Explaining Total Factor Productivity at Firm Level in Italy: Does Location Matter?

Abstract

This study analyses how firms' internal variables and regional factors affect total factor productivity (TFP) of Italian manufacturing firms. Due to the hierarchical structure of our data, we employ a multilevel model that allows for a clear distinction between firm and region-specific effects. Results refer to 2004–2006 and show, as expected, the importance of firm-specific determinants of TFP. At the same time, they indicate that location matters in the sense that the context where firms operate plays a crucial role in determining the level of TFP. In more detail, we find that the regional endowment of infrastructure, the efficiency of local administration and the investments in R&D exert a positive effect on firms' performance.     

How Does Open Innovation Modify the Relationship between Environmental Regulations and Productivity?

With increasingly severe environmental regulations, a pressing issue has been the need for firms to develop efficient strategies to achieve environmental protection and high productivity. Several environmental experts argue that firms can respond to environmental regulations through innovation; however, the question of how to innovate is unanswered in the environmental literature. Therefore, this study focuses on the open innovation strategy approach to respond to environmental regulations and maintain high productivity by incorporating the idea of innovation management. We first divide open innovation strategy into two modes of external technology acquisition: foreign and domestic. Next, we examine these modes' mediation effects on environmental regulations and productivity. In addition, we test the moderating effect of internal R&D on the relationship between external technology acquisition and productivity. Using data on 35 Chinese industrial sectors from 2001 to 2010, the empirical findings show that foreign technology significantly and positively mediates the link between environmental regulations and productivity, while domestic technology does not. Internal R&D investment, as an absorptive capacity, positively moderates the effect of foreign technology; however, it negatively moderates the effect of domestic technology on productivity. Copyright © 2017 John Wiley & Sons, Ltd and ERP Environment     

Management for Sustainable Development and Its Impact on Firm Value in the SME Context: Does Size Matter?

With the increasing demands from society towards sustainable and social responsible business practices, management for sustainable development has become a cornerstone to understand the success of many firms in the current competitive context. This article investigates corporate social responsibility (CSR) and examines the links between CSR practices and business outcomes – both financial and non‐financial (i.e. image and corporate reputation) – for small‐to‐medium sized enterprises (SMEs). In addition, we also attempt to determine whether the impact of such relationships is moderated by firm size. To this end, we carry out a quantitative study using PLS techniques to analyze a sample of SME owners and managers, with a view to test the proposed model in the light of social capital theory. In this sense, our study is pioneering in that it aims to determine – from a quantitative viewpoint – the degree to which firm size has a moderating impact on a series of relevant CSR‐driven outcomes. The data suggest that, in SME contexts, CSR impacts corporate reputation, brand image and financial value of the company. Importantly, we find that the larger the firm, the greater the intensity of the relationships linking CSR and business outcomes. Hence, our findings have important implications for CSR implementation in SME contexts. Finally, we provide a series of guidelines aimed at maximizing the effectiveness of CSR‐based business practices. Copyright © 2017 John Wiley & Sons, Ltd and ERP Environment     

How Does Cooperation and Competition Foster or Inhibit Creativity and Innovation?

The current article provides a brief insight into the relationship between cooperation and competition in organizational settings as they relate to the origination and proliferation of new ideas. Does cooperation stifle creativity? Does competition promote innovation? Or is it likely the answer resides in a more complex process somewhere in the middle? With a vested interest in organizational productivity, leadership should pay special attention to what social processes give rise to these phenomena.     

The Link Between Diversity and Equality Management Practice Bundles and Racial Diversity in the Managerial Ranks: Does Firm Size Matter?

Invoking strategic human resource management (SHRM) theory and tenets of the resource‐based view of the firm, we explore how two bundles of diversity and equality management (DEM) practices influence racial diversity in the managerial ranks. By considering the conceptualization of DEM practices and the moderating role of firm size, our study disentangles subtle nuances in the DEM practices–racial diversity in managerial ranks relationship. Based on a sample of 137 Fortune 1,000 firms over a two‐year period, our results suggest that minority opportunity‐based DEM practices and manager accountability DEM practices positively relate to racial diversity in managerial ranks, and these relationships are stronger in smaller companies than large ones. Theoretical and practical implications for a strategic perspective on future diversity management research are elaborated.     

