new evidence in the pursuit of locating new businesses abstract finding good generalizable samples has long been an achilles heel for those interested in entrepreneurship related phenomena practitioners policy makers and researchers frequently desire to take the pulse of entrepreneurial activity but struggle in doing so for example friedman 1995 reported that california overestimated job loss by 2 4 times because of failure to account for newer more robust firms with the goal of being able to better identify new businesses this research addresses the following questions 1 which sample sources best identify new businesses 2 are the characteristics of a sample drawn from one source similar to those drawn from a different source 3 how accurate are the different sample sources in the information they report and 4 how practical and cost effective are the different sample sources we pursued answers to these questions by examining the state sales tax file and comparing it with the previously examined sources of the state unemployment insurance file es202 and dun bradstreet s dun s market indicator file dmi birley 1984 aldrich et al 1989 the phonebook was also used to examine its overlap with the three primary sources in making these comparisons we evaluate generalizability issues accuracy of founding date cost practicality and other auxiliary information sales tax file our findings suggest that the sales tax file is a rich source for identifying generalizable samples the accuracy of the founding data was correct over 70 of the time and it appears to identify businesses very early in the start up phase the data also are available in machine readable format give some helpful auxiliary information and the cost of obtaining the file was negligible another advantage of the sales tax file is its ability to identify new businesses that do not have visible on street locations thus the sales tax file appears to be a very credible source for identifying firms early in the start up process es202 file dmi file and phone book our study affirms earlier studies that found major limitations with both the es202 and dmi files more specifically this study found that both sources have substantial limitations in identifying new start up firms and they both appear to be slow in removing firms from their records once they have moved or gone out of business as for the phonebook as it is only issued annually it takes some time for new businesses to be listed in the directory furthermore because so many of the new businesses identified by the sales tax file initially operate out of the entrepreneur s home 58 in our survey sample the enumeration phonebook method would miss many new businesses unless they had a business phone listing and a business sign on their residential property thus we do not consider the enumeration phonebook method to be very practical nor the best method for identifying new firms in sum these findings give renewed hope in locating generalizable samples of new businesses although the sales tax file is not a perfect source it represents a very attractive alternative for those interested in identifying entrepreneurial firms early in the start up phase these findings should assist practitioners policy makers and researchers in making better sample selections which should lead to more accurate indicators of new business start ups fewer sample biases and ultimately to a better understanding of the determinants of new venture failure and success

intrinsic motivation in public service theory and evidence from state supreme courts abstractthis paper provides a theoretical and empirical analysis of the intrinsic preferences of state appellate court judges we construct a panel data set using published decisions from all state supreme courts from 1947 to 1994 we estimate the effects of changes in judges employment conditions on a number of measures of judicial performance the results are consistent with the hypothesis that judges are intrinsically motivated to provide high quality decisions and that at the margin they prefer quality over quantity when judges face less time pressure whether from the introduction of an intermediate appellate court the weakening of electoral demands or an increased salary they write more well researched opinions that are cited more often by other judges these effects are strongest when judges have more discretion to select their portfolios of cases

is firm specific innovation associated with greater value appropriation the roles of environmental dynamism and technological diversity abstract this paper extends the resource based theory of the firm to examine the contingencies that either intensify or reduce the relationship between firm specific innovation and value appropriation based on a large scale analysis of a sample of us manufacturing firms we found that greater innovation rents appropriation is associated with an increase in firm specificity of its innovative knowledge but the positive relationship between firm specific innovations and firm value appropriation tends to decrease when the product or technology market is highly dynamic further under high environmental dynamism firms should increase the diversity in their knowledge composition in order to mitigate the risk of value erosion associated with firm specific innovations

the allocation and effectiveness of china s r d subsidies evidence from listed firms abstract in this study we investigate the allocation of china s r d subsidies and their effectiveness in stimulating business r d investments for the population of chinese listed firms between 2001 and 2006 with respect to subsidy allocation we find that firm selection is mainly determined by prior grants high quality inventions and minority state ownership market oriented provincial governments distribute grants less frequently and firms located in developed provinces receive grants more often considering effectiveness r d subsidies instantaneously crowd out business r d investment but are neutral in later periods in 2006 one public rmb reduces business r d investments by half an rmb however crowding out is not prevalent for repeated recipients of r d subsidies high tech firms and minority state owned firms

human resources human resource management and the competitive advantage of firms toward a more comprehensive model of causal linkages we maintain that human resources are strategically significant in at least three cases when these resources 1 help create traditional ricardian rents 2 function as components of organizational capabilities that generate nontraditional ricardian rents and 3 are the source of technological and managerial innovations that produce entrepreneurial rents human resource management hrm activities on the other hand assume strategic significance by supporting the three cases above through a process that we call managerial entrepreneurship furthermore hrm takes on different forms when supporting each of these types of rents hence this rent based view has greater potential to help explain the contribution of human resources to firms competitive advantages than approaches that are grounded in the resource based view rbv of the firm which primarily reflects the ricardian view of rents moreover a rent based approach suggests fruitful new ways to address many of the theoretic challenges confronting the strategic human resource management shrm literature

to elect or to appoint bias information and responsiveness of bureaucrats and politicians in this paper we address empirically the trade offs involved in choosing between bureaucrats and politicians in order to do this we map institutions of selection and retention of public officials to the type of public officials they induce we do this by specifying a collective decision making model and exploiting its equilibrium information to obtain estimates of the unobservable types we focus on criminal decisions across us states supreme courts we find that justices that are shielded from voters influence bureaucrats on average i have better information ii are more likely to change their preconceived opinions about a case and iii are more effective make less mistakes than their elected counterparts politicians we evaluate how performance would change if the courts replaced majority rule with unanimity rule

