R&D investment dynamics in agglomerations under weak appropriability regimes: Evidence from Indian R&D labs

What are the dynamics of R&D investment when firms agglomerate in environments with weak intellectual property rights protection? Specifically, do foreign and domestic firms present equal opportunities for free riding by domestic firms in such environments? We examine the impact on local firms' R&D investment from knowledge spillovers originating from co‐located foreign and domestic firms within and across industries. Building on fieldwork in India, we predict free riding by local firms on nearby foreign and local firms. Furthermore, we expect local firms to free ride more from other local firms within their industry and from foreign firms across industries. Analyzing a sample of 3,475 R&D lab investment decisions during 2003–2010 in India, we find that local firms free ride from other local firms both within and across industries. Copyright © 2014 John Wiley & Sons, Ltd.     

Reputations for toughness in patent enforcement: implications for knowledge spillovers via inventor mobility

‘Job hopping’ by engineers and scientists is widely heralded as an important channel for knowledge spillovers within industries. Far less is known, however, about the actions firms take to reduce the outward flow of knowledge through markets for skilled labor. This study investigates the efficacy of a lever that has received little research attention: corporate reputations for toughness in patent enforcement. Drawing on unique data on enforcement activity, intra‐industry inventor mobility, and patent citations in the U.S. semiconductor industry, we find that a firm's litigiousness significantly reduces spillovers otherwise anticipated from departures of employee inventors, particularly when the hiring organizations are entrepreneurial ventures. Surprisingly, the deterrent effects of patent enforcement are similar in magnitude for firms located in California, a state characterized by open norms for knowledge trading, and firms headquartered in other U.S. states. The study sheds new light on the strategic actions firms use to prevent rivals from capturing value from their investments in human capital and research and development. Copyright © 2009 John Wiley & Sons, Ltd.     

Contribution of productivity and firm size to value-added: Evidence from Vietnam

A new indexing method is developed to decompose the contributions of productivity, prices and firm size to a firm's value-added. The method introduces an error term into the decomposition equation to capture measurement biases which are caused by using the deflator instead of the observed price and all other sorts of measurement error. An application of the method is given using private small and medium manufacturing firm level data in Vietnam from 1996 and 2001. The error index decomposition method provides a comparison of performance of all firms to the hypothetical representative firm. The analysis allows firms and policy makers to realize the key factors contributing to the success or failure of a firm and suggest strategies to improve firm economic performance.     

Diversification,coordination costs,and organizational rigidity: evidence from microdata

This paper examines the impact of coordination costs and organizational rigidity on the returns to diversification. The central thesis is that coordination costs offset economies of scope, while organizational rigidity increases coordination costs, further constraining economies of scope. The empirical tests of this proposition identify the effects of coordination and organizational rigidity costs on business unit and firm productivity, using novel data from the Economic Census on taxicab and limousine firms. The key results show that coordination and organizational rigidity costs are economically and statistically significant, while organizational rigidity itself accounts for a 16 percent decrease in paid ride‐miles per taxicab in incumbent diversifiers, controlling for the other costs and benefits of diversification and incumbency. The findings suggest that coordination costs, in general, and organizational rigidity costs, in particular, limit the scope of the firm. Copyright © 2010 John Wiley & Sons, Ltd.     

The impact of agricultural policy distortions on the productivity gap: Evidence from rice production

This article explores how production and trade policy distortions affected rice productivity in 33 rice-producing countries. A rice-productivity index is constructed, and a model linking the productivity gap with policy distortions is presented. After controlling for the differences in infrastructure, access to inputs and equipment, openness, and human capital, this article shows that high levels of rice subsidies and protection in rich countries combined with taxation of rice farming in poor countries widened the gap in rice productivity between rich and poor rice countries.     

Intra-operator mobile plan switching: Evidence from linked survey and billing microdata

This paper examines consumers' intra-operator mobile phone plan switching in Ireland. It models the factors associated with switching outcomes, including the direction of change in expenditure and whether those who are observed to switch plans tend to arrive at more or less optimal plans given their usage. A dataset is employed that combines survey responses from mobile consumers with the same consumers' actual usage data in the period 2017–2019; this was collected by Ireland's national regulatory authority. The cost each consumer would have incurred on every plan offered in the market based on their observed usage is estimated. Using models that allow for selection into switching, associations between switching outcomes and demographic and user characteristics are modelled. Controls are included for plan and user attributes, including demographics and proxies for user sophistication and access to alternative communication options. A substantial proportion of intra-operator switchers in the sample increase expenditures when they switch plan. While many switchers move to plans that are more optimal given their usage, a slight majority move to plans that charge a higher price premium over the best available plan (based on observables) than the consumer's previous plan did. Few observable characteristics of consumers or plans seem to be significantly associated with which switches achieve greater optimality, although fixed operator effects are large and significant. These findings add to the weight of evidence which finds that many consumers fail to arrive at the best price even after switching.     