Internal Commitment or External Collaboration? The Impact of Human Resource Management Systems on Firm Innovation and Performance

Complementing previous research that showed a positive effect of general human resource management (HRM) systems on general firm performance, this article undertakes an integrative approach to compare the main effects and examine the interaction effects of two particular HRM systems on influencing firm innovation and performance. Using data from 179 organizations in China, we found that both the commitment‐oriented system, which emphasized internal cohesiveness, and the collaboration‐oriented system, which was intended to build external connections, contributed to firm innovation and, subsequently, bottom‐line performance. We also found an attenuated interaction between the two HRM systems in predicting firm innovation. We employed a mediated‐moderation path model to extricate the relationships. Results suggested that organizations that implemented both HRM systems to promote innovation might face ambidexterity challenges. Ideas for future research and practical implications are discussed.     

Reexamining the Workplace Justice to Outcome Relationship: Does Frame of Reference Matter?

Using a combination of self‐interest and deontological theories as justification, we propose a demarcated view of workplace justice that separates justice for an individual (personal justice) and inferred assessments of justice for organizational members (third party justice). Results of two studies confirmed the appropriateness of separate justice measures and demonstrated differential effects on key criteria based on the relevancy (personal or joint) of the outcome in question. Specifically, Studies 1 and 2 found that personal justice was a better predictor of organizational commitment and turnover intentions while third party justice was more closely related to workplace cohesion (Study 1), citizenship behaviours (Study 2), and deviance behaviours (Study 2). Implications of these findings and future research needs are discussed.     

Oil Prices and Personal Consumption Expenditures: Does the Source of the Shock Matter?

This paper studies the effect of structural oil shocks on personal consumption expenditures (PCE). First, we estimate a nonlinear simultaneous equation model, compute impulse responses by Monte Carlo integration, and conduct a test of the symmetry of the impulse response functions. We find that aggregate PCE responds asymmetrically to positive and negative oil‐specific demand shocks. Second, we find that aggregate PCE responds negatively to positive oil demand shocks, while adverse oil supply shocks are of limited effect. Third, we find important heterogeneity in the magnitude, sign and timing of the disaggregate PCE responses to structural shocks in the crude oil market. Our results clearly indicate that the response of PCE to an unexpected oil price increase depends on the source of the oil price shock. Our findings are robust to different nonlinear transformations for the real price of oil.     

The Wage Effects of Being Raised in the Catholic Religion: Does Religion Matter?

This paper provides new empirical evidence about the existence of a Catholic wage premium. A simple allocation-of-time model provides two explanations for the observation that those persons raised in the Catholic religion earn more than their non-Catholic counterparts. The Catholic religion may add to a person's stock of human capital and/or it may act as a signal of desirable labor market characteristics such as discipline, honesty, trustworthiness, and high motivation.     

Does Familiarity Foster Innovation? The Impact of Alliance Partner Repeatedness on Breakthrough Innovations

Does familiarity with alliance partners promote breakthrough innovations? This study draws on the literature of interorganizational routines to examine the impact of repeated R&D collaborations within a firm's alliance portfolio on its breakthrough innovations. Specifically, we contend that the benefits and liabilities of interorganizational routines, arising from alliance partner repeatedness at a firm's alliance portfolio level, lead to an inverted U‐shaped relationship between alliance partner repeatedness and breakthrough innovations. Further, we build on the recent theoretical development of interorganizational routines to propose that technological dynamism will make the inverted U‐shaped relationship steeper. Analyses of approximately 230 firms in the US biopharmaceutical industry from 1983 to 2002 support our hypotheses. Our findings provide important implications for research on alliance portfolio and management of firm innovation.     

Does the Order and Timing of Active Labour Market Programmes Matter?

This study extends the traditional focus of active labour market policy evaluation from a static comparison of participation in a programme versus non‐participation (or participation in another programme) to the evaluation of the effects of programme sequences, that is, multiple participation or timing of such programmes. Explicitly allowing for dynamic selection into different stages of such programme sequences we analyse multiple programmes, the timing of programmes, and the order of programmes. The analysis is based on comprehensive administrative data on the Austrian labour force. Our findings suggest that (i) active job search programmes are more effective after a qualification programme compared to the reverse order, (ii) multiple participation in qualification measures dominates single participation and (iii) the effectiveness of several labour market programmes deteriorates the later they start during an unemployment spell.     

