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This paper wishes to problematize the foundations of production governance and offer an analytical perspective on the interrelation between agents’ preferences, strategic choice, and the public sphere (defined by impacts of choices on ‘publics’ who do not have an input in strategic choice, and by contextual conditions). The value is in the idea of preferences being social in nature and in the application both to the internal stakeholders of the organisation and its impacts on people outside. Using the concept of ‘strategic failure’ we suggest that social preferences reflected in deliberative social praxis can reduce false beliefs and increase individual wellbeing. From this approach, the paper offers a taxonomy of production organisations, based on social preferences about two variables: (i) the governance form (i.e. ownership and control rights) (ii) other strategic decisions that characterize the management of a company at a more operational level, once its fundamental legal form has been chosen. Each dimension (governance and strategic decisions processes) is then categorised alongside two basic preferences: towards inclusion or exclusion of ‘publics’ that have no substantial access to decision power about these variables. Our framework explains governance heterogeneity by contrasting exclusive and inclusive social preferences in cooperatives, social enterprises, as well as traditional corporations. A discussion of the evolution of social preferences and organizational forms is addressed through examples and regional experiences.

Using a large administrative dataset for Germany, this paper compares employment developments in exiting and surviving establishments. For both West and East Germany we find a clear 'shadow of death' effect reflecting lingering illness: establishments shrink dramatically already several years before closure, employment growth rates differ strongly between exiting and surviving establishments, and this difference becomes stronger as exit approaches. We further show that prior to exit the workforce becomes on average more skilled, more female and older in exiting compared to surviving establishments. These effects are more clearly visible in West than in East Germany. Our results also hold when applying a matching approach.

The following paper describes the basic principles of global quality management (T and the way that these influence pricing in a domain where due to the nature of the provided service, the provider who administers the network has a monopoly over the field.

In the article, approaches of different managerial communities to standardization of the corporate director's profession are considered. Non-commercial partnership "Directorium" has initiated the elaboration of educational professional standard "Board Member of the Business Entity (Corporate Director)". Experience of interaction between "Directorium" and high schools on building a system of certification of independent directors revealed some problems: distribution of intellectual and other rights to develop products, to construct a mutually beneficial financial model of cooperation, the need to organize contacts between the universities and professional experts for their participation in the preparation and evaluation of programs and some other.

We use a unique proprietary monthly panel data set on the operations of a large hotel firm to study the effect of vertical integration decisions on the pricing and performance (occupancy rate and RevPar) of individual hotels. Aggregate data patterns – which managers pay most attention to – suggest sizeable performance differences between franchised and non-franchised hotels. However, empirical analyses controlling for observable and unobservable characteristics show that if significant at all, such differences are economically much smaller than what mean comparisons suggest. Furthermore, once we endogenize the choice of organizational form using information about the Company’s other hotels in the same local market, the differences are both statistically and economically insignificant. We conclude that the Company chooses which hotels to franchise and to own optimally such that, conditional on hotel and market characteristics, it achieves consistent results – in terms of revenues per room, occupancy rates, and prices – on average across the two sets of hotels. Relating our results, obtained in a policy unconstrained setting, to those from studies that showed significant performance differences when firms’ choices of organizational forms were restricted by policy, suggests that policy can significantly affect firm performance and outcomes.

We investigate learning by doing using detailed data from a major auto producer's assembly plant. We focus on the acquisition, aggregation, transmission, and embodiment of the knowledge stock built through learning. We find that most knowledge was not retained by plant workers despite their importance as a learning conduit. This is consistent with the plant's systems for productivity measurement and improvement. We further explore how learning at the hundreds of processes along the production line undergirds plantwide productivity. Our results shed light on how productivity gains accrue at the plant level and how firms apply managerial inputs to expand production.

This paper discusses two variations to the optimal lending contract under asymmetric information studied in Clementi and Hopenhayn (2006). One variation assumes that the entrepreneur is less patient than the bank, and the other assumes the bank has limited commitment. The qualitative properties of the two modified contracts are very similar. In particular, both variations lead to borrowing constraints that are always binding such that the firm is financially constrained throughout its life cycle and subject to a positive probability of being liquidated eventually.

The business success of an economic entity largely depends on the funding politics they adopt, during which there is a need to identify those funding sources to ensure both the expected profit and the maximization of the value of the entity. In this respect, our scientific approach is in line with concerns about finding the most efficient funding sources of the SMEs activity in Romania in the context of the European economy stongly affected by the global economic crisis. The main objective of this approach has been to make an analysis on the prime funding sources of the eligible SMEs and on how they are relevant to the development of their activities, as well as on how they considerably contribute to the economic growth of the country.

