Fulvio, Castellacci (2012): Business Groups, Innovation and Institutional Voids in Latin America.
Download (480kB) | Preview
The paper presents an empirical analysis of the innovative activities of business groups in Latin America. It compares the innovativeness of group-affiliated firms (GAFs) and standalone firms (SAFs), and it investigates how country-specific institutional factors – financial, legal, and labor market institutions – affect the group-innovation relationship. The empirical analysis is based on the most recent wave of the World Bank Enterprise Survey (period 2010-2011), and it focuses on a sample of 6500 manufacturing firms across 20 Latin American countries. The econometric results point out two major conclusions. First, GAFs are more innovative than SAFs: we estimate the innovation propensity of GAFs to be 9% higher than that of SAFs. Secondly, across countries, the innovativeness of GAFs is higher for national economies with a better institutional system than for countries with a less efficient institutional set up.
|Item Type:||MPRA Paper|
|Original Title:||Business Groups, Innovation and Institutional Voids in Latin America|
|Keywords:||Business groups; innovation; institutional voids; emerging economies; Latin America|
|Subjects:||O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development
L - Industrial Organization > L2 - Firm Objectives, Organization, and Behavior
D - Microeconomics > D2 - Production and Organizations
P - Economic Systems > P5 - Comparative Economic Systems
O - Economic Development, Innovation, Technological Change, and Growth > O5 - Economywide Country Studies > O54 - Latin America ; Caribbean
M - Business Administration and Business Economics ; Marketing ; Accounting ; Personnel Economics > M2 - Business Economics
O - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights
L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance
|Depositing User:||Fulvio Castellacci|
|Date Deposited:||22. Sep 2012 20:08|
|Last Modified:||22. Aug 2015 23:24|
Ai, C. and Norton, E. (2003): “Interaction terms in logit and probit models”, Economics Letters, 80: 123-129.
Aldrighi and Postali (2010): “Business groups in Brazil”, in Colpan, A., Hikino, T. and Lincoln, J. (Eds.): The Oxford Handbook of Business Groups, Oxford University Press, Oxford.
Belenzon, S. and Berkovitz, T. (2010): “Innovation in business groups”, Management Science, 56 (3): 519-535.
Botero, J., Djankov, S., La Porta, R., Lopez-de-Silanes, F. and Shleifer, A. (2004): “The regulation of labor”, Quarterly Journal of Economics, 119 (4): 1339-1382.
Bull, B. and Kasahara, Y. (2012): “The dominating diversified business groups in Central America: Who are they and where are they heading?”, SUM, University of Oslo, mimeo.
Caliendo, M. and Kopeinig, S. (2008): “Some practical guidance for the implementation of propensity score matching”, Journal of Economic Surveys, 22, 1: 31-72.
Carney, M., Gedajlovic, E., Heugens, P., Van Essen, M. and Van Oosterhout, J. (2011): “Business group affiliation, performance, context, and strategy: a meta-analysis”, Academy of Management Journal, 54 (3): 437-460.
Castellacci, F. (2011): “Closing the technology gap?”, Review of Development Economics, 15 (1): 180-197.
Castellacci, F. and Archibugi, D. (2008): “The technology-clubs: The Distribution of Knowledge Across Nations”, Research Policy, 37: 1659-1673.
Castellacci, F. and Natera, J. M. (2012): “The dynamics of national innovation systems: a panel cointegration analysis of the coevolution between innovative capability and absorptive capacity”, Research Policy, forthcoming.
Chang, S. J., Chung, C. N. and Mahmood, I. P. (2006): “When and how does business group affiliation promote firm innovation? A tale of two emerging economies”, Organization Science, 17 (5): 637-656.
Cohen, W.M. and D.A. Levinthal (1990): “Absorptive capacity: a new perspective on learning and innovation”, Administrative Science Quarterly, 35: 128-152.
Colpan, A., Hikino, T. and Lincoln, J.: The Oxford Handbook of Business Groups, Oxford University Press, Oxford.
Fracchia, E., Mesquita, L. and Quiroga, J. (2010): “Business groups in Argentina”, in Colpan, A., Hikino, T. and Lincoln, J. (Eds.): The Oxford Handbook of Business Groups, Oxford University Press, Oxford.
Greene, W. (2003): Econometric Analysis, Fifth Edition, Upper Saddle River, N.J., Prentice Hall.
Greene, W. (2010): “Testing hypotheses about interaction terms in nonlinear models”, Economics Letters, 107: 291-296.
Hall, P. and Soskice, D. (2001): Varieties of Capitalism: The Institutional Foundations of Comparative Advantage, Oxford University Press, New York.
Hoshino (2010): “Business groups in Mexico”, in Colpan, A., Hikino, T. and Lincoln, J. (Eds.): The Oxford Handbook of Business Groups, Oxford University Press, Oxford.
Khanna, T. (2000): “Business groups and social welfare in emerging markets: Existing evidence and unanswered questions”, European Economic Review, 44: 748-761.
Khanna, T. and Palepu, K. (2000): “The future of business groups in emerging markets: long-run evidence from Chile, Academy of Management Journal, 43 (3): 268-285.
Khanna, T. and Rivkin, J. W. (2001): “Estimating the performance effects of business groups in emerging markets”, Strategic Management Journal, 22 (1): 45-74.
Khanna, T. and Rivkin, J. W. (2006): “Interorganizational ties and business group boundaries: evidence from an emerging economy”, Organization Science, 17 (3): 333-352.
Khanna, T. and Yafeh, Y. (2005): “Business groups and risk sharing around the world”, The Journal of Business, 78 (1): 301-340.
Khanna, T. and Yafeh, Y. (2007): “Business groups in emerging markets: paragons or parasites”, Journal of Economic Literature, XLV: 331-372.
Kolasinski, A. and Siegel, A. (2010): “On the economic meaning of interaction term coefficients in non-linear binary response regression models”. SSRN paper. Available at SSRN: http://ssrn.com/abstract=1668750.
Mahmood, I. P. and Lee, C. Y. (2004): “Business groups: entry barrier-innovation debate revisited”, Journal of Economic Behavior and Organization, 54: 513-531.
Mahmood, I. P. and Mitchell, W. (2004): “Two faces: Effects of business groups on innovation in emerging economies”, Management Science, 50 (10): 1348-1365.
Nelson, R. R. (1993): National Innovation Systems: A Comparative Analysis, Oxford University Press, New York and Oxford.
Schneider, B. R. (2009): “Hierarchical market economies and varieties of capitalism in Latin America”, Journal of Latin American Studies, 41: 553-575.