the action mechanism analysis of environmental pressures on the development of environmentally friendly technologies using a neo schumperian model in order to analyze the action mechanism of environmental pressures on the development of environmentally friendly technologies efts this paper constructs a neo schumpeterian simulation model containing firms production pricing pollution abatement investment environmental r d entry exit decision making and consumer choice behavior the objective of this paper is to investigate the influence of consumer demand preferences and environmental policies on firms environmental investment decision making as well as the development of eft results showed that consumers prefer product price a market based instrument mbi combined with an information oriented instrument ioi can promote the development of eft while mbi applied alone will reduce environmental investment under scenarios that consumers prefer product quality a command and control environmental policy cac can promote the development of eft to a greater extent but it inhibits environmental investment and damages the average profit rate of profit of the industry if consumers prefer environmental performance of firms cac or ioi is advantageous to the change of eft however in such a case environmental investment and consumer utility are reduced

managing technological development lessons from the newly industrializing countries this survey looks at the technological development of the newly industrializing countries to draw some important lessons for firms and governments in other developing countries first inventing products and processes is not at the center of the technological development needed for successful industrialization it is at the fringe what is at the center is acquiring the capabilities needed for efficient production and investment second some countries have overemphasized the drive for technological self sufficiency and paid a high price in poor productivity what makes the best economic sense is to combine foreign and local technological elements and to do this in a way that progressively develops local capabilities in areas where they can be more efficient third the acquisition of technological capability does not come merely from experience though experience is important fourth the economic environment through its influence on the technological efforts of firms is very important in determining the productivity of a country s resources

history friendly models of industry evolution the computer industry the model presented in this paper is the first of a new generation of evolutionary economic models history friendly models history friendly models are formal models that aim to capture in stylized form qualitative and appreciative theories about the mechanisms and factors affecting industry evolution technological advance and institutional change put forth by empirical scholars of industrial economics technological change business organization and strategy and other social scientists in this paper we have analyzed the long term evolution of the computer industry in particular we have examined the emergence of a dominant firm in mainframes the introduction of a major innovation microprocessor the opening up of a new market segment personal computers ad the competition there between newcomers and diversified old established firms we have taken a body of verbal appreciative theorizing developed a formal representation of that theory and found that the formal version of that theory is consistent and capable of generating the stylized facts the appreciative theory purports to explain going through this analytic exercise has significantly sharpened our theoretical understanding of the key factors behind salient aspects of the evolution of the computer industry copyright 1999 by oxford university press

the market evolution and sales takeoff of product innovations in contrast to the prevailing supply side explanation that price decreases are the key driver of a sales takeoff we argue that outward shifting supplyand demand curves lead to market takeoff our fundamental idea is that sales in new markets are initially low because the first commercialized forms of new innovations are primitive then as new firms enter actual and perceived product quality improves and prices possibly drop which leads to a takeoff in sales to provide empirical evidence for this explanation we explore the relationship between takeoff times price decreases and firm entry for a sample of consumer and industrial product innovations commercialized in the united states over the past 150 years based on a proportional hazards analysis of takeoff times we find that new firm entry dominates other factors in explaining observed sales takeoff times we interpret these results as supporting the idea that demand shifts during the early evolution of a new market due to nonprice factors is the key driver of a sales takeoff

technological capabilities and industrialization abstract this paper reviews the implications for industrial strategy of recent research on technological capabilities at the firm and national levels after exploring the nature and determinants of microlevel technological development a simple framework for explaining the growth of national capabilities is set out based on the interplay of incentives capabilities and institutions each may suffer market failure and so require corrective intervention the experience of some industrializing countries is described to assess the validity of this framework it is concluded that interventions carefully and selectively applied are necessary for industrial success

on the instability of the r d portfolio in a dynamic monopoly or one cannot get two eggs in one basket abstract firms innovation portfolios include several dimensions ranging from organizational aspects to cost reduction and product characteristics all of these efforts take place during the product life cycle and interact with each other in determining the spectrum of features of the product and its performance on the market this paper contributes to the related theoretical debate focussing on the possibility of having superior product quality levels at lower marginal production cost over time to deal with this issue we investigate the optimal r d portfolio of a single product monopolist investing in cost reducing activities accompanied by efforts improving the quality of its product over an infinite time horizon it turns out that the firm s relative incentives along the two directions are conditional upon market affluence measured by consumers willingness to pay for quality and r d efforts are complements in the neighbourhood of the steady state equilibrium however the dynamics of the two r d controls depend on both quality and marginal cost at every instant consequently as the stability analysis reveals the steady state equilibrium is indeed unstable due to the dynamics of marginal cost thereby implying that one should not expect the firm to supply an increasing quality level at a decreasing production cost hence the dynamic interplay between r d controls and the resulting instability affecting production costs also imply that one may not expect to observe product quality to increase and market price to decrease over the product life cycle

