Efficiency and Ownership Structure: The Case of Poland

We examine the effects of foreign entry on productive efficiency during the Polish investment liberalisation. The performance of foreign acquisitions is compared to foreign firms entering the market through greenfield entry, as well as domestic acquisitions of privatised firms, domestic greenfields and remaining state‐owned (non‐privatised) firms during the period 1995–2000. We find that foreign privatised firms have realised larger productivity gains than all types of domestic firms and that this is not due to higher price‐cost margins, which is consistent with the idea that foreign firms bring in firm‐specific knowledge. Foreign greenfields have the highest average labour productivity, while foreign privatisations show the largest productivity increase.     

Domestic regulation,import penetration and firm-level productivity growth

This paper shows that the impact of import penetration on firms’ productivity growth depends on firms’ distance to the efficiency frontier and on product market regulation. Using firm-level data for a substantial number of OECD countries from the late 1990s to late 2000s, the analysis reveals nonlinear effects of both sectoral import penetration and de jure product market regulation measures, depending on firms’ positions along the global distribution of productivity. Close to the technology frontier, import penetration has a strongly positive effect on firm-level productivity growth, with less stringent domestic regulation enhancing this effect substantially. However, far from the frontier, the effect of import penetration on firm-level productivity growth is much smaller and often not significant. Its interaction with domestic regulation generally has no statistically significant effect either. The heterogeneous effects of import penetration and domestic product market regulation on firm-level productivity growth are consistent with a neo-Schumpeterian view of trade and regulation.     

The shadow of death: analysing the pre-exit productivity of Portuguese manufacturing firms

The pre-exiting productivity profile of mature firms relative to survivors is examined along with an evaluation of how productivity affects the probability of exit along various dimensions. An empirical approach, based on an unbalanced panel of Portuguese manufacturing firms covering a 10-year period, is used. The findings confirm that market selection forces low-productivity firms to exit, but there is also evidence that a sizeable portion of low-productivity firms do not shut down. Conversely, there is a non-negligible fraction of high-productivity firms that do actually close. Consistent with some key theoretical predictions, our analysis reveals that exiting firms have a falling productivity level over a number of years prior to exit. Finally, the results from the survival model show that both small firms and ones with low productivity are relatively much more likely to exit the market. Industry and macro-environment are also found to have a non-negligible role on the exit of mature firms.     

Evaluating offshore and domestic production in the apparel industry: The small firm’s perspective

This paper extends the existing literature on the potential advantages and drawbacks of domestic and offshore manufacturing strategies to a small firm perspective. The advantages of offshore production to the large corporation have received much attention in recent years, particularly with regards to the apparel industry. The key advantages of offshore production are obvious for the large firm: cost reductions and increased productivity through labour market differentials. Little is known however about the viability and attractiveness of this strategy for the small apparel firm. The high number of small apparel firms who continue to produce in their domestic market, despite labour market differentials, suggests that the cost advantages of producing offshore may not be as critical for the competitive advantage of many of these small firms. Four case studies of small New Zealand apparel firms are used to substantiate and expand on themes developed from the literature.     

Acquisitions in a Patent Contest Model with Large and Small Firms

Big companies and small innovation factories possess different advantages in a patent contest. While large firms typically have better access to product markets, small firms often have a superior R&D efficiency. These distinct advantages immediately lead to the question of cooperations between firms. In this paper, we model a patent contest with heterogeneous firms. In a pre-contest acquisition game large firms bid sequentially for small firms to combine respective advantages. Sequential bidding allows the first large firms to bid strategically to induce a reaction of its competitor. For high efficiencies both large firms prefer to acquire immediately leading to a symmetric market structure. For low efficiencies strategic waiting of the first large firm leads to an asymmetric market structure even though the initial situation is symmetric. We also discuss two different timing setups of the acquisition stage. In all setups, acquisitions increase the chances for a successful innovation.     

