Taking the First Step - What Determines German Laser Source Manufacturers' Entry into Innovation Networks?
Jutta Günther, Muhamed Kudic, Andreas Pyka
International Journal of Innovation Management,
No. 5,
2015
Abstract
Early access to technological knowledge embodied in the industry’s innovation network can provide an important competitive advantage to firms. While the literature provides much evidence on the positive effects of innovation networks on firms’ performance, not much is known about the determinants of firms’ initial entry into such networks. We analyze firms’ timing and propensity to enter the industry’s innovation network. More precisely, we seek to shed some light on the factors affecting the duration between firm founding and its first cooperation event. In doing so, we apply a unique longitudinal event history dataset based on the full population of German laser source manufacturers. Innovation network data stem from official databases providing detailed information on the organizations involved, subject of joint research and development (R&D) efforts as well as start and end times for all publically funded R&D projects between 1990 and 2010. Estimation results from a non-parametric event history model indicate that micro firms enter the network later than small-sized or large firms. An in-depth analysis of the size effects for medium-sized firms provides some unexpected findings. The choice of cooperation type makes no significant difference for the firms’ timing to enter the network. Finally, the analysis of geographical determinants shows that cluster membership can, but do not necessarily, affect a firm’s timing to cooperate.
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Stress Testing and Bank Efficiency: Evidence from Europe
Iftekhar Hasan, Fotios Pasiouras
International Journal of Corporate Finance and Accounting,
No. 2,
2015
Abstract
This study examines whether and how the stress testing of European banks in 2010, 2011, and 2014 is related to their technical, allocative, and cost efficiency. Using a sample of large commercial banks operating in 20 European countries, and Data Envelopment Analysis (DEA), the authors perform comparisons between banks that were included in one of the three European stress tests and untested banks operating in the same countries. They estimate various specifications as for the inputs and outputs, cross-section and pooled estimations, and they also examine alternative samples as for the ownership of banks. In general, the authors conclude that banks included in the stress-test exercises are more efficient that their counterparties. The differences tend to be statistically significant in the case of allocative efficiency and cost efficiency, but not in the case of technical efficiency. With regards to the latter form of efficiency, the results depend upon the specification and the stress test in question.
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Public Bank Guarantees and Allocative Efficiency
Reint E. Gropp, Andre Guettler, Vahid Saadi
Abstract
In the wake of the recent financial crisis, many governments extended public guarantees to banks. We take advantage of a natural experiment, in which long-standing public guarantees were removed for a set of German banks following a lawsuit, to identify the real effects of these guarantees on the allocation of credit (“allocative efficiency”). Using matched bank/firm data, we find that public guarantees reduce allocative efficiency. With guarantees in place, poorly performing firms invest more and maintain higher rates of sales growth. Moreover, firms produce less efficiently in the presence of public guarantees. Consistently, we show that guarantees reduce the likelihood that firms exit the market. These findings suggest that public guarantees hinder restructuring activities and prevent resources to flow to the most productive uses.
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Optimizing Policymakers' Loss Functions in Crisis Prediction: Before, Within or After?
Peter Sarlin, Gregor von Schweinitz
Abstract
Early-warning models most commonly optimize signaling thresholds on crisis probabilities. The ex-post threshold optimization is based upon a loss function accounting for preferences between forecast errors, but comes with two crucial drawbacks: unstable thresholds in recursive estimations and an in-sample overfit at the expense of out-of-sample performance. We propose two alternatives for threshold setting: (i) including preferences in the estimation itself and (ii) setting thresholds ex-ante according to preferences only. We provide simulated and real-world evidence that this simplification results in stable thresholds and improves out-of-sample performance. Our solution is not restricted to binary-choice models, but directly transferable to the signaling approach and all probabilistic early-warning models.
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R&D Collaboration for Environmental Innovation
Gunnar Pippel
International Journal of Innovation Management,
No. 1,
2015
Abstract
The literature on the impact of R&D collaboration on environmental innovation performance of firms suggests that R&D collaboration is not always beneficial. Therefore, a more detailed analysis of the effects of R&D collaboration is necessary. This paper investigates the impact of R&D collaboration with different partner types on a firm’s environmental innovation performance. In addition, the paper addresses the question of whether the diversity of R&D collaboration partners is important to environmental innovation performance. Firm-level data from 2337 German firms are used in the regression analysis. The results suggest that R&D collaboration with suppliers, customers, universities, governmental research institutes, consultants and other firms within the same firm group has a significant positive impact on a firm’s environmental innovation performance, whereas collaboration with competitors has no significant impact. The diversity of R&D collaboration partners has a significantly positive impact on a firm’s environmental innovation performance.
