competition cooperation and innovation organizational arrangements for regimes of rapid technological progress abstract discussions of the link between firm size and innovation are outmoded because the boundaries of the firm have become fuzzy in recent decades strategic alliances constellations of bilateral agreements among firms are increasingly necessary to support innovative activities such alliances can facilitate complex coordination beyond what the price system can accomplish while avoiding the dysfunctional properties sometimes associated with hierarchy antitrust law and competition policy need to recognize that these new organizational forms are often the functional antithesis of cartels though they may have certain structural similarities a more complete understanding of bilateral contracts and agreements ought to reveal when and how cooperation can support rather than impede innovation and competition

models of inflation expectations formation a comparison of household and economist forecasts the recent appreciation of the critical role played by expectations of inflation in the behavior of macromodels has stimulated empirical studies of the formation of expectations by different groups time series survey data on expectations of inflation exist now for economists households and businesses these data have been used as independent variables in explaining wage behavior gordon 16 turnovsky and wachter 34 and de menil and bhatta 5 prices turnovsky and wachter 34 and wachtel 36 interest rates gibson 14 hendershott and van horne 19 pearce 30 and mishkin 27 and consumption wachtel 36 generally with a significant improvement in explanatory power they have also been used as dependent variables in attempts to determine how expectations are formed by gordon 15 mullineaux 28 jacobs and jones 20 and figlewski and wachtel 9 for the economist survey van duyne 35 for the household survey and leonard 23 and de leeuw and mckelvey 4 for businesses given their different levels of knowlege of economics and perspectives one might expect that the models used by the different groups to forecast inflation would

the optimal performance of the global firm formalizing and extending the integration responsiveness framework with the increasing globalization of business there has been growing interest in how to create and manage a successful international enterprise although researchers and practitioners have grappled with the issue of globalization for some time there is no one model that encompasses the range of phenomena we observe in the global economy nor have those models that do exist been precisely formalized this paper provides an expanded approach to thinking about the organizational forms and linkages that exist in international business operations building on the popular integrationresponsiveness framework of international strategic orientation we develop a more expansive approach that is better able to account for the diversity of organizational forms and strategic choices open to managers by adding a third set of environmental pressures incorporating the beliefs of managers and by employing the idea of efficient frontiers we reformulate the integration responsiveness framework making it more consistent with modern economic models of the firm our integration responsiveness completeness irc model argues that global firms can respond to these fundamental and competing pressures by configuring themselves in a variety of ways rather than normatively prescribing that the transnational form is optimal in addition our model has methodological ramifications its formal structure suggests that empirical techniques that focus on the best rather than average performance are necessary to adequately investigate the performance differences among alternative organizational forms this may explain the paradoxical lack of empirical support for a link between organizational form and performance

assets and actions firm specific factors in the internationalization of u s internet firms by providing a nearly instant connection among parties at opposite corners of the world and enabling a variety of commercial exchanges the internet emerged as the technology expected to create a truly global market space internet firms faced the challenge of capitalizing on this development in this paper we examine what firm specific factors are associated with the propensity of pure u s based internet firms to enhance their international presence on the internet by developing country specific websites despite the assertion that all internet firms are born global our findings show that the pursuit of internationalization by internet firms is related to the levels of their intangible assets and strategic activity two types of intangible assets reputation and website traffic are positively related to the degree of internationalization so are the levels of competitive and cooperative activity and the interaction effects between reputation and competitive and cooperative activity these findings suggest that ideas from both resource based theory and research on competitive dynamics can contribute to understanding the internationalization of internet firms

strategizing by firms in the presence of markets for resources strategizing by firms from the resource based view is concerned with the process through which firms acquire a distinctive bundle of resources that is costly and time consuming for competitors to duplicate or imitate a central question facing any firm therefore is its strategy for accumulating the resources that underpin its production activities in this article the process of resource accumulation is discussed as one involving potentially both internal resource development and external resource acquisition from the perspective of the strategic issues involved in making a choice between these options emerging markets for technologies and know how through licensing and other forms of resource exchange have opened up new avenues through which firms may jostle for advantage the article is concerned with three major aspects of this process illustrating the discussion with cases from biotechnology and pharmaceuticals first the strategizing by firms around the internal development vs external sourcing issue is discussed as informed by the practices of leading firms and how these lend greater variety of strategic options for firms second the potential competitive advantages as well as disadvantages to be secured by firms through the process of external sourcing as compared with the well known potential advantages accruing to incumbents through internal development such as time compression diseconomies and causal ambiguity and third the criteria to be used by firms to strategically evaluate resources individually as contrasted with the strategic evaluation of the resource bundle or totality these criteria it is argued turn on the issues of marginal value contribution resource complementarities and synergies resource variety and transferability involving intellectual property issues successful firms it is argued expand their options through blending internal resource accumulation with external resource leverage thereby deepening their distinctive dynamic capabilities this approach extends the framework of the rbv enabling it to encompass resource driven schumpeterian competition and such aspects of industrial dynamics as specialization modularization and imitative challenge copyright 2003 oxford university press