capacity investment under postponement strategies market competition and demand uncertainty we consider duopoly models where firms make decisions on capacity production and price under demand uncertainty capacity and price decisions are made respectively ex ante and ex post demand realizations the interplay between the timings of demand realization and production decision endows firms with different capabilities flexible firms can postpone production decisions until the actual demand curve is observed but inflexible firms cannot under general demand structures and cost functions we characterize the equilibrium for a symmetric duopoly and establish the strategic equivalence of price and quantity competitions when firms are flexible we investigate the stochastic order properties of capacity and profit and show that they both increase for a flexible firm when the market is more volatile we find that flexibility allows a firm to increase investment in capacity and earn a higher profit while benefiting customers by keeping the price in a narrower range strategic equivalence implies that

a study of the relationship between competitiveness and technological innovation capability based on dea models researchers and managers have been searching for appropriate methods to explore the relationship between technological innovation capability and competitiveness in recent years this study attempts to find a systematic quantitative methodology to tackle this problem in a recent survey covering 182 industrial innovative firms in china the traditional data envelopment analysis dea model was employed to analyze the data collected the research results show that only 16 of the enterprises operate on the best practice frontier and there are some inconsistencies between organizational innovation capability and competitiveness in many enterprises decreasing returns to scale were found among about 70 of the inefficient enterprises and increasing returns to scale were found among the remaining 30 of the inefficient enterprises thus the internal innovation harmonizing process in these enterprises is considerably inefficient based on the restricted ranges of the input output factors a multi objective dea projection model has also been developed in this study to provide a benchmark for auditing competitiveness research results further indicate that there is still much room for enterprises to improve competitiveness in situations of confining score ranges of technological innovation capability and competitiveness

strategic group formation and performance the case of the u s pharmaceutical industry 1963 1982 the focus of this paper is on three major questions 1 what is the theoretical rationale for the strategic group concept 2 does strategic group membership have performance implications and 3 are strategic groups and membership in strategic groups stable characteristics of industries a statistical procedure is proposed to longitudinally identify strategic groups the empirical setting is the u s pharmaceutical industry over the period 1963 82 while performance differences are found in terms of market share profitability differences between groups are not observed neither are differences found in terms of risk and risk adjusted performance these results are attributed to the existence of performance variation within each strategic group a dynamic model of competitive repositioning is proposed which helps integrate the findings from the study

legislative restraints in corporate bailout design abstract the aftermath of the recent economic crisis saw the largest u s government bailout of corporate entities ever while the bailout was carried out with the explicit goal of restoring stability it aroused much controversy and public criticism based on moral hazard concerns as well as the exorbitant cost to the taxpayer this paper examines the bailout design on behalf of an imperfectly informed legislature aimed at shaping the incentives of a policymaker to whom bailout decisions are delegated we show that important elements of the more moral hazard proof design entail various legislative procedural hurdles which effectively make the bailouts dependent on supermajority support

asset stock accumulation and sustainability of competitive advantage given incomplete factor markets appropriate time paths of flow variables must be chosen to build required stocks of assets that is critical resources are accumulated rather than acquired in strategic factor markets barney barney j 1986 strategic factor markets expectations luck and business strategy management sci october 1231 1241 sustainability of a firm s asset position hinges on how easily assets can be substituted or imitated imitability is linked to the characteristics of the asset accumulation process time compression diseconomies asset mass efficiencies inter connectedness asset erosion and causal ambiguity

information polarization and term length in democracy abstract this paper considers term lengths in a representative democracy where the political issue divides the population on the left right scale parties are ideologically different and better informed about the consequences of policies than voters are a short term length makes the government more accountable but the re election incentive leads to policy distortion as the government seeks to manipulate swing voters beliefs to make its ideology more popular this creates a trade off a short term length improves accountability but gives distortions a short term length is best for swing voters when the uncertainty is large and parties are not very polarized partisan voters always prefer a long term length when politicians learn while in office a long term length becomes more attractive for swing voters

are organisation researchers too obsessed with the economic responsibility of the firm the original intent of business education in america focused on the development of professional managers who would look after the interests of society as economic and shareholder theories influenced business education firm performance became the manager s top if not only priority the economic responsibility of the firm also appears to be dominating scholarly interest in organisations as well however business firms constitute part of the fabric of society and closer attention should be paid by organisation researchers to the social responsibilities of the firm in doing so a more balanced research approach can be achieved in this article we give evidence that research within the study of the organisation specifically in the field of management has predominately turned its attention to the economic responsibility of the firm we close by demonstrating that other fields within organisation research also appear to be favouring the study of performance and we offer suggestions as to how scholars might better address the firm s role in society beyond its economic responsibility

a literature based innovation output indicator abstract this paper presents an application of a recently developed method for measuring innovative activity in a national economy based on new product announcements in trade and technical journals the literature based innovation output indicator is not meant to capture all aspects of innovation or to substitute for other indicators but is seen as a useful addition to the range of indicators available the method is described in detail and then applied to the uk a sample of 941 innovations is constructed and then subjected to analysis the results suggest that the method is a useful and relatively reliable way of measuring the degree of radicalness of innovations being generated and of surveying their distribution across sectors across firm size and across firms which are uk owned or foreign owned the method captures product innovations well but captures process innovations less well the results for the uk suggest that the more radical innovations come disproportionate from companies based outside the uk innovations originating inside the uk are skewed towards product differentiation there is also some evidence that smaller companies produce a slightly higher than average share of the more radical innovations the paper suggests that this small scale testing of this indicator has produced promising results and that there would be benefits to the policy community from establishing it on a permanent basis

fiscal transparency political parties and debt in oecd countries abstract many believe and argue that fiscal or budgetary transparency has large positive effects on fiscal performance however the evidence linking transparency and fiscal policy outcomes is less compelling to analyze the effects of fiscal transparency on public debt accumulation we present a career concerns model with political parties this allows us to integrate as implications of a single model three hitherto separate results in the literature on deficit and debt accumulation that transparency decreases debt accumulation at least by reducing an electoral cycle in deficits that right wing governments at least for strategic reasons tend to have higher deficits than left wing governments and that increasing political polarization increases debt accumulation to test the predictions of the model we construct a replicable index of fiscal transparency on 19 country oecd data simultaneous estimates of debt and transparency strongly confirm that a higher degree of fiscal transparency is associated with lower public debt and deficits independent of controls for explanatory variables from other approaches

