Dutch Firms Research Articles

Sustainability performance of Dutch firms and the role of digitalization: The case of textile and apparel industry

The textiles and apparel industry is a major contributor to economic development while at the same time being one of the most polluting industries due to its lengthy supply chain and resource intensive production operations. To address these sustainability challenges, digitalization is seen as one of the potential solutions. Using the lens of sustainability and digitalization in Supply Chain Management (SCM), this paper analyses the sustainability and digitalization status of Dutch textile and apparel firms. We used a mixed methodology of quantitative text mining of 94 Dutch textile and apparel firms as well as qualitative thematic and coding analysis of experts’ views and opinions on sustainability and digitalization in the Dutch textiles and apparel industry. Quantitative analysis of website data shows that Dutch textile and apparel firms predominantly communicate the environmental, to a lesser extent social, and least of all economic sustainability factors. Keyword analysis also shows that the use of technological keyword indicators is less prominent, while certain technologies such as IoT, sensors and blockchain correlate mostly to environmental sustainability factors. Moreover, qualitative analysis reveals that to address sustainability via digitalization, it is important to link sustainability goals to Key Performance Indicators, which requires data for traceability. We recommend firms to: (1) re-evaluate their business models and assess the extent traceability can be incorporated in their sustainability strategy; (2) enhance stakeholder collaboration within and outside the supply chain to utilize traceability; and (3) proactively use traceability information to improve transparency and accountability to meet legal requirements and address greenwashing. This study contributes to literature by showing the importance of traceability for (a) linking sustainability and digitalization in SCM, b) achieving the ultimate goals of transparency and accountability, and c) predicting demand and supply to address overproduction and waste in the textiles and apparel sector.

Going Dutch? Firm exports and FDI in the wake of the 2014 EU‐Russia sanctions

AbstractWe examine the 2014 European Union economic sanctions on exports to Russia and the Russian retaliatory measures on imports from several Western countries. Using the universe of highly disaggregated international trade and taxation data for firms in the Netherlands, we systematically analyze the impact of these economic sanctions on Dutch firms' exports and foreign direct investment. Our analyses account for the product‐specific EU restrictions on arms, equipment used for oil exploration and extraction, and dual‐use products suitable for civilian and military use, as well as the Russian import ban on various primary commodities. Our empirical findings highlight the overall negative impact of sanctions on the intensive margin of exports. However, having a foreign affiliate in Russia helps to mitigate the otherwise negative impact of sanctions on the extensive margin of exports. We also show that exporters do not circumvent sanctions by setting up a local affiliate in Russia. In fact, exposure to Russian countersanctions may even force firms to close their Russian affiliates.

Leveraging synergy to drive digital transformation: A systems-theoretic perspective

Given the strategic importance of digital transformation, IS research pays meticulous attention to identifying its key drivers, including awareness, motivation, and capability. Nevertheless, the interaction and synergy among these drivers remain conceptually and empirically understudied. Our study tries to address this research gap. We first consider digital proactiveness as awareness, change commitment as motivation, and organizational flexibility as the capability driver of digital transformation. Drawing on systems theory, this study proposes the synergy of these three key drivers in steering digital transformation. Recent data from 206 Dutch firms support the existence of synergy, showing that digital proactiveness, change commitment, and organizational flexibility contribute jointly to digital transformation. Our analysis reveals that the effect of organizational flexibility on digital transformation is highest when digital proactiveness and change commitment are both at a high level. This study extends our understanding of the complementary and synergistic digital transformation drivers and broadens research in this tradition by considering the synergy of awareness, motivational, and capability drivers in driving digital transformation.

Migrants and imports: Evidence from Dutch firms

AbstractThis paper examines the effect of hiring migrants on firms' imports using a rich employer–employee dataset from the Netherlands for 2010–17. We use an instrumental variables strategy, and find that firms that employ migrants from a high‐income country are more likely to import from that country. Our benchmark specification indicates that a one standard deviation increase in the share of migrant workers from a certain country raises their employer's probability of importing from those workers' origin country by 6.6 percentage points, explaining half of the average probability of importing from a given country. This result is robust to a battery of sensitivity checks, and the effects are driven largely by migrants working in trade intermediaries that import final goods and inputs. Our results suggest that migrants help to erode informational barriers and enable their employers to source goods from abroad.

