of the model.     

Corporate governance in publicly traded small firms: A study of Canadian venture exchange companies

Most evidence regarding the determinants and effects of corporate governance practices is based on large firms. Herein, we explore these issues in the context of small publicly traded Canadian companies. We exploit the fact that such firms were not subject to corporate governance guidelines prior to 2005 and thus analyze the determinants of voluntary governance practice choices, as well as the effects of those practices on firm performance. Using a unique data set, we construct a corporate governance index for each firm. We measure performance by two variables: quality of accounting earnings and financial performance. The results indicate that corporate governance does matter for smaller traded Canadian firms. We find that both accounting and financial performance are positively related to corporate governance; however, their underlying mechanisms may differ somewhat. Given this result, it would be natural to expect all firms to choose higher levels of governance. However, our results also suggest small firms face resource constraints that limit their choices. We conclude that good governance is an important driver of small firm performance that cannot be neglected by the owners and managers of these firms.     

How a patent conflict affects industrial R&D Management

The authors relate and analyse the case of a long-running patent conflict between two very large multinational firms in the synthetic fibre business - AKZO and Du Pont. The subject of the conflict was a new fibre of the aramid dass. They show that the case reveals deficiencies in international patent law in need of correction.
The analysis is conducted with the aid of social network theory applied to pub-lished information and data supplied by AKZO and other sources. The theory takes as its starting point that when a number of related functional groups unite behind a common and vital interest the pursuit of this interest becomes virtually unstoppable. In this case the crucial social network was formed first within AKZO and then extended outside to include politicians and government. It propelled the firm to pursue to the end attempts to by-pass a patent position held by Du Pont.
The paper reveals that an apparently strong patent position can actually help a rival to circumvent it. This defect in the patent law is leading companies to avoid patenting and to rely instead on secrecy alone. The authors believe that this will act against the public interest, for exam-ple, by preventing thorough public assessment of a new technology before it is implemented. They argue for changes in the patent law to reduce this risk.     

POVERTY AND ASSETS IN BELGIUM

This paper discusses how to take assets into account in the measurement of poverty. First asset holdings of current income-poor households are described. Second, the effects on the measured incidence of poverty of two methods to combine income and assets into a single index of economic resources are presented. Third, since the majority of income-poor households do not have assets of much value except for their home, I reconsider the matter of the treatment of housing costs in the measurement of poverty. A method where poverty thresholds are adjusted according to home tenure status is favored, and results of this method are shown. Data are used from the Belgian Socio-Economic Panel, wave 1992.     

Zum Problem der teleologischen Theorie der Wirtschaft

Ohne Zusammenfassung     

The Transformation of an Old Industrial District: Firms, Family, and Mutuality in the Zaanstreek between 1840 and 1920

The Zaanstreek—northwest of Amsterdam, The Netherlands—hasbeen a highly industrialized region for nearly four hundredyears. For most of this period, it showed a strong sense ofcommunity and a high degree of cooperation between firms, whichis usually considered to be typical for an "industrial district."However, between about 1840 and the First World War the characterof this industrial district was dramatically transformed. Inresponse to the rapidly growing integration of markets in thenational and international economies since the 1840s, the Zaanstreekwent through a radical change in energy base, as well as a fundamentalshift in industrial structure. This essay addresses the questionsof what happened to interfirm cooperation in the Zaanstreekwhen this fundamental transition in energy base and shift inindustrial structure came about and how and to what extent entrepreneursin the Zaan district between 1840 and 1920 managed to preservethe sense of community and interfirm cooperation that were thehallmarks of this region since the seventeenth century. It showsthat the principle of mutuality eventually proved no longerstrong enough to keep the actors in these institutions together.Ties between firms within the industrial district were in severalrespects replaced by, or subordinated to, ties between firmsoutside the industrial district. What kept interfirm cooperationin the district nevertheless intact for much of the period after1920 were ties of regional family networks. The essay concludeswith a few observations about the relevance to the study ofindustrial districts in general.