Pub Date : 2021-03-08DOI: 10.1080/13571516.2021.1896926
Preeya S. Mohan
Abstract Crime and growing the private sector are pertinent development challenges. Despite their importance there is a paucity of research on crime and business performance, particularly in developing countries, partly because of limited firm level data. This study used cross sectional firm data from the Productivity Technology Innovation survey (PROTEqIN) gathered in 2014 across 13 Caribbean countries to investigate violent crimes and company performance using Ordinary Least Squares regression, and several robustness checks including Instrumental Variables and Propensity Score Matching. The Caribbean provides an apt study given that a key characteristic of the business environment is high exposure to crime. The study found that firm sales and violent crime are negatively associated, even after firm characteristics, other factors which influence sales, and country and sector fixed effects were taken into account. The findings of this study underscore the importance for crime prevention, control and reduction policies to grow the private sector.
{"title":"Violent Crime and Firm Performance: Evidence from the Caribbean","authors":"Preeya S. Mohan","doi":"10.1080/13571516.2021.1896926","DOIUrl":"https://doi.org/10.1080/13571516.2021.1896926","url":null,"abstract":"Abstract Crime and growing the private sector are pertinent development challenges. Despite their importance there is a paucity of research on crime and business performance, particularly in developing countries, partly because of limited firm level data. This study used cross sectional firm data from the Productivity Technology Innovation survey (PROTEqIN) gathered in 2014 across 13 Caribbean countries to investigate violent crimes and company performance using Ordinary Least Squares regression, and several robustness checks including Instrumental Variables and Propensity Score Matching. The Caribbean provides an apt study given that a key characteristic of the business environment is high exposure to crime. The study found that firm sales and violent crime are negatively associated, even after firm characteristics, other factors which influence sales, and country and sector fixed effects were taken into account. The findings of this study underscore the importance for crime prevention, control and reduction policies to grow the private sector.","PeriodicalId":45470,"journal":{"name":"International Journal of the Economics of Business","volume":null,"pages":null},"PeriodicalIF":1.2,"publicationDate":"2021-03-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"72769431","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-03-08DOI: 10.1080/13571516.2021.1893570
Timothy Flannery, S. Roberts
Abstract We design an experiment to test what motivates agents to choose higher effort and how well principals anticipate agent responses. Principals rank five contracts where a higher ranking increases the likelihood of a contract's implementation. In one treatment, those rankings remain hidden from agents; in the other, agents view the rankings. Agent response to contract structure and monetary incentives largely conforms to our predictions: agents demonstrate a preference for monotonic contracts over non-monotonic contracts, and the vast majority responds favorably to contracts where high effort is a best response. Surprisingly, offering a flat contract that exactly compensates agents for effort performs no better than offering nothing. Principals, however, poorly anticipate agent response to contracts, regardless of the observability of rankings. Additionally, although differences in observable rankings only affect agent behavior in minor ways, principals' rankings between the two treatments indicate principals believed different rankings would significantly influence agents when observable.