This paper investigates the mechanism of the power shortage in China by estimating the capacity expansion and capacity utilisation behaviour of the power firms. The theoretical and empirical evidence is presented to show that the state planner deals with the ‘coal-electricity' conflict by internalising the coal price inflation in the power generation sector. This policy may distort the market signal of the capacity utilisation and lead to the power shortage even if the capacity supply is sufficient.

This paper investigates whether group affiliation and stakeholder's nationality affect both the propensity of engaging in outward FDI and its effects on home performance. Using a sample of French manufacturers, we combine propensity-score matching with a Difference-In-Difference estimator in order to estimate the impact of outward FDI on home activities, and distinguish our results for three subsamples: independent firms, firms which belong to a French business group and foreign-owned affiliates. We find that firms which are part of a French business group are more likely to engage in outward FDI and to enjoy positive effects from their investment decision than independent firms. This suggests that independent firms face more obstacles in their internationalization process and that group affiliation might increase the ability of handling international development. Reversely, foreign-owned firms appear less likely to engage in outward FDI and do not enjoy any significant effect on their home performance ex-post. One explanation for this result might be that foreign-owned firms do not invest abroad in order to increase their own performance, but the performance of their own group.

Company's stakeholders make business decisions based on information presented by management. The quality of decisions, among other things, depends on the quality and reliability of information in the financial reports. Business practice demonstrates that managers tend to present a false picture of the financial position and profitability of the company, often in cooperation with the owners of the capital. Procedures that management and investors take, in order to create a false impression about the performances of the enterprise, the contemporary literature defines as creative financial reporting. Presentation of better financial performance than realistic one provides misleading signals about the company, while the users of information are misinformed. The goal of this paper is the analysis of opportunities to implement creative cash flow reporting and the factors that encourage the company’s management and the owners of the capital to wrong and misleading interpretation of performance items. After the presentation of the main motive of creative financial reporting, we shall focus on examples of erroneous classification of cash flows. Earnings management and the shaping of cash flows may be realised within and beyond the boundaries of accounting regulations on several ways, but a special review in the paper is dedicate to creative reporting procedures of cash inflow and outflow related to receivables, investments, liabilities, and expenses. Consequences of creative reporting on cash flow and other performances could be serious both for stakeholders and for survival of the company, which is discussed in the last part of the paper

Until now, the capitalist system proved to be the most efficient one from an economic, technological, and social perspective. The purest form of capitalism is entrepreneurial capitalism, where small and medium enterprises play the leading role. In a post crises economy, SMEs seem to be the key element in ensuring the economic recovery of nations worldwide. Thus, Governments try to adapt the market to the SMEs needs and help them develop. However, in some parts of the world, entrepreneurial capitalism seems to have lost the battle against other types of capitalism: corporative capitalism and state capitalism.

This research, identifies lean management practices and elements. Despite widespread interest and little empirical evidence to support its position in improving organization performance, there is little understanding of lean business strategy key organizational factors. This research identifies five elements of lean business practices. An instrument was developed to empirically analyze dimensions underlying the constructs of this study. To verify the results, cluster analysis was used to group organizations having different patterns of lean manufacturing practice implementation. The results confirm that lean organizations significantly differ from non-lean organizations with regard to manufacturing strategies having emphasis on cost and volume flexibility.

This paper combines different strands of the productivity literature to investigate the effect of idiosyncratic (firm-level) policy distortions on aggregate outcomes. On the one hand, a growing body of empirical research has been relating cross-country differences in key economic outcomes, such as productivity or output per capita, to differences in policies and institutions that shape the business environment. On the other hand, a branch of empirical research has attempted to shed light on the determinants of productivity at the firm level and the evolution of the distribution of productivity across firms within each industry. In this paper, we exploit a rich source of data with harmonized statistics on firm level variation within industries for a number of countries. Our key empirical finding is that there is substantial variation in the within-industry covariance between size and productivity across countries, but this covariance varies significantly across countries and is affected by the presence of idiosyncratic distortions. We develop a model in which heterogeneous firms face adjustment frictions (overhead labor and quasi-fixed capital) and idiosyncratic distortions. We show that the model can be readily calibrated to match the observed cross-country patterns of the within-industry covariance between productivity and size and thus help to explain the observed differences in aggregate performance.

