Workers learn from the tasks they perform, and in the process, they accumulate human capital that is potentially portable. Companies that cannot commit to specific task allocations may assign employees to tasks that reduce retention costs and do not maximize productivity. Equity partnerships may achieve efficient task allocation by distributing control and profit among partners, thus improving productivity. This analysis provides a novel rationale for the widespread presence of partnerships in professional service industries, their shift toward performance-based remuneration, and the conditions under which partnerships are more efficient than corporations with frictions like wealth constraints and asymmetric information.
{"title":"Organizational Design With Portable Skills","authors":"Luca Picariello","doi":"10.1111/jems.12641","DOIUrl":"https://doi.org/10.1111/jems.12641","url":null,"abstract":"<p>Workers learn from the tasks they perform, and in the process, they accumulate human capital that is potentially portable. Companies that cannot commit to specific task allocations may assign employees to tasks that reduce retention costs and do not maximize productivity. Equity partnerships may achieve efficient task allocation by distributing control and profit among partners, thus improving productivity. This analysis provides a novel rationale for the widespread presence of partnerships in professional service industries, their shift toward performance-based remuneration, and the conditions under which partnerships are more efficient than corporations with frictions like wealth constraints and asymmetric information.</p>","PeriodicalId":47931,"journal":{"name":"Journal of Economics & Management Strategy","volume":"35 1","pages":"196-216"},"PeriodicalIF":1.4,"publicationDate":"2025-05-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/jems.12641","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146136093","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We explore quality-based strategies in frictional online markets using a targeted search model with vertical differentiation and heterogeneous agents. Firms self-select into high- or low-quality segments and compete in prices. We demonstrate that reduced search costs amplify the prominence of quality, leading to an increase in the market share of high-quality designs. While low-quality firms dominate when cost differentials are large, declining search frictions amplify the prominence of the quality attribute. The raised importance of quality triggers dual effects: a higher price sensitivity, leading to further price reductions across all products, and a boost in demand for high-quality designs. Our findings offer insights into the recent dynamics of online markets, explaining the expansion of high-quality segments and providing a strategic framework for firms to navigate evolving consumer preferences in increasingly transparent markets.
{"title":"Quality Strategies in Frictional Search Models","authors":"Paolo Morganti","doi":"10.1111/jems.12642","DOIUrl":"https://doi.org/10.1111/jems.12642","url":null,"abstract":"<div>\u0000 \u0000 <p>We explore quality-based strategies in frictional online markets using a targeted search model with vertical differentiation and heterogeneous agents. Firms self-select into high- or low-quality segments and compete in prices. We demonstrate that reduced search costs amplify the prominence of quality, leading to an increase in the market share of high-quality designs. While low-quality firms dominate when cost differentials are large, declining search frictions amplify the prominence of the quality attribute. The raised importance of quality triggers dual effects: a higher price sensitivity, leading to further price reductions across all products, and a boost in demand for high-quality designs. Our findings offer insights into the recent dynamics of online markets, explaining the expansion of high-quality segments and providing a strategic framework for firms to navigate evolving consumer preferences in increasingly transparent markets.</p>\u0000 </div>","PeriodicalId":47931,"journal":{"name":"Journal of Economics & Management Strategy","volume":"35 1","pages":"185-195"},"PeriodicalIF":1.4,"publicationDate":"2025-05-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146129896","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We introduce a form of consumers' bounded rationality, price similarities, in a duopoly market with price–quantity competition. Price similarities occur when consumers do not react to slight differences in prices. In this case, firms' demands are determined by a sharing rule that depends on the quantities produced. Assuming a general form of the proportional sharing rule, we show that a pure strategy Nash equilibrium for the price–quantity game materializes if, and only if, price similarities are in place. We also show that there are two kinds of equilibrium. In the first kind, total supply equals total demand. By contrast, in the second kind, firms overproduce. Finally, we show how to compute the minimum level of the price similarities phenomenon necessary to ensure equilibrium existence given the market conditions.