a theory of market pioneers dynamic capabilities and industry evolution we analyze a model of industry evolution where the number of active submarkets is endogenously determined by pioneering innovation from incumbents and entrants incumbent pioneers enjoy an advantage of additional pioneering innovation via a dynamic capability that takes the form of an improved technology for innovation in young submarkets entrants are motivated in part by a desire to acquire the dynamic capability we show that dynamic capabilities increase total innovation but whether the capability confers an advantage in terms of marginal or average cost is important in determining how the impact of dynamic capabilities is distributed across incumbent and entrant innovation rates we complement the existing literature that focuses on exogenous arrival of submarkets or the steady state of a model with constant submarkets by describing how competition free entry and the dynamic capability of incumbents drive the evolution of an industry the shift from immature to mature submarkets can lead to a shakeout in firm numbers and it eventually leads to a reduction in total dynamic capabilities in an industry this paper was accepted by bruno cassiman business strategy

role of demand side strategy in quality competition abstract the research questions studied in this paper concern the role of demand side strategy for a firm engaged in duopolistic competition in quality and price a demand side strategy research looks towards markets and consumers unlike the traditional resource side strategy research that looks upstream into the firm s resources and its supply side we examine whether following a demand side strategy would benefit the firm the consumers or both in a market where two firms are competing with each other we first find the equilibrium quality and price levels for the traditional case where the two firms optimize their own profit function we use this case as a benchmark case for comparison next we let one firm the lower quality firm adopt a demand side strategy operationalized by an objective function where the profit is augmented by consumer surplus the equilibrium results show that a demand side strategy would increase the product quality level in the market and improve the adopter firm s competitiveness at the same time increasing the market consumer surplus we also study the case where the higher quality firm adopts demand side strategy and compare the results with the two cases mentioned above overall we find that adopting a demand side strategy would benefit the adopter firm s profitability and the consumers we therefore find evidence of what the strategy literature has been predicting about the role of demand side strategy

incentives and uncertainty an empirical analysis of the impact of demand on innovation we study the impact of demand on innovation by focusing on a sample of small and medium sized enterprises in several industries and european countries we analyse how demand stimulates innovation by providing economic incentives and reducing uncertainty considering the size of the market as a proxy for the presence of demand we find support for the idea that the presence of incentives stimulates innovation this is particularly true for process innovation in considering interaction with customers as a way to reduce uncertainty we find that firms that see customers as the most important sources of information for both innovation ideas and completion tend to introduce product innovations firm size r d expenditure and sectoral effects also matter

public policies for local networks of innovators abstract a rich and heterogeneous literature has recently clarified the nature of agglomerations of small and medium sized companies industrial districts flexible manufacturing networks interacting in a territory and acting in the open market as efficient competitors against other forms of production organization such as the traditional vertically integrated firm their ability to adjust to uncertain external conditions depends on fthe common culture and diffuse knowledge of the area which is a sunk cost for those companies in a policy perspective the main question concerns the possibility of intervening in a specific context to stimulate the creation and growth of an agglomeration of companies i e to establish a clan of agents having a common interest in innovation technological knowledge will have to be provided as club good for the network there are three elements to be considered in designing such a policy 1 entry into admission and exit from exclusion the network 2 promotion of a positive selection process of innovators within the network 3 increasing the common knowledge and the specific learning characterizing the network the aim of public interventions undertaken in the various regions of europe but also in several experiments in the us can be seen as the constitution of collective agents or service centers sponsored by the local public authorities and enterpreneurial associations to manage collectively the cost of coordination of the entrepreneurial activities necessary for the formation and development of a local network of innovators the new industrial policy approach of the european community is explicitly oriented to supporting the local aggregation of new businesses through the promotion of integrated plans of local intervention

