Antecedents to supplier integration in the automotive industry: A multiple-case study of foreign subsidiaries in China

Supplier integration has become an important concept for improving supply chain performance. The aim of this paper is to identify factors that facilitate and inhibit supplier integration in the context of the Chinese automotive industry. An inductive approach based on grounded theory was chosen as the research methodology, where data was collected through 30 detailed case interviews with subsidiaries of foreign automotive companies operating in China. The results indicate that buyer-side leadership is an important antecedent for building motivation, trust, and commitment among suppliers and for shaping their mindsets. This, in turn, facilitates strategic alignment and enables suppliers to build collaborative capabilities, which are finally shown to be a key enabler for successful supplier integration.     

Structural measurement errors in nonseparable models

This paper considers measurement error from a new perspective. In surveys, response errors are often caused by the fact that respondents recall past events and quantities imperfectly. We explore the consequences of limited recall for the identification of marginal effects. Our identification approach is entirely nonparametric, using Matzkin-type nonseparable models that nest a large class of potential structural models. We show that measurement error due to limited recall will generally exhibit nonstandard behavior, in particular be nonclassical and differential, even for left-hand side variables in linear models. We establish that information reduction by individuals is the critical issue for the severity of recall measurement error. In order to detect information reduction, we propose a nonparametric test statistic. Finally, we propose bounds to address identification problems resulting from recall errors. We illustrate our theoretical findings using real-world data on food consumption.     

Germany and France at cross purposes: the case of Banking Union

In the past, France and Germany were able to exercise leadership in history-making decisions in monetary cooperation, from the establishment of the EMS to EMU. In the case of Banking Union (BU), however, Germany and France turned out to be the main opponents with little common influence. Why could we not observe the familiar pattern of Franco-German co-leadership in building the BU? My explanation points to diverging views on the social purpose of a BU, the asymmetrical distribution of its costs and benefits for the two countries, highly prominent distributional conflicts and severe domestic constraints in Germany. These explanatory factors also account for the unfinished character of Banking Union.     

Product diversification and stability of employment and sales: first evidence from German manufacturing firms

In this study, we use a unique rich newly built data set for German manufacturing enterprises to investigate the relationship between product diversification and the stability of sales and employment. We find that contrary to portfolio theoretic considerations, more diversified firms exhibit a higher variability of sales and employment. However, the effects are negligibly small from an economics point of view.     

Branding in the age of social media firestorms: how to create brand value by fighting back online

ABSTRACT

Leading research on social media firestorms typically advises managers to quickly quell the backlash by appeasing brand critics. Drawing on crisis communications and branding research, we offer a radically different perspective and argue that brands can benefit from fighting back online. Through a netnography of a moral-based firestorm, we contribute to the marketing and crisis communications literatures by identifying the escalation strategy as a way to build brand value; explaining how brands can activate supporters; and providing guidance on how to assess these morally steeped events. We advance branding research by identifying how managers can provoke consumer-generated brand stories; and uncovering the hidden benefits of negative consumer voices. Finally, we outline a new perspective on how brands are dialogically constructed through a process we call ‘flyting’.     

A note on why more West than East German firms export

Germany is one of the most important exporters of manufacturing goods in the world, but by far not all manufacturing firms in Germany are exporters, and there is a remarkable gap between the share of exporters in all manufacturing firms between West Germany and East Germany. While in West Germany in 2004 about two in three manufacturing plants were exporters, fourteen years after re-unification this share was less than fifty percent in the former communist East Germany. Given that exports play a key role in shaping business cycles and growth in Germany, and the much higher unemployment in East compared to West Germany, promotion of exports by East German firms figure prominently on the policy agenda. However, the reasons for the large difference in the propensity to export between East and West German firms are not yet well understood, not least due to a lack of comprehensive micro data. Using unique new data and a recently introduced non-linear decomposition technique this paper shows that the huge difference in the propensity to export between West and East German plants can only partly be explained by differences in firm size, productivity, and technology intensity.

Offshoring and firm performance: self-selection,effects on performance,or both?

This paper uses unique new data for German manufacturing enterprises from matched regular surveys and a special purpose survey to investigate the causal effect of relocation of activities to a foreign country on firm performance. Compared to non-offshoring firms, firms that relocated activities were larger and more productive, and had a higher share of exports in total sales. These differences existed the year before some firms started to relocate, and this points to self-selection of “better” firms into offshoring. To investigate the causal effects of offshoring, six different variants of a matching approach are used. Contrary to what is often argued we find no evidence for a large negative causal effect of offshoring on employment in Germany.     

International Differences in Conditional Conservatism – The Role of Unconditional Conservatism and Income Smoothing

Abstract

Prior research documents that conditional conservatism, measured as the asymmetric timeliness of earnings reflecting bad vs. good news, varies with cross-country differences in institutional regimes. In this paper, we examine the determinants of conditional conservatism and related earnings attributes internationally. First, using panel data, we investigate whether competing earnings attributes such as unconditional conservatism and income smoothing affect conditional conservatism and its international differences. We find that these attributes are predictably correlated with conditional conservatism. Second, we address the question whether income smoothing and conditional conservatism are two fundamentally different earnings attributes. We show theoretically that both attributes yield different earnings distributions and that the motivations for producing earnings which possess these attributes differ. To test these predictions empirically, we calculate firm-specific time-series measures of asymmetric timeliness, using a novel trigonometric measure based on the standard Basu (1997)-type regression. Using this cross-sectional data, we test whether conditional conservatism and income smoothing are different and find them to be only weakly correlated for a broad international sample. Also, we demonstrate that income smoothing explains international differences in conditional conservatism. Finally, we estimate simple determinant models of conditional conservatism and income smoothing, showing that both earnings attributes are driven by different explanatory firm-level factors: Conditional conservatism increases with the importance of debt financing, while income smoothing increases with the importance of dividends. Despite some important limitations, we believe our results to be meaningful because they show that cross-country differences in conditional conservatism are influenced by the effects of other accounting properties, predominantly income smoothing. Especially, legal regime appears to drive income smoothing while losing its explanatory power for conditional conservatism when firm-specific factors are controlled for.