resources transactions and rents managing value through interfirm collaborative relationships this paper offers a theoretical explanation for why interfirm collaborations form yet fail and further suggests how firms might manage them for a more positive outcome based on a perspective of value we explain how a more inclusive and integrative perspective one which combines elements from transaction costs and resource based theory provides more robust insight into collaboration formation management and instability in doing so we differentiate rent yielding firm specific assets at the core of the resource based view from the transaction specific assets at the core of transaction cost theory the paper makes a crucial distinction between the potential value attainable through collaborations and its actual realization the crux of our argument is that firms enter into collaborative relationships because these are expected to yield superior value relative to alternate organizational forms in certain situations offering potentially synergistic combinations of complementary resources and capabilities yet such relationships are frequently prone to failure because the partner firms tend not to recognize ex ante the nature and extent of transaction specific investment that is required in the collaborative relationship to attain these synergies in our argument critically the relationship between organizations is seen not simply as a governance structure of a hybrid nature but more importantly as a productive resource for value creation and realization in this light transaction specific investment in what we term relational specificity becomes imperative in the search for value we explain why the transaction costs incurred in the exchange of resources are not independent of the nature of resources to be transacted and similarly why the returns realized from these resources are not independent of the relationship and transaction specific expenditures incurred in effectively combining them and maintaining the combination the interdependence between the two mediated by the quality of the relationship has direct implications for the earning of rents through collaborations these relationship specific expenditures can be of an internally generated nature endogenous to the alliance form itself and need not exceed alternative forms while the associated benefits have the capacity to potentially exceed the alternatives this translates into potentially superior value the paper contributes in three key related ways a the explicit recognition of the relationship as a value bearing asset embedded in a larger and endogenous institutional context namely a system of resource relationships both intraorganizational and inter organizational among partner firms and the collaboration b the recognition of the evolving relationship between production and exchange which at the level of the collaboration is directly dependent on the nature evolution and dynamics of the relationship among the parties to the transaction and c the provision of a nontrust explanation for why firms might knowingly forego opportunities to take advantage of their partners drawing from this the paper occasions a a shift in focus from the form to the process of governance which has direct implications for value creation and realization and b a shift in the primary identity of transaction specific and relationship specific expenditures from cost to investment in future value

friends acquaintances or strangers partner selection in r d alliances like governance structure and alliance scope partner selection may serve to safeguard firms intellectual assets in r d alliances we categorize potential alliance partners into friends acquainta

r d cooperation and failures in innovation projects empirical evidence from french cis data the second french community innovation survey cis indicates that 14 of rd collaborating firms had to abandon or delay their innovation projects due to difficulties in their partnerships an outcome which we term cooperation failures controlling for sample selection on the cooperation decision our estimates show that firms collaborating with competitors and public research organizations pros especially when they are foreign are more likely to delay or stop an innovation project because of difficulties encountered in their rd partnerships more surprisingly firms collaborating with their suppliers also face a higher risk of cooperation failures at least for pros firms can reduce the risk of cooperation failures through previous experiences in partnerships larger firms and group subsidiaries are less likely to face cooperation failures and so do firms in industries with a strong appropriability regime

determinants of governance structure in alliances the role of strategic task and partner uncertainties research in transaction cost economics and structural sociology has emphasized the role of opportunism and trust in the choice between equity and non equity governance forms in alliances this paper suggests that the uncertainty surrounding partner cooperation is not straightforwardly predictive of governance structure in alliances instead task uncertainty and strategic uncertainty associated with the activities performed within alliances induce coordination and adaptation requirements that are important determinants of alliance governance independently of partner uncertainty support for this view is provided based on a 12 year panel of alliances formed in the us telecommunications entertainment and computer industries

clusters entrepreneurial ecosystem co creation and appropriability a conceptual framework extant literature on clusters underplays the role of entrepreneurs and entrepreneurial management in creating and co creating organizations markets and supporting ecosystems we employ transaction costs resource knowledge capabilities and power control based theories to provide a comparative static governance based perspective on clusters we embed this into a more general co evolutionary entrepreneurial theory of the emergence evolution and co evolution of markets ecosystems and clusters we suggest that clusters can involve advantages that help engender superior appropriation of co created value as compared to alternatives entrepreneurial managers faced with a degree of choice will help co create clusters and be part of them for as long as they can appropriate more value in this way than through alternatives

organizational debut on the public stage marketing myopia and initial public offerings successful initial public offerings ipos provide firms with access to valuable resources but also put pressure on firms to impress potential investors with evidence of their current well being and prospects for future growth to impress investors ipo firms might curtail their marketing budgets which appears to inflate current earnings and provide evidence of current well being however curtailing marketing budgets unexpectedly during an ipo may be a myopic practice in that the immediate benefits of these budget cuts are offset by their longer term adverse consequences on financial well being the extent of these adverse consequences in turn may be moderated by external firm factors including strategic alliances and key customer relationships and internal firm factors such as the strategic emphasis on value creation versus value appropriation a sample of 1 095 ipos during 2000 2011 reveals evidence of myopic marketing practices in more than 37 of the sample investors seem misled during ipos bu