Landmarks as lighthouses: firms' innovation and modes of exit during the business cycle

We revisit the relationship between innovation and survival, tracking how innovation types (product, process, organizational, and marketing innovation) relate to exit routes (closure, failure, M&A) during different phases of the business cycle (i.e. normal times, the 2007–08 financial crisis and subsequent recovery). In particular, we implemented a new (to the economic field) econometric approach, landmark analysis, to include time-varying covariates in survival models with competing exit routes on our representative sample of Dutch firms (obtained merging monthly register data with biennial innovation surveys, for 2006–2015). Our most straightforward result is that each type of innovation, across the different phases of the business cycle, affects, in a substantially different way, the likelihood to exit the market through different modes of exit. Innovations seems to grant some innovation premium, but no common pattern appears between the evolution of the relationships between different types of innovation and exit routes across the business cycle.

Does Offshoring Shape Labor Market Imperfections? A Comparative Analysis of Belgian and Dutch Firms

Does Offshoring Shape Labor Market Imperfections? A Comparative Analysis of Belgian and Dutch Firms

How far do Gazelles run? - growth patterns of regular firms, high growth firms and startups

ABSTRACT High growth firms receive a lot attention from policy and academia. In this paper we investigate the general validity of an investor startup database in studying high growth firms and growth persistence. To do so, we match Dutch administrative firm level panel data with this startup database. We establish two main facts. First, although the vast majority of high growth firms in the Dutch economy does not appear in the database, included firms do have a higher probability of being a high growth firm. Second, in contrast to regular Dutch firms and previous findings in the literature, startups show a strikingly persistent growth pattern: their growth phases are prolonged. We conclude that commercial startup databases can complement more traditional data sources, but interpretation requires care due to unclear selection in the database.

Born of necessity: The introduction of convertible bonds in The Netherlands

This paper investigates the adoption of convertible bonds in the Netherlands in the nineteenth century. These instruments were introduced around the start of the nineteenth century in British canal companies and later adopted by U.S. canal builders. Their value in large infrastructural projects was firmly established when British and American railroads issued bonds which were convertible into shares. In the Netherlands, convertible bonds were first used in the second half of the nineteenth century. To understand the motives for issuing convertibles, we study the first Dutch firms that issued convertible bonds. We document that firms that were rationed by financial markets in equity and bond issues were still able to place convertible bonds successfully. We demonstrate that the riskiness of the firm’s business was a key driver of convertible bond issuance, while personal networks enabled the financial innovation to be adopted in the Netherlands.

Talent or Technology? The Antecedents of Performance in the Digital Era

Digital transformation has been at the center of practitioners’ and academics’ attention, as firms aspire to utilize consequent waves of digital technologies to sustain long-term performance. Research identifies technological and non-technological antecedents of digital transformation. Employing resource-based view of sustained performance, we develop and test a sophisticated mediation model to shed light on under-explored mechanisms of digital transformation. We hypothesize about the complex effects of human, organizational and technological antecedents on the firm’s performance. We test our model using a rich and unique dataset of 860 Dutch firms collected in 2020. The results of our analysis highlight the relatively greater role of human and organizational antecedents and the critical role of market orientation in digital transformation and performance. We discuss the results and present our study’s theoretical and managerial implications. We suggest future directions for research on digital transformation and conclude at the end.

Organic and Acquisitive Growth: Replicating and Extending Lockett, Wiklund, Davidsson, Girma (2011)

We replicate and extend the work from Lockett, Wiklund, Davidsson, and Girma (2011), investigating how organic and acquisitive growth strategies influence future organic growth rates. Analysing a panel of Dutch firms over the period 2011-2016, we confirm Lockett et al.’s finding that past organic growth exerts a restraining effect on current organic growth. Unlike the original paper, we also find that acquisitive growth hinders rather than sustains subsequent organic growth. We therefore extend Lockett et al.’s framework by explicitly accounting for how the relatedness and complementarity of acquisitions moderate this effect. We observe that this negative effect is less pronounced when acquisitive growth is less related and complementary. Finally, we refine the identification strategy further developing the empirical analysis.