food beliefs and food supply chains the impact of religion and religiosity in israel abstract this paper demonstrates that religion and religiosity affect norms which affect food consumption patterns and production heterogeneity and asymmetric information lead to multiple certification channels as well as multiple supply chains major supply chains may address multiple constituencies that are secular or less religious technological change affects norms and thus the food system we obtain these results by analyzing the food systems for meat products in israel where there are three religions jews muslims and christians and people assign themselves three levels of religiosity secular conservative and orthodox israel has multiple kosher and halal certifiers and several specialized supermarket chains for orthodox groups its main supermarket chains serve secular and some conservative segments the immigration of secular jews from russia led to the proliferation of non kosher supply chains and products and increased consumption of pork new technologies and higher incomes led to emergence of fast food chains serving orthodox jews that had previously tended to eat at home

product and process innovation the implication of making comparisons between uniform pricing monopolist and second degree price discriminating monopolist the question of simultaneous product and process innovation price discrimination is crucial for technologically evolving industries in this paper we assume that there are two different kinds of

the choice theory approach to market research this paper surveys economic choice theory stressing developments that permit use of data from psychometric and conjoint experiments to produce market demand forecasts alternatives to the widely used multinomial logit model are summarized and a new method for estimating multinomial probits is described an integration of choice models with attitudinal scaling and perceptual mapping within a latent variable system is described estimation of such systems under either random effects or fixed effects descriptions of heterogeneity across individuals is discussed issues in the use of choice models to describe responses from conjoint experiments are presented new regression diagnostic tests for the consistency of multinomial logit representations are discussed

dynamic optimal control of process product innovation with learning by doing abstract in this paper we present a dynamic optimal control model of process product innovation with learning by doing and extend the model of chenavaz 2012 to an even more general model in which the firm s cost functions of product and process innovation depend on both the innovation investments and the knowledge accumulations of product and process innovation furthermore in our paper the product price the investments of product and process innovation are decision variables the product quality production cost the change rates of knowledge accumulations of product and process innovation are state variables the main objective of this paper is to analyze the relationships between these variables and investigate the model s optimal conditions and characteristics further we solve the model with some numerical examples and sensitivity analysis is conducted to study the effect of changing the parameters and coefficients on the objective function value

demand heterogeneity and technology evolution implications for product and process innovation the evolution of technology has been a central issue in the strategy and organizations literature however the focus of much of this work has been on what is essentially the supply side of technical change the evolution of firm capabilities we present a demand based view of technology evolution that is focused on the interaction between technology development and the demand environment in which the technology is ultimately evaluated we develop a formal computer simulation model that explicitly considers the influence of heterogeneity in market demand the presence of consumers with different needs and requirements on firms innovation choices the model is used to examine the dynamics of product and process innovation utterback and abernathy 1975 the analysis reveals that demand heterogeneity offers an alternative to supply side explanations of the technology life cycle further by considering the implications of decreasing marginal utility from performance improvements the model highlights the role of technologically satisfied consumers in shaping innovation incentives and suggests a rationale for a new stage in the technology life cycle characterized by increasing performance at a stable price the stage has not yet been treated formally in the literature but is widely observed most prominently in digital and information based technologies

process and product innovation by a multiproduct monopolist a dynamic approach abstract we adopt a dynamic approach to model the behaviour of a multiproduct monopolist investing in process innovation and either product differentiation or product proliferation or both irrespective of the number of activities appearing in the r d portfolio we prove that depending on initial conditions there may exists substitutability between process innovation and either form of product innovation along the optimal path towards the steady state while in the latter only complementarity emerges looking at the threefold investment plan we qualitatively characterise the ranking of r d activities in terms of the consumer reservation price and the extent of the spectrum of varieties

the special problems of small countries abstract the paper describes the characteristics of small economies and discusses the advantages and disadvantages arising from these characteristics it is shown that small economies by their very nature tend to be less diversified and to have relatively high foreign trade risks in spite of these drawbacks a number of small economies have achieved high rates of economic growth some reasons given to explain this success are the relatively small size of the agricultural sector concentration on labor intensive exports and sociological and psychological factors such as the ability to respond in a flexible manner to changes the paper ends with a discussion on whether the drawbacks of small size can be overcome by economic integration it is argued that the experience in this regard is disappointing

