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Distribution and effect of R&D subsidies: A comparative analysis according to firm size

Distribution and effect of R&D subsidies: A comparative analysis according to firm size

With regard to outputs of the innovation process, the analysis shows that R&D subsidies have a positive, significant effect only on the tendency to patent in the case of large firms and that this propensity shows a significant rise a year after receiving this aid. As a consequence, the present report concludes that the effects of innovation policy on the inputs and outputs of the innovation process are variable depending on the size of the firm. From the findings obtained in this study two recommendations are formulated for future innovation policy evaluations. Firstly, it is important to make a joint evaluation of the aid distribution and its effect. Firms more likely to obtain public backing do not always gain the greatest effect from the policy. Consequently, the conclusions stemming from this analysis could improve the access to the different support instruments. Secondly, input and output effects are sensitive to firm size. This could encourage policy makers to previously define the type of effect they wish to attain in relation to each firm size.

28 Lee mas

The function of the urban informal sector in employment - Evidence from Colombia 1984-2000

The function of the urban informal sector in employment - Evidence from Colombia 1984-2000

The aim of this paper is to analyze the function of the informal sector in employment, its relat ionship to urban employment, with illustrative evidence from Colombia. The analysis is done for the period 1984 – 2000, which includes phases of boom and economic crisis as well as the implementation of neo- liberal reforms to national development. The paper summarizes four competing approaches to the conceptualization of the informal sector, and describes their measurement strategies. It argues that elements of state regulation are fundamental whereas firm size should not be considered as a defining element. Subsequently, it analyzes how the internal composition of the informal sector evolved, considering elements of state regulation, firm size, and dynamism of the economic activities. It examines the function of the informal sub-sectors in the urban labor market, using indicators such as relative earnings and size, and a crude indicator of labor mobility. At least three sub-sectors conforming the informal sector are identified: salaried workers of large and small firms, entrepreneurs and subsistence workers. It is argued that each sub-sector of the informal sector responds in different ways to prevailing economic conditions. The subsistence sub-sector supports the dualistic view, whereas the other two are integrated to the formal sector. No dominant sub-sector permits broad- range generalizations about “the” informal sector.

60 Lee mas

Association between firm characteristics and corporate voluntary disclosure: Evidence from Turkish listed companies

Association between firm characteristics and corporate voluntary disclosure: Evidence from Turkish listed companies

We tested whether firm size has an impact on the extent of voluntary disclosure level. The variables of SALES in models 1 and 2 and ASSETS in models 3 and 4 are positive and significant at 1% level which suggests that firm size affects the voluntary disclosure level positively. The findings lend support to Hypothesis 7 regarding firm size. Hence, there is a significant positive association between firm size and voluntary disclosure level. Our finding confirms many previous studies (Wallace et al., 1994; Inchausti, 1997; Eng & Mak, 2003; Aksu & Kosedag, 2006; Alsaeed, 2006; Hossain & Reaz, 2007; Huafang & Jianguo, 2007; Hossain & Hammami, 2009; Uyar, 2009; Chau & Gray, 2010). The impact of firm size on disclosure level could be explained by the fact that larger firms have better organization structure, more developed information system, more complex operating activities and segments, and more diversified. All these factors might be the reasons of why large firms stay ahead of small firms in terms of voluntary disclosure.

33 Lee mas

Factors Influencing the Usage and Selection of Project Management Software

Factors Influencing the Usage and Selection of Project Management Software

Finally, our results indicate that the level of PM software package selected by PM professionals is significantly influ- enced individually by the number of activities in a typical project, firm size, the initial year of PM software use, and the extent of PM software usage. Higher levels of each variable are associated with use of higher-end packages, with the only exception being initial year of PM software use. In the latter case, earlier use of the software is associated with higher-end package selection, as would be expected. The other relation- ships also seem logical, since higher levels of complexity and higher use of the software would tend to be associated with more specialized and sophisticated uses of the software, in addition to the fact that larger firms can usually afford more expensive software. We were able to identify a discriminant analysis model that makes excellent predictions of package level based on these variables.