{"title":"Agent Motivation and Principal Anticipation: Non-Monotonicity, Intentions, and Other Factors","authors":"Timothy Flannery, S. Roberts","doi":"10.1080/13571516.2021.1893570","DOIUrl":"https://doi.org/10.1080/13571516.2021.1893570","url":null,"abstract":"Abstract We design an experiment to test what motivates agents to choose higher effort and how well principals anticipate agent responses. Principals rank five contracts where a higher ranking increases the likelihood of a contract's implementation. In one treatment, those rankings remain hidden from agents; in the other, agents view the rankings. Agent response to contract structure and monetary incentives largely conforms to our predictions: agents demonstrate a preference for monotonic contracts over non-monotonic contracts, and the vast majority responds favorably to contracts where high effort is a best response. Surprisingly, offering a flat contract that exactly compensates agents for effort performs no better than offering nothing. Principals, however, poorly anticipate agent response to contracts, regardless of the observability of rankings. Additionally, although differences in observable rankings only affect agent behavior in minor ways, principals' rankings between the two treatments indicate principals believed different rankings would significantly influence agents when observable.","PeriodicalId":45470,"journal":{"name":"International Journal of the Economics of Business","volume":null,"pages":null},"PeriodicalIF":1.2,"publicationDate":"2021-03-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"80380574","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-03-04DOI: 10.1080/13571516.2020.1846450
G. Haile
{"title":"Creating Good Jobs: An Industry-Based Strategy","authors":"G. Haile","doi":"10.1080/13571516.2020.1846450","DOIUrl":"https://doi.org/10.1080/13571516.2020.1846450","url":null,"abstract":"","PeriodicalId":45470,"journal":{"name":"International Journal of the Economics of Business","volume":null,"pages":null},"PeriodicalIF":1.2,"publicationDate":"2021-03-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"88528172","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-12-17DOI: 10.1080/13571516.2020.1858703
K. R. Sinimole, K. M. Saini
Abstract Asian countries have enhanced their innovation capabilities through the advancements in science, technology and innovation with skilled workers and R&D institutions. Regardless of the investments made in R&D, a country’s objective of nurturing economic growth might not be fulfilled if R&D resources are used inefficiently. The aim of this paper is to evaluate and compare the R&D performance of Asian countries divided into two groups based on a threshold expenditure of 1% of GDP on R&D. Using an output-oriented DEA model, the study finds that five countries (Bahrain, Armenia, Oman, Georgia and Vietnam) in the first group and two countries (Singapore and Israel) in the second group are operating in the efficiency frontier. The study also reveals the relevance of parameters such as ‘ease of doing business’ strategies, regulatory policies, trade policies, industry academia collaboration, strategic collaboration between nations and public and private partnership on R&D efficiency.
{"title":"Performance evaluation of R&D organisations: an Asian perspective","authors":"K. R. Sinimole, K. M. Saini","doi":"10.1080/13571516.2020.1858703","DOIUrl":"https://doi.org/10.1080/13571516.2020.1858703","url":null,"abstract":"Abstract Asian countries have enhanced their innovation capabilities through the advancements in science, technology and innovation with skilled workers and R&D institutions. Regardless of the investments made in R&D, a country’s objective of nurturing economic growth might not be fulfilled if R&D resources are used inefficiently. The aim of this paper is to evaluate and compare the R&D performance of Asian countries divided into two groups based on a threshold expenditure of 1% of GDP on R&D. Using an output-oriented DEA model, the study finds that five countries (Bahrain, Armenia, Oman, Georgia and Vietnam) in the first group and two countries (Singapore and Israel) in the second group are operating in the efficiency frontier. The study also reveals the relevance of parameters such as ‘ease of doing business’ strategies, regulatory policies, trade policies, industry academia collaboration, strategic collaboration between nations and public and private partnership on R&D efficiency.","PeriodicalId":45470,"journal":{"name":"International Journal of the Economics of Business","volume":null,"pages":null},"PeriodicalIF":1.2,"publicationDate":"2020-12-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"73553550","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Abstract The purpose of this study is to investigate whether creditors consider the governance characteristics of the enterprise in deciding the cost of the debt. Starting from a sample of 486 American firms during the period from 1998 to 2017, we integrate governance in six factorial axes by using estimation by OLS regressors. We validate that audit quality as well as financial expertise are informative tools for creditors who provide information on the quality and reliability of financial information. They negatively and significantly affect the cost of the debt. Moreover, the creditors appreciate the existence of independent directors on the board of directors and reduce the cost of indebtedness required. Then, the attributes of the board of directors are poorly perceived by the creditors who will improve the interest rate. Additionally, the cost of debt improves with the concentration of managerial property and majority shareholders.