science technology and innovation policies in small and developing economies the case of central america in the last decade there has been an increasing recognition among central american policy makers of the central importance of science technology and innovation sti for inclusive and sustainable economic growth based on higher productivity this paper aims to study current sti policies in those countries and explore whether this increasing acknowledgement has come along with new and more active policies empirical evidence collected through questionnaire based interviews with high level government officials in each country shows that central american governments have built public organisations and institutions to support sti such as laws national plans and a wide variety of policy instruments yet available science and technology indicators illustrate that the results are still meagre this paper identifies eight barriers faced by these governments when designing and implementing sti policies

adoption and diffusion of an innovation of uncertain profitability the argument has frequently been made that the pattern of diffusion associated with most new innovations will typically have certain characteristics a diffusion curve for an innovation is usually defined as the proportion of its potential users who have already adopted as a function of time measured from the first adoption many empirical studies by both economists and other social scientists have shown that diffusion curves nearly always have two distinct characteristics i they are s shaped the proportion adopted is an increasing function of time which is initially convex but eventually becomes concave and ii they tend to be right hand skewed the inflection point occurs at a time corresponding to a proportion adopted which is less than one half so that the function is concave over the greatest amount of time in fact this skewing is occasionally severe enough to make the diffusion curve appear concave everywhere the focus of most empirical studies of innovation diffusion has centered on identification of either the major determinants of the speed of diffusion or the characteristics of firms which determine how long they delay adoption the seminal contributions are griliches 6 study of hybrid corn and mansfield s 121 study of 12 industrial innovations these studies and most of the similar ones following conclude that diffusion is faster for innovations with higher profitability and that large firms tend to be the earliest adopters some studies e g mansfield 121 herregat 71 have attempted to ascertain

organizational constraints to adaptation intrafirm asymmetry in the locus of coordination we assemble a panel data set of firms in the u s defense industry between 1996 and 2006 to examine the drivers of heterogeneous incumbent firm adaptation following the industry wide demand shock of september 11 2001 this shock entailed not only an increase in aggregate demand but more importantly a shift in the relative attractiveness of individual product areas resulting in the need for firms to reshuffle their product portfolios in response to changing demand conditions the exogenous nature of the shock allows us to empirically identify the effect of preshock interdependence structures on postshock adaptation outcomes we find that the locus of coordination inside a firm can explain differential postshock adaptation performance because interdependencies spanning organizational boundaries are more difficult to manage than those contained within such boundaries coordination across product areas creates greater adaptation challenges compared with coordination within product areas we further inves

a model of cultural differences and international alliance performance we propose a model of cultural differences and international alliance performance to explain the ambiguous findings regarding the influence of national culture differences on alliance performance building on research on national organizational and professional cultures we argue that the closer the domain of a social group is to the value creating activities of an alliance the more disruptive cultural differences between the partners members of that social group will be organizational culture differences will tend to be more disruptive than national culture differences and differences in the professional culture most relevant to alliance value creation typically will be the most disruptive implications for research and managerial practice are discussed and the model s relevance for international r d alliances is highlighted

inward technology transfer and competitiveness the role of national innovation systems this paper examines the role of national innovation systems in the inward transfer of technology that has underpinned the transformation of japan and other east asian economies since 1945 the economies that have benefited most from inward technology transfer have national innovation systems that have strengthened their national absorptive capacity this capacity relies primarily on investments in scientific and technical training and on economic policies that enforce competition among domestic firms the particular channels for inward technology transfer the identity of any strategic industries targeted for public intervention and the overall level of a nation s trade restrictions are ail of secondary importance a central theme of global economic change during the postwar period has been the application in less developed countries of technologies developed within economically advanced regions this phenomenon underpinned the post 1945 transformation of japan and other east asian economies and influenced the reconstruction of western european economies after world war ii the application of externally developed technologies within latecomer economies is hardly unique to the postwar period however samuel slater s introduction of british textile manufacturing is but one example of inward technology transfer in the nineteenth century us economy and david 1992 traces the origins of patent monopolies to efforts by medieval european city states and nations to attract experts in industrial arts to practice their craft within these jurisdictions both international technology flows and government efforts to influence them for national competitive advantage thus have ample historical precedent several characteristics nevertheless distinguish the post 1945 era from earlier historical periods the influence of international technology transfer on national economic development has increased as the postwar development of such economies as taiwan and south korea has relied much less on natural resource endowments than nineteenth