the revealed preferences of high technology acquirers an analysis of the innovation characteristics of their targets this paper investigates whether acquisitions involving public high technology firms are best understood in terms of acquirers taking over firms with superior innovation performance to access their assets or acquiring firms with inferior innovation performance to turn them around innovation performance is proxied by r d intensity r d expenditure over assets patent intensity patents per us million of assets i e the r d productivity of a firm s assets and the patent stock i e the accumulated r d output we find substantial overlaps between target and non acquired firm characteristics nevertheless targets have a relatively high r d intensity and a large patent stock which is consistent with acquirers targeting firms with a superior innovation performance however these targets have significantly lower pre acquisition patent intensity and hence a lower r d productivity the targets are also experiencing weak financial performance our results are consistent with a selection process in which acquirers seek out firms that have a superior past innovation performance but that are failing in terms of recent r d productivity and financial performance a comparison of the performance of the targets with their acquirers reinforces this conclusion

the effects of corporate environmental disclosure on environmental innovation from stakeholder perspectives abstractbased on legitimacy theory and resource dependence theory using 111 listed companies among china s typically high pollution emitting listed corporations research into the effects of environmental disclosure on environmental innovation is undertaken from the perspective of stakeholders we analyse the moderating effects of different proportions of institutional investor holdings and types of enterprises on the relationship between environmental disclosure and environmental innovation the results indicate that corporate environmental disclosure has a positive role in promoting environmental innovation the proportion of institutional investor holdings has a positive moderating effect between environmental disclosure and environmental innovation however there is no significant difference between state owned enterprises and private enterprises in terms of the effect of the environmental disclosure on environmental innovation which possibly arises because both types of enterprises make full use

cooperation and political economic performance in affluent democratic capitalism research on comparative political economic performance has traditionally followed two separate tracks one concerned with collective economic gain growth and efficiency and the other focused on distribution and redistribution cooperative institutions offer a key to understanding cross national variation among the affluent capitalist democracies in both facets of political economic performance these institutions cluster along two dimensions neocorporatism and firm level cooperation pooled time series analysis for 18 nations over 1960 89 suggests that 1 neocorporatism is a major source of distributive redistributive policies and outcomes and of several sources of collective gain 2 firm level cooperation is a key contributor to economic growth

client profitability of diffusion segments across countries for multi generational innovations the influence of firm market and cross national differences there is scant research on the important managerial question of how to maximize returns on investments in either international business or international marketing literature we propose and test a conceptual framework using data from a large technology manufacturer service provider despite early adoption by innovators and early adopters the early majority segment is most profitable however the late majority segment and the early adopters segment are the next most profitable in the developed and emerging countries respectively we propose a decision support framework incorporating cross national distances on single generation and multi generation profitability for mnes offering multi generational products in multinational markets to be more profitable

commercialization strategies of young biotechnology firms an empirical analysis of the u s industry abstract we studied the commercialization strategies of young biotechnology companies in the united states building on previous studies by assuming that commercialization also includes intermediate forms like hierarchical or bilateral cooperation our hypotheses are derived from the resource based view transaction cost economics and property rights theory the results show that the propensity to integrate is related to the appropriability regime direct capabilities financial resources and synergies between the products our results show that the resource based view and property rights theory contribute a great deal to explaining commercialization strategies whereas transaction cost economics explains less

instabilities of strategic alliances an internal tensions perspective the instabilities of strategic alliances have been examined in the literature through a number of theoretical approaches alliance instabilities refer to major changes or dissolutions of alliances that are unplanned from the perspective of one or more partners although the literature identifies certain characteristics of strategic alliances that may lead to their unplanned dissolution the extent of our understanding of this subject appears to be fragmented and incomplete in this article we propose a comprehensive framework for adequately understanding alliance instabilities based on the notion of internal tensions we suggest that strategic alliances are sites in which conflicting forces develop and which can be viewed as being constituted by three key pairs of competing forces namely cooperation versus competition rigidity versus flexibility and short term versus long term orientation this tensions framework helps us in explaining the intrinsic vulnerability of alliances in terms of a wide range of internal contradictions and enables us to examine in an integrated manner the incidence dynamics and eventual dissipation of the inherent instabilities we discuss the interrelationships among the different internal tensions and their impacts on different types of strategic alliances we also examine the termination of alliances through mergers acquisitions and dissolution finally we suggest ways to empirically test the various ideas and propositions developed here and indicate directions for further research

the demand and supply of external finance for innovative firms access to finance has figured prominently in the debate on barriers to firm growth even though existing empirical research has not found conclusive evidence of a finance gap moreover it is not clear to what extent innovation aggravates financial constraints and what role innovation inputs processes and outputs play in the market for external capital in this article we analyze how firm level innovation affects i the likelihood of seeking external finance and ii the likelihood of obtaining it we analyze an original data set of 3095 uk and us firms small and medium size enterprises and middle market containing information on firms innovation behaviors performance and finances for the period 2002 2004 controlling for firm specific characteristics we provide novel and extensive evidence on the links between innovation in its input process and output dimensions and the demand for external capital and its supply

