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Efficient Firms (efficient + firm)

Distribution by Scientific Domains
Business, Economics, Finance and Accounting80%

Selected Abstracts

Strategic Quality Decisions under Heterogeneous Resource Endowments

JOURNAL OF ECONOMICS & MANAGEMENT STRATEGY, Issue 2 2001
Byong-Duk Rhee
The literature on product competition advocates a differentiation strategy assuming firm homogeneity in resources. However, firm heterogeneity in resource endowments has long been recognized in economics. Merging these two perspectives, we show that the increase in consumer preference for quality leads to firms' aggressive price competition instead of quality differentiation. As consumers look for higher quality, the cost advantage arising from superior resources increases and makes head-to-head competition more profitable than accommodating a less efficient rival. When consumers are highly concerned about quality, even a small resource difference leads a more efficient firm to initiate cutthroat price competition for market dominance. [source]

Efficient versus Responsive Supply Chain Choice: An Empirical Examination of Influential Factors

THE JOURNAL OF PRODUCT INNOVATION MANAGEMENT, Issue 6 2003
Taylor R. Randall
Contemporary strategies in operations management suggest that successful firms align supply chain assets with product demand characteristics in order to exploit the profit potential of product lines fully. However, observation suggests that supply chain assets often are longer lived than product line decisions. This suggests that alignment between supply chain assets and demand characteristics is most likely to occur at the time of initial market entry. This article examines the association between product demand characteristics and the initial investment in a supply chain at the time of market entry. We characterize supply chains as responsive or efficient. A responsive supply chain is distinguished by short production lead-times, low set-up costs, and small batch sizes that allow the responsive firm to adapt quickly to market demand, but often at a higher unit cost. An efficient supply chain is distinguished by longer production lead-times, high set-up costs, and larger batch sizes that allow the efficient firm to produce at a low unit cost, but often at the expense of market responsiveness. We hypothesize that a firm's choice of responsive supply chain will be associated with lower industry growth rates, higher contribution margins, higher product variety, and higher demand or technological uncertainty. We further hypothesize that interactions among these variables either can reinforce or can temper the main effects. We report that lower industry growth rates are associated with responsive market entry, but this effect is offset if growth occurs during periods of high variety and high demand uncertainty. We report that higher contribution margins are associated with responsive market entry and that this effect is more pronounced when occurring with periods of high variety. Finally, we report that responsive market entry also is correlated positively with higher technological demand uncertainty. These results are found using data from the North American mountain bike industry. [source]

Corruption's Effect on Business Venturing Within the United States

AMERICAN JOURNAL OF ECONOMICS AND SOCIOLOGY, Issue 5 2009
David T. Mitchell
In developing countries with high levels of corruption, people are often forced into small-business venturing or survivalist entrepreneurship because larger, more efficient firms do not exist. In developed countries, however, low corruption means that people choose entrepreneurship as a better means of innovating. In this article we use federal convictions of state and local officials and the Small Business Administration's firm formation data to test whether corruption within the United States forces some people into business venturing. We find that business venturing within the United States is caused in part by corruption. [source]

WHY DID JAPAN'S TFP GROWTH SLOW DOWN IN THE LOST DECADE?

THE JAPANESE ECONOMIC REVIEW, Issue 2 2006
AN EMPIRICAL ANALYSIS BASED ON FIRM-LEVEL DATA OF MANUFACTURING FIRMS
This study analyses the cause of the slowdown in Japan's TFP growth during the 1990s. Many preceding studies, examining the issue at the macro- or industry-level, have found that the slowdown was primarily due to the stagnation in TFP growth in the manufacturing sector. Using firm level panel data covering the entire sector, we investigate the causes of the TFP slowdown and find that the reallocation of resources from less efficient to more efficient firms was very slow and limited. This "low metabolism" seems to be an important cause for the slowdown in Japan's TFP growth. [source]

An Empirical Analysis of Entrant and Incumbent Bidding in Road Construction Auctions

THE JOURNAL OF INDUSTRIAL ECONOMICS, Issue 3 2003
Dakshina G. De Silva
This paper explores differences in the bidding patterns of entrants and incumbents in road construction auctions. We find that entrants bid more aggressively and win auctions with significantly lower bids than incumbents. The differences in their bidding patterns are consistent with a model of auctions in which the distribution of an entrant's costs exhibits greater dispersion than that of an incumbent's and relations of stochastic dominance in the distributions do not persist for the entire range of estimated costs. We also find that more efficient firms bid, on average, more aggressively and firms with greater backlogs bid less aggressively. [source]