consumer preferences and product and process r d firms often conduct both product and process r d consumer preferences typically play a vital role in determining these r d choices the economics literature however has mostly ignored the interrelationship between the r d choices of firms and consumer preferences istudy product and process r d from the perspective of their relationship with consumer preferences in doing so i find a novel distinction between the two kinds of r d this distinction can explain several empirical observations regarding firms choices of the two and can also potentially enable us to better empirically identify the two

development of national innovation policy in small developing countries the case of cyprus abstract this paper analyses the concept of national innovation policy nip and puts forward arguments supporting the need for a nip for small developing economies like cyprus a brief outline is given of the science technology infrastructure and current innovation related policies in cyprus while the attitudes of owners managers of private manufacturing firms towards these policies based on a research survey are examined the survey reveals an ambivalent attitude towards nip which is probably due to unrealistic expectations as well as inefficiency in design and implementation of innovation policy measures case research confirms these conclusions and highlights the importance of nip for private firms despite the rhetoric of their managers against it the formulation of a specific nip for cyprus is then considered from which lessons for other developing countries are drawn

the moderating role of submarket dynamics on the product customization firm survival relationship in this paper we examine how the provision of product customization services affects firm survival integrating literatures on industry evolution product related adapting services and entry deterrence we hypothesize that the relationship between product customization the costly modification of a product to cater to customer needs and firm survival differs across industries based on the extent of submarkets we argue that in industries that feature submarkets more prominently the positive association between product customization and firm survival is stronger for two conceptually distinct and empirically distinguishable mechanisms customizing firms enter new submarkets and also deter potential entry we conclude that offering product customization services has strategic benefits that sometimes outweigh the cost of coordinating with customers

disruption disintegration and the dissipation of differentiability this paper proposes a deductively derived model to help managers who preside over decisions to integrate or outsource to assess ex ante whether when and why it might be strategically and competitively important to develop internal capabilities to perform certain activities in house and when it would be sensible and safe to outsource elements of value added among the paper s conclusions are that the competitive advantage from vertical integration is strongest in tiers of the market where customers are under served by the functionality or performance available from products in the market vertical integration tends to be a disadvantage when customers are over served by the functionality available from products in the market vertically integrated firms will therefore often dominate in the most demanding tiers of markets that have grown to substantial size while a horizontally stratified or disintegrated industry structure will often be the dominant business model in the tiers of the market that are less demanding of functionality

fortune favors the prepared firm a critical factor in industrial competitiveness is the ability of firms to exploit new technological developments we term this ability a firm s absorptive capacity and argue that such a capability not only enables a firm to exploit new extramural knowledge but to predict more accurately the nature of future technological advances we develop a stylized model in which we focus exclusively on firms decisions to invest in their absorptive capacities we first examine a monopolist s investment decision analyzing the path dependence of its investment and the effect of uncertainty we then consider the effect of competition by modeling the impact of entry on an incumbent s investment behavior implications for management and public policy are then discussed

the influence of market demand upon innovation a critical review of some recent empirical studies abstract a number of recent empirical studies of technical change at the level of the individual firm have concluded that market demand is the dominant influence upon the innovation process calling forth innovations in market economies the pace of innovation in the private sector heavily influences the growth of national output and productivity and these studies and their conclusions have therefore received much attention having been extensively quoted in discussions of appropriate government policy for the encouragement of innovation this paper reviews a number of these studies and concludes that their findings and the interpretations of their findings in the secondary literature are seriously flawed and in many cases invalid the proposition that market demand governs the innovation process is by no means conclusively demonstrated in these studies and they are therefore inadequate and inappropriate guides for the formulation of policy most of the studies examined employ a working definition of demand factors which is so broad as to embrace a range of possible influences upon innovation which should more properly be classified elsewhere the concept of demand utilized in these studies bears little resemblance to the more restrictive and precise definition of market demand found in economics in addition the phenomena analyzed in these studies are a very heterogeneous lot the studies do not address identical empirical questions and their findings are as a result neither uniform nor unambiguous both demand and supply side influences are crucial to understanding the innovation process and it is the exclusive preoccupation with only one set of these forces which is criticized in this paper some implications of the criticism for government policy toward innovation are discussed in the conclusion