reappraising the eclectic paradigm in an age of alliance capitalism this article discusses the implications of the advent of alliance capitalism for our theorizing about the determinants of mne activity in particular it argues that due to the increasing porosity of the boundaries of firms countries and markets the eclectic or oli paradigm of international production needs to consider more explicitly the competitive advantages arising from the way firms organize their inter firm transactions the growing interdependencies of many intermediate product markets and the widening of the portfolio of the assets of districts regions and countries to embrace the external economies of interdependent activities

external technology sourcing through alliances or acquisitions an analysis of the application specific integrated circuits industry in today s turbulent business environment innovation is the result of the interplay between two distinct but related factors endogenous r d efforts and quasi external acquisition of technology and know how given the increasing importance of innovation it is vital to understand more about the alternative mechanisms such as alliances and acquisitions that can be used to enhance the innovative performance of companies most of the literature has dealt with these alternatives as isolated issues companies however are constantly challenged to choose between acquisitions and strategic alliances given the limited resources that can be spent on research and development this paper contributes to the literature because it focuses on the choice between innovation related alliances and acquisitions we focus on the question of how the trade off between strategic alliances and acquisitions is influenced by previous direct and indirect ties between firms in an industry network of interfirm alliances we formulate hypotheses pertaining to the number of direct ties between two companies their proximity in the overall alliance network and their centrality in that network in so doing we distinguish between ties that connect firms from the same and from different industry segments and those that connect firms from the same or from different world regions these hypotheses are tested on a sample of strategic alliances and acquisitions in the application specific integrated circuits asic industry the findings show that a series of strategic alliances between two partners increases the probability that one will ultimately acquire the other whereas previous direct contacts tend to lead to an acquisition this is not true of previous indirect contacts which increase the probability that a link between the companies once it is forged takes the form of a strategic alliance in the case of acquisitions firms that are more centrally located in the network of interfirm alliances tend to be acquirers and firms with a less central position tend to become acquired these findings underscore the importance of taking previously formed interfirm linkages into account when explaining the choice between strategic alliances and acquisitions as these existing links influence the transaction costs associated with both alternatives

in house versus external basic research and first to market innovations this paper explores to what extent conducting internal basic research as opposed to external basic research i e outsourcing and collaboration with universities encourages firms to bring new products into the market ahead of competitors and contributes to innovation performance the analysis is based on a sample of spanish manufacturing firms over the period 2006 2012 our findings suggest that conducting in house basic research affects firm s propensity to introduce product novelties furthermore performing this activity continuously affects the probability of being product pioneer in low and medium low tech sectors collaboration with universities also helps in introducing new products ahead of competitors but contracting scientific research from universities does not lead to a pioneer strategy results also reveal the absence of complementarities

policy interventions for industrial network formation contrasting historical underpinnings of the small business policy in japan and the united states this article examines the role of policies in promoting inter firm networks by contrasting policy frameworks for small businesses in japan and the united states while the policies in two countries share similarities in many respects different historical underpinnings have led small business policies to play different roles in economies of japan and the united states this paper analyzes how japan s small business policy came to encourage inter firm collaborations over the course of its history while policies in the united states have not had explicit orientation toward the development of inter firm networks until the 1990s

hierarchies markets and power in the economy an economic perspective this paper adopts the transaction cost economics perspective for purposes of examining hierarchies markets and power in the economy transaction cost economics works out of an economizing perspective in which markets and hierarchies are alternative modes of governance and the object is to ascertain which transactions go where and why the role of power in this setup is strictly limited partly because power tends to be myopic transactions are not examined in their entirety and partly because it is tautological power needs to be operationalized whereupon the refutable implications that accrue to this perspective can be derived copyright 1995 by oxford university press

technology development mode a transaction cost conceptualization technology alliances have emerged in the past decade as a significant mode for the development of innovation the present research assesses the factors explaining whether firms will engage in such technology alliances or utilize the more traditional mode of internal r d the hypotheses stem from a transaction cost conceptualization results suggest that firms which pursue technology alliances are likely to have less commitment to product category specific assets to face higher technological uncertainty to be more capable at measuring innovation performance to have more successful technology alliance experiences and to compete in lower growth product categories 1998 john wiley sons ltd

why reputation favors joint ventures over vertical and horizontal integration a simple model abstract this paper investigates the effect of reputation in a model where two parties make noncontractable contributions to an economic undertaking it is shown that the optimal allocation of ownership between the parties is more similar in a repeated than in a one shot version of the model this implies that unified ownership and reputation are substitutes low discount rates and repeated investment decisions thus favor subcontracting and joint venture arrangements of the type commonly observed in japanese industry while full integration is more likely to be optimal when reputational forces are weak

equity links and information acquisition in biotechnology alliances abstract we use a simple model of collaborative innovation to structure an empirical analysis of minority equity links in biotechnology alliances between clients and r d firms in the model an equity link is an investment in information acquisition it improves the ability of the client to learn about the r d firm s ability and the alliance project s quality the model generates several testable hypotheses about how the r d firm s project characteristics and previous alliances affect the use of equity links in new alliances we test the hypotheses using a large data set of biotechnology alliances and find empirical support

