Profits persistence and ownership: evidence from the Italian banking sector

The hypothesis that ownership structure affects persistence of profits in the Italian banking industry is tested. The time-invariant components of ROA and ROE are regressed against ownership concentration and the fraction of shares held by the major shareholders. The results show that abnormal profits increase if ownership is concentrated in foundations and banks, and decrease if market forces are allowed to operate.     

Diversity and intensity of information and communication technologies use and product innovation: evidence from Chilean micro-data

This study uses data from two waves of the Encuesta Longitudinal de Empresas (ELE) to examine the relationship between information and communication technologies (ICT) use and product innovation in Chilean firms. Our findings sustain the hypothesis that ICT act as enablers of innovation. However, the impacts of ICT on product innovation depend on the type of application considered. In particular, we find positive and significant association between production-integrating ICT, i.e. administrative and industry-specific software, and product innovation, while this is not the case for market-oriented ICT such as e-commerce or client relationship manager software. Finally, the results show that not every ICT combination is beneficial for innovation: firms that show a basic use of ICT are not associated with a better likelihood of introducing innovation, while firms with an advanced use of ICT are those with the more likelihood of innovating.     

Exploring the relationship between university and innovation: evidence from the Italian food industry

This study provides empirical evidence on the role of universities’ technological transfer (TT) activities in the Italian manufacturing sector, with particular attention to the food industry. Using the UniCredit-Capitalia database (2008 UniCredit-Capitalia. 2008. Decima Indagine Sulle Imprese Manifatturiere Italiane. Rapporto Corporate. [Google Scholar]) for firms and data from the Ministry of Education, University and Research (MIUR) to obtain the university TT indicator, we estimate a probit model to assess the effect of universities’ TT activities on a firm’s likelihood to innovate. The role of proximity in knowledge spillovers from TT activities is also investigated. Results show that university TT activities seem to stimulate food industry firms innovation and the impact appears significantly higher than for the manufacturing sector. Moreover, the effect of TT activities on innovation appears to be geographically bounded. As regards policy implications, this study provides two insights which may help promote innovation in the food sector. First, the factors that influence innovative capability in the food sector are different from those in other sectors, suggesting the need for sector specific instruments for promoting innovation. Second, science is important in the food industry and this raises questions about the policy of mainly considering high-tech industries when promoting a closer relationship between firms and universities.     

Time variation in inflation persistence: New evidence from modelling US inflation

This article explores how inflation persistence relates to the conduct and goals of monetary policy by presenting a new approach to modelling US inflation persistence and the Fed's dual mandate. Our framework fills a gap in pre-existing models by more flexibly accounting for diverse dynamic properties and shocks. Estimating a Phillips Curve model augmented with inflation volatilities and expectations, we find that the degree of monthly inflation persistence is time variant since World War II. Variations in persistence continue to be observed regardless of the absolute level of inflation and the extent of the trade-off between inflation and unemployment. We demonstrate that inflation persistence varies in line with expectations formed by memories of past inflation. This supports the case for more flexible monetary policy at times, as in the 1980s or especially the present decade, when inflation is more persistent.     

Tax perceptions and the demand for public expenditure: evidence from UK micro-data

Using responses from the 1995 British Social Attitudes Survey (BSAS), this paper assesses if there is evidence of voter misperception of tax costs. We find convincing evidence of income tax (IT) and value added tax (VAT) misperceptions, with a systematic bias towards overestimation of tax burdens for VAT, contrary to predictions of the fiscal illusion literature. We then integrate tax misperceptions into a model of demand for public expenditure. Voters' spending preferences are strongly related to their incomes, actual tax costs, and other fiscal-related household characteristics. A tendency to overestimate tax burdens appears to have only a modest influence on demands for public spending.     

Patterns in UK company innovation styles: New evidence from the CBI innovation trends survey

This paper reports on the results of an analysis at Centre for Research on Innovation and Competition (CRIC) of the data from the 1996 and 1997 Survey of Innovation Trends conducted by the Confederation of British Industry (CBI) in conjunction with the NatWest Bank in the UK. This is one of the few, direct surveys of innovation activity, as opposed to R&D and patenting actvity, which is conducted in the UK It is characterized by the fact that it asks responding firms to report on trends in a wide variety of aspects of their innovative behaviour. The central feature of the analysis in this paper is a factor analysis of the answers to a set of 15 questions on different aspects of innovative behaviour. This results in a three-factor solution which reveals three distinct ‘styles’ of innovation in the behaviour of respondents. These three styles are shown to be broadly applicable to both manufacturing industry firms and service industry firms in the sample, thus revealing a dimension of innovation in the service sector which is not so readily disclosed by analysis of R&D or patent statistics. Statistical modelling of the constraints and incentives influencing innovation shows that while constraints do not appear to be very significant, competitive pressure and the utilization of collaborative linkages are strongly positively associated with innovation, and especially with a more radical s o b of innovation. Ihe paper concludes that the CBI survey provides data about innovation in the UK which are not easily provided through other means. Its format allows certain aspects of innovation—particularly the similarities and differences between manufacturing and services —to be examined in an interesting way.     

