When Small Firms Fight Back Against Large Firms in R&D Activities

2010 ◽  
Vol 10 (1) ◽  
Author(s):  
Toshihiro Matsumura ◽  
Noriaki Matsushima
Keyword(s):  
Small Firm ◽  
Small Firms ◽  
Economies Of Scale ◽  
Large Firm ◽  
Consumer Surplus ◽  
Large Firms ◽  
Product Positioning ◽  
Duopoly Model ◽  
Asymmetric Duopoly ◽  
Positive Effect

Abstract This paper investigates an asymmetric duopoly model with R&D competition and product positioning. We find that an inefficient (small) firm may engage in R&D more intensively than an efficient (large) firm in spite of economies of scale in R&D activities. Contrary to the findings of previous studies, competition is more likely to have a positive effect on the investments of the small firm than on those of the large firm. We also find that improving the efficiency of the inefficient firm can reduce both social and consumer surplus.

scholarly journals Small and Large Firm Performance Gaps in Indonesia: Evidences from the 1981–2008 Indonesian Manufacturing

2019 ◽  
Vol 8 (1) ◽  
pp. 1-20
Author(s):  
Ari Kuncoro
Keyword(s):  
Small Firms ◽  
Large Firm ◽  
Manufacturing Sector ◽  
Policy Implications ◽  
Industrial Agglomeration ◽  
Large Firms ◽  
Firm Characteristics ◽  
Minimal Impact ◽  
Export Orientation ◽  
Macroeconomic Indicators

This study aims to examine the impacts of globalization on the performance gap between small and large firms in Indonesia, specifically in the manufacturing sector. First, the study addresses whether there are performance differentials between small and large firms, and if so, whether such gap is increasing while controlling for firm characteristics such as age, finance, export orientation, industry, and macroeconomic indicators. Second, the study discusses whether the opening of domestic market through trade and FDI liberalization affect firms disproportionately with respect to firm size. The study highlights such impacts amid successive economic reforms from 1986 to 1994. The empirical results suggest that opening the economy through market liberalization increased the productivity and wages gaps between large and small firms before it stabilized. Factors such as industrial agglomeration, financial access, export orientation have minimal impact on firms. The findings also suggest that while empirically, small firms benefit from more open trade regime after Asian financial crisis, the medium and large firms have more chance to benefit from the liberalization of the economy in general. Policy implications are also further explored.

scholarly journals An investigation into the small firm effect on the Johannesburg Stock Exchange

1986 ◽  
Vol 17 (4) ◽  
pp. 191-195 ◽  
Author(s):  
P. De Villiers ◽  
A. J. Lowings ◽  
T. Pettit ◽  
J. Affleck-Graves
Keyword(s):  
New York ◽  
Small Firm ◽  
Small Firms ◽  
Stock Exchange ◽  
Share Price ◽  
Large Firms ◽  
Investment Performance ◽  
Market Capitalization ◽  
Johannesburg Stock Exchange ◽  
Firm Effect

Recent studies on the New York Stock Exchange have provided empirical evidence which suggests that small market capitalization firms outperform large market capitalization firms in terms of share price performance. This appears valid even after adjusting for the additional risk borne by the small firms. This has become known as the 'small firm effect' and questions the validity of many traditional pricing models such as the Capital Asset Pricing Model. In this paper, the small firm effect is examined on the Johannesburg Stock Exchange. The risk-adjusted performance of portfolios comprising large firms is contrasted with that of small firms. Three measures of size are used, namely market capitalization, asset base and traded volume. In all three cases, no evidence of a small firm effect is apparent. Indeed, if anything, the large firms appear to provide superior investment performance on the JSE.

Work Decentralisation from Large to Small Firms: A Preliminary Analysis of Subcontracting

1986 ◽  
Vol 18 (7) ◽  
pp. 949-965 ◽  
Author(s):  
R F Imrie
Keyword(s):  
Empirical Research ◽  
Small Firm ◽  
Preliminary Analysis ◽  
Small Firms ◽  
Preliminary Review ◽  
Large Firms ◽  
Central Elements ◽  
Interfirm Linkages

This paper is a preliminary review of small firm subcontracting. It is argued that increasingly subcontracting and other forms of small firm activities are becoming a central part of the operations of large firms. As a result, small firms have to be viewed as central elements in the economy. In this paper three issues are reviewed as a prerequisite to empirical research. First, an outline is presented of theoretical proposals on interfirm linkages. Second, the nature of subcontracting is outlined. The paper concludes with a categorisation of different ways in which subcontracting relations are formed.