Tensions in multilateral coopetition: Findings from the disrupted music industry

Coopetition may help firms to respond collectively to technological change, and compete against disruptive innovation. Yet, coopetition often creates tensions, as coopetitors need to engage in persistently contradictory activities. While existing research focuses on dyadic coopetition, we know much less about multilateral coopetition; specifically, how tensions in multilateral coopetition arise and how they are managed in response to disruptive innovation. We use an in-depth case study of nine Dutch firms, who respond to digital disruption by introducing a new digital music platform, to analyse how tensions evolve in a multilateral coopetition entity. Our findings reveal two coopetitive tensions: a novel multilateral generalist–specialist contribution tension, and the well-known value creation–capture tension. The generalist–specialist contribution is an actor-activity-based tension that originates from the variable contributions of different vertical and horizontal coopetitors over time. Coopetitors try to resolve or balance this tension constantly via commensuration and orchestration of individual coopetitors' contributions, but the tension remains dormant and therefore re-appears. The second tension appears to stabilize over time as the coopetitive entity manages to balance the value creation–capture tension through an iteration of cooperation-inducing, competition-inducing and attendance to redirecting external events. The tensions are interlinked: the generalist–specialist contribution tension triggers subgroup coalition formation, which spurs the value creation–capture tension. We contribute to the coopetition literature by explaining how tensions emerge and are managed in multilateral coopetition, pointing to a new tension inherent in multilateral coopetition. Furthermore, we show how disruptive innovation uniquely shapes multilateral coopetition by inducing cooperative behaviour.

The Shift and Surge of Phishing During the COVID-19 Pandemic: An Analysis of Over 1100 Targeted Top-Level Domains Used by Dutch Firms

The Shift and Surge of Phishing During the COVID-19 Pandemic: An Analysis of Over 1100 Targeted Top-Level Domains Used by Dutch Firms

An empirical application of the financial instability hypothesis based on data from the Dutch non-financial private sector

This paper conducts an empirical analysis of the financial instability hypothesis on Dutch data. The main literature on this topic has been reviewed, and various financial fragility indexes to determine whether Dutch firms are in a hedge, speculative, or Ponzi regime are discussed. To do empirical analysis, 340 publicly-listed private Dutch firms from various industries were selected, and these panel data include observations from 2005 to 2019. This period includes three cases of falling GDP of the Netherlands: 2008–2009, 2011, and 2014. We use for our empirical analysis three financial fragility indexes. After identifying the regime of firms according to these criteria, we chose an index developed by Nishi to make a logistic regression. We use the Nishi approach to determine what affects a firm’s probabilities of becoming a Ponzi and thereby confirm Minsky’s hypothesis on Dutch data. According to our analysis, significant factors of the probability that Dutch private non-financial companies will be a Ponzi firm are profitability, interest rate, industry output, and crisis. Both accumulation of financial fragility due to “destabilizing stability” and austerity policy were reasons for economic crises in the Netherlands in the last decades.

Flexible Wages or Flexible Workers? A Decomposition of Wage Bill Adjustment by Dutch Firms, 2006–2013

Flexible Wages or Flexible Workers? A Decomposition of Wage Bill Adjustment by Dutch Firms, 2006–2013

Migrants and Global Value Chains: Evidence from Dutch Firms

Migrants and Global Value Chains: Evidence from Dutch Firms

Firm productivity and functional specialisation

AbstractThis paper examines the relation between productivity and specialisation of firms in business functions. We distinguish between specialisation in R&D, fabrication and marketing based on the firm's employment composition over these functions using unique survey data of Dutch firms. Our results suggest that firms specialised in R&D and marketing are significantly more productive compared to firms specialised in fabrication. We find that measures of upstreamness based on input–output tables do not significantly relate to firm productivity and are uncorrelated to measures of functional specialisation.

Time to exit: \u201crevolving door effect\u201d or \u201cSchumpeterian gale of creative destruction\u201d?