Exploring the relationship between farm size and productivity: Evidence from the Australian grains industry

The effect of farm size on productivity remains to be one of the longest standing debates in the agricultural development literature. In this paper, we use farm level data for the Australian grains industry from 1989 to 2004 to investigate the relationship between farm size and total factor productivity and its potential determinants. We show that a positive farm-size productivity relationship could be linked to farmer capital choice. In particular, the productivity advantage of larger farms is likely to diminish as farms use contract services to replace self–owned capital, suggesting that the hire of capital services (hereafter ‘capital outsourcing’) may lift the productivity level of small farms compared to their larger counterparts.     

International knowledge sourcing: evidence from U.S. firms expanding abroad

Recent research demonstrates that firms, motivated by national differences in technical activity, expand abroad to source unique knowledge. Extant research suggests that firms use a knowledge sourcing strategy to ‘catch up’ with competitors and to obtain ‘technical diversity.’ We widen the investigation by suggesting that firms also use knowledge sourcing as a springboard to reduce their next generation R&D costs–that firms would seek out similar R&D activity to combine with their own. Using unique data that encompasses the multitude of countries where U.S. firms invest, we test the importance of these explanations. Measuring knowledge via patent stocks, we find that country‐industries with larger stocks and greater technical similarity to the United States are more attractive. These findings suggest that an important explanation for firms investing abroad is not catching up or technologically diversifying, but is using similar R&D efforts of others to overcome fixed R&D cost hurdles. Copyright © 2008 John Wiley & Sons, Ltd.     

Near and dear? The role of location in CSR engagement

Research summary : Building on economic geography and institutional theory, we develop and test theory relating geographic variables to the strength of corporate social responsibility (CSR) engagement and the cost of equity capital. For a large sample of U.S. firms over the period 1998–2009, we find strong and robust evidence that firms located in areas characterized by high levels of local CSR density score higher in CSR engagement. In addition, firms located close to major cities and financial centers exhibit higher CSR engagement compared to firms located in more remote areas. Moreover, the effect of CSR engagement on reducing equity financing costs is even greater for firms in high CSR density areas than for firms in low CSR density areas. Managerial summary : Does the location of CSR engagement by firms affect the strength of CSR engagement by their neighbors? Does the geography of engagement have an impact on financial performance? Our findings show that a firm's CSR engagement increases in areas where there is dense CSR engagement and when it is located near large cities. In these areas, norms, values, and knowledge related to CSR are transmitted to firms through face‐to‐face meetings and frequent social interactions with groups such as peers, labor unions, news media, universities, and community organizations, which tend to be concentrated in large cities. Our findings further highlight that CSR engagement reduces equity financing costs for firms in areas where CSR is widely practiced. Copyright © 2015 John Wiley & Sons, Ltd.     

Economic growth,telecommunications development and productivity growth of the telecommunications sector: Evidence around the world

This paper studies the relationships between economic growth, telecommunications development and productivity growth of the telecommunications sector in different countries and regions of the world. In particular, this study assesses the impact of mobile telecommunications on economic growth and telecommunications productivity. The results indicate that there is a bidirectional relationship between real gross domestic product (GDP) and telecommunications development (as measured by teledensity) for European and high-income countries. However, when the impact of mobile telecommunications development on economic growth is measured separately, the bi-directional relationship is no longer restricted to European and high-income countries. This study also finds that countries in the upper-middle income group have achieved a higher average total factor productivity (TFP) growth than other countries. Countries with competition and privatization in telecommunications have achieved a higher TFP growth than those without competition and privatization. The diffusion of mobile telecommunications services is found to be a significant factor that has improved the TFP growth of the telecommunications sector in Central and Eastern Europe (CEE).     

Learning by Doing and Spillovers: Evidence from Firm-Level Panel Data

In this paper we extend the Bahk and Gort (1993) (Journal of Political Economy, 101, 561–583) approach of testing for the impact of learning by doing (LBD) on firm productivity using data on a panel of Spanish manufacturing firms. Specifically, we show that support for firm specific LBD and spillovers from sector-wide LBD seems to hinge crucially on the econometric methodology, and hence the underlying assumptions, employed. Once potential biases due to unobserved time invariant firm specific effects and endogeneity are taken account of, there is only support for spillovers from sector-wide LBD. Moreover, results depend on the definition of LBD employed.     