new horizons or a strategic mirage artist led distribution versus alliance strategy in the video game industry abstract in this paper we contribute to the debate between researchers who argue that the emergence of online distribution allows content producers in the creative industries to bypass powerful publishers and distributors and other researchers who argue that this strategy cannot succeed without the complementary assets that these intermediaries provide we use a case study of the dutch video game developer dvgd bringing to market an identical game using two different but comparable distribution channels as a quasi experiment in the first release dvgd used online distribution to reach consumers directly whereas in the second it used an alliance with an established video game publisher we find that while the alliance required dvgd to share with the publisher a substantial fraction of the value appropriated by the game the alliance strategy resulted in greater absolute financial performance and relative market performance compared to the self publishing strategy we conclude that the differences in performance can be traced back to specialized complementary assets required for successful commercialization

innovation and cooperation implications for competition and antitrust n k robel laureate robert solow and his colleagues on mit s industrial productivity commission recently noted dertouzos lester and solow 1989 p 7 undeveloped cooperative relationships between individuals and between organizations stand out in our industry studies as obstacles to technological innovation and the improvement of industrial performance and later p 105 that interfirm cooperation in the u s has often though not always been inhibited by government antitrust regulation these striking conclusions warrant further exploration unfortunately industrial organization textbooks still discuss horizontal cooperation and competition almost exclusively in terms of standard cartel theory on the other hand vertical cooperation contracting is viewed differently and some textbooks provide treatments of supplier buyer relationships in which cooperation is viewed as enhancing efficiency both in the textbooks and in policy discussion among economists cooperation among competitors is highly suspect being perhaps the last bastion of what was once referred to as the inhospitality tradition in antitrust as a result very little literature addresses how cooperation among competitors can promote competition notwithstanding that cooperation among competitors may sometimes be essential if innovating firms are to compete in today s increasingly global markets imai and baba 1989 such cooperation is already important in japan and in europe 1

transnational firms and the changing organisation of innovative activities it is suggested that a transition is taking place towards new modes of organising transnational corporations innovative activities first different units of multinational firms including foreign based subsidiaries are increasingly involved in the generation use and transmission of knowledge secondly multinationals are developing external networks of relationships with local counterparts through which foreign affiliates gain access to external knowledge sources and application abilities as a result of this evolutionary process multinationals organisation is subject to both centripetal and centrifugal forces considerable efforts are then necessary to innovate coordination procedures and mechanisms in order to enhance the generation circulation and use of knowledge a number of empirical works are reviewed providing some evidence of the evolutionary process discussed in the paper 1 transnational companies as networks of innovators economists have long viewed innovation as being primarily generated by firms in their home countries classic contributions in the economics of multinational corporations have consolidated this view referring mainly to the us based multinationals vernon 1966 kindleberger 1969 and stopford and wells 1972 theorised a quasi colonial relationship between the parent company and foreign subsidiaries wherein the latter are in charge of replicating the former s activities abroad with strategic decisions including r d and innovation strategies being rigidly centralised particularly vernon emphasised that coordinating international innovative activities would be too costly owing to the difficulties of collecting and controlling relevant information across national borders host countries and foreign subsidiaries would then play a role almost exclusively in the adoption and diffusion of centrally created technology this view was supported mainly by us economists and based on us evidence from the early post world war ii period but it was very influential for the development of studies on the economics of transnational companies tncs and the internationalisation of

technological flows and choice of joint ventures in technology alliances abstract this paper analyses the influence of technological flows in the choice of joint ventures as a governance form of technology alliances using a theoretical framework based on transaction costs economics and the economics of intellectual property rights we argue that the formation of a joint venture is only necessary in situations for which technological flows make the monitoring of alliance activities and the distribution of cooperation rents difficult our hypotheses have been confirmed using a sample of technology alliances created by companies from the european union between 1992 and 1999

multinational experience and the creation of linkages with local firms evidence from the electronics industry the paper focuses on the nature and determinants of multinational firms creation of linkages with local firms with specific reference to the electronics industry the study of the recent evolution of international operations in this sector seems to highlight a relevant and somewhat generalisable pattern of industrial organisation and dynamics it is argued that the nature and intensity of multinational companies involvement into linkages with local counterparts are strongly influenced by a combination of factors that are partially inter dependent but still rely on different decision making centres on the one hand host countries long term investment policies in the field of human capital training and accumulation and on the other hand firms decisions to take roots in local contexts through the creation of foreign subsidiaries it is further suggested that human capital and subsidiaries will particularly favour the development of collaborative linkages with local firms compared to previous work of the authors on this subject this paper utilises an expanded and updated data set covering international operations of the top european and us electronics companies over the 1984 1995 period and attempts a more detailed and in depth analysis concerning the nature determinants and evolution in time of international growth strategies