Over the past decades, exit has been analyzed at the theoretical and empirical levels. From this rich series of contributions, two basic patterns of exit can be identified: the revolving door and the gale of creative destruction. In the first, the liability of newness plays a major role in the exit process, while in the second the displacement of non-innovators is the driver of exit. We have tested these two patterns of exit on the population of Dutch firms that exited in 2018. We find confirmation that the two patterns characterize different types of industries. In industries in which innovation does not play a major role, the revolving door effect is the typical pattern and exit is concentrated among the adolescent firms. These firms are also small in size. On the contrary, in industries in which innovation plays a role, exit takes place both among infant as well as mature firms. Exiters are not necessarily only the smaller firms. While a highly innovative and uncertain environment can threaten the survival of infant firms, the exit of mature firms is driven by the innovation of young firms, following the gale of creative destruction.

Inclusiveness, Internationalization, and Innovativeness Impact on Talent Management Effectiveness

The paper explores the relationship between talent management (TM) and a firm’s performance mediated by absorptive capacity (AC). It examines the role of inclusive talent management strategy, a firm’s degree of internationalization and innovativeness as boundary conditions to the relationship between TM, AC, and performance. We test our hypotheses on the sample of 185 Dutch firms. The findings reveal that Dutch firms committed towards the adoption of more sophisticated TM routines not only exerted higher absorptive capacity, but also performed above their industry average. Another key finding shows that the inclusive TM strategy increases AC and performance. Moreover, there is a significantly stronger effect of advanced TM practices on the firm’s absorptive capacity for highly innovative firms; however, the moderating effect of innovativeness were found to be insignificant for the link between the firm’s AC and its performance. Additionally, for regionally operating firms (as compared to global and domestic ones), the positive effects of TM practices on AC and AC on performance were found to be stronger. On the other hand, the results revealed significantly weaker effect of AC on a firm’s performance for local (domestic) firms.

Mounting corporate innovation performance: The effects of high-skilled migrant hires and integration capacity

We adopt an organizational learning approach to examine how firms’ recruitment of high-skilled migrants contributes to subsequent firm-level innovation performance. We argue that due to migrants’ often different experience from that of native high-skilled workers, their perspectives on problem-solving and access to non-overlapping knowledge networks will also differ. The implied complementarity between these worker types makes migrant hires a particularly valuable resource in the context of firm-level innovation. We refine our diversity hypothesis further by predicting that migrant hires who add to the firm's cultural diversity should contribute more to firm innovation performance than new high-skilled migrant hires who do not add cultural diversity. Finally, we conjecture that firms with high integration capacity as a function of prior experience of employing high-skilled migrants should derive more innovation-related benefits from migrant hiring than firms with a low integration capacity. We track the inward mobility of high-skilled workers empirically using patents and matched employer-employee data for 16,241 Dutch firms over an 11-year period. We find support for our hypotheses.

Bidder Value Implications of Cross-Border vs Domestic Acquisitions: A Study of Dutch Firms

This study aims to investigate the value implications of cross-border as well as domestic acquisitions which are undertaken by Dutch bidding firms. This study focuses on Dutch firms since the Netherlands is one of the world’s largest sources of cross-border investments, and cross-border acquisitions are a prime example. Past literature which focuses on different regions/countries discovered conflicting findings regarding value implications of cross-border and domestic acquisitions. Some recorded results which pointed towards value creation for cross border acquisitions while some found the opposite. This study utilizes the event study methodology to find out whether cross-border and domestic acquisitions create significant value right after the announcement of the acquisition. This is done by testing the significance of the Cumulative Average Abnormal Returns (CAARs) of 62 cases of acquisitions, comprised of 31 cross-border and domestic acquisitions, all involving a Dutch bidding firm. The significance tests yielded statistically insignificant results for all the groups of samples. However, the CAARs themselves were positive for the cross-border acquisitions and also positive but lower for domestic acquisitions. The unexpected results led to the conclusion that there is weak support towards the value creating nature of cross border acquisitions and that engaging in a domestic acquisition instead also does not guarantee value creation, while further inspection discovered that the firms’ strategy may also play a role in the Dutch acquisition’s value creation.