fiscal expansion and political instability in the iberic latin region recent research by public choice oriented economists and political scientists points to a negative relation between fiscal expansion and voter support for the incumbents real per capita federal spending is negatively associated with the vote for the incumbent party s candidate in american presidential elections niskanen 1979 there is a negative relation between increases in the percent of gross national product spent by the central government and incumbent party reelection to the white house and the british parliament cuzain and heggen 1984 1985 furthermore the incumbent party s vote in american gubernatorial elections varies inversely with increases in the ratio of state general revenues to state personal income between elections peltzman 1987 fiscal expansion is also associated with the overthrow of latin american governments cuzin 1986 fiscally expansionist latin american regimes whether civilian governments or military juntas tend to be overthrown while democracies and dictatorships practicing fiscal restraint usually survive together these findings suggest that fiscal expansion costs the incumbent party a loss of political support resulting in its being voted out or forced out of office since the stability of any government depends partly on support for the incumbents it is hypothesized that ceteris paribus fiscal expansion is a cause of political instability according to this hypothesis fiscal expansion has a boomerang effect on the incumbents increasing the likelihood that the party will lose executive office either by election or coup the purpose of this paper is twofold one is to bring additional empirical

the red queen in action the longitudinal effects of capital investments in the mobile telecommunications sector organizations undertake capital investments in technology to generate revenues or decrease costs and thereby enhance profitability however red queen type responses by competing organizations in the form of rapid imitation and escalating of technology investments erode the ability of the investing organizations to sustain gains in profitability productivity gains from these investments may persist but they may not translate into sustained profitability gains owing to declining prices brought about by a hypercompetitive environment the emergence and erosion of benefits attributable to capital investments is examined by decomposing profitability into productivity price recovery product mix and capacity utilization and by regressing each performance measure on past technology investments a polynomial distributed lag model is estimated with quarterly data for 30 firms in the mobile telecommunications services sector from 1996 to 2005 the results indicate that capital investments are positively associated with productivity of current and future periods and their association with profitability is only positive in the future after six quarters these results highlight a unique outcome of the red queen hypothesis simply by imitating learning and investing in technology due to competition is beneficial to all firms in the industry

comparing innovation systems a framework and application to china s transitional context abstract this paper proposes a generic framework for analyzing innovation systems anchored around five fundamental activities r d implementation end use education linkage and focused on the performance implications of a system s structure and dynamics rather than simply describing the role and performance of particular actors institutions and policies this approach focuses on system level characteristics including the distribution of these activities within the system the organizational boundaries around them coordination mechanisms evolutionary processes and the effectiveness of the system in introducing diffusing and exploiting technological innovations the framework is applied to a comparison of china s national innovation system under central planning and since reforms revealing the evolving structure and dynamics of this system and current inconsistencies and perverse incentives that policymakers must address to realize their development goals more generally it provides a basis for addressing the implicit assumptions of organizational types roles and convergence among innovation systems emerging in very different contexts whether national regional or industrial

the provocative public sector domestic political protest and public sector growth in the oecd 1965 1982 the results shown in tables 1 through 8 above are consistent in that gg is repeatedly shown to be significant whether making cross national comparisons of dpp or predicting intra national variations over time therefore hypotheses 1a and 1b are confirmed the confirmation of hypotheses 2a and 2b shows that taking into account public sector size government growth is most provocative in countries where it represents a major socio economic change i e where the public sector is small government growth has a neutral impact where the role of the public sector is long established i e where the public sector is large

super partes assessing the effect of judicial independence on entry incumbents can enjoy a cost advantage vis a vis new entrants and so deter new firm entry by establishing and leveraging connections with the judicial system connected firms may in fact avoid fully complying with the costly norms implied by a law a regulation or a contract at the same time they can also credibly threaten to sue new entrants therefore a change in the institutional environment that diminishes the ability of incumbent firms to establish judicial connections i e an increase in judicial independence can promote entrepreneurship exploiting reforms that change the way in which u s state judges are selected we confirm that this is the case and we show that this effect is more salient in states and industries where the likelihood of entering into a business dispute is higher the paper also sheds some light on the mechanisms behind this effect data and the online appendix are available at https doi org 10 1287 mnsc 2017 2794 this paper was accepted by toby stuart entrepreneurship

using acquisitions to access multinational diversity thinking beyond the domestic versus cross border m a comparison prior research provides ambiguous results regarding the performance of international acquisitions drawing on a survey of 248 acquisitions we find that acquirers enhance their capabilities when they buy a target with a multinational geographic scope a financial event study uses a subsample of the acquisitions to show that the financial markets also value targets multinational scope both surveys and stock market based studies suggest that targets with access to heterogeneous resource environments provide the acquirer with greater potential for capability enhancement and financial performance in contrast simply acquiring firms across borders has less influence on post acquisition outcomes the study demonstrates greater value of the attributes of the target rather than of international expansion alone thus the multinational scope of the target is more likely to account for the resource diversity provided by the target than the country of origin of the target per se the study changes the emphasis on multinational acquisitions by shifting the focus from foreign market expansion country level emphasis to accessing geographically distributed resources that are embedded in target firms firm level emphasis

the financing of business start ups abstract this article investigates the determinants of capital structure and types of financing used around business start ups utilizing a survey that reduces the confounding effects of survivorship bias in particular the influence of start up size asset structure organization type growth orientation and owners characteristics are examined both in the choice and in the magnitude of finance use the results are consistent with the theoretical models incorporating issues such as information asymmetries agency theory and transaction costs the results also demonstrate linkages among providers of finance maturity of assets and the capital structure of start ups while the results provide insights into business finances near the time of creation some recommendations for future research are discussed