Pricing response to entry and agglomeration effects

In contrast to the traditional approach that typically views entry solely as a threat, we argue that our understanding of this important phenomenon will remain incomplete until we consider the possibility that entry may also provide opportunity for incumbent firms. Drawing from agglomeration theory, which describes the benefit from colocating with competitors, we explicitly examine the combined impact of the competitive and agglomeration effects of entry using a unique dataset of Texas hotels. We find that incumbent establishments price higher when facing entrants whose agglomeration benefits are more likely to outweigh their competitive effects. This association is stronger for incumbents that have greater experience with entry. Our results bring a new perspective to the entry response literature helping clarify inconsistent empirical results. Further, we apply agglomeration theory to a new question, incumbent behavior, and demonstrate that experience appears to play an important role in recognizing situations that generate agglomeration externalities. Copyright © 2009 John Wiley & Sons, Ltd.     

The independent and joint effects of the skill and physical bases of relatedness in diversification

By examining the independent and joint effects of the skill and physical bases of relatedness, this study develops a multidimensional view of relatedness in diversification. The paper compares the ways the two bases identify relatedness, and examines empirically the relationship between relatedness and performance for a sample of 158 large diversified manufacturing firms. Each base of relatedness alone had no significant effect on financial performance. However, when the two approaches were combined, there was a strong positive effect on most indicators of performance. The findings demonstrate how different bases of relatedness complement and extend one another, and they clarify findings of previous studies that used a single base of relatedness. © 1998 John Wiley & Sons, Ltd.     

Management and ownership effects: evidence from five countries

Despite the growing recognition in the corporate governance literature that the relationship between ownership concentration and profitability is context dependent, this issue has not yet been subjected to direct empirical investigation using a single cross-national sample. This study empirically examines the ownership concentration–performance relationship across the nations of Canada, France, Germany, the United Kingdom, and the United States. Essentially, we argue that the correlation (if any) between ownership concentration and firm profitability differs across countries in a systematic way determined by the national system of corporate governance. Results indicate that important and statistically significant differences do in fact exist across the countries studied. © 1998 John Wiley & Sons, Ltd.     

Ultra-fast broadband access and productivity: Evidence from Italian firms

We study the impact of ultra-fast broadband (UFB) infrastructures on the total factor productivity (TFP) and labor productivity of firms. We use unique balanced panel data for the 2013–2019 period on incorporated firms in Italy. Using the geographical location of the firms, we merge firm-level data with municipality-level information on the diffusion of UFB, which started in 2015. We derive consistent firm-level TFP estimates by adopting a version of the Ackerberg et al.’s (2015) method, which also accounts for firm fixed effects. We then assess the impact of UFB on productivity and deal with the endogeneity of UFB by exploiting the physical distance between each municipality and the closest optical packet backbone node. Our results show an overall positive impact of UFB on productivity. Services companies benefit the most from advanced broadband technologies, as do firms located in the North-West and South of Italy. We further decompose the impact of full-fiber networks from mixed copper-fiber connections and find that the former significantly contribute to enhancing firm productivity. Finally, by exploiting Labor Force Survey data, we provide suggestive evidence that productivity increases from UFB might be related to structural changes at the workforce level.     

企业社会责任与企业价值的相关性研究--来自沪市上市公司的经验证据

作者以我国上海证券交易所2003年521家上市公司为样本，研究了企业社会责任活动与企业价值的相关性问题。结果表明，从当期看。承担社会责任越多的企业。企业价值越低；但从长期看，根据关键利益相关者理论与社会资本理论。承担社会责任并不会降低企业价值。同时，本文的研究也表明资产规模、负债比率、重污染行业因素与企业承担社会责任活动显著正相关；财务状况或其他状况异常的ST类公司、前一年的盈利能力与企业承担社会责任活动显著负相关。     

Growth and survival: The moderating effects of local agglomeration and local market structure

One of the central explanations of the high failure rates of de novo entrants is the liability of smallness. As a corollary, most prior literature has suggested that firms should experience survival benefits from growth. In this paper, we argue that survival benefits need to be balanced against the potential cost of rapid growth, and they are contingent upon the structure of the environment. We predict a curvilinear relationship between an entrant's growth rate and failure, and argue that the relationship is contingent upon the local agglomeration of economic activity and the local structure of competition. We test and find support for our predictions using firm‐level longitudinal data of all de novo entrants into the Canadian manufacturing sector between 1984 and 1998. Copyright © 2014 John Wiley & Sons, Ltd