a model of strategic product quality and process improvement incentives in many production firms it is common practice to financially reward managers for firm performance improvement the use of financial incentives for improvement has been widely researched in several analytical and empirical studies literature has also addressed the strategic effect of incentives in particular what the effect of certain incentive structures would be on the behavior of a firm s competitor s most of these studies however focus on sales incentives in this paper we investigate the effects of strategic incentives for product quality and process improvement using a game theoretic model that considers two owner manager pairs in competition we find that if one of the managers is told to only maximize firm profits which in fact is similar to profit incentives the other manager will be offered positive incentives for product quality and process improvement these product quality and process improvement incentives result in increased profits at the expense of the profits of the other firm also we find that if both firm owners have the possibility to offer incentives for product quality and process improvement they will both do so however this equilibrium essentially entails a prisoner s dilemma in which the two firms earn lower profits compared to a situation in which the owners instruct their managers only to maximize firm profits insights into the normalization of the problem and the aggregation of multiple product quality and process improvement variables are also discussed

the short run price performance dynamics of microcomputer technologies abstract models of technology growth are often conceived in terms of long run trends in performance and price because in general short run parameter stability and even the form of the growth function have proved elusive yet short run growth models are arguably more useful for managers and research scientists because the majority of their decisions are concerned with discretionary spending and operations rather than longer run strategic plans and investments our research explores short run growth in microcomputer technologies by specifying growth models and parameter estimates for six commercially important computer technologies over short time periods with weekly data observations were acquired in a homogeneous market limited to a collection time frame of less than two years data was collected at granular weekly intervals with concurrent tests to determine whether parameters were stable over successively longer intervals conversely candidate growth models from longer strategic planning horizons were tested to determine whether they scaled down to operational planning horizons we found that an exponential model of performance to price growth is supported over short time horizons in all but one microcomputer technology nonvolatile ram the exponential model and technology specific parameter estimates that are valid over short horizons were found to accurately scale up to longer planning horizons we expect our results to contribute to more accurate price performance forecasting at the corporate and product level better decision making concerning inventory management capacity utilization lead and lag times in supply chain operations and efficiency of logistics

anniversary article the strategy field from the perspective of management science divergent strands and possible integration we reflect on the evolution of the strategy field as seen through the window ofmanagement science reflecting the diverse disciplinary roots of strategy research we identify a broad ranging body of work that varies with respect to the assumptions made regarding individual rationality and the level of analysis at which the research is carried out we argue that recent developments begin to delineate a potentially unifying conceptual framework for treating the field s defining questions the conceptual apparatus of evolutionary economics we conclude by laying out important challenges for evolutionary economics if it is to serve as a foundation for both the positive and the normative research agendas of the strategy field

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

achieving demand side synergy from strategic diversification how combining mundane assets can leverage consumer utilities we explore the overlooked issue of how certain strategic level interindustry diversification options might increase consumer utility discussions of inter industry diversification typically focus on producer synergies obtainable from economies of scope or from skill transfer across business units discussions of intra industry product diversification generally the province of marketing typically focus on synergies obtainable from product bundling which lowers producer costs or provides convenience for consumers we take a different tack by linking interindustry diversification and consumer utility we first separately examine two possible consumer benefits of interindustry diversification 1 facilitating consumers accomplishment of two tasks simultaneously or 2 attracting diverse consumer groups to a common platform when intergroup externalities exist we then assess a simple empirical context that shows potential for simultaneous consumer utilities and two sided market utility together we analyze this context and concurrently develop a mathematical model showing how these demand side synergies can create unique business value we next introduce asymmetric preferences among consumer subgroups and we refine our arguments by comparing their conclusions with the empirical data we learn that combinations of otherwise mundane i e commonplace assets can create consumer value superior assets are not necessary moreover common ownership is necessary for the pricing flexibility required to deliver and capture maximum value through interindustry diversification especially when consumer groups preferences may change the negotiations and settling up required for cooperation through alliances will without common ownership increase costs and reduce responsiveness we discuss the sustainability of demand side advantages and the implications of these ideas for future research and practice

unemployment insurance and moral hazard in employment abstract using the 1988 1990 lmas we examine whether the variable entrance requirement ver that claimants must work for a minimum number of weeks conditions job durations estimated employment hazards contain a large significant spike at the ver

