Analysing network partnerships

Support for the notion of networks is growing rapidly across Europe, especially in the public sector where faith in market and hierarchy is diminishing. However, the concept is still loosely interpreted and variably applied. This article unpacks the concept of network and goes on to suggest that a useful model for application to a ‘whole systems’ approach is Ken Benson's neglected framework of an ‘inter-organisational network’. It urges application of the framework to specific contexts and issues.     

Financing professional partnerships

Increases in net-debt obligations of profit sharing partnerships give these organizations a strong incentive to expand. This paper argues that when capital structure is transparent, partnerships can signal their hiring intentions to uninformed clients by their net-debt levels. Levin and Tadelis (2005) predicts that professional service firms with fewer informed clients will tend to choose to organize as partnerships rather than corporations. The present paper demonstrates that this prediction only holds when financial frictions are present.     

Team formation with complementary skills

One explanation for the prevalence of self‐managed work teams is that they enable workers with complementary skills to specialize in the tasks they do best, a benefit that may be enhanced if workers can sort themselves into teams. To assess this explanation, we design a real‐effort experiment to study the endogenous formation of teams, and its effect on productivity, when specialization either is or is not feasible. We find a strong positive interaction between endogenous team formation and the ability to specialize, indicating that endogenous team formation is a particularly effective mechanism for promoting team output in production environments that enable the exploitation of skill complementarities.     

Creating win-win customer-supplier partnerships

Today's global competition mandates that each customer-supplier combination achieve a balance between the supplier's manufacturing flexibility and the customer's schedule stability. Sharing valid schedules, working on quality together, reducing each other's costs, and streamlining communications allows a customer and supplier to become true enterprise partners.     

Building business through partnerships

In a request-driven environment, human resources can be pressured to "do a program," which solves the immediate problem. Such procedures result in a reactive mode of operation, which may not address the more global needs of the organization.     

Strategic partnerships and relationship marketing in healthcare

Despite repeated government policies to introduce market-orientation and customer-focus into the UK National Health Service, there is still much anecdotal evidence of unsuccessful policy implementation. In this article we investigate the attitudes of healthcare managers to one recent policy initiative based on partnership working that is intended to provide integrated and customer-focused service to patients. While acknowledging the tensions and dilemmas inherent in private sector marketing concepts, we argue that relationship marketing has considerable potential in public healthcare contexts, based on its advocacy of building relationships between providers and customers and between providers and their suppliers. Using the framework of relationship marketing we identify healthcare managers' concerns about the motives, effects and benefits of implementing partnership arrangements in two regions of the NHS. Through a longitudinal research design our findings suggest that while respondents' attitudes to partnership working and customer focus had become more positive after two years of policy implementation, they remain centred on the service process rather than the customers it serves. We discuss what still needs to be done to transform public healthcare from what is still a predominantly supplier and product-driven service to one that is truly relationship orientated.     

Dynamic competition with consumer inertia

We study a framework where two duopolists compete repeatedly in prices and where chosen prices potentially affect future market shares, but certainly do not affect current sales. This assumption of consumer inertia causes (noncooperative) coordination on high prices only to be possible as an equilibrium for low values of the discount factor. High discount factors increase opportunism and aggressiveness of competition to such an extent that high prices are no longer sustainable as an equilibrium outcome. Moreover, we find that both monopolization and enduring market share and price fluctuations (price wars) can be equilibrium path phenomena without requiring exogenous shocks in market or firm characteristics.     

Economic geography with tariff competition

A simple two-country model of economic geography is constructed in order to examine the effect of tariff competition on the spatial distribution of manufacturing activities as well as on welfare. We show that when the transport cost is small, tariff competition with firm migration leads to a core-periphery economy, where one of the two countries imposes no tariff in Nash equilibrium. We also show that when the transport cost is sufficiently large, both countries impose a positive tariff, which decreases the welfare of both countries.     

National pricing with local quality competition

We study the incentives of national retail chains to adopt national (uniform) prices across local markets that differ in size and competition intensity. In addition to price, the chains may also compete along a quality dimension, and quality is always set locally. We show that absent quality competition, the chains will never use national pricing. However, if quality competition is sufficiently strong there exist equilibria where at least one of the chains adopts national pricing. We also identify cases in which national pricing benefits (harms) all consumers, even in markets where such a pricing strategy leads to higher (lower) prices.     

Earning supplier partnerships through principled negotiations

In today's competitive global village, we must be prepared to do things differently than in the past if we wish to survive as a manufacturing economy. If purchasing is to do its part, running away from the problems will not solve the problems. We must learn how to work with our suppliers in a much more productive fashion than ever before. Supplier partnerships are indeed part of the answer to this change. But without changing the way we deal with suppliers, we'll never get the improvements that are possible.     

Tax competition in a fiscal union with decentralized leadership

This paper examines capital tax competition in the presence of an interstate transfer policy without federal commitment. Lack of commitment implies that local tax policy is chosen prior to federal transfers. The paper's main result is that ex-post federal policy neutralizes horizontal fiscal externalities, insulating tax policy from capital mobility. Federal policy, however, introduces a new source of inefficiency unrelated to tax competition. Specifically, ex-post transfer payments prove to be equivalent to an interstate revenue-sharing system which may render federal intervention in the presence of fiscal externalities welfare-deteriorating relative to tax competition.     