11 Lee mas

Re employment probabilities of unemployment benefit recipients

Re employment probabilities of unemployment benefit recipients

Previous job variables. We consider variables asso- ciated with the previous job held by the individual, such as the industry, the type of contract held, the firm size and whether the individual was hired through a THA or not. In addition, our data set does not contain variables related to the individual’s educational attainment or occupation, but the required qualification level in the previous job (a proxy for the educational level). It indicates a position in a ranking determined by the worker’s contribution to the SS. Therefore, although it is somewhat related to the individual’s qualification since it reflects the worker’s professional category and salary, it does not reveal the worker’s level of qualification, but rather the level of qualification required for the job. 12 As in previous studies using data from the SS records, we group those 10 categories into four groups (Table A2 in the Appendix). We have no ex ante expectation about the effect of this variable on the hazard out of unemployment: on the one hand, the higher the worker’s qualification level, the higher his/her reser- vation wage and thus the lower the probability of accepting a job offer; on the other hand, employers may prefer those unemployed with higher qualifica- tion levels (as they expect greater productivity), so

20 Lee mas

The predictability of financial, accounting‐based, and industrial factors on the success of newly incorporated Spanish firms

The predictability of financial, accounting‐based, and industrial factors on the success of newly incorporated Spanish firms

As for market share, there should exist some linkages between it and firm size, because it is possible that the firms being larger in size would have stronger productivity and more output which would help them occupy higher market share. Geroski (1995) points out that, compared to relatively higher entry rate, the proportion of the total sales of entrants to that of the whole industry should be lower and this could be explained by relatively smaller size of entrants to incumbents. In fact, market share could be viewed as a positive factor on performance. Laverty (2001) states that positive relationship between market share and profitability as mainstream conclusion has been supported since 1970s by Gale (1972) for example. Despite that, different viewpoints also emerge in the research of, for instance, Bourantas and Mandes (1987) pointing out the complexity of research where multiple impacting factors should be considered as well as Fraering and Minor (1994) who also highlight the heterogeneity between industries.

19 Lee mas

Managing skill premium through firm structure

Managing skill premium through firm structure

To investigate the relationship between firm size and the skill premium theoretically, we develop a hierarchical model of firms that borrows elements from Garicano (2000) and Caliendo and Rossi-Hansberg (2012), where large firms optimally choose organizational structures with more layers of management than small firms. A manager receives direct reports from employees on the next-lowest layer (either production workers or lower-level managers) and is able to augment their output multiplicatively using her managerial la- bor. High-level managers at large firms, who have the scope to augment large amounts of output, receive high wages. Small firms, producing relatively little output, have no such high-productivity managers and therefore pay their managers lower wages on average. Ad- ditionally, since wages for unskilled workers are constant across firms in our model, the skill premium is increasing in firm size. These results can be obtained as the equilibrium outcome of a general equilibrium outcome.

31 Lee mas

A theory of firm decline

A theory of firm decline

We close this Section by emphasizing two implications of our theory that we find of particular interest. The first is that it provides a novel rationale for the assumption of limited span of managerial control, i.e. for the idea that the amount of productive resources that it is efficient to put under a manager’s control is bounded (see Lucas (1978)). Even in the case in which the production function displayed constant returns to scale, our theory would still predict that firm size converges. This is the case because the process for ω would still be a sub–martingale, and promised utility would eventually become so high (and incentive provision so costly) to discourage further investment.

44 Lee mas

Unemployment duration, unemployment benefits and recalls

Unemployment duration, unemployment benefits and recalls

UI recipients with the highest and the lowest qualification levels are more likely to exit from unemployment through recall, while the qualification level presents a non- significant impact on the recall hazard rate for UA recipients. Results regarding tenure in the previous job are similar to those obtained for the entire sample: the recall hazard rate is larger for individuals whose previous tenure is under 4 weeks than for the remainder ones. Having worked via a temporary help agency presents a non-significant impact on the hazard rate of exiting from unemployment, with the only exception of UA recipients, whose chances of finding a new job increase up to 80 per cent. There exists evidence of a negative effect of the number of children on the new-job hazard for both types of recipients and a null effect for recall jobs. As regards the state of labour market demand, unemployed who receive UI and live in regions with a lower regional unemployment rate enjoy a higher probability of finding a recall job, since there may be less competition for existing vacancies in their respective locations. As expected, recall durations are shorter for large firms, longer for small firms, and duration of new job spells are not particularly affected by firm size (a similar result is found by Mavromaras et al., 1998). As regards the activity sector, UI recipients from the service sector suffer a lower transition rate from unemployment into a recall job than those from the industry sector. This result is expected in so much as workers from the industry sector (particularly larger firms) move from one job to another with a relatively high frequency. We also appreciate that workers receiving UI from the service sector are more likely to find a new job. Finally, estimated results regarding the type of contract held in the previous job show that duration of recall spells is shorter for benefit recipients who have held either a temporary contract or a permanent per task contract in the previous job (independently of whether they receive UI or UA). This is reasonable, to the extent that, as commented in the previous section, workers under this latter type of contract enjoy a stronger relationship with their previous employer while they are unemployed.