Stock option contracts provide managers with dual incentives, motivating both effort and fraud. We show that although there exists an infinity of stock option contracts that induce a given level of effort, no contract behaviorally dominates another in the sense that it induces relatively greater effort and relatively less fraud. We also characterize the schedule of implementable effort-fraud pairs.

In the aftermath of the global financial turmoil the negative market sentiment and the challenging macroeconomic environment in Greece have severely affected the banking sector, which faces funding and liquidity challenges, deteriorating asset quality, and weakening profitability. This paper aims to investigate how banks? liquidity interacted with solvency and the business cycle during the period 2004-2010. To this end a panel of 17 Greek banks is utilized which, in conjunction with cointegrating techniques and one-way static and dynamic panel models, explores the presence and the strength of the relationship between banks? liquidity and the business cycle, while allowing for the role of banks? solvency. Addressing the liquidity risk of the Greek banking sector and the liquidity-solvency nexus remains largely an uncharted area. The results generated provide clear-cut evidence on the linkages between banks? market liquidity and the business cycle, as reflected in the real GDP and the effective exchange rate. Yet the results display a transmission channel that runs from banks? solvency to liquidity and from country risk to bank risk.

This study examines the reasons of perseverance in firm’s investment decision. It shows the possible influence of three closely related features which are: firm’s financial indicators, investor’s risk profile, and investor’s commitment bias, on a firm’s investment decisions escalation. This study aims to provide evidence as to whether investor considers the financial and risk’s perception features (financial strength and risk profile) to persevere his initial investment decision while he notes a high level of commitment bias. The proposed model of this paper uses GLM univariate data analyses to examine this relationship. Investor’s risk profile and his commitment bias have been measured by means of a questionnaire comprising several items. As for the selected sample, it has been composed of some 360 Tunisian individual investors. Our results have revealed that investors pay more attention to keep their psychology comfort than their financial comfort. It exposed the importance of the investor’s commitment bias and its risk perception in explaining investment decision escalation. Moreover results shows that there is strong and significant empirical relationship linking the escalatory behavior in investment decision and the interaction effects between the three independent variables. This means that, in practice, investors consider the three factors simultaneously.

We examine the allocation of scarce attention in team production. Each team member is in charge of a specialized task, which must be adapted to a privately observed shock and coordinated with other tasks. Coordination requires that agents pay attention to each other, but attention is in limited supply. We show that when attention is scarce, organizational focus and leadership naturally arise as a response to organizational trade-offs between coordination and adaptation. At the optimum, all attention is evenly allocated to a select number of "leaders." The organization then excels in a small number of focal tasks at the expense of all others. Our results shed light on the importance of leadership, strategy and “core competences,” as well as new trends in organization design. We also derive implications for the optimal size or “scope” of organizations. Surprisingly, improvements in communication technology may result in smaller but more adaptive organizations.

SummaryThe paper analyzes the relevance of the three constituent elements of the ‘new firm paradigm’, i.e. ICT, workplace organization and human capital, as determinants of a firm’s provision of training. We concentrate on apprenticeship training, which in German-speaking countries is a widespread practice of skill formation. Econometric studies dealing with a firm’s provision of apprenticeships so far did not pay much attention to the influence of a shift towards the new paradigm. We find that apprenticeship training is an appropriate way of skill formation in advanced economies, but this may not be the case in leading-edge segments of the economy.

A monopoly that sells to brand-name loyal customers and to price-sensitive customers must decide whether to carry both name-brand and private-label products and how much to charge. The monopoly may charge either more or less for the brand name if it carries a private label, and the price differential between the products is sensitive to cost and taste parameters.

Since the first publication of Economics of Shortage in 1980, an entire economist generation has grown up, whose members are well-versed in numerous sub-themes of the economic sciences. They find their way around the most modern methodological schools, yet they know significantly less about the workings of the social systems. To the younger generations, the socialist system, whose heritage still lives with us and whose characteristic behavioural forms and attitudes have not yet disappeared at all from the economic practices of the post-socialist countries, seems like the distant past, just like the Turkish occupation or the Austro-Hungarian Monarchy.The target audience of Kalligram Publishing House is this generation, to the majority of whom János Kornai’s works will probably come as a revelation. The years of crisis — whose end is still far off — has made even those uncertain about the workings of economic systems, who have personal experiences of the decades of socialism. Therefore, it would be quite important for them to re-read Kornai’s works written during the socialist era in order to be able to grasp the workings of economic systems through the help of balanced and objective analyses. Moving beyond the momentary shocks and nostalgias, the older ones also have a great need to evaluate the roles of the market and the state in a bias-free manner resting on a solid theoretical foundation, to realistically see the mechanisms of shortage and surplus economies. This way it is perhaps possible to avoid “going down the same river twice”, which disappears somewhere underground and never reaches the sea.