政府补贴、资源误置与制造业生产率

政府对部分企业进行补贴,会影响企业的市场进入、退出和规模,导致资源在企业之间的误置,不利于制造业生产率.本文用1998—2007年我国工业企业面板数据,研究政府补贴的资源误置效应对制造业生产率的影响及微观机制.从生产率的分解上看,我国制造业中存在企业之间的资源误置效应,对制造业生产率具有负面作用.实证研究发现,政府补贴是导致这种资源误置的重要因素,补贴会改变市场的广延边际和集约边际,导致资源在受补贴企业和未补贴企业之间的误置,降低制造业的生产率,并且这种资源误置效应在国有资本比重高的行业中更严重.具体来看,广延边际方面,补贴阻碍了市场进入和市场退出,受补贴企业相对于未补贴企业的市场进入和市场退出概率均较低;集约边际方面,补贴有利于受补贴企业扩大生产规模,并挤出未补贴企业的市场份额.本文的启示在于,政府补贴需要在一般均衡框架下考虑其对企业动态和资源配置的影响.     

Small and Medium Enterprises in Thailand: Recent Trends

This paper reviews the evolution of small and medium firms in Thailand in recent years. It shows that such firms did not preserve their share of total employment during the period 1987–96; indeed, their share fell from 60% to 52% over this period. Much of this decline was felt in the category of very small firms (with less than 10 workers). This aspect is explored further by looking at small firm employment shares in three sub-periods of varying overall economic growth rates. It is found that when overall economic growth is high, the share of small firms tends to contract possibly because many small firms become medium in size and others disband because their owners can find more remunerative employment in larger firms. In slower growth periods, the employment share of small firms appears to rise probably because larger firms may be taking in less new workers or even laying off workers. The paper also calculates productivity measures (technical efficiency and total factor productivity) and shows that different measures give different rankings by size of firm.     

Technical efficiency and productivity growth of entrant firms in the retail sector in Spain

This paper analyses efficiency and productivity growth in relation to size, and age and for both entrant and incumbent firms using a birth cohort approach for the period 1995–2003 for two sectors, non-specialized shop (521) and specialized shop (524) three-digit NACE. On the one hand, our results indicate the existence of statistically significant differences among entrant and incumbent firms by size. Also, we found differences according to the start up size in relation to membership of the birth cohort and activity sectors. On the other hand, productivity growth shows that, in general, the larger entrants in the non-specialized sector obtained higher productivity than did small firms. This phenomenon was not observed in the specialized sector, where firms worsened in productivity in most of the cohorts and we did not find significant differences in productivity growth between large and small firms. Efficiency changes tend to be a positive contributor to total factor productivity change, but technical change tends to be a negative contributor for both sectors. A deeper analysis of the efficiency changes (catching up) has shown that these improvements are generally attributed to pure technical efficiency and the scale.     

Deregulation in Services and the Marketing Challenge

This paper contributes to the literature on international firm activities by providing the first evidence on the link between productivity and both exports and foreign direct investment (FDI) in services firms from a highly developed country. It uses unique new data from Germany, one of the leading actors in the world market for services. Statistical tests and regression analyses indicate that the productivity pecking order found in numerous studies using data for firms from manufacturing industries – where the firms with the highest productivity engage in FDI while the least productive firms serve the home market only and the productivity of exporting firms is in between – does not exist among firms from services industries. There is evidence that firms with FDI are less productive than firms that export; this finding is in line with recent empirical results reported for software firms from India.     

A Technological and Organisational Explanation for the Size Distribution of Firms

This paper combines insights from the literature on the economics of organisation with traditional models of market structure to construct a theory of equilibrium firm size heterogeneity under the assumption of a homogenous product industry. It is possible that configurations consisting entirely of small firms (run by entrepreneurs with limited attention) and with larger firms (using managerial techniques to substitute away these limits to allow increasing returns technologies to become profitable) can arise in equilibrium. However, there also exist equilibrium configurations with the co-existence of large and small firms. The efficiency properties of these respective equilibria are discussed. Finally, the implications of an expanding market size are considered.     

