Relating in business networks: Innovation in practice

Few studies have looked at the innovation process in the early stages of new business ventures in the context of business networks. Reporting on eight years of development of a new venture, we examine how the development of initial business relationships in an ever-changing business network affects technological innovation. We conclude that technological innovation is contingent on the development of business relationships that are a critical mechanism permitting a new venture not only to access but also to produce knowledge essential for innovating. For management this implies the need to strike a judicious balance between internal focus and closure to produce novel solutions and external focus and openness to experiment in business relationships.     

Impact of Chinese Agribusiness Entrepreneurs on the Local Land Market in the Russian Far East

Chinese originally migrated to the Russian Far East (RFE) to fill a labor shortage on collective farms. In more recent decades, some Chinese migrants have chosen to lease land from Russian farmers to manage their own farms. Rising soybean prices and the trade war between China and the United States have increased demand for land capable of producing soybeans. Thus, Chinese farmers in the RFE compete for land with Russians. The Chinese also contribute positively to local food security by increasing food availability and accessibility. This study uses an econometric model to analyze the impact of Chinese on local land markets in the RFE. Financial support for Russian farmers by the government depresses their demand for land; rising soybean prices and the employment of Chinese farm workers by Russian farmers encourage farm expansion, resulting in higher land prices. Selling farm produce to Chinese merchants increases the amount of land owned, cultivated, and rented by Russian farmers.     

Economy as a Social System: Niklas Luhmann's Contribution and its Significance for Economics

Niklas Luhmann's (1927–1998) ambitious research project was aimed not only at describing society as a global social system, but it also analyzed various subsystems (including an economic one). The article assesses Luhmann's vision of the economy, summarized mainly in his Wirtschaft der Gesellschaft, wherein he addresses basic economic notions: the economic system, money, prices, rationality, and the market. I then interpret his ideas in the context of modern discussions in economics (intersubjective structures, complex systems, and evolutionary modeling). I also propose some heuristics implied by Luhmann's economic ontology, which are potentially interesting for methodological and theoretical strategies of modern economics.     

Three decades of research on corporate governance and R&D investments: a systematic review and research agenda

This paper reviews and systematizes the empirical research on the nexus between corporate governance (CG) and investments in research and development (R&D) published in leading business, management, economics and finance journals over the past 30 years. We find that CG is key in shaping R&D investments. Moreover, the effects of both firm- and country-level CG are important for both internal and external R&D investments. Drawing on our review, we welcome future studies to examine the effect of the interplay between various CG mechanisms and different types of R&D investments, and possibly identify mediating variables besides the moderating ones. Moreover, we highlight the need for future interdisciplinary studies, as well as investigations of private companies and across developing countries. Whenever causal interpretations are attempted, both sample selection and endogeneity problems should be addressed, along with testing the CG-R&D investment nexus for nonlinear dynamics. The implications of the study for both theory and practice are also discussed.     

The impact of entry costs on export market participation in agriculture

Theoretical models of market entry imply that sunk costs are an important factor in the decision to export. Following Helpman, Melitz, and Rubinstein (2008) , we develop a simple model of foreign market participation and use a Bayesian method to estimate the resulting dynamic discrete‐choice model with lagged dependent variable. Employing a balanced panel data that follows 81 trading partners for 30 years from 1971 to 2000, we estimate our model and compute the marginal effect of sunk costs on the likelihood of export market participation. We find that such costs are economically and statistically important for trade in all of the six major agricultural commodities (Cereals, Dairy, Fish, Meat, Vegetables and Fruits, and Sugar), for agricultural producers in both developed and developing countries. We also find evidence suggesting that, in general, market access for both developed and developing exporters had improved in the years following the Uruguay round of trade negotiations (1995–2000).     

The determinants of service exports from Central and Eastern Europe

The transition economies of Central and Eastern Europe (CEE) have become important exporters of many types of services to Western Europe. We identify the sources of CEE’s advantages over competing exporters, such as India, China and Brazil, using disaggregated data on service exports and a novel estimation technique for the gravity equation. Our results indicate that the importance of geographical distance varies substantially across types of service exports. Geography is important for exports of construction services, but it has a negligible impact on computer‐related services. However, the relative quality of legal institutions influences trade across a broad range of service categories. The results demonstrate that aggregating services that are not homogeneous could conceal important differences in the effects of geographical distance and other variables on the pattern of service trade.     

Regulation of international roaming in the European Union—Lessons learned

This paper analyzes the evolution of prices and competition in intra-EU international roaming markets. It addresses three main research questions: (i) to what extent have market forces by themselves brought competition to retail roaming markets? (ii) Has the evolution of market dynamics in wholesale roaming improved competition? (iii) Is wholesale regulation sufficient to lead to a reduction in retail roaming prices? Data show that there has been little price-based competition both at wholesale and retail levels, despite prices being well above costs and the significant margins allowed by regulation. Available data from the period preceding the entry into force of the first EU roaming regulation also point to the same conclusion. Lack of competitive pressure in retail roaming markets and inelastic demand give little incentives for retail roaming service providers to lower prices. Wholesale international roaming markets have complex competition dynamics. They are characterized by the reciprocity of wholesale roaming agreements and traffic internalization inside transnational groups. These circumstances limit price competition at the wholesale level. The traditional regulatory approach applied to electronic communication markets has been primarily focused on wholesale regulation. However, empirical evidence shows that even if wholesale charges are reduced, retail roaming markets continue to operate at very high retail margins (for example, more than 200% retail mark-up over wholesale charges for data roaming services and incoming calls). This proves that in international roaming markets wholesale charge reductions are not necessarily passed on to retail prices. It can thus be inferred that wholesale price regulation alone is in most cases not sufficient to ensure that benefits are passed through to end users.     

Senior expatriate leadership's effects on innovation and the role of cultural intelligence

We propose that senior expatriates’ visionary–transformational leadership influences the rate of innovation adoption in the organizations or units they head, but cultural intelligence moderates this relationship. Our hypotheses were tested with data from 153 senior expatriate managers and 695 subordinates from companies in all 27 countries of the European Union. We found a direct influence of senior expatriates’ visionary–transformational leadership on the rate of innovation adoption. Cultural intelligence moderates the effect of senior expatriates’ leadership on organizational innovation, but not on product-market innovation. Implications for academic research and business practice are discussed.