Measuring the Role of Central and Eastern European Countries in World Drug Research

This paper explores the sociological behavior of firms in the pharmaceutical industry in Central and Eastern Europe as measured by funding linkages. Using the ISI Web of Science data-base, the number of research papers funded by top American and European pharmaceuticals with at least one author from Central and Eastern Europe are identified. Results indicate that Poland leads in the region by both the number of papers funded and by percentage of a firm’s total papers funded, followed closely by Hungary, Greece and the Czech Republic. Though the percentages of any firm’s linkages with a Central and Eastern European author are small (upper limit being 6.6%), this percentage is skewed due to the fact that the US is cited for 50% of papers for most firms. Roche Corporation is the top funder of papers among both US and European firms. Incidentally, zero top American pharmaceuticals were found to have an R&D center located in Central and Eastern Europe whereas European firms: GlaxoSmithKline and Sanofi-Aventis do—possibly indicating a difference in business strategy between European and American pharmaceuticals.     

The Mechanistic Structure Shift and Strategic Reorientation in Declining Firms Attempting Turnarounds

Past researchers have observed that decliningorganizations often experience mechanistic structuralchanges that centralize authority, increase reliance onformalized procedures, and reduce the amount of information flowing to top managers. Many haveproposed that this “mechanistic shift” indeclining organizations reduces their adaptivecapability by making innovative organizational change in response to decline less likely. However,despite much research on declining firms and theirturnaround attempts, many questions about mechanisticshifts remain, such as: (1) To what extent do declining firms become systematically mechanistic whentrying to recover from decline? (2) What aspects ofdeclining firms' situations make mechanistic shifts morelikely? (3) Do mechanistic shifts reduce the likelihood of large-scale strategic reorientation asdeclining firms attempt to recover? We sought answers tothese questions through an analysis of data fromin-depth interviews with top managers (mostly CEOs) at 29 U.S. firms attempting turnarounds fromdecline. Our primary finding was that mechanisticstructure shifts did restrict firms' abilities to changetheir strategic orientations in response to decline. Highlighting the important role of the contextof turnaround attempts, we further found the averagedeclining firm attempting a turnaround did not becomemore mechanistic, but that turnaround attempts launched from financial crises were significantly morelikely to lead to mechanistic shifts. Also, we foundthat the common practice of replacing the firm's CEOduring turnaround attempts had conflicting andparadoxical effects on firms' abilities to enact strategicreorientations.     

Continuation Commitment: Family’s Commitment to Continue the Family Business

This study investigates what influences families’ commitment to continue a family business, or continuation commitment. We hypothesize that top executives’ cultural capital, family members’ satisfaction with the firms past performance and their aspirations regarding its future performance, as well as the level of family involvement in the family business represent key factors underlying continuation commitment. In addition, we suggest the interaction effects among the identified factors that affect a family’s commitment will be higher in the founder generation compared to successive generations of family owners. Analysis of a dataset of 2,168 family firms from a nationwide survey provided support for most hypotheses.     

CEO Succession: Overcoming Forces of Inertia

Population ecologists suggest that inertialpressures make it difficult for organizations to adapttheir strategies and structures in response toenvironmental changes. One way in which organizations may attempt to overcome these inertial tendenciesis by selecting executive successors with differentcareer specializations than their predecessors, whichmay enable them to better cope with changingenvironmental contingencies. The present study examined therelationship between the previous CEO s careerspecialization, the corporate strategy in place at thetime of the succession event, and the careerspecialization of the new CEO from 1981-1990. The resultssuggest that organizations often chose successors withdifferent career specializations than theirpredecessors, and that previous corporate strategy wasa relatively poor predictor of successors specializations.These results differ from earlier research findingsconcerning executive succession between 1957-1981.Possible reasons for these differences are discussed, and the implications for future research are considered.     

Inducing Homogeneity in the Audit Services Market: A Cross-Industry Analysis

In an earlier study on the audit services market, I showed that an individual client firm's likelihood of imitation in auditor selection systematically varied along with its relative position among competing peers within the industry. This paper extends that finding to the aggregate industry level by shifting the analytical focus from within-industry to between-industry variation. The data on 2254 auditor–client pairs across 45 manufacturing industries in the United States are examined to specify the social structural conditions under which the firms are more, or less, likely to produce the outcome of isomorphism. In general, the more hierarchically stratified an industry, the more likely it is to have a highly homogeneous practice among the firms within it. Inequality leads to and exacts behavioral homogeneity. There is, however, a threshold in the relationship between the aggregate homogeneity and the industry structure: When the disparity between the top and middle tiers is too large, the social reference process breaks down and the level of homogeneity declines. This industry-level finding complements the earlier firm-level finding and empirically substantiates the mechanism of mimetic isomorphism, further elaborating the theory.     