The productivity payoff of information technology in multimarket SMEs

This paper examines the effects of information technology (IT) adoption on the productivity of multimarket small and medium-sized enterprises (SMEs). The main hypothesis is that IT usage increases efficiency to a higher degree in diversified and internationalized firms compared with single-market SMEs. This hypothesis is tested using a large sample of more than 2,000 Spanish SMEs. Overall, intensive use of IT in operations processes is found to be associated with substantial increases in productivity of firms following both related and unrelated diversification. Also, exporting firms with more intensive use of IT have higher productivity. These results are consistent with previous theoretical arguments on the relationship between IT and efficiency of firms and open future research directions related to the role played by IT in the management control systems of both diversified and exporting firms.     

中国制造业的市场集中、地理集聚与企业绩效

本文研究我国制造业的市场结构与地理分布对企业全要素生产率的影响.以中国工业企业数据库的大样本数据为基础,采用LP法计算企业生产率,构造市场集中度指标和地方化经济、城市化经济两个集聚指标,进行了多方位的计量检验.研究结果表明,制造业的市场集中不利于企业生产率的提高,代表专业化水平的地方化经济促进了企业生产率的提升,度量行业间多样化集聚的城市化经济对企业生产率没有显著的影响.市场集中对出口企业的负面影响不明显,控制市场集中和地理集聚后,出口企业生产率高于非出口企业,出口的“生产率悖论”并不存在.     

国际外包承接对我国内资企业生产率的影响

跨国外包作为产品内专业化分工在国际市场的延伸,使参与其中的国家和行业生产都得到了专业化分工的好处。作为发展中国家,我国内资企业多利用劳动资源优势参与国际分工,即以外包的承接方身份参与跨国外包。本文首次从外包承接企业角度出发,利用我国制造业内资企业面板数据,实证分析了企业承接外包对其生产率的影响。结果表明,内资企业承接国内的外包业务并不会提高企业的生产率;但是企业承接国际外包会提高企业的生产率。这说明,内资企业在承接国际外包的情况下,能够从国外的外包商那里获得相应的生产技术、工艺或者经营管理知识,从而提高了企业的技术水平,促进了生产率的提高。     

Small firm growth,access to capital markets and financial structure: Review of issues and an empirical investigation

This article investigates the financial structure of small firms with an emphasis on growth and access to capital markets. Neo-classical economic, life cycle, pecking order and agency theory perspectives are reviewed in order to formulate testable propositions concerning levels of long-term, short-term and total debt, and liquidity. Up-to-date financial data were collected from the U.K. Private+ database for a large sample comprising of both listed and unlisted small firms. Regression results indicate significant relationships between financial structure and profitability, asset structure, size, age and stock market flotation but not growth except when rapid and combined with lack of stock market flotation. Analysis of stock market flotation as an interactive dummy reveals major differences between listed and unlisted small firms. The results indicate that the variety of financial structures observed in practice may reflect rational trade-offs of various costs on the part of small firm owner-managers but that the over-reliance on internally available funds and the importance of collateral, in the case of unlisted small firms, are likely to be major constraints on economic growth.     

Exporting raises productivity in sub-Saharan African manufacturing firms

Proponents of trade liberalization argue that exporting helps firms to achieve higher productivity levels. This hypothesis is examined for a panel of manufacturing firms in nine African countries. The results indicate that exporters in these countries are more productive and, more importantly, exporters increase their productivity advantage after entry into the export market. While the first finding can be explained by selection-only the most productive firms engage in exporting-the latter cannot. The results are robust when unobserved productivity differences and self-selection into the export market are controlled for using different econometric methods. Scale economies are shown to be an important channel for the productivity advance. Credit constraints and contract enforcement problems prevent firms that only produce for the domestic market from fully exploiting scale economies.     

Do export status and export intensity increase firm performance?

