Is there a profit premium for market-oriented firms? A panel data investigation

ABSTRACT

This paper provides an empirical investigation of the impact of market orientation on firms' economic performance during the period 1998–2012 using a panel of Italian manufacturing firms. We introduce a dynamic concept of market orientation, in that we define a market-oriented firm as one that persistently undertakes product and marketing innovation, while at the same time introducing organizational changes and training efforts to manage and improve its knowledge assets over the long term. This notion of market orientation is therefore crucially related to the so-called dynamic capability approach. The related empirical model shows that being a market-oriented firm significantly affects profitability, in a framework in which this latter is simultaneously estimated with productivity, thus allowing for more precise estimates of the profit premium which is earned accordingly.     

The Cinderella moment: Exploring consumers' motivations to engage with renting as collaborative luxury consumption mode

Past literature argued that the purchase of luxury goods is driven by people's motivation to conform or fit into our economic and social system. In this study, the authors focus on a new aspect of consumption, that is, renting instead of purchasing luxury goods, backed by the emerging opportunities of sharing economy platforms. Drawing upon the analysis of spontaneous consumers' online communications (in the form of tweets), this study aims to investigate the motivations to engage with luxury garment renting within a collaborative consumption context. To this end, a series of automatic content analyses, via two studies, were conducted using the tweets posted with respect to the Run the Runway collaborative consumption platform. Results demonstrate consumers' increased willingness to show their social status through renting rather than owning luxurious apparel based on five main motivators (need to wear new clothes for a special event, inspirations created by the products/brands, possibility to explore a new way of consuming luxury goods, need to make more sustainable choices, and to increase the life cycle of each luxury product). The implications of these findings are discussed, while they pave the way for future research in collaborative consumption of luxury retailing.     

Who Convinces Whom? Parent and Child Perceptions of Children's Engagement in Parental Purchase Decisions

Do children overestimate their engagement in parental purchase decisions? A systematic analysis of the articles enabled us to create a database of 149 cases where child and parent perceptions of children's engagement in parental purchase decisions were measured. The findings proved that there is congruence between children's and parents' perception of a child's engagement in most cases. Children's overestimation of their engagement in a parental decision to purchase products is likely the exception rather than the rule. The cases characterized as overestimations are related to product category and type of measured domain. (Children tend to overestimate their engagement more when the measures track participation or influence rather than decision independence.)     

Environmental Innovations and Internationalization: Theory and Practices

Based on original data on Italian firms specializing in medium‐ and low‐tech industries, we study the relationship between firms’ upstream and downstream internationalization and their propensity to introduce products or processes that reduce environmental impact. Preliminary evidence suggests that geography plays an important role in green firms’ activities and supply chains. More precisely, results suggest that firms that outsource to and rely on non‐local suppliers are less likely to engage in environmental innovations. Moreover, we verify that firms engaged in export activities play a similar and negative role, regardless of the export intensity and typology of foreign markets (i.e. developed versus emerging). Tapping global flows of knowledge by being a part of a multinational group positively spurs the development of green innovations, as for FDIs. Copyright © 2014 John Wiley & Sons, Ltd and ERP Environment     

New development: Can ‘public’ market-based solutions restore the banking system? The case of non-performing loans (NPLs)

The authors discuss how policy-makers could use new market-based solutions to dismantle NPLs. They examine viable solutions for NPLs and then study the Italian State Guarantee Scheme for NPL Securitization (GACS) to highlight how public actors could efficiently use public resources to solve the NPL problem.     

Migration,Friendship Ties,and Cultural Assimilation

We study immigrant assimilation by analyzing whether friendship with natives is a measure of cultural assimilation, and by investigating the formation of social ties. Using the German Socio‐Economic Panel, we find that immigrants with a German friend are more similar to natives than those without German friends, along several important dimensions, including concerns about the economy, an interest in politics, and a host of policy issues. Turning to friendship acquisition, we find that becoming employed, time spent in the host country, the birth of a child, residential mobility, and additional education acquired in the host country are significant drivers of social network variation.     

Good practices on cost – effective road infrastructure safety investments

The paper presents the findings of a research project aiming to quantify and subsequently classify several infrastructure-related road safety measures, based on the international experience attained through extensive and selected literature review and additionally on a full consultation process including questionnaire surveys addressed to experts and relevant workshops. Initially, a review of selected research reports was carried out and an exhaustive list of road safety infrastructure investments covering all types of infrastructure was compiled. Individual investments were classified according to the infrastructure investment area and the type of investment and were thereafter analysed on the basis of key safety components. These investments were subsequently ranked in relation to their safety effects and implementation costs and on the basis of this ranking, a set of five most promising investments was selected for an in-depth analysis. The results suggest that the overall cost effectiveness of a road safety infrastructure investment is not always in direct correlation with the safety effect and is recommended that cost–benefit ratios and safety effects are always examined in conjunction with each other in order to identify the optimum solution for a specific road safety problem in specific conditions and with specific objectives.     

The past and the possible futures of Futures Studies: Some thoughts on Ziauddin Sardar's ‘the namesake’

The need to explain the concepts and terms used in Futures Studies, as in other sciences, has existed for a long time. But the necessity to do so has increased since the Second World War and is clearly important in recent debates among different groups involved in the field. This article traces the historical timeline of some of these terms in relation to the social and cultural contexts in which they were coined and first used. It argues that concepts and terms used in Futures Studies are mainly of Western origin and suggests that research should be conducted in different social and cultural contexts for concepts and terms embedded, and possibly used, in cultures different from that of the West. The article also suggests that some sort of ‘liberation movement’ should be started in this direction.     

The persistence of innovation: a panel data investigation on manufacturing firms

This paper represents a contribution to empirical debate on the persistence of innovation in the firm, by exploiting an innovative panel database that, for the first time, links three waves of the Italian Community Innovation Survey with an administrative data source providing economic and financial information for firms in the Italian manufacturing sector, 1996–2003. By using both a dynamic logistic model and a Granger causality approach, we show that in order to innovate successfully it is much more important to have an adequate flow of profits during an appropriate time span rather than high profits only during one period before innovation. Our causality tests prove the existence of a dynamic interaction between innovation and profitability: successful innovation can, in the short run, generate the profitability conditions that can then enhance the financial resources needed to reinvest in new technological opportunities, thus causing the firm to persist in its innovative behaviour. We have also shown that another important source of persistence is represented by past innovative experience. A firm with consolidated innovative behaviour would have a higher probability of future successful innovation with respect to a firm that occasionally (or accidentally) innovates. Persistence in innovation enables a firm to take advantage of substantial technological and organizational learning effects, which improve with time.