“It's Definitely a Good Time to Be a Farmer”: Understanding the Changing Dynamics of Successor Creation in Late Modern Society

This article considers the implications of the wider systemic shift from modernity to late modernity for the process of intergenerational farm transfer. The article argues that the shift from the collective to the individual, indicative of late modern society, is particularly pertinent in the context of intergenerational transfer, which has long been rooted in collective thinking. Drawing on the perspectives of incumbent farmers and potential successors, the article utilizes results from semistructured interviews with 29 farmers and 19 potential successors in Devon, England. Using a thematic analysis, the article provides a nuanced understanding of the impact of the systemic shift and the associated emphasis on the individual on successor identification. Although the article reaffirms understanding of successor creation as a collective process, determined by factors such as gender and birth order, it also identifies an emergent cohort of younger potential successors, for whom succession was the outcome of an evaluation of farming as a career. It concludes that, within the case study area, modernization is changing the way in which farm children are identifying themselves as “the successor.” The article suggests how this increasingly judicious approach to succession leaves reproduction of the family farm increasingly vulnerable to negative externalities.     

OVERSEAS MARKET INFORMATION AND FIRMS' EXPORT DECISIONS

This paper examines how firms' decision to start exporting is affected by the availability of information on export markets. Unlike existing studies that focus on information sharing among firms, we are interested in the information provided by firms' main bank. Specifically, using a unique data set containing information on both Japanese firms' export activities and the experience of their main bank (i.e., their top lender bank) in transacting with other exporting firms, we examine whether main banks act as a conduit of information on export markets. We find that information spillovers through main banks positively affect client firms' decision to start exporting (extensive margin), implying that information on foreign markets provided by banks substantially reduces the fixed entry cost of exporting. On the other hand, we do not find any evidence that information provided by banks has an effect on the export volume or on the growth rate of exports (intensive margin). Our results highlight that channels of information spillovers other than those examined in the literature so far may be of considerable importance. (JEL F10, F14, G21)     

ZONING UNDER SPATIAL PRICE DISCRIMINATION

This paper investigates zoning in a duopoly model of spatial price discrimination. We find that the zone in which the firms are not allowed to locate depends on the bias of the regulator. A bias toward firms is deduced when locations around the central area are forbidden, and a bias toward consumers exists when firms are only allowed to locate at places around the central area. The design of the zoned area guarantees that firms locate optimally and works under simultaneous or sequential choice of locations by the two firms. (JEL L13, R38)     

CORPORATE PRODUCTIVITY GROWTH: CHAMPIONS, LEADERS, AND LAGGARDS

This paper examines the relative productivity growth performance of a sample of large UK firms between 1986 and 1995. We find that superior productivity growth, however measured, is not persistent—firms with high productivity growth rates relative to (say) the average in 1 yr are as likely as not to display below-average performance in the following year. Studying the determinants of the length of time for which firms outperform their peers, we find that innovative firms carrying low debt who are relatively free from financial distress are likely to display whatever persistently superior performance we observe in the data. ( JEL D24, O33, O4)     

How manufacturing industries connect cities across the world: extending research on ‘multiple globalizations’

In this article, I concentrate on a macro‐level analysis of inter‐urban linkages in a ‘world city network’. Empirical research on the formation of a world city network has mostly concentrated on global service providers. Yet, globally operating manufacturing firms also choose distinct urban regions throughout the world as locational anchoring points. In this article, using social network analysis, I present the first global‐scale analysis of how manufacturing firms connected cities across the world (in 2010). To detect the differing ‘sectoral profiles’ and nodal centralities of cities functioning as geographical hubs of transnational production networks, it is necessary to analyse the network structure of distinct industrial subsectors within the global urban system. The data collected for analysis cover 120 top global firms from three manufacturing subsectors, of which two are analysed in more detail than the third. I then compare the nodal centralities of cities included in these subsectors' global networks with the GaWC research on the producer services sector that has been at the centre of previous analyses of the world city network. The comparison reveals the cities' differing positioning within ‘multiple globalizations’. The aim of the article is to extend research on world city networks.     

The adoption of family-friendly practices in family-owned firms

Most family business research on managing work and family conflict focuses on the family unit while ignoring non-family employees. This study investigates how family businesses manage the work and family conflicts facing non-family employees by examining the adoption of work–family practices in family-owned firms. Two research questions are addressed. First, to what extent do family-owned firms adopt work–family practices? Second, do family-owned firms offer the same level of work–family practices as non-family-owned firms? Results indicate that when family-owned firms do adopt work–family practices, they favour flexible scheduling arrangements for non-family employees to reduce work–family conflict. In general, however, work–family practices are used less in family-owned firms than non-family-owned firms.     