knowledge diffusion market segmentation and technological catch up the case of the telecommunication industry in china abstract this paper examines the growth of technological capability in the telecommunication industry in china we apply a modified version of lee and lim s lee k lim c 2001 the technological regimes catch up and leapfrogging findings from the korean industries research policy vol 30 model of technological learning and catching up using the three cases of the shanghai bell the cit led r d consortium and indigenous companies such as huawei we analyze how the catching up in the telecommunication industry occurred we find that the important factors in the catch up are the strategy of trading market for technology the knowledge diffusion from shanghai bell both to the r d consortium and to huawei and industrial promotion by the government as a condition for successful catch up the paper points out that the technological regime of the telephone switches is featured by a more predictable technological trajectory and a lower cumulativeness these conditions and strategies helped the chinese firms to achieve a stage skipping catch up namely by skipping the stage of analogue electronic switches to jump to digital electronic switches

a positive theory of fiscal deficits and government debt this paper considers an economy in which policymakers with different preferences alternate in office as a result of elections government debt is used strategically by each policymaker to influence the choices of his successors if different policymakers disagree about the desired composition of government spending between two public goods the economy exhibits a deficits bias that is debt accumulation is higher than it would be with a social planner the equilibrium level of debt is larger the larger is the degree of polarization between alternating governments and the less likely it is that the current government will be re elected

the u s national innovation system origins and prospects for change in recent years the concept of national innovation systems has attained considerable currency and interest although a precise definition of a national innovation system is difficult analyses of the japanese and u s national innovation systems have implicitly defined them as the array of public and private institutions and organizations within an economy that fund and perform rd nelson 1993 interest in national innovation systems stems in part from a growing acknowledgment of the contributions to national economic welfare of superior performance in the commercialization and adoption of new technologies this awareness in turn has been heightened by the innovative and economic strength of postwar japan

civil service reform abstract civil service rules governing the selection and motivation of bureaucrats are among the defining institutions of modern democracies although this is an active area of reform in the us and elsewhere economic analyses of the issue are virtually nonexistent this paper provides a welfare evaluation of civil service reform it describes the effect of reform on the interaction of politicians voters and bureaucrats and shows that society often faces trade offs between improving the bureaucracy and improving the performance of politicians my results characterize the conditions under which merit based recruitment and civil service protections such as tenure can improve welfare

incumbent performance and electoral control in the pure theory of electoral competition citizens compare the platforms of the candidates and vote for the one whose platform is preferred candidate strategies are identified with promises about future performance in office models of this sort have been developed in both static mckelvey 1975 and dynamic kramer 1977 i settings and all appear to have the property that if the set of alternatives is large enough in some sense equilibrium platforms rarely exist but these models have another feature that is quite as disturbing as their instability in the static setting discussed by mckelvey little attention is paid to the possibility that once in office the politician s preferences may diverge from those of his constituents and that he may therefore choose policies at variance from his platform instead it is simply assumed that promises will be kept whether or not such behavior is congruent with the interest of the officeholder it is sometimes argued that an enforcement mechanism may exist to discipline politicians for failing to keep promises but without a specification of the mechanism it is not obvious that it would be in the interests of the

preferences and incentives of appointed and elected public officials evidence from state trial court judges we study how two selection systems for public officials appointment and election affect policy outcomes focusing on state court judges and their criminal sentencing decisions first under appointment policy congruence with voter preferences is attained through selecting judges with homogeneous preferences in contrast under election judges face strong reelection incentives while selection on preferences is weak second the effectiveness of election in attaining policy congruence critically depends on payoffs from the job which implies that the effectiveness of election may vary substantially across public offices third reelection incentives may discourage judges with significant human capital from holding office jel d72 k41 understanding systems concerning the selection and retention of public officials and their effects on policy outcomes has long been an important issue in economics e g barro 1973 and ferejohn 1986 in this paper we compare two selection systems for public officials appointment by the head of the executive branch and election by popular votes we study the influence of the selection systems on public officials behavior focusing on state court judges and their criminal sentencing decisions specifically we quantitatively assess the separate role of preference heterogeneity versus reelection incentives in determining sentencing decisions we focus on the behavior of state court judges in the state of kansas which has within state variation in the selection systems 1 we conduct three key analyses

public policy measures to support new technology based firms in the european union abstract this paper provides a review of public policy measures implemented in eu countries to support new technology based firms ntbfs during the 1980s and early 1990s it identifies five policy areas and provides a synthesis of the policy developments during this period and an assessment of their effectiveness the policy areas examined are science parks the supply of phds in science and technology the relationships between ntbfs and universities research institutions direct financial support to ntbfs from national governments and the impact of technological advisory services on ntbfs although considered independently these issues are clearly part of an interdependent system of policies and we conclude with an overview of the whole policy area together with our personal recommendations for its improvement

why a stubborn conservative would run a deficit policy with time inconsistent preferences a conservative government in favor of a low level of public consumption knows that it will be replaced by a government in favor of a larger level of public consumption we show that the resulting level of public consumption is in between the levels the two governments would choose if each were in power both in the present and in the future in particular we show that if the conservative government is more stubborn in a particular sense than the succeeding government the conservative government will borrow more than it would had it remained in power in the future

information technology as competitive advantage the role of human business and technology resources this paper investigates linkages between information technology it and firm performance although showing recent signs of advance the existing it literature still relies heavily on case studies anecdotes and consultants frameworks with little solid empirical work or synthesis of findings this paper examines the it literature develops an integrative resource based theoretical framework and presents results from a new empirical study in the retail industry the findings show that its alone have not produced sustainable performance advantages in the retail industry but that some firms have gained advantages by using its to leverage intangible complementary human and business resources such as flexible culture strategic planning it integration and supplier relationships the results support the resource based approach and help to explain why some firms outperform others using the same its and why successful it users often fail to sustain it based competitive advantages