{"title":"The nexus between governance structure and cost of debt","authors":"Abdelkader Mohamed Sghaier Derbali, Lamia Jamel, Mohamed Bechir Chenguel","doi":"10.1080/13571516.2020.1858702","DOIUrl":"https://doi.org/10.1080/13571516.2020.1858702","url":null,"abstract":"Abstract The purpose of this study is to investigate whether creditors consider the governance characteristics of the enterprise in deciding the cost of the debt. Starting from a sample of 486 American firms during the period from 1998 to 2017, we integrate governance in six factorial axes by using estimation by OLS regressors. We validate that audit quality as well as financial expertise are informative tools for creditors who provide information on the quality and reliability of financial information. They negatively and significantly affect the cost of the debt. Moreover, the creditors appreciate the existence of independent directors on the board of directors and reduce the cost of indebtedness required. Then, the attributes of the board of directors are poorly perceived by the creditors who will improve the interest rate. Additionally, the cost of debt improves with the concentration of managerial property and majority shareholders.","PeriodicalId":45470,"journal":{"name":"International Journal of the Economics of Business","volume":null,"pages":null},"PeriodicalIF":1.2,"publicationDate":"2020-12-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"75887408","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-11-29DOI: 10.1080/13571516.2020.1838227
Jules Duberga
Abstract This paper investigates the effectiveness of liberalization policy on the intercity coach market in England and Wales and evaluates its impact in promoting competition and enhancing welfare. The paper adds to the current literature by assessing this policy focusing on natural monopolies, deriving a structural model of the industry and using web-scraped key market-level data in the study. Regression analysis and descriptive statistics suggest peripheral routes with a small market size are natural monopolies, where passengers pay higher prices. We estimate a structural model, currently absent from the literature, which shows that these routes are characterized by lower welfare levels. The model allows us to simulate a policy promoting competition on such routes showing that a regulator could generate net welfare gains by implementing a more competitive equilibrium on these routes. This paper confirms the dominant conclusion that unregulated coach industries detrimentally consolidate, as demonstrated in other European markets.
{"title":"Competition analysis of the UK intercity coach market: a structural econometric model","authors":"Jules Duberga","doi":"10.1080/13571516.2020.1838227","DOIUrl":"https://doi.org/10.1080/13571516.2020.1838227","url":null,"abstract":"Abstract This paper investigates the effectiveness of liberalization policy on the intercity coach market in England and Wales and evaluates its impact in promoting competition and enhancing welfare. The paper adds to the current literature by assessing this policy focusing on natural monopolies, deriving a structural model of the industry and using web-scraped key market-level data in the study. Regression analysis and descriptive statistics suggest peripheral routes with a small market size are natural monopolies, where passengers pay higher prices. We estimate a structural model, currently absent from the literature, which shows that these routes are characterized by lower welfare levels. The model allows us to simulate a policy promoting competition on such routes showing that a regulator could generate net welfare gains by implementing a more competitive equilibrium on these routes. This paper confirms the dominant conclusion that unregulated coach industries detrimentally consolidate, as demonstrated in other European markets.","PeriodicalId":45470,"journal":{"name":"International Journal of the Economics of Business","volume":null,"pages":null},"PeriodicalIF":1.2,"publicationDate":"2020-11-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"79474602","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-11-09DOI: 10.1080/13571516.2020.1843381
Øystein Foros, Mai Nguyen-Ones, Frode Steen
Abstract
First, we analyze how regular days off from competition and a time-dependent price pattern affect firm performance. Second, we examine the effects on firms' profitability from consumers’ changing search- and timing behavior. We use microdata from gasoline retailing in Norway. From 2004 to 2017, firms practiced an industry-wide day off from competition, starting on Mondays at noon, by increasing prices to a common level given by the recommended prices (decided and published in advance). In turn, a foreseeable low-price window is open before every restoration. During the data period, we observe an additional weekly restoration on Thursdays at noon. The additional day off from competition increases firm performance. As expected, a conventional price search of where to buy reduces firms’ profitability. In contrast, consumers who are aware of the cycle and spend effort on when to buy have a positive impact on firms’ profitability. If consumers spend effort on when to buy, they attempt to tank during low price windows. By its very nature, this shrink consumers’ ability to compare prices at several outlets. Consequently, more attention to when to buy may soften price competition.