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Corporate Taxation and Firm Location in Germany
Götz Zeddies
IWH Discussion Papers,
No. 2,
2015
Abstract
German Fiscal Federalism is characterized by a high degree of fiscal equalization which lowers the efficiency of local tax administration. Currently, a reform of the fiscal equalization scheme is on the political agenda. One option is to grant federal states the right to raise surtaxes on statutory tax rates set by the central government in order to reduce the equalization rate. In such an environment, especially those federal states with lower economic performance would have to raise comparatively high surtaxes. With capital mobility, this could further lower economic performance and thus tax revenues. Although statutory tax rates are so far identical across German federal states, corporate tax burden differs for several reasons. This paper tries to identify the impact of such differences on firm location. As can be shown, effective corporate taxation did seemingly not have a significant impact on firm location across German federal states.
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Network Positioning, Co-Location or Both?
Muhamed Kudic
Innovation Networks in the German Laser Industry. Springer Cham,
2015
Abstract
Previous research indicates that firm innovativeness can either be determined by a firm’s position within the network dimension or by its position within the geographical dimension. Integrative studies addressing both distinct and combined proximity effects remains rare (cf. Whittington et al. 2009). Thus, we address in this Chapter the following research question: Are firm-level innovation outcomes positively or negatively related to network positioning effects, geographical co-location effects or combined proximity effects; and if the latter case is true, are the combined effects substitutional or complementary in nature? Panel data count models with fixed and random effects were used to analyze a firm’s innovative performance as measured by patent application counts. This last empirical analysis is organized as follows: We start with a short introduction in Sect. 12.1. Next, we provide a brief discussion of theoretical background in Sect. 12.2. In Sect. 12.3 we introduce our conceptual framework and derive our hypotheses. In Sect. 12.4 we introduce the data and methods used. Next, we outline the estimation strategy and report our empirical results in Sect. 12.5. Finally, we discuss our findings and conclude with a number of critical remarks in Sect. 12.6.
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Coordination between Municipalities and Local Non-Municipal Public Units (NMPUs) for Supporting Urban Economic Development: Theoretical Analysis and Empirical Evidence for the Example of Universities in Germany
Martin T. W. Rosenfeld, J. Hinz
Koordination raumwirksamer Politik: Mehr Effizienz und Wirksamkeit von Politik durch abgestimmte Arbeitsteilung,
2015
Abstract
In many European cities, policymakers are trying to change the local paths of economic development to head in new directions, e.g. by trying to become a location for Non-Municipal Public Units (NMPUs), like federal special agencies, state museums, military bases, universities or publicly funded research institutes. But as the competencies for such local NMPUs are allocated to higher levels of government, the municipal level has no direct formal institutional responsibilities for influencing their location. Once a NMPU has chosen a certain location, support from the municipality may, however, stabilize the NMPU. There are some categories of NMPUs that should have considerable interest in local conditions, as determined by the municipal level. This paper first theoretically categorizes NMPUs with regard to their importance for the urban economy, with regard to the importance of local conditions for the performance of NMPUs and with regard to their degree of fiscal autonomy. It is shown that universities are one example of NMPUs where the relevance of coordinating activities with the municipalities is fairly high. The benefits of universities for local economic development have often been discussed. From the point of view of universities, their capacity to attract human capital depends on factors which may be influenced by the municipalities. This means that there is a reciprocal relationship between municipalities and universities; coordination by cooperation between the partners could be useful for both – but in practice there is often a lack of cooperation. Information policy is one relevant field for coordination: the city should highlight publicly the advantages of local universities; the universities should highlight the advantages of their city. As information policy is a field for which empirical data is available, the empirical part of the paper presents results from an analysis based on the internet presentations of selected cities and universities. It is shown that in most cities the level of coordination in this field is so far quite low. One possible way to achieve a higher degree of coordination could be to introduce fiscal incentives for cities.
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Private Equity, Jobs, and Productivity
Steven J. Davis, John Haltiwanger, Kyle Handley, Ron S. Jarmin, Josh Lerner, Javier Miranda
American Economic Review,
No. 12,
2014
Abstract
Private equity critics claim that leveraged buyouts bring huge job losses and few gains in operating performance. To evaluate these claims, we construct and analyze a new dataset that covers US buyouts from 1980 to 2005. We track 3,200 target firms and their 150,000 establishments before and after acquisition, comparing to controls defined by industry, size, age, and prior growth. Buyouts lead to modest net job losses but large increases in gross job creation and destruction. Buyouts also bring TFP gains at target firms, mainly through accelerated exit of less productive establishments and greater entry of highly productive ones.
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