{"title":"Price–Quantity Competition in a Duopoly Market With Price Similarities","authors":"Bertrand Crettez, Rabia Nessah, Raluca Parvulescu","doi":"10.1111/jems.12637","DOIUrl":"https://doi.org/10.1111/jems.12637","url":null,"abstract":"<div>\u0000 \u0000 <p>We introduce a form of consumers' bounded rationality, <i>price similarities</i>, in a duopoly market with price–quantity competition. Price similarities occur when consumers do not react to slight differences in prices. In this case, firms' demands are determined by a sharing rule that depends on the quantities produced. Assuming a general form of the proportional sharing rule, we show that a pure strategy Nash equilibrium for the price–quantity game materializes if, and only if, price similarities are in place. We also show that there are two kinds of equilibrium. In the first kind, total supply equals total demand. By contrast, in the second kind, firms overproduce. Finally, we show how to compute the minimum level of the price similarities phenomenon necessary to ensure equilibrium existence given the market conditions.</p>\u0000 </div>","PeriodicalId":47931,"journal":{"name":"Journal of Economics & Management Strategy","volume":"35 1","pages":"168-184"},"PeriodicalIF":1.4,"publicationDate":"2025-05-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146129895","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In a dynamic adverse selection setting with private information about stochastic consumer preferences, we study the pricing of franchise rights when the awarding government body has to balance between revenue collection and consumer welfare. In this environment, we show that optimal pricing requires an appropriate combination of fixed and time-variable transfers between the parties. Notably, our findings suggest that it might be optimal to occasionally subsidize rather than charge the franchisee when consumers' willingness to pay increases well beyond initial expectations.
{"title":"Optimal Pricing of Public Franchises With Imperfectly Correlated Demand Shocks","authors":"Marco Buso, Cesare Dosi, Michele Moretto","doi":"10.1111/jems.12639","DOIUrl":"https://doi.org/10.1111/jems.12639","url":null,"abstract":"<p>In a dynamic adverse selection setting with private information about stochastic consumer preferences, we study the pricing of franchise rights when the awarding government body has to balance between revenue collection and consumer welfare. In this environment, we show that optimal pricing requires an appropriate combination of fixed and time-variable transfers between the parties. Notably, our findings suggest that it might be optimal to occasionally subsidize rather than charge the franchisee when consumers' willingness to pay increases well beyond initial expectations.</p>","PeriodicalId":47931,"journal":{"name":"Journal of Economics & Management Strategy","volume":"35 1","pages":"126-138"},"PeriodicalIF":1.4,"publicationDate":"2025-04-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/jems.12639","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146136321","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In teamwork settings, providing effective leadership can be challenging for team leaders due to multitasking and the difficulty in measuring and rewarding leadership input. These challenges can lead to underprovision of leadership activities, ultimately impeding the productivity of the team. To address this problem, we conducted a field experiment at a manufacturing firm, introducing a relative subjective performance evaluation of team leaders' leadership activities by their managers, coupled with bonuses based on their leadership rank among all leaders. Our intervention increased other team members' productivity by approximately 7% while leaving team leaders' productivity unchanged and was profitable for the firm. During the intervention, we observed a positive correlation between the evaluations of team leaders and the productivity of team members, suggesting that the subjective evaluation was accurate and indeed increased leadership activities and thus productivity.
{"title":"Incentivizing Team Leaders: A Firm-Level Experiment on Subjective Performance Evaluation of Leadership Skills","authors":"Thomas Gall, Xiaocheng Hu, Michael Vlassopoulos","doi":"10.1111/jems.12640","DOIUrl":"https://doi.org/10.1111/jems.12640","url":null,"abstract":"<div>\u0000 \u0000 <p>In teamwork settings, providing effective leadership can be challenging for team leaders due to multitasking and the difficulty in measuring and rewarding leadership input. These challenges can lead to underprovision of leadership activities, ultimately impeding the productivity of the team. To address this problem, we conducted a field experiment at a manufacturing firm, introducing a relative subjective performance evaluation of team leaders' leadership activities by their managers, coupled with bonuses based on their leadership rank among all leaders. Our intervention increased other team members' productivity by approximately 7% while leaving team leaders' productivity unchanged and was profitable for the firm. During the intervention, we observed a positive correlation between the evaluations of team leaders and the productivity of team members, suggesting that the subjective evaluation was accurate and indeed increased leadership activities and thus productivity.</p>\u0000 </div>","PeriodicalId":47931,"journal":{"name":"Journal of Economics & Management Strategy","volume":"35 1","pages":"139-167"},"PeriodicalIF":1.4,"publicationDate":"2025-04-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146130168","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
To analyze how firms' policies to reimburse consumer switching costs affect prices, market structure, and welfare, we develop a dynamic duopoly model with network effects, switching costs, and switching cost reimbursement. We find that each firm's reimbursement strategy is nonmonotonic in its installed base. While nonmonotonic, the firm with the greater installed base always reimburses more of the switching cost than its smaller competitor, allowing the firm that obtains an early advantage to dominate the market. Consumers benefit from the reimbursement, while producers only benefit in network industries when network effects are large; otherwise, the reimbursement induces a prisoner's dilemma.