33 Lee mas

The internationalization dilemma [recurso electrónico]

The internationalization dilemma [recurso electrónico]

The knowledge-based view of the firm. Conceptualization of knowledge “Knowledge is at the core of received wisdom on internationalization” (Prachantham, 2005). As said before, firms are increasingly entering in foreign markets looking for advantages. Internationalization involves decisions that face a diversity of uncertainties that can be reduced through knowledge. The growing foreign presence can be attributed to the firm`s accumulation of knowledge about the specific target country where to internationalize. This knowledge is a critical resource, since the knowledge needed to operate in any country cannot be easily acquired (Barkema, Bells & Pennings, 1996). Furthermore, the knowledge-based view of the firm focuses on knowledge as the most strategically important firm`s resource, which is used within the firm to create value (Grant, 1996). The firm needs this knowledge to learn about the local political and institutional conditions, in order to reduce uncertainty in the internationalization decision. As it was said before, even though there are different kinds of uncertainty, the present research focuses in political and institutional uncertainty. This is, as internationalization decisions are constrained by the country political and institutional environmental factors, in order to reduce these factors and deal with uncertainty, firms should accumulate knowledge. Thus, the international environment of the host country is an important influence on the decision (Delios & Beamish, 1999).

147 Lee mas

Hydrological risk allocation and its influence over long term contracting in the Chilean electricity system

Hydrological risk allocation and its influence over long term contracting in the Chilean electricity system

A firm’s decision of investment in an electrical system in most of cases depends on the decisions of the rest of the stakeholders, especially competitor companies. If the market considers that an investment is to be performed until completing efficient investment for projected demand, then a competitor’s similar investment would be discarded. In that sense, if an expected investment suffers unexpected problems by judicial orders or socio- political problems (similar to “Castilla”, “Barrancones” or “Punta Alcalde” in Chile’s recent experience), then it is impossible to catch up with efficient investments given typical lead times. Furthermore, if the expected investments for coal beginning in year 2018 are unable to be carried out, then the deficit of generation would not only impact the upward motion of spot prices, but also undermine the willingness to assume energy obligations. A decrease of a single MW of coal installed capacity should not be linearly associated with the decrease of a single GWh of willingness to commit energy. This lack of association is due to the effect on LNG’s dispatch and spot prices, which equal a non-linear compensation on willingness to assume contracts of other technologies (see Figure 3-10). For instance, a decline of 300MW on coal’s optimal capacity in 2018 means an almost negligible increment of overall contracting of 0.1%, because of a compensation of contracting over firm energy of the rest of the technologies (as seen in

82 Lee mas

To know or not to know: the role of salary disclosure on the gender wage gap

To know or not to know: the role of salary disclosure on the gender wage gap

Most of OECD countries have taken the gender pay gap into consideration by passing laws that aim to guarantee equal pay for equal work, making wage differences based in sex or race illegal (eg. Bassanini and Saint-Martin (2008); Pay Equity Comission (1987); EEOC (1963)). Nonetheless, these laws are not easily enforced as wages are not of public knowledge and thus complaints for unequal payment can arise only if the victim is aware and willing to claim for the existing disparities (Bassanini and Saint-Martin, 2008). Article 461 of the CLT (Consolida¸ c˜ ao das Leis do Trabalho) regulates equal payment in Brazil; however, the conditions under which employers are obliged to compel with equal pay are very restrictive, with only employers with same position, under same employer and same firm as subject to the law (Decreto-lei N 5.452, 1943). This is particularly relevant in the case of high positions, which are usually occupied by only one person in the company, thus making the former legislation inapplicable in an important number of cases.