Supplier-Based Concentration and Inventory Efficiency

2020 ◽  
Vol 13 (4) ◽  
pp. 95-113
Author(s):  
Yize Hu ◽  
Jun Shan
Keyword(s):  
Financial Performance ◽  
Small Firms ◽  
Raw Materials ◽  
Manufacturing Sector ◽  
Annual Reports ◽  
Additional Analysis ◽  
Large Firms ◽  
Customer Base ◽  
Work In Process ◽  
Positive Effect

This study empirically examines the relation between supplier-base concentration and inventory efficiency in the Chinese manufacturing sector. Using hand-collected data from annual reports during 2007–2015, the authors find that manufacturers with a more concentrated supplier base hold fewer inventories, and the efficiency primarily flows through the raw materials and work-in-process inventory accounts. The authors find that small firms benefit more from a concentrated supplier base in inventory efficiency than large firms do. The authors also find that the positive effect of supplier-base concentration on inventory efficiency is stronger as customer-base concentration increases. In an additional analysis, the authors find that firms with a high supplier-base concentration would have better current and future financial performance.

Small firm subsistence and market dimensionality

2014 ◽  
Vol 25 (10) ◽  
pp. 1450053 ◽  
Author(s):  
Jeroen Bruggeman ◽  
Gábor Péli
Keyword(s):  
Small Firm ◽  
Small Firms ◽  
Large Firms ◽  
Product Innovations ◽  
Parsimonious Explanation ◽  
Market Center

In many markets, large and small firms coexist. As large firms can in principle out-compete small ones, the actual presence of the latter asks for an explanation. In ours, we focus on the dimensionality of markets, which can change as a consequence of product innovations, preference elaboration or institutions. We show that increasing market dimensionality substantially enlarges the market periphery relative to the market center, which creates new potential niches for small firms. We thereby provide a parsimonious explanation for small firm subsistence.

The Factors Influencing Tourist Visitations Number in Curug Silawe

2019 ◽  
Vol 2 (3) ◽  
pp. 553-561
Author(s):  
Novian Hangga Prakosa ◽  
Fafurida Fafurida
Keyword(s):  
Economic Value ◽  
Consumer Surplus ◽  
Sampling Technique ◽  
Travel Cost ◽  
Analysis Tool ◽  
Literature Study ◽  
Factors Influencing ◽  
Negative Effect ◽  
Value Estimation ◽  
Positive Effect

The purposes of this research are to identify the influence of travel cost, income, distance, access, facilities, natural beautiness, and age on the number of individual visits to Curug Silawe and to estimate the economic value of Curug Silawe through individual travel cost method. The population in this study are tourists that visited Curug Silawe with sample of 98 respondents taken by the quota accidental sampling technique. The data collection method used are literature study and questionnaire. The analysis tool used are OLS linear regression and economic value estimation. The results showed the variables that influence the number of individual visits to Curug Silawe are income, distance and age. Income and age has a positive effect. While distance has a negative effect. The economic value of Curug Silawe reached IDR 1,109,930,140.48 per year. This value is obtained from consumer surplus obtained per individual per year of IDR 308,656.88. Tujuan dari penelitian ini adalah untuk mengidentifikasi pengaruh biaya perjalanan, pendapatan, jarak, akses, fasilitas, keindahan alam, dan usia pada jumlah kunjungan individu ke Curug Silawe dan untuk memperkirakan nilai ekonomi Curug Silawe melalui metode biaya perjalanan individu . Populasi dalam penelitian ini adalah wisatawan yang berkunjung ke Curug Silawe dengan sampel 98 responden yang diambil dengan teknik quota accidental sampling. Metode pengumpulan data yang digunakan adalah studi literatur dan kuesioner. Alat analisis yang digunakan adalah regresi linear OLS dan estimasi nilai ekonomi. Hasil penelitian menunjukkan variabel yang mempengaruhi jumlah kunjungan individu ke Curug Silawe adalah pendapatan, jarak dan usia. Penghasilan dan usia memiliki efek positif. Sedangkan jarak memiliki efek negatif. Nilai ekonomi Curug Silawe mencapai Rp1.109.930.140,48 per tahun. Nilai ini diperoleh dari surplus konsumen yang diperoleh per individu per tahun sebesar Rp308.656,88.