{"title":"Reimbursing Consumers' Switching Costs in Network and Nonnetwork Industries","authors":"Jiawei Chen, Michael Sacks","doi":"10.1111/jems.12635","DOIUrl":"10.1111/jems.12635","url":null,"abstract":"<div>\u0000 \u0000 <p>To analyze how firms' policies to reimburse consumer switching costs affect prices, market structure, and welfare, we develop a dynamic duopoly model with network effects, switching costs, and switching cost reimbursement. We find that each firm's reimbursement strategy is nonmonotonic in its installed base. While nonmonotonic, the firm with the greater installed base always reimburses more of the switching cost than its smaller competitor, allowing the firm that obtains an early advantage to dominate the market. Consumers benefit from the reimbursement, while producers only benefit in network industries when network effects are large; otherwise, the reimbursement induces a prisoner's dilemma.</p>\u0000 </div>","PeriodicalId":47931,"journal":{"name":"Journal of Economics & Management Strategy","volume":"35 1","pages":"99-125"},"PeriodicalIF":1.4,"publicationDate":"2025-04-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146139809","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
<p>This paper examines the geographically heterogeneous environmental effects of electric vehicle (EV) subsidies in China and compares EV subsidies with alternative policies that price environmental externalities. The study employs a structural model that features demand and supply to analyze the environmental effects of EV subsidies through counterfactual analysis. Our findings suggest that EV subsidies incentivize the substitution of EVs for internal combustion engine vehicles (ICEVs), which reduces local pollution but potentially redistributes it to locations of electricity generation. Specifically, the proposed 71.2% increase in EV subsidies decreases <span></span><math> <semantics> <mrow> <mrow> <msub> <mstyle> <mspace></mspace> <mtext>CO</mtext> <mspace></mspace> </mstyle> <mn>2</mn> </msub> </mrow> </mrow> </semantics></math> emissions by 0.1%, but raises emissions of <span></span><math> <semantics> <mrow> <mrow> <msub> <mstyle> <mspace></mspace> <mtext>PM</mtext> </mstyle> <mn>2.5</mn> </msub> <mo>,</mo> <msub> <mstyle> <mtext>NO</mtext> <mspace></mspace> </mstyle> <mi>x</mi> </msub> </mrow> </mrow> </semantics></math>, and <span></span><math> <semantics> <mrow> <mrow> <msub> <mstyle> <mspace></mspace> <mtext>SO</mtext> <mspace></mspace> </mstyle> <mn>2</mn> </msub> </mrow> </mrow> </semantics></math> by 0.1%, 3.9%, and 113.1%, respectively, over the period analyzed. More importantly, the increased subsidies redistribute pollution: The additional subsidies reduce <span></span><math>
{"title":"Is Pollution Reduced or Redistributed? The Impact of Electric Vehicle Subsidies in China","authors":"Lisha Meng, Junji Xiao, Mengxin Liu","doi":"10.1111/jems.12634","DOIUrl":"https://doi.org/10.1111/jems.12634","url":null,"abstract":"<p>This paper examines the geographically heterogeneous environmental effects of electric vehicle (EV) subsidies in China and compares EV subsidies with alternative policies that price environmental externalities. The study employs a structural model that features demand and supply to analyze the environmental effects of EV subsidies through counterfactual analysis. Our findings suggest that EV subsidies incentivize the substitution of EVs for internal combustion engine vehicles (ICEVs), which reduces local pollution but potentially redistributes it to locations of electricity generation. Specifically, the proposed 71.2% increase in EV subsidies decreases <span></span><math>\u0000 <semantics>\u0000 <mrow>\u0000 \u0000 <mrow>\u0000 <msub>\u0000 <mstyle>\u0000 <mspace></mspace>\u0000 \u0000 <mtext>CO</mtext>\u0000 <mspace></mspace>\u0000 </mstyle>\u0000 \u0000 <mn>2</mn>\u0000 </msub>\u0000 </mrow>\u0000 </mrow>\u0000 </semantics></math> emissions by 0.1%, but raises emissions of <span></span><math>\u0000 <semantics>\u0000 <mrow>\u0000 \u0000 <mrow>\u0000 <msub>\u0000 <mstyle>\u0000 <mspace></mspace>\u0000 \u0000 <mtext>PM</mtext>\u0000 </mstyle>\u0000 \u0000 <mn>2.5</mn>\u0000 </msub>\u0000 \u0000 <mo>,</mo>\u0000 \u0000 <msub>\u0000 <mstyle>\u0000 <mtext>NO</mtext>\u0000 <mspace></mspace>\u0000 </mstyle>\u0000 \u0000 <mi>x</mi>\u0000 </msub>\u0000 </mrow>\u0000 </mrow>\u0000 </semantics></math>, and <span></span><math>\u0000 <semantics>\u0000 <mrow>\u0000 \u0000 <mrow>\u0000 <msub>\u0000 <mstyle>\u0000 <mspace></mspace>\u0000 \u0000 <mtext>SO</mtext>\u0000 <mspace></mspace>\u0000 </mstyle>\u0000 \u0000 <mn>2</mn>\u0000 </msub>\u0000 </mrow>\u0000 </mrow>\u0000 </semantics></math> by 0.1%, 3.9%, and 113.1%, respectively, over the period analyzed. More importantly, the increased subsidies redistribute pollution: The additional subsidies reduce <span></span><math>","PeriodicalId":47931,"journal":{"name":"Journal of Economics & Management Strategy","volume":"35 1","pages":"59-98"},"PeriodicalIF":1.4,"publicationDate":"2025-04-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/jems.12634","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146136313","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
