No Arabic abstract
How do regions acquire the knowledge they need to diversify their economic activities? How does the migration of workers among firms and industries contribute to the diffusion of that knowledge? Here we measure the industry, occupation, and location-specific knowledge carried by workers from one establishment to the next using a dataset summarizing the individual work history for an entire country. We study pioneer firms--firms operating in an industry that was not present in a region--because the success of pioneers is the basic unit of regional economic diversification. We find that the growth and survival of pioneers increase significantly when their first hires are workers with experience in a related industry, and with work experience in the same location, but not with past experience in a related occupation. We compare these results with new firms that are not pioneers and find that industry-specific knowledge is significantly more important for pioneer than non-pioneer firms. To address endogeneity we use Bartik instruments, which leverage national fluctuations in the demand for an activity as shocks for local labor supply. The instrumental variable estimates support the finding that industry-related knowledge is a predictor of the survival and growth of pioneer firms. These findings expand our understanding of the micro-mechanisms underlying regional economic diversification events.
Standard micro-economics concentrate on the description of markets but is seldom interested in production. Several economists discussed the concept of a firm, as opposed to an open labour market where entrepreneurs would recrute workers on the occasion of each business opportunity. Coase cite{Coase} is one of them, who explains the existence of firms as institution because they reduce the transaction costs with respect to an open labour market. Whatever the rationale proposed by economists to account for the existence of firms, their perspective is based on efficiency and cost analysis. Little attention is paid to the dynamics of emergence and evolution of firms. The aim of the present manuscript is to check the global dynamical properties of a very simple model based on bounded rationality and reinforcement learning. Workers and managers are localised on a lattice and they choose collaborators on the basis of the success of previous work relations. The choice algorithm is largely inspired rom the observation and modeling of long term customer/sellers relationships observed on perishable goods markets discussed in Weisbuch etalcite{Weisbuch} and Nadal etalcite{Nadal}. The model presented here is in no way an alternative to Coase. We describe the build-up of long term relationships which do reduce transaction costs, and we deduce the dynamical properties of networks built from our simple assumptions. In conclusion, the present model explains the metastability of employment relations in the firm, but something has to be added to it to explain the more efficient workload repartition observed in real firms.
This paper assesses the role of financial performance in explaining firms investment dynamics in the wine industry from the three European Union (EU) largest producers. The wine sector deserves special attention to investigate firms investment behavior given the high competition imposed by the latecomers. More precisely, we investigate how the capitalization, liquidity and profitability influence the investment dynamics using firm-level data from the wine industry from France (331 firms), Italy (335) firms and Spain (442) firms. We use data from 2007 to 2014, drawing a comparison between these countries, and relying on difference-and system-GMM estimators. Specifically, the impact of profitability is positive and significant, while the capitalization has a significant and negative impact on the investment dynamics only in France and Spain. The influence of the liquidity ratio is negative and significant only in the case of Spain. Therefore, we notice different investment strategies for wine companies located in the largest producer countries. It appears that these findings are in general robust to different specifications of liquidity and profitability ratios, and to the different estimators we use.
The objective of this study is to examine empirically the impact of good corporate governance on financial performance of United Kingdom non-financial listed firms. Agency theory and stewardship theory serve as the bases of a conceptual model. Five corporate governance mechanisms are examined on two financial performance indicators, return on assets (ROA) and Tobins Q, employing cross-sectional regression methodology. The conclusion drawn from empirical test so performed on 252 firms listed on London Stock Exchange for the year 2014 indicates a positive or a negative relationship, but also sometimes no effect, of corporate governance mechanisms impact on financial performance. The implications are discussed. Thereby, so distinguishing effects due to causes, we present a proof that, when the right corporate governance mechanisms are chosen, the finances of a firm can be improved. The results of this research should have some implication on academia and policy makers thoughts.
In this paper, we study the characteristics of the member firms on the Korea Exchange. The member firms intermediate between the market participants and the exchange, and all the participants should trade stocks through members. To identify the characteristics of member firms, all member firms are categorized into three groups, such as the domestic members similar to individuals (DIMs), the domestic members similar to institutions (DSMs), and the foreign members (FRMs), in terms of the type of investor. We examine the dynamics of the member firms. The trading characteristics of members are revealed through the directionality and trend. While FRMs tend to trade one-way and move with the price change, DIMs are the opposite. In the market, DIMs and DSMs do herd and the herding moves in the opposite direction of the price change. One the other hand, FRMs do herd in the direction of the price change. The network analysis supports that the members are clustered into three groups similar to DIMs, DSMs, and FRMs. Finally, random matrix theory and a cross-sectional regression show that the inventory variation of members possesses significant information about stock prices and that member herding helps to price the stocks.
We present a new approach to understanding credit relationships between commercial banks and quoted firms, and with this approach, examine the temporal change in the structure of the Japanese credit network from 1980 to 2005. At each year, the credit network is regarded as a weighted bipartite graph where edges correspond to the relationships and weights refer to the amounts of loans. Reduction in the supply of credit affects firms as debtor, and failure of a firm influences banks as creditor. To quantify the dependency and influence between banks and firms, we propose a set of scores of banks and firms, which can be calculated by solving an eigenvalue problem determined by the weight of the credit network. We found that a few largest eigenvalues and corresponding eigenvectors are significant by using a null hypothesis of random bipartite graphs, and that the scores can quantitatively describe the stability or fragility of the credit network during the 25 years.