effects of government financial incentives on firms innovation performance in china evidences from beijing in the 1990s abstract the purpose of this paper is to investigate the effects of chinese government financial incentives on firms innovation performance during the nation s initial economic transition period in the mid 1990s through a large scale empirical survey of more than 1000 chinese manufacturing firms the empirical evidences show that whereas the major government financial incentives such as special loans and tax credits were positively influential to innovative economic performance of firms direct earmarks not only failed to enhance innovative economic performance it sometimes negatively affected it surprisingly the findings show that all financial incentives of governments were unrelated to the patents of either high tech or general firms and direct earmarks affected the patents of these firms negatively although not to a significant degree this indicates that the centrally planned funding system of the 1990s was ineffective for enhancing technological progress for chinese manufacturing firms the study results imply that the chinese government should further increase the role of market force in its reforms a more market driven model by developing more s t initiatives to match the strategic directions of different enterprises particularly soes is recommended

long live democracy the determinants of political instability in latin america abstract we investigate the underlying causes of political instability in a panel of 18 latin american countries from 1971 2000 we test whether regime type regime durability factionalism income inequality ethnic diversity ethnic discrimination regional spillover effects urban growth and macroeconomic variables matter for instability we find several important results 1 democracy has a significant negative effect on instability that is robust to several alternative specifications 2 factionalised political systems experience higher instability 3 income inequality ethnic fractionalisation and urban growth have important nonlinear effects on instability and 4 of the macroeconomic variables we study only openness to trade has a significant negative effect on instability

the interactions of organizational and competitive influences on strategy and performance despite much debate in the strategy literatures there is little consensus as to whether organizational capabilities or market competition are more important in shaping firms actions and performance we suspect that simply comparing firm level and industry level influences will continue to prove fruitless for two reasons in the first place both organization and competition are clearly important in shaping strategy and performance in the second place we suspect that the inconclusive nature of much of the existing research reflects the fact that organizational capabilities competition strategy and performance are fundamentally endogenous that is reciprocal interactions at multiple levels of analysis between the environment and the firm shape business strategy and performance while interactions between strategy and performance in turn shape both organizational capabilities and competitive environments this special issue of the strategic management journal includes papers that focus attention on several dimensions of these interactions a common theme emerges from the work concerning the sequential nature of the interrelationships the papers suggest that firms develop organizational capabilities as they act in competitive institutional and cognitive environments where capabilities arise both by design and as the unexpected by products of firm actions the capabilities managers understanding of the capabilities and the historical context that surrounds them then condition firms reactions to changes in their environment the reactions and firm performance in turn affect the structure of the industry and all these changes generate new information which in turn creates new learning opportunities thus the papers view strategy and performance as an ongoing sequence of capabilities conditioned adaptations by firms which in turn become exogenous events in the environments of the managers of other firms for strategy researchers the important question is not that of which disciplinary perspective or mode of explanation is a more appropriate one but rather that of the conditions under which a given mode of explanation is most appropriate 1997 by john wiley sons ltd

dynamic capabilities and their indirect impact on firm performance this article seeks to empirically explore the relationship between dynamic capabilities and firm performance in particular it addresses the question of whether dynamic capabilities impact directly or indirectly on performance in doing so the article articulates and measures a construct of dynamic capabilities and using structural equation modeling it examines whether their impact on performance is mediated through operational marketing and technological capabilities the proposed model is tested in different levels of environmental dynamism using data on 271 greek firms belonging to the manufacturing sector empirical findings suggest that dynamic capabilities impinge on operational capabilities which in turn have a significant effect on performance direct effects on performance are found to be insignificant furthermore similar effects seem to hold for both higher and lower levels of environmental dynamism theoretical and practical implications are discussed

china s innovation policies evolution institutional structure and trajectory abstract china has transformed itself from a planning to a market oriented economy over the past three decades and has sustained a fairly long period of rapid economic growth to which the contributions from innovation in science and technology s t have become increasingly important then how have china s innovation policies evolved to reflect the changing and supposedly better understanding of innovation by china s policy makers the paper tries to answer this question through a quantitative analysis of 287 policies issued by china s central government agencies between 1980 and 2005 and of 79 policies introduced between 2006 and 2008 to implement the medium and long term plan for the development of science and technology 2006 2020 china has shifted its s t and industrial policy centered innovation strategy and has pursued a series of better coordinated innovation oriented economic and technology initiatives that give greater attention to a portfolio of policies that include critical financial tax and fiscal measures there has been a gradual departure from the pattern in which innovation policies are formulated by one single government agency therefore steering china to a different and probably more promising innovation trajectory

turning water into wine exploring the role of dynamic capabilities in early stage capitalization processes technology based ventures face considerable challenges when attempting to raise early stage capital during the early stages of development to create an operational business they need access to financial capital but external investors prefer to see an operational business before investing capital this study extends arguments grounded in dynamic managerial capabilities theory to examine the extent to which various trade offs among the quality of a venture s management team radicalness of the firm s technological resources and demand uncertainty in focal markets impact the ability of ventures to resolve these capitalization challenges we find that higher levels of demand uncertainty and more radical innovations do not appear to enhance the impact of strong management teams on the raising of early stage capital however lower levels of uncertainty do appear to strengthen the effects of strong management teams implications of these findings for dynamic capabilities theory and early stage capitalization processes are discussed

court politics the political economy of tort awards abstract we investigate the forces that explain why trial awards differ across the united states in 23 states judges are elected and in 10 they are elected via partisan elections elections have two important effects first defendants are often out of state nonvoters while plaintiffs are typically in state voters we predict therefore that elected judges will redistribute wealth from out of state businesses to in state plaintiffs second the realities of campaign financing require judges to seek and accept campaign funding from trial lawyers who uniformly are interested in larger awards we hypothesize that these two forces cause awards to be larger in states where the judiciary is elected rather than appointed we also hypothesize that the demand for redistribution will increase as poverty increases and thus that awards will be larger in states with greater poverty using a sample of over 7 000 cases across 48 of the 50 states we find significant evidence in support of these hypotheses