For privately held startups, restructuring ownership is challenging due to diverse and uncertain valuations among owners. Traditional approaches, including the BMBY mechanism for equal partnerships, fail to address the complexities of multi-owner settings and do not elicit true valuations. We propose a novel mechanism that extends the BMBY rationale to accommodate these complex scenarios. Our mechanism ensures truthful valuation elicitation while offering several advantages: it is easy to implement, budget balanced, resistant to collusion, individually rational, and allocates shares to those who value them most. Crucially, it preserves proportionality among the remaining owners, maintaining the existing power dynamics. The mechanism allows for adaptive control of the eventual number of owners, addressing unique startup needs such as incentivizing employee ownership. This paper contributes to the field of ownership restructuring by providing a practical, theoretically grounded solution for the complex dynamics of startup recapitalization, potentially improving decision-making processes and stakeholder relationships in these pivotal business transitions.
{"title":"The Multi-BMBY Mechanism: Proportionality-Preserving and Strategyproof Ownership Restructuring in Private Companies","authors":"Gal Danino, Moran Koren, Omer Madmon","doi":"10.1111/jems.12638","DOIUrl":"https://doi.org/10.1111/jems.12638","url":null,"abstract":"<p>For privately held startups, restructuring ownership is challenging due to diverse and uncertain valuations among owners. Traditional approaches, including the BMBY mechanism for equal partnerships, fail to address the complexities of multi-owner settings and do not elicit true valuations. We propose a novel mechanism that extends the BMBY rationale to accommodate these complex scenarios. Our mechanism ensures truthful valuation elicitation while offering several advantages: it is easy to implement, budget balanced, resistant to collusion, individually rational, and allocates shares to those who value them most. Crucially, it preserves proportionality among the remaining owners, maintaining the existing power dynamics. The mechanism allows for adaptive control of the eventual number of owners, addressing unique startup needs such as incentivizing employee ownership. This paper contributes to the field of ownership restructuring by providing a practical, theoretically grounded solution for the complex dynamics of startup recapitalization, potentially improving decision-making processes and stakeholder relationships in these pivotal business transitions.</p>","PeriodicalId":47931,"journal":{"name":"Journal of Economics & Management Strategy","volume":"35 1","pages":"50-58"},"PeriodicalIF":1.4,"publicationDate":"2025-04-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/jems.12638","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146129922","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Using comprehensive microdata from the Chinese Patent Survey, we examine the appropriation strategies that firms use to capture value from their innovations and assess the motivations underpinning these strategies. Although Chinese firms exhibit a robust overall preference for patents, we find that firms often use patents for reasons other than directly protecting intellectual assets from competitors. In particular, our results suggest that firms utilize patents to secure external financing and negotiate third-party production contracts, while relying on secrecy and/or first mover advantage to protect against competitor imitation. Furthermore, we find that firms pursuing the most expensive R&D projects exhibit a relative preference for secrecy over patents, consistent with theories that predict the use of secrecy to protect a firm's most valuable intellectual assets. Our results provide novel insights into China's recent patenting surge and help inform policy efforts to encourage domestic innovation in developing economies.