Insider Trading: Does Being a Neighbor of the Securities and Exchange Commission Matter?

Using a perception‐based crime deterrence approach, we present evidence that corporate insiders located closer to the Securities and Exchange Commission regional offices trade less frequently on their own company's stocks, while they earn higher abnormal returns from such insider transactions. These results are robust to several additional tests. Our further analysis indicates that such differences in trading profitability are mitigated during the periods of a high level of legal jeopardy such as the periods around earnings announcements and mergers and acquisitions. These findings are consistent with the view that Securities and Exchange Commission oversight has an impact on insiders' trading behavior by influencing their perceptions of sanctions risk. Copyright © 2015 John Wiley & Sons, Ltd.     

The R&D Investment–Uncertainty Relationship: Do Strategic Rivalry and Firm Size Matter?

This paper uses a real options perspective to augment a standard research and development (R&D) investment model and implement a firm‐level empirical analysis to assess the practical significance of market uncertainty and its interactions with strategic rivalry and firm size. We use a measure of firm‐relevant market uncertainty along with panel data and find that firms invest less in current R&D as uncertainty about market returns increases. The effect of firm‐specific uncertainty on R&D investment is smaller in markets where strategic rivalry is likely to be more intense. Furthermore, holding access to financing constant, the effect of uncertainty on R&D investment is attenuated for large firms. Copyright © 2012 John Wiley & Sons, Ltd.     

Does Productivity Decline After Promotion? The Case of French Academia*

The present research examined the effect of promotion decisions on ex‐post productivity in French academia. As, once promotion decisions are known, most external incentives vanish for promoted candidates, their productivity was expected to decrease. This hypothesis was tested by using an original dataset and matching methods to evaluate the impact of promotion on publication scores. The robustness of the matching estimates was tested using sensitivity analysis. The results clearly show that the removal of extrinsic incentives following promotion does not lead to a fall in productivity in French academia.     

The World Technology Frontier: What Can We Learn from the US States?*

We re‐estimate the world technology frontier non‐parametrically using a dataset covering OECD country‐level data and US state‐level data on GDP per worker and the stocks of physical capital, unskilled labour and skilled labour. The auxiliary use of US state‐level data significantly reduces the upward bias in cross‐country estimates of technical efficiency, and so does allowing for imperfect substitutability between skilled and unskilled labour. We then use our adjusted estimate of the world technology frontier in a series of decompositions of productivity differences and sources of economic growth in the OECD in 1970–2000, including also ‘appropriate technology vs. efficiency’ decompositions.     

My Comments on the Values of The United States——Equality of Opportunity and Competition

In spite of the gap,these cultural values have played an important role in forming the basic characteristics of Americans and in American social life.     

Why Does the Reduction of Greenhouse Gas Emissions Enhance Firm Value? The Case of Japanese Manufacturing Firms

This paper examines the influence of firms’ reductions of greenhouse gas (GHG) emissions on firm value, measured by Tobin's q. If the stockholders/investors regard the reduction of GHG emissions as a form of intangible value, the reduction of GHG emissions will enhance firm value. To prove this relation more precisely, this paper analyzes not only the effect of the reduction of GHG emissions on firm value but also that of the market discipline imposed by the stockholders/investors in terms of the reduction of GHG emissions. Using data on 641 Japanese manufacturing firms in the period 2006–2008, the random effect instrumental variable estimate supports the view that firms with strong market discipline imposed by stockholders/investors are more likely to reduce GHG emissions and, consequently, firms that reduce more GHG emissions are more likely to enhance firm value. Copyright © 2011 John Wiley & Sons, Ltd and ERP Environment.     

Understanding the Inputs into Innovation: Do Cities Substitute for Internal Firm Resources?

We examine whether there is a trade-off between employing internal (firm) resources and purchased external (local) resources in process innovation. We draw on a rich dataset of Internet investments by 86,879 US establishments to examine decisions to invest in advanced Internet technology. We show that the marginal contribution of internal resources is greater outside of a major urban area than inside one. Agglomeration is less important for firms with highly capable IT workers. When firms invest in innovative processes they act as if resources available in cities are partial substitutes for both establishment-level and firm-level internal resources.