Strong Nash equilibrium in games with common and complementary local utilities

A rather general class of strategic games is described where the coalitional improvements are acyclic and hence strong Nash equilibria exist: The players derive their utilities from the use of certain facilities; all players using a facility extract the same amount of local utility therefrom, which amount depends both on the set of users and on their actions, and is decreasing in the set of users; the ultimate utility of each player is the minimum of the local utilities at all relevant facilities. Two important subclasses are “games with structured utilities,” basic properties of which were discovered in 1970s and 1980s, and “bottleneck congestion games,” which attracted researchers’ attention quite recently. The former games are representative in the sense that every game from the whole class is isomorphic to one of them. The necessity of the minimum aggregation for the existence of strong Nash equilibria, actually, just Pareto optimal Nash equilibria, in all games of this type is established.     

Survival depends on effective partnerships with suppliers, management, and physicians

Partnering in health care materiel management circles is a concept that has been discussed for years. We, as materiel managers, have never accomplished effective partnering; but I propose that if we are to have a professional future, we should learn to establish effective partnership arrangements with our various customers--externally and internally.     

Price and quality competition with quality positions

In this study, we investigate price and quality decisions in a duopoly in the presence of firms’ quality positions , which are determined by the quality levels of their existing core products. Into a standard model of vertical differentiation, we incorporate a “repositioning cost” that is proportional to the quality differences between firms’ current and new products. By varying the levels of quality positions, we analyze the impact of this cost on the equilibrium outcomes. Our results show that the presence of repositioning costs restricts firms’ abilities to improve profitability and differentiate themselves vertically. As a result, a high‐positioned firm does not necessarily have a competitive advantage over a low‐positioned firm, even if the former offers a superior new product in equilibrium. In addition, if a low‐positioned firm is significantly cost‐efficient compared with its rival with regard to repositioning, then that firm can earn higher profits than those of a high‐positioned firm by strategically offering its low‐end product. These results contrast sharply with those based on the standard vertical differentiation model.     

小企业与大企业的竞争策略

由于小企业在经济发展中的重大作用,小企业的生存和发展越来越受到人们的重视,它的地位和作用也越来越为人们所认识.未来时代是小企业时代,充满活力的小企业能集中精力于关键性的工作,每个企业成为独立的问题解决群体,并织成一张网,这张网将会为经济发展注入新的活力.     

Dual licensing strategy with open source competition

Software firms that produce and sell proprietary software can use dual licensing (DL) strategies, that is, they can distribute their products under different (proprietary, OS, e.g., open source) licensing terms. We investigate the relevance and impacts of such distribution strategies in the presence of an OS software competitor. We determine the conditions for this strategy to be profitable for the software firm, and its impact on price, market share, and welfare. We show that a DL strategy can be used to crowd the OS software out of the market. This strategy then is profitable for the software firm only if the spillovers coming from the hybrid software (i.e., second distribution launched by the software firm) are sufficiently high and result in both a higher price and a lower market share for the proprietary software. We also consider a situation where the introduction of DL leads to a market shared between the firm's software and the OS competitor. In this situation, the profitability of the DL strategy depends also on the degree of compatibility between the proprietary software and its OS competitor. We show also that this situation can generate conflicts of interests between proprietary software vendors and users, resulting in suboptimal outcomes.     

Platform market competition with endogenous side decisions

This paper develops a framework to analyze platform competition in two‐sided markets in which agents endogenously decide on which side of a platform to join. We characterize the equilibrium pricing structure and perform a comparative statics analysis on how the distribution of agents’ preferences affects the platforms’ profits. We also show that the market equilibrium under profit‐maximizing platforms leads to the first best social surplus, which illustrates the importance of the price mechanism to induce more balanced participation across the two sides. This framework can be applied to analyze market competition for “rental” or “sharing” platforms. In addition, we extend our analysis to consider an initial investment stage, which makes participants the owner of some durable goods to rent out.     

Government-university-industry partnerships in technology development: a case study

State programs in high technology development have expanded rapidly since 1979, when only five states had such programs. Today almost all states have technology development programs. Many of these involve partnerships between the state government, industry and universities. The newness of these programs makes the evaluation of their success problematic. However, analysis of the formation and management of technology development programs is useful to practitioners charged with the implementation of university-industry advanced technology programs. One of the largest programs is the Thomas Edison Program created by the Ohio Legislature in 1983. The program has three components, a Seed Capital Fund, Advanced Technology Centers, and Incubator Program.This paper examines the Edison program through analysis of the Edison Animal Biotechnology Center, one of the seven state Advanced Technology Centers.     

Optimal order display in limit order markets with liquidity competition

Order display is associated with benefits and costs. Benefits arise from increased execution-priority, while costs are due to adverse market impact. We analyze a structural model of optimal order placement that captures trade-off between the costs and benefits of order display. For a benchmark model of pure liquidity competition, we give a closed-form solution for optimal display sizes. We show that competition in liquidity supply incentivizes the use of hidden orders to prevent losses due to over-bidding. Thus, because aggressive liquidity competition is more prevalent in liquid stocks, our model predicts that the proportion of hidden liquidity is higher in liquid markets. Our theoretical considerations ares supported by an empirical analysis using high-frequency order-message data from NASDAQ. We find that there are no benefits in hiding orders in il-liquid stocks, whereas the performance gains can be significant in liquid stocks.