the disadvantage of tying their hands on the political economy of policy commitments incumbents are more likely to be re elected if they have a comparative advantage in the eyes of voters on some central issue this paper argues that incumbents have an incentive to avoid reforms that reduce the government s role in deciding these issues in order to increase their chances of re election this point is illustrated in the context of the choice of an exchange rate regime in an economy characterized by an inflation bias a flexible exchange rate allows the government to use monetary policy as a stabilization tool while fixed exchange rates remove the inflation bias of the economy on the one hand it is shown that a more inflation averse government may refrain from choosing fixed exchange rates in order to capitalize on the inflationary reputation of its opponent this incentive is contrasted with the opposite incentive to tie the hands of the future government should be incumbent be defeated on the other hand it is shown that electoral considerations may reinforce the incentive of the more inflationary government to tie its own hands with fixed exchange rates

the origins of democracy a model with application to ancient greece abstract this paper seeks to provide an improved understanding of the origins of democracy it begins by developing a theoretical model to demonstrate how exogenous economic conditions can influence the incentives to establish democratic institutions the model predicts that democratic institutions will expand where they mitigate important time inconsistency problems and therefore encourage investment exogenous conditions determine the magnitude of those time inconsistency problems and hence the likelihood of democracy a comparison of ancient greek city states suggests that the conditions under which democracy first emerged support the model other potential applications are discussed

electoral competition in the american states electoral competition is a concept that has played a central role in much of the state politics literature one commonly used indicator of competition in the states is the ranney index we offer an alternative indicator of competition one based on district level outcomes of state legislative elections after evaluating both indicators in terms of validity and reliability the analysis suggests that the district level indicator is both empirically and intuitively superior as a measure of electoral competition the implications of this finding are discussed

appropriate intellectual property protection and economic growth in countries at different levels of development this paper examines how the role of patents and utility models in innovation and economic growth varies by level of economic development using a panel dataset of over 70 countries we find that patent protection is an important determinant of innovation and that patentable innovations contribute to economic growth in developed countries but not in developing instead in developing economies a minor form of intellectual property rights iprs namely utility models is conducive to innovation and growth controlling for other factors using korean firm level data as a case study we find that utility model innovations contribute to firm performance when firms are technologically lagging and that those minor innovations can be a learning device and thus a stepping stone for developing more patentable inventions later on upon reaching higher levels of technological capabilities firms become more reliant upon patents and less on utility models thus the lesson here is that patent protection enhances innovation and economic growth in countries where the capacity to conduct innovative research exists where this capacity is weaker a system that provides incentives to conduct minor incremental inventions is more conducive to growth the significance of this paper is to emphasize the importance not just of the strength of iprs but of the appropriate type of iprs for economic development

sources of inefficiency in a representative democracy a dynamic analysis this paper studies the efficiency of policy choice in representative democracies it extends the citizen candidate model of democratic policy making to a dynamic environment equilibrium policy choices are shown to be efficient in the sense that in each period conditional on future policies being selected through the democratic process there exists no alternative current policy choices which can raise the expected utilities of all citizens however policies that would be declared efficient by standard economic criteria are not necessarily adopted in political equilibrium the paper argues that these divergencies are legitimately viewed as politicalfailures

is there a politically optimal level of judicial independence independent courts render current policy more durable by raising the cost of future policy changes but may also engage in policy making of their own this paper asks is there an optimal level of judicial independence from the perspective of incumbent officials in the other branches to answer that question the paper develops a model of strategic institutional choice and tests it on the judicial institutions of the american states consistent with the model s predictions the most independenceenhancing institutions are found where political competition between rival parties is tightest and differences between party platforms are largest

a framework linking intangible resources and capabilities to sustainable competitive advantage this article is concerned with the role of intangible resources in business strategy in particular it is concerned with identifying the intangible sources of sustainable competitive advantage sustainable competitive advantage results from the possession of relevant capability differentials regulatory and positional capabilities are concerned with intangible assets functional and cultural capabilities are concerned with competencies a framework linking intangible resources to capabilities has been devised and is used as the basis of a new technique for identifying the relative contribution which the different intangible resources make to competitive advantage the results of the use of this technique in six case studies are reported

asset stock accumulation and the sustainability of competitive advantage reply authors reply to comments regarding their paper dierickx i k cool 1989 asset stock accumulation and the sustainability of competitive advantage management sci

state governance and technological innovation in emerging economies state owned enterprise restructuration and institutional logic dissonance in china s high speed train sector can state governance spur firm innovation in an emerging economy and transform state owned enterprises soes from dying dinosaurs to dynamic dynamos we seek an answer to this question by investigating the innovative performance of restructured soes in china s high speed train sector we expect that soe restructuration will improve firm innovation but that the degree of improvement will depend on how the state conducts firm governance building on institutional theory we distinguish state governance via equity ownership and administrative affiliation in an emerging economy with market hierarchy institutional conflicts under such conflicts restructured soes experience institutional logic dissonance which hinders organizational change for technological innovation we hypothesize that state ownership exacerbates institutional logic dissonance at a restructured soe thus limiting innovation improvement from restructuration in contrast state affiliation mitigates firm dissonance and hence augments such improvement we find empirical evidence for these hypotheses in a comprehensive panel of high speed train manufacturers in china between 1989 and 2015 this study contributes to the institution based theory of technological innovation in emerging economies on the practical front our findings suggest that emerging states may adopt arms length governance to spur soe innovation and unleash these dynamic dynamos to fuel sustainable economic growth