{"title":"The Effects of a Day off from Retail Price Competition: Evidence on Consumer Behavior and Firm Performance in Gasoline Retailing","authors":"Øystein Foros, Mai Nguyen-Ones, Frode Steen","doi":"10.1080/13571516.2020.1843381","DOIUrl":"https://doi.org/10.1080/13571516.2020.1843381","url":null,"abstract":"<p><b>Abstract</b></p><p>First, we analyze how regular days off from competition and a time-dependent price pattern affect firm performance. Second, we examine the effects on firms' profitability from consumers’ changing search- and timing behavior. We use microdata from gasoline retailing in Norway. From 2004 to 2017, firms practiced an industry-wide day off from competition, starting on Mondays at noon, by increasing prices to a common level given by the recommended prices (decided and published in advance). In turn, a foreseeable low-price window is open before every restoration. During the data period, we observe an additional weekly restoration on Thursdays at noon. The additional day off from competition increases firm performance. As expected, a conventional price search of where to buy reduces firms’ profitability. In contrast, consumers who are aware of the cycle and spend effort on when to buy have a positive impact on firms’ profitability. If consumers spend effort on when to buy, they attempt to tank during low price windows. By its very nature, this shrink consumers’ ability to compare prices at several outlets. Consequently, more attention to when to buy may soften price competition.</p>","PeriodicalId":45470,"journal":{"name":"International Journal of the Economics of Business","volume":null,"pages":null},"PeriodicalIF":1.2,"publicationDate":"2020-11-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138513938","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-10-06DOI: 10.1080/13571516.2020.1819084
Panagiotis N. Fotis, M. Polemis
Abstract The scope of this paper is to investigate the impact of market deregulation on the level of farm-gate prices and the competitiveness of raw milk producers in Greece along the suggested lines of OECD. For this purpose, we use a dynamic panel data approach. We argue that the full openness of the relevant milk market segment had significant implications for the level of farmgate prices in the industry. On the one hand, market deregulation causes the increase of farmgate prices and, on the other hand, a fiercer market competition proxied by the increase in the number of firms in the industry results in a decrease in farmgate milk prices. Lastly, our empirical findings remain robust under different methodologies and sample splitting, providing a focal point to policymakers and government officials for the ex-post evaluation of the proposed OECD deregulation strategies.
{"title":"The impact of regulation in shelf life on milk price","authors":"Panagiotis N. Fotis, M. Polemis","doi":"10.1080/13571516.2020.1819084","DOIUrl":"https://doi.org/10.1080/13571516.2020.1819084","url":null,"abstract":"Abstract The scope of this paper is to investigate the impact of market deregulation on the level of farm-gate prices and the competitiveness of raw milk producers in Greece along the suggested lines of OECD. For this purpose, we use a dynamic panel data approach. We argue that the full openness of the relevant milk market segment had significant implications for the level of farmgate prices in the industry. On the one hand, market deregulation causes the increase of farmgate prices and, on the other hand, a fiercer market competition proxied by the increase in the number of firms in the industry results in a decrease in farmgate milk prices. Lastly, our empirical findings remain robust under different methodologies and sample splitting, providing a focal point to policymakers and government officials for the ex-post evaluation of the proposed OECD deregulation strategies.","PeriodicalId":45470,"journal":{"name":"International Journal of the Economics of Business","volume":null,"pages":null},"PeriodicalIF":1.2,"publicationDate":"2020-10-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"78311863","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-09-15DOI: 10.1080/13571516.2020.1783938
Hernán Herrera-Echeverri, John Rosso, D. Fragua
Abstract Using a sample of 23 OECD countries, studied over a period of 20 years (1995–2015), we find that direct foreign investment has a spillover effect on private equity (PE) in that it supports the development of the domestic PE industry. We also show how contextual variables influence the investment process. Our results suggest that a positive effect on domestic PE dynamics can be seen if the number of foreign PE deals is measured, while calculations using the value of foreign PE investments show mixed results. The positive effect of foreign investment on domestic PE activity persists where low gross capital formation is adopted and in low value-added environments. Foreign PE investment increases overseas activity in the host country’s domestic PE industry. These effects are proportional to the size of the foreign fund. Foreign PE activity related to firms in the early stages of development encourage domestic PE industry activity in the same kind of firms.