Patterns in UK company innovation styles: New evidence from the CBI innovation trends survey

This paper reports on the results of an analysis at Centre for Research on Innovation and Competition (CRIC) of the data from the 1996 and 1997 Survey of Innovation Trends conducted by the Confederation of British Industry (CBI) in conjunction with the NatWest Bank in the UK. This is one of the few, direct surveys of innovation activity, as opposed to R&D and patenting actvity, which is conducted in the UK It is characterized by the fact that it asks responding firms to report on trends in a wide variety of aspects of their innovative behaviour. The central feature of the analysis in this paper is a factor analysis of the answers to a set of 15 questions on different aspects of innovative behaviour. This results in a three-factor solution which reveals three distinct 'styles' of innovation in the behaviour of respondents. These three styles are shown to be broadly applicable to both manufacturing industry firms and service industry firms in the sample, thus revealing a dimension of innovation in the service sector which is not so readily disclosed by analysis of R&D or patent statistics. Statistical modelling of the constraints and incentives influencing innovation shows that while constraints do not appear to be very significant, competitive pressure and the utilization of collaborative linkages are strongly positively associated with innovation, and especially with a more radical s o b of innovation. Ihe paper concludes that the CBI survey provides data about innovation in the UK which are not easily provided through other means. Its format allows certain aspects of innovation—particularly the similarities and differences between manufacturing and services —to be examined in an interesting way.     

The innovation effect of dual-class shares: New evidence from US firms

The proliferation of dual-class structures in the US stock market presents a controversial trend since such shares are traditionally deemed to damage governance quality. We study the relationship between 362 firms with dual-class shares and their innovativeness using patent citations from Google Patents over the 1976 through 2006 period. We find dual-class shares have significant innovation effect in high-tech sectors, hard-to-innovate industries, firms with higher external takeover threat and firms heavily dependent on external equity financing. We also document a positive causality relationship between dual-class structures and the quality of innovation. The channel for this causal relationship is the protection mechanism by which managers can take a long-term view. From a policy perspective, regulators should promote a corporate governance system that protects corporate long-term interest for shareholders.     

The persistence of regional unemployment: evidence from China

The purpose of this paper is to examine the persistence of regional unemployment and to explore the sources of this persistence. Evidence from China suggests three empirical findings. First, provincial relative unemployment is more persistent than aggregate unemployment. Second, youth unemployment is less persistent than total unemployment. Third, although the western region has the highest provincial unemployment rate, it has the lowest persistence of regional unemployment. To explore the sources of this unemployment persistence, a panel data method has been developed based on the Barro Approach and Edwards work. The higher the share of industry output by state sector and collective sector, the more the regional unemployment persistence. The private sector is the main employment destination for jobless now and has acted to reduce unemployment persistence.     

Explaining innovation in mature industries: evidences from Italian SMEs

In recent years management scholars and practitioners have been interested in innovation in high-technology industries. However, little attempt has been undertaken to examine factors affecting innovation in mature industries, such as agro-food. In this paper we tried to fill this literature gap. We hypothesise that weak-collaborations have a positive effect on firms’ innovations. We test our hypotheses on a sample of Italian agro-food firms. We discuss our results and present some theoretical and practical implications.     

Measuring the persistence in innovation in Spanish manufacturing firms: empirical evidence using discrete-time duration models

This paper measures the level of persistence in innovation using a large representative sample of Spanish manufacturing firms for the period 1990–2008. We determine survival in innovation activities using discrete-time duration models, which control for some of the existing problems in the continuous-time duration models used in previous studies (namely, unobserved heterogeneity and the proportional hazards assumption). This paper examines the relationship between the firm-specific characteristics of technological regimes and the persistence measured by innovative spells at the firm level. The results show that high technological opportunities, patents, cumulativeness of learning based on previous experience and accumulated R&D, as well as the use of generic knowledge provided by universities enhance persistence in innovative activity.     

Firm persistence in technological innovation: the relevance of organizational innovation

Organizational innovation favors technological innovation, but does it also influence persistence in technological innovation? This paper empirically investigates the pattern of technological innovation persistence and tests the potential impact of organizational innovation using firm-level data from three waves of French Community Innovation Surveys. The evidence indicates a positive effect of organizational innovation on persistence in technological innovation, according to the various measures of organizational innovation. Moreover, this impact is more significant for complex innovators, i.e. those who innovate in both products and processes. The results highlight the complexity of managing organizational practices with regard to the technological innovation of firms. They also add to understanding of the drivers of innovation persistence through the focus on an often forgotten dimension of innovation in a broader sense.     

