Network embeddedness and new-venture internationalization: Analyzing international linkages in the German biotech industry

This paper examines whether inter-organizational factors influence German biotech firms' propensity to internationalize by forming international research alliances. Inter-organizational factors include dimensions of a firm's embeddedness within its local cluster and within its national research network. We test two sets of hypotheses (local and national network-drivers) on a longitudinal event history dataset of the complete German biotech population for the years 1995–2004. Findings show that location in a local cluster already dense with international linkages, the building of research alliances with local research institutes as well as national partners and central position in the national research network increase the probability of forming international research alliances.     

The Eyes Have It: How a Car's Face Influences Consumer Categorization and Evaluation of Product Line Extensions

This research focuses on a previously unexamined risk associated with the widely used new product development strategy of line extensions. Specifically, it explores consumer reactions when line extensions become too visually similar and examines both short‐term and longer term strategies for solving the problem. Examined in the context of consumer durables, specifically, automobiles, the results show that consumers who make categorization mistakes when trying to distinguish between two visually similar product lines have more negative attitudes not only toward the product but also toward the parent brand. The results of Study 1 confirm that providing a design vocabulary that articulates the car's design features is effective in reducing consumer's categorization mistakes. In addition, results of Study 2 indicate that changes to the car's “eyes” (headlights) are more effective than changes to the car's “mouth” (grille) in helping consumers to differentiate among cars in the line.     

The Tipping Point of Design: How Product Design and Brands Interact to Affect Consumers’ Preferences

Existing research on product design has demonstrated the importance of aesthetics in generating favorable consumer responses. However, the literature has only recently begun to explore if and to what extent the impact of product design is influenced by brand strength. Whereas some research indicates that strong brands may benefit less strongly from aesthetically attractive designs, other research suggests that attractive designs are more persuasive when they are paired with a strong brand. In this research, these two competing predictions were tested through three studies with German car buyers. In Study 1, participants were exposed to a fictitious car that was paired with a randomly chosen brand name. In Study 2, participants were presented with a set of existing cars and were asked to choose one. Both studies yield converging evidence and show that product design and brands interact in a positive fashion, suggesting that attractive designs exert a greater influence on consumers’ decision processes when they are accompanied by a strong brand. Study 3 extended these findings by demonstrating that strong brands only increase the impact of attractive designs when perceived risk is high but not when it is low.     

Zero‐interest Rate Policy and Unintended Consequences in Emerging Markets

Since 2009, central banks in the major advanced economies have held interest rates at very low levels to stabilise financial markets and support the recovery of their economies. This paper outlines the unintended consequences of the prolonged period of very low world funding interest rates in emerging markets. The paper is informed by a Mises–Hayek‐BIS view on credit booms and Mises' law of unintended consequences. Consistent with the presented credit boom view, I provide evidence that the very low world funding interest rates are associated with a rise in volatile capital flows and asset market bubbles in fast‐growing emerging markets. In line with Mises' law, I further show that these unintended consequences give rise to a new wave of interventionism as policymakers in emerging markets increasingly reintroduce financially repressive measures to isolate the economies from foreign capital inflows.     

Determinants of Firm R&D: The Role of Relationship-Specific Interactions for R&D Spillovers

Research and Development (R&D) is a key component behind technological development and economic growth; therefore, understanding the drivers of R&D is crucial. An interesting question is the role of technology spillovers, transferred by trade, and their impact on firm R&D. Here we analyze not only how international and domestic inter- and intra-industry technology spillovers affect firm R&D but also the relatively unexplored issue of how relationship-specific interactions between buyer and seller affect such spillovers. We find international technology spillovers to be larger and more significant than domestic inter- and intra-industry spillovers. Moreover, relationship-specific interactions between seller and buyer enhance technology spillovers in general and international spillovers in particular.     

Der deutsche Telekommunikationsmarkt im europäischen und internationalen Vergleich

According to current discussions, the German and European market for telecommunications is not as competitive as in the US or Asia. This paper shows — based on official data — that Germany has a high availability of broadband internet connections. It is not the availability but the usage that lags behind. Fixed telephone calls as well as broadband internet connections are rather cheap in Germany, but to be prepared for the digitalisation of the economy and society, more investments in infrastructure are needed. Surprisingly the US does have a higher number of network providers than Europe. What is missing in Europe is a provider that covers all countries of the European Union; current EBITDA does not show that the European market is too fragmented to make a profit.     

Fixed costs per shipment

Exporting firms do not only decide how much of their products they ship abroad but also at which frequency. Doing so, they face a trade-off between saving on fixed costs per shipments (by shipping large amounts infrequently) and saving on storage costs (by delivering just in time with small and frequent shipments). The firm's optimal choice defines a mapping from size and frequency of shipments to fixed costs per shipment. We use a unique dataset of Swiss cross-border trade on the transaction level to infer the size and shape of the underlying fixed costs. The inferred fixed costs are specific to each firm–country–product combination. Our results suggest that the fixed costs per shipment of the average Swiss exporter are large, ranging between 0.82% of the export value in our most conservative specification and 5.4%. We document that the imputed fixed costs per shipment correlate negatively with language commonalities, trade agreements and geographic proximity.     

Trust and controllability in venture capital fundraising

This study discusses a model of success in venture capital (VC) fundraising. We develop this model based on agency and trust theory. The model is tested against quantitative data collected from 151 limited partners (LP) with headquarters predominantly in North America and Europe. Beyond the well-known criterion of the VC firm's track record, results suggest that trust and perceived controllability shape the investment decisions of those LPs. Moreover, antecedents of these main factors are evaluated. In sum, this study shows how fundraising VC firms can systematically manage the fundraising process.     

Cross-cultural entrepreneurship research: Current status and framework for future studies

Although cross-cultural research in the field of entrepreneurship is still in its infancy as a research stream, it offers important inferences for both theory and practice. Some have criticized the relative immaturity of previous survey-based studies’ methodology. In order to address this flaw, we analyze existing survey-based studies in the field of cross-cultural entrepreneurship to identify research gaps in content and methodology and then derive the most appropriate analytical approach to fill the gaps for this type of research. Finally, we present a practical framework in which to conduct sound and prudent future studies, integrating the most appropriate analytical approach, general methodological insights, and the particularities of entrepreneurship research in a cross-cultural setting.