OWNERSHIP,CONTROL, AGENCY AND RESIDUAL CLAIMS IN HEALTHCARE: INSIGHTS ON COOPERATIVES AND NON‐PROFIT ORGANIZATIONS

Many issues surrounding healthcare entities’ performance can be traced to their governance and ownership. Increasingly, public services are being provided by non‐profit organizations and/or cooperatives, particularly in the healthcare sector. This is not unproblematic. We draw on the conceptual separation of ownership and control, and the notion of firm ownership to derive a taxonomy of dimensions along which a contractual‐ and property rights theory of the firm can be structured, in order to determine the nature of firms’ differences. We utilize the taxonomy to illustrate important distinctions between non‐profit and cooperative firms in the primary healthcare sector and propose testable hypotheses. Funders and regulators must recognise the differences between these firms, if public funding of healthcare is to achieve the expected outcomes.     

Innovation and productivity in SMEs: empirical evidence for Italy

Innovation in SMEs exhibits some peculiar features that most traditional indicators of innovation activity do not capture. Therefore, in this paper, we develop a structural model of innovation that incorporates information on innovation success from firm surveys along with the usual R&D expenditures and productivity measures. We then apply the model to data on Italian SMEs from the “Survey on Manufacturing Firms” conducted by Mediocredito-Capitalia covering the period 1995–2003. The model is estimated in steps, following the logic of firms’ decisions and outcomes. We find that international competition fosters R&D intensity, especially for high-tech firms. Firm size and R&D intensity, along with investment in equipment, enhances the likelihood of having both process and product innovation. Both these kinds of innovation have a positive impact on firm’s productivity, especially process innovation. Among SMEs, larger and older firms seem to be less productive.

The moonlighter

Jeremy Hicks, Zagante Systems' lead programmer, walks into the office at eight o'clock on a Sunday night and does a double take when he spots his boss, Melanie. She's equally surprised to find she isn't alone. Before leaving for the evening, Melanie pays Jeremy a visit, only to discover that he isn't hard at work on Zagante's new product--he's programming a game for another company. The next day over lunch, Melanie confronts Jeremy and lets him know that he needs to stay focused on Zagante's new software. Jeremy insists that he's fully engaged in it. So Melanie agrees to keep the moonlighting under wraps so long as it doesn't interfere with Jeremy's job. That night, Melanie sits down at her laptop and opens up a Google window. "Moonlighting," she types. Dismayed at the number of hits, she changes her search to "Fired for moonlighting." This search leads her to case after case, but none helps her with Jeremy. She tries one more time. "Promoted for moonlighting," she types. No surprise. Zero hits. Frustrated with Jeremy, yet anxious to keep such a talented employee, Melanie turns to Jill Darby, Zagante's HR director, for guidance. Jill has both good and bad news. The bad news is that the company has no moonlighting policy. The good news is that Jill can arrange for Jeremy to receive a low-interest loan. But when Melanie tells Jeremy about the loan, he doesn't go for it. He's not just freelancing for the money, it turns out; he's downright enjoying the work and doesn't appreciate his boss butting in to his private business. How should Melanie handle this moonlighting issue? Commentators Bill Jensen, author of Work 2.0: Rewriting the Contract; attorney Barry LePatner; economics professors Jean Kimmel and Karen Conway; and HR director Sandra Davis offer advice in this fictional case study.