Impact of funding and value added on Spanish venture capital-backed firms

This paper contributes to the literature on the effect of venture capital (VC) on the economic development of areas in which those specialized investors are active. The work focuses on the separate consideration of two effects that are supposed to explain the superior performance of a large sample of Spanish VC-backed firms, namely funding and value-added services provided by VC managers to their investee firms. The results show that funding is significant regardless of the stage of development of the investee firm. The value added, however, is only significant for the subsample of firms at the expansion stage.     

COSTLY EXTERNAL FINANCE AND INVESTMENT EFFICIENCY IN A MARKET EQUILIBRIUM MODEL

The corporate finance literature suggests that a financially constrained firm invests less than an identical unconstrained firm. This does not imply that financial frictions cause firms to invest less than in a frictionless economy. When firms compete for investment funds, an increase in financial frictions can lead individual firms to increase their investment levels. A greater than the frictionless level of investment is likely in low-productivity firms, in cash-rich firms, and in firms with cheap external capital. Government programs that make capital cheaper for small firms may lead to lower levels of investment for all firms and decrease efficiency (JEL O16, E22, E44, G20)     

Self-employed immigrants and their employees: evidence from Swedish employer-employee data

We present a study of the employees of self-employed immigrants with unincorporated firms in Sweden using matched employer-employee data from 2014. Non-European immigrants are more likely than natives to have employees in their firms. Furthermore, immigrants, especially non-European immigrants, are more likely than natives to employ immigrants in their firms, and non-European immigrants are most likely to employ recently arrived non-European immigrants with low education in their firms. Males are more likely than females to have employees in their firms, but self-employed females are more likely than self-employed males to have female employees. This is the case for all immigrant groups as well as for natives. We conclude that self-employed immigrants play a role in the labour market integration process since they create employment opportunities for immigrant groups that have difficulty entering the labour market.

     

ENTREPRENEURIAL ENTERPRISES, ENDOGENOUS OWNERSHIP, AND THE LIMITS TO FIRM SIZE

This paper develops a simple model of entrepreneurial enterprises. The analysis differs from traditional work on entrepreneurship by analyzing why entrepreneurial activities are typically conducted in small firms owned by the entrepreneur. I argue that ownership incentives are an advantage of small firms. When the probability of success of an economic activity becomes small, if becomes costly for large firms to commit to strong incentives, and small worker-owned firms emerge. The paper discusses application of the theory to innovation, wild-cat oil exploration, restaurants and retail trade, professional practices, salesmen, and franchising.     

FIRM PRODUCTIVITY AND SALES DESTINATIONS: EVIDENCE FROM WITHIN CHINA

This paper builds on and extends the literature on the linkage between firm productivity and their export destinations to study the productivity of Chinese firms and their sales destinations in other provinces within China. Moving the study from international markets to domestic markets conveniently avoids the hard to control heterogeneity across different destination markets in international trade, as provincial markets within China are less heterogeneous than international markets but segmented by Chinese provincial borders. The paper explicitly controls the fact that many firms only sell in their home provinces by using the zero‐inflated negative binomial method. It finds that firms with higher productivity tend to sell in other provincial markets, and more productive firms enter more provincial markets. The results are robust. (JEL F15, D21, D24)     

IMPACT OF CORRUPTION ON FIRM‐LEVEL EXPORT DECISIONS

This article examines the impact of corruption on the self‐selection of firms into domestic and export markets. A heterogeneous firm model predicts that corruption decreases the probability that a firm only sells domestically, increases the probability that a firm exports indirectly through an intermediary, and decreases the probability that a firm exports directly. The propositions of the model are tested using a comprehensive dataset of over 23,000 firms in 80 developing countries. The results confirm both the self‐selection of firms according to their productivity and the anticipated impact of corruption. This indicates that in developing countries where corruption is especially severe, intermediaries provide a crucial link to global markets. (JEL F1, O1)     

COLLUSION, EFFICIENCY AND PRICING BEHAVIOR: EVIDENCE FROM THE BANKING INDUSTRY

This paper examines the validity of competing hypotheses used to explain the observed positive relationship between concentration and profits. Using price proxies from the banking industry, we find that leading (secondary) firms in a market act as price-setters (price-takers). This is true regardless of market concentration. We interpret this as evidence of the superior efficiency of leading firms and conclude that the higher profits earned by these firms is due to their superior efficiency and not collusive behavior.