scholarly journals Duopoly price competition with limited capacity

2021 ◽  
Author(s):  
A. Bërdëllima
Keyword(s):  
Price Competition ◽  
Small Firms ◽  
Common Knowledge ◽  
Limited Capacity ◽  
Equilibrium Outcome ◽  
Second Stage ◽  
Duopoly Model ◽  
Full Capacity ◽  
Stage Game ◽  
The Given

AbstractWe study a variation of the duopoly model by Kreps and Scheinkman (1983). Firms limited by their capacity of production engage in a two stage game. In the first stage they commit to levels of production not exceeding their capacities which are then made common knowledge. In the second stage after production has taken place firms simultane- ously compete in prices. Solution of this sequential game shows that the unique Cournot equilibrium outcome as in Kreps and Scheinkman is not always guaranteed. However the Cournot outcome is still robust in the sense that given sufficiently large capacities this equilibrium holds. If capacities are sufficiently small, firms decide to produce at their full capacity and set a price which clears the market at the given level of output.

scholarly journals Getting a Foot in the Door: Small-Firm Credit and Interest Group Politics in the Netherlands, 1900–1927

2020 ◽  
pp. 1-37
Author(s):  
RUBEN PEETERS
Keyword(s):  
Small Firm ◽  
Small Firms ◽  
Power Structures ◽  
Access To Credit ◽  
Financial Infrastructure ◽  
History Of ◽  
Interest Group Politics ◽  
Group Politics ◽  
The Government

This article explores the link between the history of small-firm associations and the development of Dutch financial infrastructure geared toward small firms. In particular, it tests Verdier’s thesis about the origins of state banking using an in-depth case study of the Dutch small-firm movement. This article shows that Dutch small-firm associations did not simply became politically relevant and use their power to lobby for state banking, but rather used the topic of insufficient access to credit to rally support, mobilize members, and obtain subsidies from the government. During this associational process, they had to navigate local contexts and power structures that, in turn, also shaped the financial system. State banking was initially not demanded by small firms, but arose as the result of failed experiments with subsidized banking infrastructure and a changing position of the government on how to intervene in the economy.

The Strategic Behavior of Firms with Debt

2016 ◽  
Vol 51 (5) ◽  
pp. 1611-1636 ◽  
Author(s):  
Jérôme Reboul ◽  
Anna Toldrà-Simats
Keyword(s):  
Small Firms ◽  
Strategic Behavior ◽  
Financing Constraints ◽  
Large Firms ◽  
Market Shares ◽  
Probability Of Bankruptcy ◽  
The Difference

We empirically study the strategic behavior of levered firms in competitive and noncompetitive environments. We find that regulation induces firms to increase leverage, and this reduces their ability to compete when deregulation occurs. Large and small levered firms adopt different strategies upon deregulation. Whereas more levered small firms charge higher prices to increase margins at the expense of market shares, highly levered large firms prey on their rivals by increasing output and reducing prices to increase their market shares. The difference in their behavior is due to differences in their probability of bankruptcy and their financing constraints.

UNLOCKING THE INNOVATION POTENTIAL IN LARGE FIRMS THROUGH TIMELY AND MEANINGFUL INTERACTIONS WITH YOUNG VENTURES

2017 ◽  
Vol 21 (01) ◽  
pp. 1750009 ◽  
Author(s):  
BABKE N. HOGENHUIS ◽  
ELLIS A. VAN DEN HENDE ◽  
ERIK JAN HULTINK
Keyword(s):  
Best Practices ◽  
Cultural Differences ◽  
Open Innovation ◽  
Large Firm ◽  
Positive Impact ◽  
Large Firms ◽  
Roles And Responsibilities ◽  
Innovation Potential ◽  
Set Up ◽  
Operational Issues

Since the introduction of open innovation (OI), both firms and academics have widely acknowledged the potential of unlocking large firms’ innovation potential through interactions with external parties, such as young ventures. These asymmetric partnerships are prone to several problems related to communication, roles and responsibilities, cultural differences, and operational issues, for which solutions and best practices have been proposed. However, all these solutions focus on the partnership itself; hence, on the “Get & Manage (GM)” stages. Unfortunately, the processes leading to a partnership; i.e., the “Want & Find (WF)” stages before the partnership, have largely been overlooked. The central thesis of this manuscript is that solutions that are implemented in the early “WF” stages have a positive impact on the outcomes of an asymmetric large firm — young venture partnership. We will show that attention to set-up and communication efforts in these early stages is needed, and discuss how our detailed explanations of such fruitful solutions contribute to the extant literature on asymmetric OI collaborations.

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