There exist two approaches in the literature concerning the multina- tional …rm's mode choice for foreign production between an owned subsidiary and a licensing contract. One approach considers environments where the …rm is transfer- ring primarily knowledge-based assets. An important assumption there is that the relevant knowledge is absorbed by the local manager or licensee over the course of time: knowledge is non-excludable. More recently, a number of in‡uential papers have adopted a property-right view of the …rm, assuming the application abroad of physical capital, the owner of which retains full and exclusive rights to the capital should a relationship break down. In this paper we combine both forms of capital assets in a single model. The model predicts that foreign direct investment (owned subsidiaries) is more likely than licensing when the ratio of knowledge capital to phys- ical capital is high, or when market value is high relative to the book value of capital (high Tobin's-Q).

For the last decade we have been using double-blind survey techniques and randomized sampling to construct management data on over 10,000 organizations across twenty countries. On average, we find that in manufacturing American, Japanese, and German firms are the best managed. Firms in developing countries, such as Brazil, China and India tend to be poorly managed. American retail firms and hospitals are also well managed by international standards, although American schools are worse managed than those in several other developed countries. We also find substantial variation in management practices across organizations in every country and every sector, mirroring the heterogeneity in the spread of performance in these sectors. One factor linked to this variation is ownership. Government, family, and founder owned firms are usually poorly managed, while multinational, dispersed shareholder and private-equity owned firms are typically well managed. Stronger product market competition and higher worker skills are associated with better management practices. Less regulated labor markets are associated with improvements in incentive management practices such as performance based promotion.

Knowledge economy is based on the existence and development of small businesses and how their development modalities should be focused on innovation, creativity, competitiveness, entrepreneurial culture, accumulation and use of knowledge, organizational intelligence, cooperation and communication. Analysis of firm theories reveals a multitude of business development opportunities, taking into account the different cultural components and key success factors in business. As such, this paper highlights the main ways of development of small business in the current context, highlighted by the most popular theories of the firm. These, and not only these, can be considered as successful models to follow by Romanian SMEs.

This paper investigates the causal relationship between innovation and labour force reallocation within the firm, measured as the share of white collar workers. To the extent that intra-firm reallocation can be considered as a substitute for inter-firms and sectors reallocations, innovation activity can be effective in hampering immigration flows from lagging regions to the richest ones. Using data on 5,000 Italian manufacturing firms we provide evidence that where sizable migration flow of graduated people took place the innovation process was not effective in increasing the requirement of high-skill workers.

The complexity of economic and financial operations of a company has as consequences positive or negative results, which are reflected in the financial statements. One of these statements that play an important role in the analysis of the company’s performance is the profit and loss account. Through this document we shall have an overall view on the performances recorded by a company in an accounting period, performances that can be followed from a dynamic, structural point of view and also through the margin rates. The profit and loss account is a part of the financial statements set that forms the informational basis of any company reflecting its performances, informational basis well known on internal plan, but also on the international area. The aim of the research is that of highlighting the structural and dynamic analysis of the results reflected through the profit and loss account, and also through the margin ratios.

Theoretical and empirical evidence is presented to show that inefficient power firms in China are subsidised by the state through the ability to charge high electricity prices and the creation of a “soft price constraint†on costs. This cost inefficiency challenges the merits of planned power supply.

We use an important legal event as a natural experiment to examine the effect of management fiduciary duties on equity-debt conflicts. A 1991 Delaware bankruptcy ruling changed the nature of corporate directors' fiduciary duties in firms incorporated in that state. This change limited managers' incentives to take actions favoring equity over debt for firms in the vicinity of financial distress. We show that this ruling increased the likelihood of equity issues, increased investment, and reduced firm risk, consistent with a decrease in debt-equity conflicts of interest. The changes are isolated to firms relatively closer to default. The ruling was also followed by an increase in average leverage and a reduction in covenant use. Finally, we estimate the welfare implications of this change and find that firm values increased when the rules were introduced. We conclude that managerial fiduciary duties affect equity-bond holder conflicts in a way that is economically important, has impact on ex ante capital structure choices, and affects welfare.