information and consumer willingness to pay for biofortified yellow cassava evidence from experimental auctions in nigeria in this article we use the becker degroot marschak mechanism to estimate consumer demand for biofortified yellow cassava varieties in two states of nigeria imo in the southeast and oyo in the southwest these two states exhibit distinct habitual product color preferences for staple food made with cassava we estimate the effect of nutrition information campaigns and nature of planting material delivery institutions on consumer demand willingness to pay estimations account for the effect of product endowment censoring in bids and nonpayment in oyo consumers are willing to pay a premium for light yellow cassava variety even in the absence of nutrition information the article finds that nutrition information results in a large and significant price premium for biofortified cassava in both states and the nature of delivery institution has no significant effect

complexity context and governance in biotechnology alliances this study explores the effect of coordination needs on alliance governance we examine coordination needs that arise as a consequence of the characteristics and the context of the alliance we posit that alliance characteristics and contextual factors influence alliance form and equity investment levels we evaluate the effects of the complexity of technology transfer and strategic complexity of the alliance we also study contextual factors represented by the distance between the intellectual property protection regimes of the home countries of the participants the focal firm s prior presence in the alliance country and its primary expertise in the industry we offer contrasting predictions based on appropriation and coordination perspectives our results demonstrate support for a dominant coordination perspective with alliance characteristics and some contextual factors influencing alliance form appropriation concerns play a weaker role and receive less support

leveraging research and development assessing the impact of the u s advanced technology program this paper examines the factors that affect a firm s chances of winning an award from the advanced technology program atp and the subsequent impact of the award on a firm s success in raising additional funds for its research and development rd the halo effect from the award increases the success of these firms in attracting additional funding from other sources our conclusion is that the atp is leveraging activities that have a strong potential for broad based economic benefit

performance verifiability and output sharing in collaborative ventures this paper studies the problem of contracting between two firms when they try to exploit their complementary resources in a collaborative venture cv but their performance in the cv cannot be precisely verified by the other party or by a third party arbiter using a mathematical model that treats performance verifiability as a continuous variable the paper first establishes that a party whose performance cannot be perfectly verified has an incentive to shirk if it is paid only a flat fee and that this shirking problem is more severe as its performance is less verifiable then the paper shows in a general setting that a contract under which each party shares a fraction of the output is superior to a contract under which one of them is paid only a flat fee when performance verifiability is sufficiently low in addition with some specific assumptions about the forms of the revenue and cost functions the paper also shows that a party s share of the venture s residual output in the equilibrium is an increasing function of its productivity and a decreasing function of its opportunity cost finally the numerical examples constructed in the paper suggest that a contract which combines the self enforcing mechanism of output sharing with the third party enforcement mechanism of arbitration generally performs better than a contract that utilizes only one of these mechanisms

arms race or detente how interfirm alliance announcements change the stock market valuation of rivals most prior event studies find that the announcement of a new alliance is accompanied by a positive stock market response for the partners this result has usually been interpreted as evidence for the prevailing view that alliances are effective vehicles for partners to acquire or access new skills and thus become stronger competitors however partners should also earn positive abnormal returns if alliances are used to shape competitive interactions attenuating competitive intensity industry wide in this study we disentangle these different mechanisms by examining how alliance announcements affect the stock market s evaluation of allying firms rivals if an alliance is expected to make partner firms more competitive this should lead to negative abnormal returns for partners rivals if an alliance is expected to facilitate a reduction in competitive intensity this should lead to positive abnormal returns for rivals results from an event study analysis of research and development alliances in the telecommunications and electronics industries during 1996 2004 provide evidence consistent with competition attenuation in some alliances our research thus challenges the increasingly narrow focus on learning and resource accumulation through alliances and calls for broader consideration of the roles and effects of collaboration both for individual firms and for industry structure

more than intent a bundling model of mne sme interactions abstract as a counterpoint to prashantham and birkinshaw i present an alternative model of mne sme cooperation where either type of firms can take the role of content provider or distributor i argue that mnes will interact with smes when there are differences in optimal scale between the content creation and distribution stages of the value chain and it is not feasible or efficient for either party to vertically integrate between these two stages i then build two 2 2 bundling models one in which the sme provides content and the mne distributes it and another with the reverse configuration in these 2 2s the axes are the transactional properties of the two complementary inputs content and distribution that mnes and smes bundle to create value i show that these models can explain the forms taken by mne sme cooperation and their dynamics

coalition formation in standard setting alliances we present a theory for predicting how business firms form alliances to develop and sponsor technical standards our basic assumptions are that the utility of a firm for joining a particular standard setting alliance increases with the size of the alliance and decreases with the presence of rivals in the alliance especially close rivals the predicted alliance configurations are simply the nash equilibria i e those sets of alliances for which no single firm has an incentive to switch to another alliance we illustrate our theory by estimating the choices of nine computer companies to join one of two alliances sponsoring competing unix operating system standards in 1988

exposing strategic assets to create new competencies the case of technological acquisition in the waste management industry in europe and north america this paper presents a model that complements the research stream of transaction cost economics with the dynamic capabilities approach the paper shows that even though technological alliances involving specific assets deployed in emerging industries are exposed to high transaction costs they possess attributes that make them attractive first they facilitate the creation of tacit competencies and second they reduce the uncertainty arising from technological innovation and regulatory changes the model is empirically tested in the hazardous waste management industry by using primary data collected through the use of questionnaires the method links governance structure choices to managers perceptions of the uncertainty surrounding the acquisition of technology