{"title":"Effects of Foreign Investment on Domestic Private Equity","authors":"Hernán Herrera-Echeverri, John Rosso, D. Fragua","doi":"10.1080/13571516.2020.1783938","DOIUrl":"https://doi.org/10.1080/13571516.2020.1783938","url":null,"abstract":"Abstract Using a sample of 23 OECD countries, studied over a period of 20 years (1995–2015), we find that direct foreign investment has a spillover effect on private equity (PE) in that it supports the development of the domestic PE industry. We also show how contextual variables influence the investment process. Our results suggest that a positive effect on domestic PE dynamics can be seen if the number of foreign PE deals is measured, while calculations using the value of foreign PE investments show mixed results. The positive effect of foreign investment on domestic PE activity persists where low gross capital formation is adopted and in low value-added environments. Foreign PE investment increases overseas activity in the host country’s domestic PE industry. These effects are proportional to the size of the foreign fund. Foreign PE activity related to firms in the early stages of development encourage domestic PE industry activity in the same kind of firms.","PeriodicalId":45470,"journal":{"name":"International Journal of the Economics of Business","volume":null,"pages":null},"PeriodicalIF":1.2,"publicationDate":"2020-09-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"78943857","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-09-14DOI: 10.1080/13571516.2020.1812998
Syeda Tamkeen Fatima, M. Khan
Abstract This paper looks at the differential impact of bribery and lobbying onto the productivity of firms using data from 28 Eastern European and Central Asian economies. It is hypothesized that since the intent of lobbying is fundamentally different from that of bribery their consequences may differ. The empirical results reveal that while lobbying increases firm performance, bribery decreases it. Also, there is a need to improve institutions to mitigate some of the negative effects of bribery onto firm performance. As far as firm-level characteristics are concerned larger sized-, service sector- and exporter-firms need to be particularly shielded from bribery practices as the negative impact of bribery onto these types of firms are more pronounced. On the other hand, lobbying is found to be more successful for larger-, export oriented- and older firms, implying that such firms need to be encouraged to collaborate and forward valuable information for effective policy making.
{"title":"Rent-Seeking and Firm Performance: Do Institutional and Firm-Specific Characteristics Matter?","authors":"Syeda Tamkeen Fatima, M. Khan","doi":"10.1080/13571516.2020.1812998","DOIUrl":"https://doi.org/10.1080/13571516.2020.1812998","url":null,"abstract":"Abstract This paper looks at the differential impact of bribery and lobbying onto the productivity of firms using data from 28 Eastern European and Central Asian economies. It is hypothesized that since the intent of lobbying is fundamentally different from that of bribery their consequences may differ. The empirical results reveal that while lobbying increases firm performance, bribery decreases it. Also, there is a need to improve institutions to mitigate some of the negative effects of bribery onto firm performance. As far as firm-level characteristics are concerned larger sized-, service sector- and exporter-firms need to be particularly shielded from bribery practices as the negative impact of bribery onto these types of firms are more pronounced. On the other hand, lobbying is found to be more successful for larger-, export oriented- and older firms, implying that such firms need to be encouraged to collaborate and forward valuable information for effective policy making.","PeriodicalId":45470,"journal":{"name":"International Journal of the Economics of Business","volume":null,"pages":null},"PeriodicalIF":1.2,"publicationDate":"2020-09-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"84952937","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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