Clearly the world is developing in new directions, social, political, and environmental. Now is the time, more than ever, for those decision makers who control training budgets to adopt a framework of practices, behaviors, attitudes and values that address every aspect of an organization's success. We must ask ourselves: is making decisions according to situations in which we are based leadership? In practice, all those in a position of some responsibility decisions, but this behavior is leadership? In fact, leadership requires a range of skills, behaviors and values. Secondly, in the current situation, leadership is not seen as something that is done only by the person in charge. Leadership exists at all organizational levels, regardless of the company. We need to move the focus from how the person "the top" lead and focus on how all employees can show leadership.

We use survey data on individual risk attitude and discount rates to test the impact of individual risk profile on the firm innovation activity and firm performance. Empirical evidence from 163 Italian entrepreneurs shows that risk-loving individuals and individuals with smaller than average discount rates introduce products that affect firm growth rates significantly.

Studies support the idea of differences between men and women managers regarding leadership style, are quite hard to find because almost all research in this direction have been made in terms of groups of male managers. If there was evidence in the sense similarity between the leadership style of men and women managers this problem would not exist. There have been some studies, mostly in the U.S., which dealt with the nature of leadership and demonstrated that there are many differences between management styles of the two sexes. Usually when we make comparisons between managers, the dialogue is framed by men tend to control, against the tendency of women to build a team and to reach an agreement. Women want more to consider compromises and seek advice from others, as opposed to this, men often believe that if they ask for advice, will be perceived as insecure.

The 2008 crisis has called to further investigate the impact of global engagement on firm performance. We focus on the link between Italian firms' involvement in international activities and their heterogenous performance in terms of survival in the context of the recent crisis. This topic has been investigated in the literature comparing foreign and domestic firms, neglecting the behaviour of exporters and of domestic multinationals (DMNEs). Our paper tries to fill this void checking for the impact on firm survival of three different forms of firms global engagement: exporting, investing abroad and being a foreign affiliate. We examine firm failure in Italy before the recent crisis (2002-2007) and after it (2008-2010) using an original database, obtained by matching and merging three firm level datasets: Capitalia, AIDA and Mint-Italy for the period 2002-2010. We estimate a conditional Probit of exit of firms according to their global activities, controlling for a wide range of other relevant firm and industry specific variables (size, age, productivity, financial status). In our results, multinationals appear more volatile, while exporting firms experience reduced exit probabilities. Our results do not support the hypothesis of a stabilising role of multinationals, in line with other studies (Varum and Rocha, 2011; Alvarez and Görg, 2011; Godart et al., 2011). Age, productivity, financial health are also important to understand the firm-level impact of the crisis.

This paper traces the evolution of the Italian industrial structure from the second postwar period up to today, which is mainly characterized by small-sized firms. Over time small businesses have been organized first, polyarchically in industrial districts then, hierarchically in business groups. These two models have accounted for the only successful reactions to the crisis of the Italian industry, but the phenomena have been concerned with mainly the northern and central regions of the country, while leaving the southern regions behind. The aim of this paper is to show through a case study that even small businesses in the South of Italy can achieve successful results by implementing new organizational schemes based on national and transnational cooperation.

This paper assumes that managers, investors, or both behave irrationally. In addition, even though scholars have investigated behavioral irrationality from three angles, investor sentiment, investor biases and managerial biases, we focus on the relationship between one of the managerial biases, overconfidence and dividend policy. Previous research investigating the relationship between overconfidence and financial decisions has studied investment, financing decisions and firm values. However, there are only a few exceptions to examine how a managerial emotional bias (optimism, loss aversion and overconfidence) affects dividend policies. This stream of research contends whether to distribute dividends or not depends on how managers perceive of the company’s future. We will use Bayesian network method to examine this relation. Emotional bias has been measured by means of a questionnaire comprising several items. As for the selected sample, it has been composed of some 100 Tunisian executives. Our results have revealed that leader affected by behavioral biases (optimism, loss aversion, and overconfidence) adjusts its dividend policy choices based on their ability to assess alternatives (optimism and overconfidence) and risk perception (loss aversion) to create of shareholder value and ensure its place at the head of the management team.

A contract-based model of the endogenous determination of an organization's architecture is considered where a principal has the choice between a two- and a three-level organization. Each organizational architecture is plagued with its own specific form(s) of opportunism. We derive the conditions under which opportunism in a three-level hierarchy becomes so severe as to make this architecture strictly outperformed by a two-level organization.