32 Lee mas

Contracts, Firm Dynamics and Aggregate Productivity

Contracts, Firm Dynamics and Aggregate Productivity

We construct a framework of rm dynamics to evaluate the impact of the enforcement of contracts between nal goods producers and their intermediate goods suppliers on rm life-cycle growth, technology accumulation and aggre- gate productivity. We build upon the tractable contracts model of Acemoglu et al. (2007), where the nal goods rm chooses technology in contractible activi- ties conducted by suppliers of intermediate inputs. Suppliers select investments in noncontractible activities, anticipating the payos of a bargaining game with the producer of the nal goods. We show that contractual incompleteness im- plies a wedge on prots for producers of nal goods, potentially dependent on the level of technology of the rm, which disincentives technology accumulation at the rm level in our dynamic model. We evaluate this mechanism in gen- eral equilibrium to analyze its quantitative implications. Our model accounts for dierences in output per worker of up to 33 percent across economies with complete and incomplete contracts. The impact on rm life-cycle growth, the age and size distribution of rms is quantitatively signicant.

28 Lee mas

Essays on contextualising firm performance heterogeneity.

Essays on contextualising firm performance heterogeneity.

innovate as advanced innovation processes require firms to master highly specific knowledge about even the minute aspect of the organizational goal. As market's have already chosen open innovation as the way of operation, firms with closed innovation model are more likely to fall behind in the race competing with a group of coordinated organizations. To deepen our understanding about how firms effectively collaborate and co-develop in an uncertain market environment, the study proposed a structured approach for strategists and strategy analyzers to examine and realign the firm strategy based on the intra-firm interactions. As Chesbrough suggests, firms that are too internally focused may fail to capture the changes in the business environment. Interaction based framework integrates most of firms strategic aspects to firm strategy and while priding an account for the impact of firm's actions on the market, and other competitors. More focus is given to the network than the firm, in order to clearly explicate the multi-directional nature of firms business. A firm is studied as a part of a larger network (if not complete) to capture its partnership dynamics. However, measuring the strategic effectiveness using the model is an area calls for serious research, especially since it involves a large number of intangible assets and activities like trust, customer loyalty, informal customer engagement etc. Study in this direction is likely to positively complement the present work.

180 Lee mas

A firm-level analysis of ICT adoption in an emerging economy: evidence from the colombian manufacturing industries

A firm-level analysis of ICT adoption in an emerging economy: evidence from the colombian manufacturing industries

After a number of empirical studies linked the high performance of the U.S. economy in the 1990s to its widespread adoption of information and communication technologies (ICT) (Berman et al., 1994; Jorgenson and Stiroh, 2000; McGuckin and Stiroh, 2002; Morrison and Siegel, 1997; Siegel, 1997; Stiroh, 2001), much has been debated about the effects of ICT on firm productivity and profitability (Bartelsman and Doms, 2000; Bresnahan and Trajtenberg, 1995; Brynjolfsson and Hitt, 1996; Brynjolfsson and Yang, 1996). On the other hand, another important conception has been developed in the literature on technological changes: increasing recognition of the complementary relationship among the adoption and usage of ICT, firm- specific factors, and industrial structure. Since Milgrom and Roberts (1990) pioneered the study on the complementary role of firm-specific operational and organizational characteristics as determinants of the adoption of new information technologies at the firm level, a significant amount of the literature has focused on the identification of the factors that are inherent to varying adoption rates across firms of ICTs (Bocquet et al., 2007; Bayo-Moriones and Lera- Lopez, 2007; Fabiani et al., 2005; Giuri et al., 2008; Hollenstein, 2004; Lucchetti and Sterlacchini, 2004).

40 Lee mas

Essays on firm dynamics and international trade

Essays on firm dynamics and international trade

Our study is one of recent contributions that takes the advantage of opportunities to ob- serve firm level price informations (De Loecker, Goldberg, Khandelwal and Pavcnik (2012); Fan, Roberts, Xu and Zhang (2012)). De Loecker et al. (2012) use Indian firms prices and physical quantity informations to separate mark ups from productivity and examine trade openness on these performance indexes. They find that after trade openness marginal costs decrease more than prices. Fan et al. (2012) use manufacturing Chinese data and conclude that firms product value, prices and cost components are very useful to explain extensive and intensive margin of trade like number of destination and the time and vol- ume for export to a destination. In our dataset, as firm level price information is available, this approach allows us to consider industries characterized by firms differentiation. First, information on firms prices is used to define each firm output quantity from revenue in all twenty industries which are not necessarily homogeneous. Firm level physical productiv- ity (technical efficiency) is computed by accessing to output (and input) quantities. For comparability reasons, and following Foster et al. (2008), we also create a revenue-based measure of TFP. For every year and every industry, we create an average industry price index and use it to deflate firm specific nominal revenues. Revenues (real) are used to estimate production function, and then revenue productivity was measured. Second, cal- culated physical productivity is used as instrumental variable to estimate demand residuals (product values). Interestingly, correlation of firm level prices and physical productivity is negative as described by theoretical models while its correlation with revenue produc- tivity is positive. Furthermore, autoregressive estimation of our main variables of interest (productivity, product value and prices) show that revenue productivity and prices have substantial persistent in the data. Technical efficiency and product value show higher per- sistent which it may emphasize the role of product value and technical efficiency in firm’s performance.