This study examines the effects of export status and export intensity on the performance of firms in Ghana. Our measures of performance include productivity and profitability. Using the Regional Project on Enterprise Development (RPED) dataset covering the period 1991–2002, the results of this study indicate that export status and export intensity have positive effects on productivity, confirming the learning‐by‐exporting hypothesis. Competition on the international market exposes exporting firms to new technologies, and this has the potential of increasing their productivity. Thus, economic policy initiatives should be directed at encouraging firms to enter the export market. Existing exporters should also be motivated to intensify their exporting efforts by exporting more of their output to foreign markets. © 2011 Wiley Periodicals, Inc.     

Exporting raises productivity in sub-Saharan African manufacturing firms

Proponents of trade liberalization argue that exporting helps firms to achieve higher productivity levels. This hypothesis is examined for a panel of manufacturing firms in nine African countries. The results indicate that exporters in these countries are more productive and, more importantly, exporters increase their productivity advantage after entry into the export market. While the first finding can be explained by selection–only the most productive firms engage in exporting–the latter cannot. The results are robust when unobserved productivity differences and self-selection into the export market are controlled for using different econometric methods. Scale economies are shown to be an important channel for the productivity advance. Credit constraints and contract enforcement problems prevent firms that only produce for the domestic market from fully exploiting scale economies.     

Financial Analysis of Palestinian Industry Including Small Scale Firms

The study aims to explore the financial aspects of the Palestinian industry, and to investigate productivity and efficiency of small scale industry compared with large scale firms. In order to help policy makers in industrial planning in the new emerged Palestinian state. A special instrument has been used to collect the financial and quantitative data for the related manufacturing firms from a random sample of 215 Palestinian firms. The one way analysis of variance test was used to examine whether the mean scores differ significantly among scale sizes of the Palestinian industry concerning the selected performance measures. In addition, the Scheffe test was used as a post hoc comparison way to identify which scale size firms' performance differs than the other two scale sizes.The research revealed that small scale firms in Palestinian industry have higher labor productivity values than large scale firms, while large scale firms accomplished higher net profit margin compared to small scale industry. Creating an additional job in large scale Palestinian industry needs less cost than creating a job in small scale industry, and large scale firms have better opportunity in getting external financing than small firms.     

Did Liberalization Impact Productivity of the Indian Electronics Hardware Industry?

In this paper, we analyse the trends in productivity, both partial and total, in the four sectors of the Indian electronics hardware industry after liberalization. Using an innovative combination of two established but independent methodologies, we estimate the contributions of technical efficiency change and technological progress to total factor productivity growth (TFPG) and thereby to output growth. Contrary to expectations, we found that none of the four sectors in the industry achieved impressive growth in capital productivity and TFPG despite the new economic reforms. The firms emphasised technological progress at the cost of technical efficiency change but failed to sustain TFPG as the liberalization of policies intensified further. Surprisingly the firms’ effort to employ skilled labour, larger scales of production and their strategy to improve production technology through R&D and/or imports did not benefit productivity substantially. In a comparative study with China, we found that the Indian electronics hardware industry did not perform as well as that of China due to the persistent rigid and bureaucratic procedures, labour market inefficiencies and inadequate infrastructure, among others.     

Economic Transition,Heterogeneous Social Capital,and Corporate Performance: Empirical Evidence from China

A theoretical framework based on information and embeddedness is constructed to analyze the micro structure of the impact of heterogeneous social capital on corporate performance. It is empirically tested based on data collected from a sample of 155 Chinese firms. Results indicate that hierarchical social capital has a positive association with corporate market power but little impact on corporate operational efficiency. Furthermore, social capital can promote operational efficiency but contribute little to corporate market power. There is a complementary structure between the two types of heterogeneous social capital. The embedded inertia of social capital into institutional environment is negatively related with corporate performance. From the perspective of economic transition, firms in developed regions rely far more on hierarchical social capital to acquire market power than firms in developing areas.