The analysis of the indicators that measure the economic and financial results is a very complex issue involving a number of theoretical and methodological aspects arising from the financial and economic activity of a company. The analysis of the indicator’s system specific to the business performance analysis is aimed at measuring the outcomes on different levels of results. The purpose of this paper is to present a summary of the indicators used in the analysis and measurement of the economic and financial results of a company. Their analysis should be guided depending on the results category we refer to, so that this construction to have concrete measures to raise the level of the results expressing the company's performance. The article reflects a synthetic presentation of the indicators used to measure business performance, creating an overview of the outcome indicators: the workload, the profitability and the potential funding.

In 2007, the Consumer Product Safety Commission (CPSC) issued 276 recalls of toys and other children's products, a sizeable increase from previous years. The overwhelming majority of the 2007 toy recalls were due to high levels of lead content and almost all of these toys were manufactured in China. This period of recalls was characterized by substantial media attention to the issue of consumer product safety and eventually led to the passage of the Consumer Product Safety Improvement Act of 2008. This paper examines consumer demand for toys following this wave of dangerous toy recalls. The data reveal four key findings. First, the types of toys that were involved in recalls in 2007 experienced above average losses in Christmas season sales. Second, Christmas sales of infant/preschool toys produced by manufacturers who did not experience any recalls were about 25 percent lower in 2007 as compared to earlier years, suggesting industry-wide spillovers. Third, a manufacturer's recall of one type of toy did not lead to a disproportionate loss in sales of their other types of toys. And, finally, recalls of toys that are part of a brand had either positive or negative effects on the demand for other toys in the property, depending on the nature of the toys involved. Our examination of the stock market performance of toy firms over this period also reveals industry wide spillovers. The finding of sizable spillover effects of product recalls to non-recalled products and non-recalled manufacturers has important implications for regulation policy.

The flexibility that modern companies must show in regard to global market entails the recourse to work teams which are multicultural adapted and aware of their role and place in the overall structure of the organization. The technological changes along with the customer needs diversification require the awareness of the influence of organizational structure on team members as well as the influence of teams on organizational structures and organizational context. The present paper aims to point out the importance of teams in the modern organization from the perspective of organizational context and organizational structure.

This paper addresses the issue of human resources motivation which is considered one of the most important ways for a sustainable organizational development. The author was conducted a special research on the issue and the main findings are presented and analyzed in the content of this paper. The objective of the research was to identify new possibilities for increasing the degree of human resources motivation for supporting a more sustainable organizational development. Based on ideas from critical realism and critical theory, the paper argues against the limitative approach of motivation of the human resource in the 21st century. The research has made it possible to identify the most relevant behavioral dimension of human resources motivation process. The last part of the paper includes some recommendations for the modern managers in order to support them to become higly effective along the sustainable organizational development process.

PurposeThis paper aims to show that the business group – i.e. the set of firms under common ownership and control – is the most appropriate unit to study the behavior and organization of firms and define their boundaries. Particular emphasis is given to notions such as unitary direction – i.e. the influence over strategic decisions – and administrative co‐ordination which allow owners to exercise supervision and authority over the controlled companies.Design/methodology/approachGiven these aims the paper adopts an interdisciplinary perspective that relies on economics, management and law. This multidisciplinary approach is necessary for analyzing the different aspects characterizing business groups in terms of ownership, control, economic synergies between firms and internal organizational mechanisms. To support the propositions, data and information from various sources are used, ranging from official statistics on the firm's population, to sample surveys, case studies and juridical evidence. The use of different sources is justified not only by the interdisciplinary nature of the problem but also by the lack of systematic statistical evidence on the phenomenon of business groups.FindingsThe authors suggest that when a company is part of a group, the business group rather than the individual company is the most appropriate “unit” for analyzing the organization and behavior of firms. This does not deny that in some cases it can be worthwhile using the legal boundary as the appropriate unit; however, most of the empirical analyses about firms consider the legal boundary without considering whether companies are independent or part of a business group.Originality/valueThe authors show that forms of unitary direction and administrative co‐ordination are common in business groups; these forms can be assimilated to the internal organization of firms. For this reason they propose that the group rather than the individual company is the appropriate unit to delimit the boundary of the firm. In this sense, their main conclusion is that not considering the business group underestimates the actual firm boundaries.