success of start up firms the role of financial constraints although there are some studies that empirically test the impact of financial constraints on the success of start ups the persistence of this impact is not well understood using survey data for a cohort of swiss start ups that were observed during a period of 10 years we find that financial constraints are not only a problem of the first years although the negative impact of financial constraints on firm survival disappears with increasing age of the firms profit is persistently negatively affected by financial constraints copyright 2014 the author 2013 published by oxford university press on behalf of associazione icc all rights reserved oxford university press

local test bed market demand in the transition to leadership the case of the korean mobile handset industry this article proposes that a potentially significant dimension of technological catching up and the transition to leadership lies in the quality and dynamics of the local market rather than in the export market demand as traditionally stressed in catch up studies based on an exploratory analysis of the korean mobile handset industry over the period of the late 1980s to 2005 the paper shows that a transition to leadership in handsets was shaped and driven by domestic users local service suppliers mobile telecommunications operators favorable government policies and strong producer user links forged by manufacturers and operators traditionally local demand in latecomer economies has been considered too small and unsophisticated to stimulate innovation and to enable catching up however in this case local demand evolved and acted as an important test bed for new products services and technologies shaping the rate and direction of the technological development of both local suppliers and operators the conclusion argues that while direct implications for other developing countries cannot be drawn from a single case future research could identify whether under certain circumstances the role of local demand and test bed markets could have wider relevance for other advanced developing nations and other sectors approaching the technology frontier

how changes in unemployment benefit duration affect the inflow into unemployment we study the effect of an unexpected reduction in maximum unemployment benefit duration on the inflow into unemployment of elderly workers in the netherlands we analyze the reduction as if it was a natural experiment finding substantial effects

research and development human capital and trade performance in technology intensive manufactures a cross country analysis abstract this paper comprises an extensive examination of the relationship between commonly utilized policy indicators of national technological capability and observed trade success in technology intensive manufactures across 52 countries in the 1980s a central focus is the relative performance of policy indicators which directly measure innovative activity such as patent output and expenditure and employed scientists and engineers in r d versus those measuring general efforts at increasing national levels of human capital the study design is guided by the inter country intrasectoral approach outlined by dosi et al 19 it emphasizes differences in trade performance based on the notion of international competitiveness but also compares results for conventional revealed comparative advantage indices the large number of countries included and the nature of the policy objectives adopted have necessitated a highly aggregated approach using nation wide attributes and trade in one broad technologyintensive sector as the measure of demonstrated international competitiveness simple correlation and multiple regression techniques are used to assess the association of four main sets of national attributes indicators of direct innovative activity general human capital development physical capital formation and natural resource endowment with technology intensive trade performance the empirical findings provide further support for the importance of national differences in technological capability as a determinant of structural and international competitiveness within the technology intensive sector of production they suggest that policy indicators measuring actual innovative activity and physical capital formation have a much closer link to technology intensive trade than the general educational effort or output indicators demand side measures which proxy the actual employment and application of resources for r d purposes demonstrate the strength of association required for reliable policy evaluation of real national differences in technological capability the poor performance of the general human capital supply variables highlights the need for a careful consideration of the optimality of the allocation of substantial levels of scarce national resources to broad based educational output a number of other significant results concerning the link between technology indicators technology intensive trade and economic performance are discussed

searching and learning by trial and error i study a dynamic model of trial and error search in which agents do not have complete knowledge of how choices are mapped into outcomes agents learn about the mapping by observing the choices of earlier agents and the outcomes that are realized the key novelty is that the mapping is represented as the realized path of a brownian motion i characterize for this environment the optimal behavior each period as well as the trajectory of experimentation and learning through time applied to new product development the model shares features of the data with the well known product life cycle jel d81 d83 d92 l26

demand and innovation in services the case of mobile communications abstract this paper aims to analyse the pricing strategies of mobile communications operators and examine the role of demand characteristics in the development of new tariff plans in so doing we depart from a traditional industrial organization approach to price discrimination and interpret new tariff plans as innovations in the spirit of schumpeter we look at competition in this sector as depending upon this form of innovation and we argue that given the specific features of the industry the development of new tariff plans is strongly related to the users characteristics and behaviour our main point is that in a context of uncertainty demand affects firms innovative strategies in two ways first by providing information on user behaviour and by increasing the capability of market segmentation and second by providing the incentives to innovate this argument is supported by an empirical analysis carried out on the basis of an original dataset which includes all the tariff plans on offer in the history of the italian market between 1992 and 2005 we find that both a firm s installed customer base and the level of market saturation play a role in shaping firms innovative pricing strategies in terms of the number and characteristics of the new tariff plans