antitrust policy towards co operative r d ventures this paper surveys the theoretical literature on r d cartels and the empirical literature on problems of appropriability in order to evaluate the case for encouraging antitrust authorities to treat r d cooperative ventures leniently the case for r d cooperative ventures trades potential gains from internalizing technological spillovers off against a possible reduction in output market competition but the empirical evidence suggests that r d spillovers can easily be exaggerated this suggests that the design of antitrust policy towards r d cooperative ventures is likely to be of major importance if they are to yield net social gains and the paper concludes with a critical examination of the ncra introduced in u s and block exemption introduced in europe in the 1980s copyright 1993 by oxford university press

governance and uncertainty the trade off between administrative control and commitment this study elaborates upon the motives for initiating equity based collaborations vs acquisition of another firm already having a desired technology we characterize both minority direct investments and joint ventures as options to defer either internal development or acquisition of a target firm in domains where learning about growth opportunities dominates investment activity this incremental mode of governance economizes on the cost of committing resources to a technology with an uncertain value using a sample of 402 transactions in the biotechnology industry we find strong support for the theoretical model the findings suggest that the cost of commitment in the face of technological uncertainty may offset the administrative benefits of hierarchical governance 1998 john wiley sons ltd

macroeconomic expectations of households and professional forecasters economists have long emphasized the importance of expectations in determining macroeconomic outcomes yet there has been almost no recent effort to model actual empirical expectations data instead m acroeconomists usually simply assume that expectations are rational this paper shows that while empirical household expectations are not rational in the usual sense expectational dynamics are well captured by a model in which households views derive from news reports of the views of professional forecasters which in turn may be rational the model s estimates imply that people only occasionally pay attention to news reports this inattention generates stickyness in aggregate expectations with important macroeconomic consequences

growth beyond gibrat firm growth processes and strategies firm growth studies have been focused on the question of whether firm growth is independent of firm size this shadow of gibrat s law has drawn attention to the randomness in firm growth however it has also clouded relevant research avenues that enquire into the role of firm growth processes and strategies this paper takes stock of the current state of the art of firm growth studies in small business economics and makes a plea for more specific research approaches that highlight the nature of the firm organization and growth paths this rejuvenation of firm growth studies comprises a search for necessary mechanisms and contingent conditions for the growth of firms

who co operates for innovation and why an empirical analysis abstract in recent years there has been growing interest in co operative arrangements for innovation with some commentators arguing innovation is no longer the province of individual firms but depends increasingly on collective action this paper examines the response to the uk s version of the second european community innovation survey cis 2 to investigate the patterns of co operation between innovating firms and external partners the analysis shows the relationship between innovation and co operation is not straightforward from a subjective i e firm based perspective it is clear that most firms still develop their new products processes and services without forming formal co operative arrangements for innovation with other organisations however firms that engage in r d and that are attempting to introduce higher level innovations i e new to the market rather than new to the firm innovations are much more likely to engage in co operative arrangements for innovation consequently if an objective i e innovation based perspective is taken which weighs innovations by their significance then it is likely that a significant proportion of high level innovations are developed through co operative arrangements although unfortunately the cis 2 does not indicate the direct significance of these arrangements to the development of the innovations in summary the extent of co operative arrangements for innovation appears to depend on the type of firms being considered and on what is meant by innovation

competition cooperation and the neighboring farmer effect abstract in this paper we propose a model that explains how cooperation can emerge spontaneously between firms in a highly competitive market environment the basic idea is that the more competitive is the market the less costly it is for firms to help each other like good neighbors cooperation takes the form of sharing technical know how which speeds up the adoption of new technologies normally developed elsewhere that spur industrial development the model comports with the development history of japan s first example of successful industrial development its cotton spinning industry whose conditions match those of firms in small open economies today

co operative r d why and with whom an integrated framework of analysis abstract firms use r d partnerships to access knowledge and build global r d networks this article develops an integrated framework to examine the determinants of the choice of partners with which firms co operate on r d this resource based perspective underscores the interactions between three major questions why co operate who does and with whom it argues in particular that the choice of partners is dictated by the complementary resources which the latter command the framework is then expanded to predict the relative efficiency of r d co operation with different partners including suppliers clients rivals academic institutions and foreign firms the empirical analysis which is based on responses to france s version of the second european community innovation survey cis 2 strongly supports the overall framework of analysis

firms motivations for cooperative r d an empirical analysis of spanish firms abstract the aim of this paper is to analyze the motives that have caused industrial firms to cooperate in r d there are many theoretical works devoted to the theme but few empirical studies have been carried out with large samples to analyze the factors which determine why firms cooperate in r d we first review the reasons offered by the literature to explain technological cooperation with this allowing us to determine the conceptual framework and to propose some hypotheses we test these hypotheses with a sample of 1652 spanish firms that have carried out r d activities the results obtained suggest that firms motivations for cooperative r d are the complexity of technology and the fact that innovation is costly and uncertain we find that in order to undertake cooperative r d it is necessary to have certain internal capacities in this area with our results being supported by the theory of absorptive capacity however and by contrast with the results presented in other works questions related to market access and search for opportunities do not appear to exert an influence over cooperative r d besides the large sized firms resort more to cooperation and the reasons for cooperative r d differ as between large and small sized firms