78 Lee mas

Essays on trade integration and firm dynamics

Essays on trade integration and firm dynamics

I next turn to explain how firm productivity is measured in the analysis, being pro- ductivity the main theoretical determinant of firm export status. As a first measure of productivity I take the distance between firm and sector average labor productivity (value added per worker) 29 . This productivity measure, even if it is only a proxy for total factor productivity, works quite well throughout the analysis. However, as firm productivity is an important control variable in regression specifications, I also con- sider more sophisticated and reliable measures of Total Factor Productivity (TFP). TFP is usually estimated as a residual of a Cobb-Douglas log-linearized production function. However, as many previous empirical studies argued, this estimation is bi- ased because of simultaneity and selection biases. The first bias arises because firms may adjust one of their production factor (capital) knowing a part of their produc- tivity, which is unknown by the econometrician. Thus the estimated coefficient for capital may be biased since it is correlated with an unknown firm level heterogeneous term which is left in the error term. Selection bias, instead, may arise because in this data set some firms exit and presumably they are the less productive ones. I thus use Olley-Pakes semi-parametric estimation method to measure TFP controlling for both biases 30 . The simultaneity bias is taken into account by using an investment

133 Lee mas

Strategic planing of firm capital structure development

Strategic planing of firm capital structure development

The obtained results testify to the achieve- ment of the firm maximum value at the le- vel of borrowed fund share in the interval of 15-16 % within the company capital structu- re. The WaCC trajectory shows a downward trend as the share of borrowed funds increa- ses from 7.5% to 32%. The revealed discrepan- cy between the empirical results of modeling and the provisions of the traditional theory of capital structure confirms the provisions of the trade-off model. The obtained modeling results prove that with WaCC decrease, the value of a firm will grow to such a level whi- le the change of the financial leverage has a positive effect on the operating cash flow. If the receipt of the next loan is associated with an excess of an acceptable risk level, then the cash flow balance will decrease in terms of operating activity, and accordingly the free cash flow (FCF) in general and the firm cost will be under the pressure of financial diffi- culty increase.

10 Lee mas

Immigration and firm performance: a city level approach

Immigration and firm performance: a city level approach

According with Table 2, immigrant flows have a positive (albeit not significant) impact on wage growth and labour productivity, and a negative impact on the number of workers employed by manufacturing firms. In line with previous findings, in cities with high immigrant inflows, firms come under greater pressure to increase wages, improve labour productivity and to regulate the growth of their workforce. The incre- ase in the share of immigrants in cities leads to an increase in housing costs, a repla- cement effect for native workers and a positive effect for skill composition and pro- ductivity in manufacturing firms. In this causal link, immigration does not affect the labour market directly, but rather does so via a city’s amenities. Immigrants produce positive and negative amenities. Thus, a multicultural environment might be positi- vely valued by a more open-minded firm, while immigrants can produce unproduc- tive amenities in terms of the cost of living in multicultural neighbourhoods and the pressure placed on the local housing market and public services.

27 Lee mas

Essays on International Trade and Firm Dynamics

Essays on International Trade and Firm Dynamics

The second chapter of this Thesis is entitled Measured Productivity and Interna- tional Trade: An Unresolved Puzzle. Using correct models of firm dynamics when analyzing the impact of trade is key in order to fully understand what are the effects to the supply side of the economy when it engages into trade. There are several models of trade that try to understand the role of trade and firm dynamics, but there is one that is most used by trade economists: the Melitz model (2003). 1 This model explains several features of the data. In particular, it aims to explain why more pro- ductive firms export. It is a common agreement among economists that the model is well suited in order to explain these patterns. In this chapter we ask: is it? In particular, we show that measuring productivity in the model’s outcome as it is done in the data may lead to some surprising results regarding what do more productive firms do: they may be the non-exporters.

113 Lee mas

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