Doing More with Less: The Disordinal Implications of Firm Age for Leveraging Capabilities for Innovation Activity*

Innovation requires the entrepreneurial capabilities of opportunity recognition and opportunity exploitation. Such capabilities generally accrue over time from a firm's cumulative learning and experience. In this study, we theorize that firm age should therefore moderate the firm's ability to leverage these capabilities for innovation activity, such that older firms can obtain higher outputs from their capabilities than younger firms can. We examine this relationship using a sample of 676 small and medium enterprises. We find that when both younger and older firms have highly developed innovation capabilities, older firms appear to enjoy higher levels of innovation activity than younger firms do. However, younger firms generally appear more likely to have higher levels of innovation activity than older firms do, when neither firm has highly developed innovation capabilities. We conclude with a discussion of the implications of these findings for research and practice.     

Product variety and the demographic transition

Why does the rate of population growth decline in the face of economic growth? We show that growing product variety may induce a permanent reduction in the demand for children and a continuous rise in income and consumption.     

Strategic R&D investment,competitive toughness and growth

We show, within a single industry, the possibility that R&D‐investment is non‐monotonically related to competitive toughness: increasing when competition is soft and decreasing when competition is tough. This possibility results from the combination of a Schumpeterian markup squeezing effect discouraging innovation, and a concentration effect spurring innovators. It is obtained in a sectoral model where the number of innovators is random and where non‐successful investors may remain productive. The result is extended to a multisectoral stochastic endogenous growth model with overlapping generations of consumers and firms, the number of which is endogenously determined in the capital market.     

Perks and the informativeness of stock prices in the Chinese market

While the literature shows that perks can affect firm values positively or negatively, we argue that firms with higher perks are more likely to be associated with a lower quality of financial reporting, which, in turn, can affect the informativeness of stock prices. Based on hand-collected data on perks from Chinese listed firms, we find that firms with lower perks are associated with higher informativeness of stock prices (or lower R-square). Moreover, the positive association between perks and R-square is shown to be weaker for firms with higher financial reporting quality through audit and earnings quality measures.     

Environmental Policy,Rankings and Stock Values

This paper examines the impact of Newsweek's ‘The Greenest Big Companies in America’ on stock values for large companies. Newsweek ranks the biggest Companies in America from one to 500. An event window of ten days following the rankings release to the public was examined to analyze the impact of relative rankings on stock values. Dummy variables were constructed denoting firms ranked in the highest and lowest quartiles. Control variables included return to the Dow Jones Industrial Average, the firm's beta coefficient and total revenue. The main finding of the study is that inclusion in the top quartile of the rankings has a positive and statistically significant impact on firms' stock values, while the coefficient for the lowest quartile was not statistically different from zero. The results provide evidence of a positive impact on stock values from favorable environmental recognition but no effect for low ranked firms. Copyright © 2011 John Wiley & Sons, Ltd and ERP Environment.     

Cost-benefit analysis of the Dutch nature policy: Transaction costs and land market impacts

This paper analyses the financial and economic costs and benefits of the large scale National Ecological Network (NEN) nature conservation project in the Netherlands, taking into account transaction costs and land market impacts of different institutional arrangements. The net financial costs associated with achieving the current plan are equivalent with an annual amount €876 per hectare. Of the costs, transaction costs amount about 16% or €140 per hectare. The substantive land purchases involved in the plan will lead to land price increase of 20%. Nature management by agriculture turns out to be a relatively cheap option.     

Technological experience and the technology adoption decisions in small manufacturing firms

This paper investigates changes in factors bearing on technology adoption decisions in small manufacturing firms. It is hypothesized that, as a firm's experience with technology increases and its technological capabilities grow, the decision process is gradually modified and puts more weight on those factors which are more closely related to the true potential of the technology. An empirical study shows the more innovative firms to have an outward orientation dominated by clients and suppliers, and to pay more attention to the added flexibility brought about by new technology. It is also shown that functional groups within the company play a more important role in the decision-making process.     

Utilization and productivity of the Duke physician's associate

The objectives of this study were as follows: (1) Formulate a theoretical model of the typical medical practice as a system for producing medical care, with particular attention to the role of middle-level health workers such as graduates of Duke University's Physician's Associate Program. (2) Develop a methodology for collecting data necessary to estimate the relevant parameters in the model, and to describe current patterns of utilization of Duke PA's. (3) Draw substantive conclusions, insofar as the model and data collection methodology permit, about the actual and potential productivity of Duke PA's.As of October 1971 Duke University had graduated 68 PA's from its Physician's Associate Program. Of these, 34 are employed as assistants in family practice or general medicine in a variety of private and institutional settings. Data were collected on eleven of these 34 PA's. No attempt was made to study the other 34 graduates engaged in clinical specialties, administration, or other functions. Neither was any attempt made to collect data on or draw inferences about the utilization and productivity of graduates of any other program such as the MEDEX Program.⁴     

Labor market equilibrium under nonsequential search

This study presents a full model of the labor market under imperfect information. Workers bear the burden of search and are assumed to use a stochastic variant of an optimal sample size search strategy. The existence and uniqueness of a nondegenerate equilibrium distribution of wage offers is established. Infficiencies which lead to underinvestment in search are uncovered and analyzed.