This paper is devoted to the development and methodological ground of a conception of making the mechanism of enterprise performance management. It describes a model of implementation of performance benchmarking on the enterprise includes the sequence of operations, which enables to connect together several key management functions, and clearly divide the performance management process into several steps. It provides both direct and feedback to ensure continuity of performance management process. Author proposes an organizational mechanism to reduce the time and resources to implement the process of enterprise performance management that consists in an organization of the branch and regional benchmarking agencies (BBA and RBA). The BBA and RBA systems are functionally complement each other, and contribute to the accelerated development of various industries and regions: RBA increases the level of innovation development of efficient enterprises; BBA raises to this level remaining, less-efficient enterprises of the industry.

Value co-creation is an emerging marketing and innovation paradigm describing a broader opening of the firm to its customers by providing them with the opportunity to become active participants in the design and development of personalized products, services and experiences. It has a great potential in affecting the way firms operate and innovate and has, therefore, attracted the attention of both scholars and practitioners. However, there is not yet a fully satisfactory theoretical vision about its distinctive characteristics as compared to more traditional value creation approaches. The present paper provides empirical research results in answering two research questions. The first question is: What are the principal components of value co-creation? The second question is: What is the relationship between the degree of firms’ involvement in value co-creation activities and the perception of their innovativeness. The paper starts with a review of the literature and a conceptual refinement of the value co-creation paradigm to continue with the identification of the key components of value co-creation based on a research methodology using web search and Principal Component Analysis techniques applied to data collected from a sample of 273 firms selected for being representative of the breadth of their value co-creation activities. The second part of the paper discusses the results from a linear regression analysis examining the relationship between firms’ degree of involvement in value co-creation and the perception of their innovativeness. The analysis leads to research insights about the relevance of specific value co-creation components in terms of their innovation-related outcomes. To the best of our knowledge this is the first work discussing value co-creation implementation patterns based on the relationship between firms’ involvement in value co-creation and the perception of innovativeness. JEL Codes: L1, L2, L17, O31

It is well known that economic growth and services have a positive association. In particular, the more developed an economy is, the higher the share of the services sector. While most research has focused on service output, this study also examines services as input. Recently, the need for taking services a separate input in the production function has come to the fore. Therefore, the OECD productivity manual generalizes the KLEM model to KLEMS (capital-labor-energy-materials-services) model by including the services as an input. We use KLEMS data in this study. In addition, we augmented the standard production function with other variables such as the inventory to sales ratio, R&D to sales ratio, education expenditure to sales ratio, and the debt to sales ratio. The findings are encouraging and lead us to formulate some important conclusions; for example, after the 1998 Financial Crisis, the Korean economy has increased in efficiency and this is partly due to an increased importance of services as both output and input.

The creation of an innovation niche depends on the interaction of three mechanisms involving: converging expectations, adequate level of individual and network power and efficient knowledge creation and diffusion (Lopolito and Morone, 2010). Such mechanisms define the key characteristics of a network of firms (i.e. the innovation niche), and the interaction among them guides the creation and development of a new technology. In this paper, we propose an agent-based model to investigate the dynamics characterising such interactions and the role that policy intervention can have in governing the niche development process. Specifically, we consider and assess the impact of two policy actions: (1) increasing actors' expectations towards the new technology by means of information spreading, and (2) providing subsidies aimed at stimulating technological switch. Our preliminary results confirm the importance of policy intervention and show the complementarity of the two policy measures considered. Hence, a mixed policy action could serve the purpose of a rapid and stable creation of an innovation-niche.

Human resources represent one of the most important factors for the achievement of a high organizational and institutional performance. The main objective of this study is to estimate the organizational performance and to see how it matches with characteristics of job and employee skills, and also to the continuing sustainable growth and their uninterrupted training. The article also explains benefits achieved by the continuous strengthening and development of institutions in general and in particular the local ones, in different directions. Some other benefits, highlighted in this article are such as economic and socio-cultural life, tourism, environment, the tendency for business expansion and job creation, the reduction of discontent and conflict population - institutions, etc. The methodology of this article is based primarily on data collection from different and contemporary sources through which it is established theoretical study. Based on interviews and questionnaires with the most important employees of these institutions and referring to the processed data due to statistical software, we have tried to analyze quantitatively the issues arised. At the end of this article there are some conclusions of the study and are provided several important recommendations that should be taken into consideration for the continuous improvement of work in our institutions, especially those of local governments where human resource problems are evident.