determinants of venture capital firms preferences regarding the industry diversity and geographic scope of their investments abstract competition is intensifying in the venture capital industry in the u s the number of venture capital firms vcfs tripled from 1980 to 1989 supplier power in the form of institutional investors such as pension funds continues to grow foreign venture capital has grown to the extent that commitments to foreign vcfs exceeded domestic commitments in both 1988 and 1989 further alternative sources of financing for entrepreneurs such as individual investors angels corporations and strategic alliances are increasingly viable options vcfs face pressure to seek lower risk investments improve rates of return and provide value to new venture development surprisingly few scholarly studies have begun to investigate the strategies vcfs are aiming to implement in order to deal with this increasing pressure building on the premise that decisions regarding product market scope are a key component of firm strategy hofer and schendel 1978 this study examined 169 domestic vcfs in order to identify factors that might explain variations in preferences regarding the industry diversity and geographic scope of their investments the sample drawn from california massachusetts and texas represented about 27 of all u s based vcfs in 1987 the year in which the data were gathered in terms of the total size of investment portfolio the average for these 169 vcfs was 69 8 million which is statistically indistinguishable from the u s average of 65 million results indicate that 1 vcfs specializing in early stage ventures prefer less industry diversity and narrower geographic scope relative to other vcfs 2 corporate vcfs i e those owned by non financial corporations prefer less industry diversity but broader geographic scope relative to non corporate vcfs 3 larger vcfs prefer greater industry diversity and broader geographic scope than do smaller vcfs and 4 provision of small business investment companies sbic financing by the vcf has no impact on preferences regarding industry diversity but is associated with a preference for narrower geographic scope one implication of these results is that vcfs in the u s are not homogeneous as regards the intended product market scope of their portfolios this in turn holds implications not only for vcfs but also for their suppliers limited partners buyers entrepreneurs and policy makers vcfs can no longer rely on haphazard investment schemes they need to attract investors by virtue of the benefits offered by their portfolio strategy and they need to attract superior investments via offering valueadded services and know how potential investors in venture capital will want to examine for example the impact on risk and return of investing smaller amounts in several vcfs at one extreme versus making one large investment in a very diversified vcf at the other extreme the results of this and other studies suggest that outcomes timing magnitude and riskiness of returns of choosing such alternatives will vary widely and will depend in great part on the strategies of the vcfs involved it will not be possible for investors to make wise choices without a full examination of their own objectives and of the profiles of vcfs entrepreneurs with the most attractive ventures have alternative sources of financing to consider and should weigh the benefits of being financed and supported by various vcfs as part of the vcfs portfolios knowing a vcf s preferences regarding product market scope improves their chances of approaching and selecting the right fit and for those entrepreneurs with a narrower set of options such knowledge may make the difference between receiving and not receiving financing in a timely manner finally policy makers may be able to make use of knowledge of the forces that influence the investment strategies of vcfs presently concerns for policy makers may include the gap in seed capital increased foreign presence in the u s market and the export of promising innovative technology via alliances with foreign firms all of these factors are influenced by the strategies pursued by vcfs as they jockey for position in the increasingly competitive venture capital market

an empirical test of the resource based theory strategic regulation in the dutch audit industry the resource based view of the firm is a recent strategic management theory that seeks to identify the resources that may provide firms with a sustainable competitive advantage this paper has two purposes first the paper relates strategic management arguments to parallel lines of reasoning in industrial organization theory and argues that strategic regulation is a major source of sustainable competitive advantage the second purpose of the paper is to report the results of an empirical test of the resource based theory on the basis of a longitudinal data set on the postwar history of the dutch audit industry a key determinant of this history proves to be strategic regulation which stimulates demand for audit services and protects rent producing resources

initial human and financial capital as predictors of new venture performance abstract this research seeks to predict the performance of new ventures based on factors that can be observed at the time of start up indicators of initial human and financial capital are considered to determine how they bear upon the probability of three possible performance outcomes 1 failure 2 marginal survival or 3 high growth four categories of initial human and financial capital are examined general human capital represented here by the entrepreneur s education gender and race may reflect the extent to which the entrepreneur has had the opportunity to develop relevant skills and contacts management know how embodied in the entrepreneur or available through advisors or partners reflects management specific skills and knowledge without regard to the kind of business industry specific know how reflects specific experience in similar businesses financial capital is one of the most visible resources it can create a buffer against random shocks and allow the pursuit of more capital intensive strategies which are better protected from imitation the study utilizes a longitudinal study of 1053 new ventures representative of all industry sectors and geographical regions the research departs from most previous studies in considering different measures of performance marginal survival and growth and in considering explicitly whether the factors contributing to marginal survival differ from those contributing to high growth it was found that measures of general human capital influenced both survival and growth except for gender with women owned ventures being less likely to grow but just as likely to survive management know how variables had more limited impact having parents who had owned a business contributed to marginal survival but not to growth number of partners contributed to growth but not to survival management level prior employment in non profit organizations or not having been in the labor force and the use of professional advisors did not have significant effects industry specific know how contributed to both survival and growth amount of initial financial capital also contributed to both the usefulness of the model is enhanced by the fact that the resource variables considered are relatively easy to assess and all can be considered at the time of start up although some of the human capital variables cannot easily be changed the benefits or risks associated with each can be assessed in some cases potential problems can be identified so that plans can be modified to improve prospects overall it appears that using a model based upon the initial human and financial capital of the venture it is possible to predict the performance of new ventures with some degree of confidence

voting on the budget deficit this paper analyzes a model in which a group of rational individuals votes over the composition and time profile of public spending all voters agree that a balanced budget is ex ante optimal however if there is disagreement between current and future majorities a balanced budget is not a political equilibrium under majority rule under certain conditions a majority of the voters favors a budget deficit and the equilibrium deficit is larger the greater is the polarization among voters copyright 1990 by american economic association

the network dynamics of international new ventures this study uses multi site case research to advance a set of propositions regarding the network dynamics of early stage international new ventures the investigative approach builds on arguments that network theory and analysis are fundamental to international entrepreneurship in the spirit of cross disciplinary research perspectives from the entrepreneurship literature are embraced to help inform our understanding of international new venture networks

sources of innovative activities and industrial organization in italy abstract this paper is based on the information gathered through a survey on industrial innovation in 24 000 italian business units two thirds of the business units surveyed declared they had introduced innovations although there were significant variations across industries and size only 16 percent of the innovating business units monitored declared they had performed r d as many as 13 986 business units have introduced innovations without performing r d the paper focuses on the different sources of technical knowledge which support the innovative activities such as r d design acquisition of capital goods patents etc it considers also the relationship between concentration and innovative intensity at the industry level it emerges that at least at the business unit level there is a weak correlation between the two variables on the basis of the measured industrial concentration the propensity to perform product versus process innovations and the sources of technological change a taxonomy of industrial sectors is proposed which elaborates on pavitt s original approach this taxonomy instead of stressing the role of either small firms as in the flexible specialization model or of the schumpeterian concentration to explain the intensity and nature of the innovative phenomena indicates that sectoral differences explain more than is generally believed in understanding technological change efficient innovation policy should therefore be tailored to match those sectoral characteristics