{"title":"Innovation and Appropriation: Insights From the Chinese Patent Survey","authors":"Dong Cheng, Michael A. Klein, Fuat Şener","doi":"10.1111/jems.12636","DOIUrl":"https://doi.org/10.1111/jems.12636","url":null,"abstract":"<div>\u0000 \u0000 <p>Using comprehensive microdata from the Chinese Patent Survey, we examine the appropriation strategies that firms use to capture value from their innovations and assess the motivations underpinning these strategies. Although Chinese firms exhibit a robust overall preference for patents, we find that firms often use patents for reasons other than directly protecting intellectual assets from competitors. In particular, our results suggest that firms utilize patents to secure external financing and negotiate third-party production contracts, while relying on secrecy and/or first mover advantage to protect against competitor imitation. Furthermore, we find that firms pursuing the most expensive R&D projects exhibit a relative preference for secrecy over patents, consistent with theories that predict the use of secrecy to protect a firm's most valuable intellectual assets. Our results provide novel insights into China's recent patenting surge and help inform policy efforts to encourage domestic innovation in developing economies.</p>\u0000 </div>","PeriodicalId":47931,"journal":{"name":"Journal of Economics & Management Strategy","volume":"35 1","pages":"30-49"},"PeriodicalIF":1.4,"publicationDate":"2025-04-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146129864","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Kyung Min Lee, Mee Jung Kim, J. David Brown, John S. Earle, Zhen Liu
We evaluate the contributions of immigrant entrepreneurs to innovation in the United States using linked survey-administrative data on 199,000 firms. We find that not only are immigrants more likely than natives to own businesses, but on average their firms display more innovative activities and outcomes. Immigrant-owned firms are particularly more likely to create completely new products, improve previous products, use new processes, and engage in both basic and applied research and development, and their efforts are reflected in substantially higher levels of patents and labor productivity. Immigrant owners are less likely than natives to imitate others' products and to hire more employees. Examining potential explanations, including entrepreneurial characteristics, industry choice, access to finance, and diversity, we find that the immigrant innovation advantage is robust to controlling for detailed characteristics of firms and owners, it holds in both high-tech and non-high-tech industries and, with the exception of labor productivity, is even stronger in diverse teams. The evidence from nearly all measures that immigrants tend to operate more innovative and productive firms, together with the higher share of business ownership by immigrants, implies large contributions of immigrant entrepreneurs to U.S. innovation and growth.
{"title":"Are Immigrants More Innovative? Evidence From Entrepreneurs","authors":"Kyung Min Lee, Mee Jung Kim, J. David Brown, John S. Earle, Zhen Liu","doi":"10.1111/jems.12633","DOIUrl":"https://doi.org/10.1111/jems.12633","url":null,"abstract":"<p>We evaluate the contributions of immigrant entrepreneurs to innovation in the United States using linked survey-administrative data on 199,000 firms. We find that not only are immigrants more likely than natives to own businesses, but on average their firms display more innovative activities and outcomes. Immigrant-owned firms are particularly more likely to create completely new products, improve previous products, use new processes, and engage in both basic and applied research and development, and their efforts are reflected in substantially higher levels of patents and labor productivity. Immigrant owners are less likely than natives to imitate others' products and to hire more employees. Examining potential explanations, including entrepreneurial characteristics, industry choice, access to finance, and diversity, we find that the immigrant innovation advantage is robust to controlling for detailed characteristics of firms and owners, it holds in both high-tech and non-high-tech industries and, with the exception of labor productivity, is even stronger in diverse teams. The evidence from nearly all measures that immigrants tend to operate more innovative and productive firms, together with the higher share of business ownership by immigrants, implies large contributions of immigrant entrepreneurs to U.S. innovation and growth.</p>","PeriodicalId":47931,"journal":{"name":"Journal of Economics & Management Strategy","volume":"35 1","pages":"3-29"},"PeriodicalIF":1.4,"publicationDate":"2025-03-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/jems.12633","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"146136733","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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