Financial constraints are a key determinant that hinders firms' ability to export. This paper analyses the nexus between these constraints and firms' engagement in international trade, as well as it explores the impact of the European monetary integration process upon firms' financial constraints. Therefore, we estimate cash to cash-flow sensitivities for different periods (1996-2000 and 2001-2004) and different groups of firms, according to their exporting and importing activity. Our results indicate that, depending on their international openness, the European monetary integration seems to have generally helped reducing the degree of financial constraints faced by Portuguese firms. Additionally, our findings suggest that rather than unconstrained firms self-selecting into exporting firms' constraints were reduced after they started exporting.

It is generally recognized that there is diversity in the workforce of any enterprise, be it business, government, or civil society. This study therefore seeks to find out the impact of workforce diversity on organizational effectiveness using a Nigerian bank for the study. We used the Blau’s1977 index of heterogeneity to measure the diversity index. While asset growth for the year 2008 and 2009, using 2007 and 2008 as base year was used to measure the growth strategy. To determine group diversity and performance outcomes moderated by workgroup context, a series of hierarchical regression analysis were conducted. The study finds significant correlation between some of the diversity variables as well as individual diversity variables with the measures of organizational effectiveness. Also it reveals that gender and ethnicity are negatively related to both employee productivity and performance bonus. In addition the study find that gender, age and tenure diversities are positively correlated and are significantly related. It is recommended that company executives use good strategies to effectively manage workforce diversity and collaborative research efforts should be done to ascertain the contextual variables that moderate workforce diversity to produce positive performance outcomes.

The dispersion of capital ownership varies a lot among German stock companies. For some time, literature has discussed possible effects of differences in capital dispersion on efficiency. We investigate effects of capital ownership dispersion in presence of codetermination. By use of 1583 (1670) observations from 383 (381) companies, we estimate a Cobb-Douglas production function and find no influence of concentrated ownership on productivity in non-parity-codetermined firms. However, our results show that a concentration of capital ownership counteracts and neutralizes negative effects of codetermination. Furthermore, we find productivity-enhancing effects of representation of a capital owner in the supervisory board if a firm is codetermined. Zusammenfassung Die Konzentration bzw. Streuung der Kapitalanteile variiert in deutschen Aktiengesellschaften erheblich. Die Literatur diskutiert seit langem, inwiefern Unterschiede der Streuung die Effizienz von Firmen beeinflussen. Wir untersuchen die Au...

The globalization opened the opportunity for multinational companies to increase their businesses in emerging markets and also to local giants from developing countries to step in the western markets. The objective of this paper is to propose a model for analyzing the differences between operating businesses in emerging markets and developed markets. The model purpose is to be applied in the strategic process by mainly the multinationals or local giants intending to develop long term businesses outside their traditional geographies. The studies on emerging markets identified two main axes to be considered when appreciating the attractiveness of the markets: the business dynamics both inside and outside the company and the institutional environment, as facilitator of efficient encounter between sellers and buyers.

Romanian SMEs can directly benefit from the Sectoral Operational Programme ‘Increase of Economic Competitiveness’ (SOP IEC) and some parts of the Regional Operational Programme (ROP) in the period 2007 2013. Research commissioned by the Directorate General for Regional Policy of the European Commission made a strategic evaluation of SMEs’ experience with these support programmes and their needs for support in general. This paper is the summary of the final report of the project carried out in the first half of 2010. In the context of the research underlying this paper, a standardized survey was implemented as an instrument for collecting primary data on the situation, the demands of and the development barriers to Romanian SMEs. The results of the survey were verified in standardized interviews and focus groups with consultants and SME administrators. The results reflect first-hand information on the problems of SMEs with the implementation of EU funds. The main findings of the project reveal that Romanian SMEs are at a rudimentary stage of skills, organization and market knowledge if compared with similar economic units in more advanced EU member states. Their development aims are rather short-term and not very complex. They lack the knowledge, expertise and staff to participate in complex tenders and in application processes. Learning by doing is, however, increasing their capacity to access external, including EU, funding. Gaps were identified between the development needs of SMEs and the design of the support programmes. The needs of SMEs to increase their competitiveness cover a whole range of areas with very diverse objectives. Weighing the identified needs of SMEs against the key areas of intervention and indicative operations of the EU support programmes, one can conclude that most needs of SMEs are covered by the two current operational programmes in one way or the other. However, the way the support package was designed and structured is deficient in supporting the development of SMEs. SMEs need more simple and transparent mechanisms which they can understand and cope with. In addition, they need the support of competent consultants.