rethinking research methods for the resource based perspective isolating sources of sustainable competitive advantage an exploration of traditional perspectives and contemporary propositions regarding sustainable competitive advantage points to the conclusion that the locus of advantage is located specifically within organizational effects the key issue emerges that research investigating sources of sustainable competitive advantage must be done not only on organizations but also in organizations the fallout from this conclusion is however that the research methodologies traditionally used in strategy research will not unambiguously uncover these sources of sustainable advantage using organizational culture as an example of a possible source of sustainable advantage within a resource based paradigm a four step research framework is suggested for isolating these organizational effects copyright 1999 john wiley sons ltd

asset profiles for technological innovation abstract this paper proposes a conceptual distinction between four generic categories of assets for technological innovation 1 scientific research assets 2 process innovative assets 3 product innovative application assets and 4 aesthetic design assets technological innovation may sometimes require the activation of only one asset type but more often a specific constellation of more asset types has to be mobilized the asset categories differ profoundly with respect not only to their respective competence bases but also with respect to their functional contribution to industrial innovation and mostly also to their organizational attachment this way of conceiving technological innovation is opposed to the one dimensional r d conception that tends to view r d as one functional asset along with others like manufacturing or marketing it is argued that the different innovative assets are often located in different organizational settings within the corporation the coupling between assets is discussed in terms of inter asset specificity we illustrate the great variation of innovative asset profiles across a wide spectrum of product categories the concept of technological trajectories is reinterpreted in terms of asset profile oscillations and regroupings finally the framework is related to recent efforts to formulate a resource based theory of the firm and the implications for innovation strategy is discussed

an audit of technological innovation capabilities in chinese firms some empirical findings in beijing china abstract recent studies have advocated different technological innovation capabilities tics and discussed their impact on a firm s competitive performance this paper introduces a study framework of innovation audit and examines the relevance of seven tics to building and sustaining the competitiveness of chinese firms empirical data was acquired through a recent study of 213 chinese firms in beijing china regression analysis was employed to examine the correlation between tics and innovation rate sales growth and product competitiveness among these firms the findings verify that r d and resources allocation capabilities are the two most important tics a strong r d capability could safeguard innovation rate and product competitiveness in large and medium sized firms whereas a resources allocation capability would enhance the sales growth in small firms however the impact of learning and organising capabilities on a firm s innovation performance has yet to be investigated the findings of this paper suggest that chinese firms should consider a more balanced focus on their tics harmonising enhancement in order to maintain their sustainable development effectively plan and implement their innovation strategies as well as enhance their whole innovation capability chinese firms should closely relate their tics to the formulation of technology strategy and harmonisation of innovation and r d activities

evaluating innovative processes in french firms methodological proposition for firm innovation capacity evaluation abstract measuring innovation processes is a major concern for academics and firm managers this study proposes an innovation capacity ic measure framework based on a set of 15 innovation management practices every practice is subdivided into multiple criteria which are directly observable phenomena or facts the statistical method of value test and a multi criteria approach are adopted to propose a typology of four groups of innovative firms proactive preactive reactive passive the features observed on these groups of firms allow the determination of the firms innovation capacity and are useful for providing recommendations and practical actions for them with a view to reinforcing it data from a sample group of 39 small and medium sized enterprises smes in the manufacturing industry in lorraine france were collected via a field survey and were fed into the model to determine the innovation capacity of the companies

impact of energy technology patents in china evidence from a panel cointegration and error correction model abstract enhancing energy technology innovation performance which is widely measured by energy technology patents through energy technology research and development r d activities is a fundamental way to implement energy conservation and emission abatement this study analyzes the effects of r d investment activities economic growth and energy price on energy technology patents in 30 provinces of china over the period 1999 2013 several unit root tests indicate that all the above variables are generated by panel unit root processes and a panel cointegration model is confirmed among the variables in order to ensure the consistency of the estimators the fully modified ols fmols method is adopted and the results indicate that r d investment activities and economic growth have positive effects on energy technology patents while energy price has a negative effect however the panel error correction models indicate that the cointegration relationship helps to promote economic growth but it reduces r d investment and energy price in the short term therefore market oriented measures including financial support and technical transformation policies for the development of low carbon energy technologies an effective energy price mechanism especially the targeted fossil fuel subsidies and their die away mode are vital in promoting china s energy technology innovation

measuring the efficiency of china s regional innovation systems application of network data envelopment analysis dea chen k and guan j measuring the efficiency of china s regional innovation systems application of network data envelopment analysis dea regional studies this study applies a relational network data analysis envelopment to the systematic evaluation of the innovation efficiency of china s regional innovation systems by decomposing the innovation process into the two connecting sub processes technological development and subsequent technological commercialization the results show that only one fifth of china s regional innovation systems are operating on the empirical best practice frontier during the whole process from technological development to commercialization furthermore it is found that substantial inconsistencies exist between technological development capacity and commercialization capacity in most regional innovation systems and that downstream commercialization capacity plays a more important role in the innovation performance of regional innovation systems chen k et guan j evaluer

the organization of innovation in a transitional economy business and government in chinese electronic publishing abstract the national innovation system that emerged in china in the 1990s integrates government science and technology efforts typically through the intermediation of public research institutes with the business activities of industrial enterprises in illustrating the institutional and organizational characteristics of this innovation system the case study of founder group world leader in pictographic language electronic publishing systems demonstrates both the strategic role of the state in the process of change and the increasing importance for economic success of the integration of investment strategy and organizational learning in industrial enteprises that compete for domestic and global markets