learning dynamics in research alliances a panel data analysis the aim of this paper is to empirically test the determinants of research joint ventures rjvs group dynamics we develop a model based on learning and transaction cost theories which represent the benefits and costs of rjv participation respectively according to our framework firms at each period in time weigh the benefits against the costs of being an rjv member rjv dynamics can then be interpreted as a consequence of this evolving trade off over time we look at entry turbulence and exit in rjvs that have been set up under the us national cooperative research act which allows for certain antitrust exemptions in order to stimulate firms to co operate in r d accounting for unobserved project characteristics and controlling for inter rjv interactions and industry effects the tobit panel regressions show the importance of group and time features for an rjvs evolution we further identify an average rjvs long term equilibrium size and assess its determining factors ours is a first attempt to produce robust stylized facts about co operational short and long term dynamics a neglected dimension in research co operations but an important element in understanding how collaborative learning works

spatial proximity and firm survival in a declining industrial district the case of knitwear firms in baden wu rttemberg the literature on small firm networks in industrial districts postulates the importance of territorial proximity for business innovation and regional development but empirical research to test this proposition is sparse while there is some research on the extent of interfirm co operation little is known about the performance outcomes of co operation i develop competing hypotheses from institutional ecological and random action theories concerning the survival chances of firms located in geographic proximity and test them with data on the complete population of knitwear firms in baden wurttemberg germany for the period from 1960 to 1998 proportional hazard estimates show that location in clusters of firms in the same industry increased business failure rates and location in diversified clusters of firms operating in complementary industries reduced failure rates the empirical results are most consistent with the ecological model of localized competition in resource environments la documentation

alliance experience and governance flexibility prior work has mapped the transaction at the heart of an alliance to the risks of opportunism inherent in that alliance and ultimately to how the alliance is structured and governed we extend this approach by noting that the parties in an alliance do not necessarily perceive the same hazards as predominant and thus may have different preferences for how the alliance is structured nevertheless it is in each party s best interest to find a structure that protects its interests while also allowing its partner to protect its interests sufficiently drawing from the alliance management capabilities literature we argue that firms with more alliance experience are better able to protect their interests under any given alliance structure making the choice of structure less consequential to them the resulting governance versatility provides a competitive advantage by enabling firms to form advantageous alliances that are less available to inexperienced competitors our study of innovative alliances in biopharmaceutical industry lends support to the hypotheses allowing us to advance the literature on governance choice in alliances the literature on alliance management and their intersection

information induced heteroscedasticity in price expectations data this study tests the hypothesis that price expectations differ across individuals because they acquire different information about inflation if price information is a normal good then the amount of price information acquired will vary across individuals according to income education and other demand specific variables causing price expectations to be heteroscedastic with respect to these variables utilizing monthly household survey data the authors test the heteroscedasticity hypothesis and find support for the differential information model in addition they develop a novel method of incorporating the don t know response to questions about inflation into the estimation of price expectations copyright 1990 by mit press

r d intensity and international joint venture performance in an emerging market moderating effects of market focus and ownership structure in this study we examine the contingent relationship between r d intensity and performance of international joint ventures ijvs in an emerging market context based on teece s 1986 arguments regarding the appropriability of innovation we identify two types of appropriability hazard related to ijvs r d activities in this context local market related and local partner related hazards we argue that a positive relationship between r d intensity and ijv performance is more likely to occur if these appropriability hazard can be mitigated results using a sample of manufacturing ijvs in china provide support for these arguments we find that r d intensity is positively related to performance in export market focused ijvs but not in local market focused ijvs in addition using a configuration approach we find that r d intensity is positively related to performance in ijvs that have an export market focus and in which the multinational companies mncs have a majority ownership but not in other market focus ownership structure configurations these findings contribute to our knowledge of r d activities of mncs overseas subsidiaries

the relationship between a firm s level of technological innovativeness and its pattern of partnership agreements in this paper we investigate the relationship between the level of a firm s technological innovativeness and its pattern of partnership agreements i e relative number of partnership agreements of one type versus another we argue that the protection of tacit technological knowledge from potential opportunism is of importance to technologically innovative firms and as a result they tend to have a relatively larger number of partnership agreements which generally minimize the transfer of tacit technological knowledge specifically they tend to have a greater number of marketing agreements than joint ventures and a greater number of licensing agreements than joint ventures this argument is tested using data from manufacturing firms in the electrical and electronics machinery sector who invest in r d and our results hold for our focal firm s agreements with both domestic and foreign partners we discuss the strategic and policy implications from this research in particular the empirical results suggest that technologically innovative firms already have relatively more agreements which are likely to preempt transfer of their tacit technological knowledge to their foreign partners thus recent suggestions of more active government regulation in the area of intellectual property may be unwarranted