The impact of R&D subsidy on innovation: evidence from New Zealand firms

This study examines the impact of government subsidy through R&D grants on innovation output for firms in New Zealand. Using a large database that links administrative and tax data with survey data, we find that R&D grants have a stronger effect on more novel innovation (e.g. applying for a patent or introducing new products to the world) than on incremental innovation (e.g. any product innovation) and that larger, project-based grants are more effective at promoting innovation than smaller, non-project-specific grants. There is little evidence that R&D grants have differential effects between smaller (<50 employees) and larger firms.     

Monetary policy effects: new evidence from the Italian flow-of-funds

New evidence on the transmission of monetary policy to the economy is provided through an analysis of the effects of a restrictive monetary policy shock on Italian flow of funds over the period 1980 to 2002. Firms reduce issuance of debt and decrease the acquisition of financial assets, providing no support for the existence of strong financial frictions. Following the shock, in the first quarter households increase short-tem liabilities and diminish the acquisition of liquid assets and shares. The public sector increases net borrowing during the first 2 years. Financial corporations decrease their borrowing for three quarters while in the same period the foreign sector increases borrowed funds. We claim that our results shed new light on the role of the financial decisions of the economic sectors in the transmission mechanism of monetary policy.     

Mercantile culture and corporate innovation: evidence from China

We investigate the role of mercantile culture in corporation innovation from the perspective of Chinese historical culture. Using a sample of listed firms located in areas with cultural origin in China, we show that mercantile culture has a significantly positive effect on firm innovation. Higher level of marketization with better legal environment and less market distortion strengthen the association of culture and corporate innovation. Furthermore, much more internal resource slack also helps to realize the positive role of mercantile culture on firm R&D activities. We conclude that regional culture, as an informal institution, makes a difference in corporate innovation decisions.     

Estimating persistence in Canadian unemployment: evidence from a Bayesian ARFIMA

The degree of persistence in aggregate Canadian unemployment is estimated within a Bayesian ARFIMA class of models. The results conclude that unemployment exhibits persistence in the short and intermediate run. The evidence of persistence is stronger than previously reported by Koustas and Veloce (1996 Koustas, Z and Veloce, W. 1996. Unemployment hysteresis in Canada: an approach based on long-memory time series models. Applied Economics, 28: 823–31. [Taylor &; Francis Online], [Web of Science ®] , [Google Scholar]). This persistence cast a vital implication regarding disinflation policies, Based on the unemployment rate, these policies will prove very costly in terms of lost output and – if implemented – they considerably lengthen recessions.     

Measuring persistence in Croatian tourism: evidence from the Adriatic region

This study examines the degree of persistence in foreign tourist arrivals and overnight stays for seven Croatian coastal counties over the period January 1998 to December 2013 using fractional integration techniques. Our findings reveal that the respective regional tourism indicators exhibit seasonal unit roots which require seasonal first differences to render the respective time series stationary. With respect to the long-run evolution of the respective time series, both the parametric and semi-parametric fractional integration approaches show the degree of persistence is greater than zero, but significantly less than one for the majority of the coastal counties. Impulse response analysis reveals indeed shocks to the deseasonalized time series, either foreign tourist arrivals or foreign tourist overnight stays, appear short-lived with the exception of Istria and Primorje-Gorski kotar counties. Policy implications of the results are also discussed.     

Economic geography and wages in Brazil: Evidence from micro-data

This paper estimates the impact of market and supplier access on wage disparities across Brazilian states, incorporating the control for individual characteristics into the new economic geography methodology. We estimate market and supplier access disaggregated by industry, and we compute access to local, national and international markets separately. We find a strong correlation between market access and wage differentials, even after controlling for individual characteristics, market access level (international, national or local), and using instrumental variables.     

Geographic price dispersion in retail markets: Evidence from micro-data

Using an extensive micro-price data of 266 retail goods and services across US, EU and OECD cities between 1990 and 2005, we study characteristics of geographic dispersion of deviations from the Law of One Price. We find that the magnitude of price dispersion is a function of the characteristics of both the type of good and set of locations under examination. Higher share of non-traded inputs and lower tradability of goods are both found to contribute to geographic price dispersion, with the former typically dominating in explanatory power. The role of tradability of good in accounting for the price dispersion is more significant as we move beyond an economic geography, while non-traded input level matters relatively more if we move to the interior of this geography. Our evidence suggests that the models of real exchange rates should incorporate the classical distinction between traded inputs and local inputs as well as a role for relative markups and traditional trade costs.     

Financial crisis and persistence: evidence from sticky expectations consumption growth model

We estimate the degree of stickiness in aggregate consumption growth for the U.S. considering the effects of the Great Recession. The behavior of stickiness estimate in the crisis is somewhat as the U-shaped pattern. Our findings imply that during the crisis consumers’ attentiveness to aggregate information has slightly increased, thereby reducing the persistence of aggregate consumption growth. However, the reduction in persistence is transitory. Since 1980, the U.S. faced five recessions and in most of them the degree of stickiness declined, albeit temporarily.