dynamic pricing product and process innovation abstract the question of simultaneous dynamic pricing product and process investment policies is crucial for manufacturing and high tech industries this paper models these policies in an optimal control setting on the supply side the firm sets prices product and process investment levels over time on the demand side current demand depends on price and quality under an additive separable demand function dynamic pricing increases with quality and cost therefore both product innovation and process innovation impact the pricing policy under a multiplicative separable demand function dynamic pricing policy follows the dynamic of production cost and is independent of the evolution of product quality thus process innovation is the main determinant of a firm s pricing policy over time and product innovation has no impact

why put all your eggs in one basket a competition based view of how technological uncertainty affects a firm s technological specialization conventional wisdom suggests that when a firm faces technological uncertainty it responds by becoming less technologically specialized so as to remain adaptable to subsequent resolution of this uncertainty we adopt a competition based view of technological uncertainty to identify an opposite effect in competitive settings the firm may instead become more specialized when faced with greater technological uncertainty so as to focus on advancing its technologies against competition and influence the resolution of uncertainty in its favor over rivals we propose that this effect is accentuated when the firm expects that it cannot easily adapt to rivals technologies subsequently specifically when rivals are a greater deterrent through being litigious or innovative using u s government funding for fuel cell research as a policy shock with stock option implied volatilities to measure expected uncertainty we find empirical support for our propositions among firms active in research and development in the u s communications equipment industry through these findings we demonstrate that a competition based view of uncertainty identifies an alternative path for the firm s resource accumulation under uncertainty and we stress that the resolution of uncertainty can be something the firm attempts to influence rather than adapt to

adaptive learning in international business building on daniel levinthal s seminal theories on learning adaptation and innovation this article elucidates an adaptive view of organizational learning undertaken by multinational enterprises mnes levinthal s perspectives have tremendous implications for theorizing and examining processes pathways and mechanisms of dynamic learning for mnes competing in a complex environment this article extends these perspectives considering unique organizational traits and environmental characteristics facing mnes for a more nuanced understanding of contexts in which adaptive learning creates global competitive advantage discussion also includes levinthal s perspectives that are not yet adequately extended to but valuable for ib research such as learning mindfulness cognitive search organizational architecture for adaptation and co evolution with technological change we offer additional research questions as well as possible solutions to adaptive learning for international business

optimizing product launches in the presence of strategic consumers a technology firm launches newer generations of a given product over time at any moment the firm decides whether to release a new version of the product that captures the current technology level at the expense of a fixed launch cost consumers are forward looking and purchase newer models only when it maximizes their own future discounted surpluses we start by assuming that consumers have a common valuation for the product and consider two product launch settings in the first setting the firm does not announce future release technologies and the equilibrium of the game is to release new versions cyclically with a constant level of technology improvement that is optimal for the firm in the second setting the firm is able to precommit to a schedule of technology releases and the optimal policy generally consists of alternating minor and major technology launch cycles we verify that the difference in profits between the commitment and no commitment scenarios can be significant varying from 4 to 12

who invests in renewable electricity production empirical evidence and suggestions for further research transforming energy systems to fulfill the needs of a low carbon economy requires large investments in renewable electricity production res e recent literature underlines the need to take a closer look at the composition of the res e investor group in order to understand the motives and investment processes of different types of investors however existing energy policies generally consider res e investments made on a regional or national level and target investors who evaluate their res e investments according to least cost high profit criteria we present empirical evidence to show that res e investments are made by a heterogeneous group of investors that a variety of investors exist and that their formation varies among the different types of renewable sources this has direct implications for our understanding of the investment process in res e and for the study of motives and driving forces of res e investors we introduce a multi dimensional framework for analyzing differences between categories of investors which not only considers to the standard economic dimension which is predominant in the contemporary energy literature but also considers the entrepreneurship innovation adoption and institutional dimensions the framework emphasizes the influence of four main investor related factors on the investment process which should be studied in future research motives background resources and personal characteristics