Knowledge Spill Research Articles

Collaborative structure and post‐mobility knowledge spillovers: A dyadic approach

AbstractResearch SummaryHow does the dyadic collaborative structure between the hiring firm and the losing firm influence knowledge spillovers following an employee's move? We demonstrate that knowledge spill‐ins (to the hiring firm) and spill‐backs (to the losing firm) are the greatest when a firm with a strong collaborative density hires an employee from another firm that too has a strong collaborative density. Furthermore, such a dyadic combination results in the greatest degree of access to the broader knowledge of the other firm. By considering the role of relative collaborative structures in post‐mobility knowledge‐building activities, we inform the extant literature on the importance of this factor. In doing so, we invite scholars to take a more holistic view of the risks and benefits associated with “learning by hiring.”Managerial SummaryFirms interested in acquiring the knowledge of other firms through employee recruitment face a dilemma. To best integrate the knowledge brought in by new employees, firms must encourage extensive collaboration between existing employees and new hires. However, such a dense collaboration exposes firms to potential knowledge spill out through these new hires, which may undermine their competitive edge. Firms that lose employees face the reverse dilemma. Accordingly, managers and practitioners should realize that not all recruitments may result in net knowledge gains. Our findings strongly suggest that where a firm hires from also matters, not just who it hires, thereby offering a practical insight for organizations in properly assessing the utility of hiring an employee, particularly in consideration of their relative collaborative structures.

Modernization of Maghreb countries in the context of external economic relations

The article analyses how Maghreb countries’ involvement into the global economy, international trade and investment activity, particularly with France and European Union in general, affects their attempts to modernize their economy and to what extent they are efficient. Algeria, Morocco and Tunisia have made many steps towards closer integration with Europe, along with certain measures aimed at loosing the barriers for trade with the African continent, including trade relations inside Maghreb itself. However, their economies still hugely rely on the demand of the European market and foreign direct investments coming from the North of the Mediterranean Sea. Another point of great importance is the migration from these countries to EU, which also has a serious impact on their economic development. While liberation of trade and strengthening ties with the developed countries were expected to boost the local economies, improve their technological level through fostering production activity, and induce knowledge spill from multinational corporations to North African companies, the actual result yet does not seem so bright. Currently, Maghreb countries are stuck at their role of either exporters of crude materials like Algeria, or outsource producers of spare parts for particular European high-tech manufacturers who seek here cutting production costs by using the opportunity of paying lower salaries than in developed countries. The role of three Maghreb countries in international economy is, however, significantly different, although they are all dependent on their ties with their former common colonial metropole, France. Investigation of the factors that curb getting benefits from the involvement in global economic activity, as well as nuances of economic development in each of the three countries inside the international context, is the focus of the article.

Intra-Industry Diffusion of Profit Shifting Practices

Does tax knowledge spill over across firms? Using data on US-listed firms and an event study approach, I provide systematic evidence that profit shifting strategies spread across companies within sectors. The probability that an enterprise owns a subsidiary in a specific tax haven increases if another enterprise operating in the same sector also does. A battery of three-way fixed effects and the non-existence of pre-trends allow a causal interpretation of the results. These findings suggest that firms replicate the tax avoidance schemes of their peers and carry policy implications.

Role of Information Communication Technology, Artificial Intelligence and Impact on GDP

Demand and supply still remains the main instrument to determine the role of information and communication technology on gross domestic product and growth. ICT Abstract: There is an increasing body of research, investigating the determinants of economic growth in China. Most studies have focused on technology results in increase demand for new products and services. This demand on the supply side naturally accounts for increase efficiency in production of services, goods and infrastructure. Knowledge spill overs, triadic patents and researcher-related activities spanning number of publications and people employed in the high-tech sectors. Although increases in innovation stemming from R&D activities are evident, the extent of economic growth is contingent on the market size (IMF reference). This paper investigates the relationship between exogenously-determined growth, proxied by ICT imports, and endogenous drivers of economic growth, by employing ICT exports. The verifies the hypothesis by employing a machine learning approach to Pearson’s correlation and employs the Augmented Dickey Fuller test to test for multicollinearity. The study postulates evidence-based policy recommendations that will facilitate the transition of the Chines economy towards and innovation-driven and consumer led economy.

Entrepreneurship Training and Sustainability of Entrepreneurial Activities: A Case of Cοcοnut Sub-Sectοr in Kwale Cοunty, Kenya

Extensive studies have been conducted on entrepreneurship training and sustainability of entrepreneurial activities. Findings from these studies have shown that entrepreneurship training greatly influence the sustainability of entrepreneurial activities. These studies have however created cοntextual and methοdοlοgical gaps since they have fοcused οn different cοntext οther than Kwale Cοunty and cοncentrated οn different pοpulatiοns such as students in variοus settings. Lack of entrepreneurship training has dealt a major blow to most of the coconut sub-sector enterprises leading to their unsustainability or failures altogether. As such, the aim of this study was to find how entrepreneurship training affects sustainability of entrepreneurial activities in the coconut sub-sector in Kwale County, Kenya. The study was to assess the influence of opportunity identification training, resource identification training, business managerial training and entrepreneurial marketing training and sustainability of entrepreneurial activities in the coconut sub-sector in Kwale County. The study was grounded on social capital theory, knowledge spill over theory of entrepreneurship, entrepreneurship innovation theory and Marketing Orientation Theory. The study used descriptive and Explanatory research designs. The population of focus was the 264 respondents drawn from the 42 institutions including coconut processors, farmer’s cooperatives, marketing Agents for example EPC, National and County governments agencies and corporations as well as tertiary institutions offering entrepreneurship education in Kwale County. Stratified sampling technique was used to select 30% (79) respondents. A questionnaire was used to collect the data from the respondents. Descriptives and regression analyses was utilized to analyse the collected data. The study found a strong and significant relationship between the four independent variables and the dependent variable. The study concluded that various aspects of opportunity identification, resοurce identificatiοn, business managerial and entrepreneurship marketing training affect sustainability οf entrepreneurial activities οf cοcοnut sub-sectοr in Kwale Cοunty. The study recommended that there is need for concerned institutions to develop a practical oriented entrepreneurship curriculum that enhances resource identification. It is important that organizers, funding organizations and executers of entrepreneurship training continuously review the objectives of such trainings to ensure that they are relevant and contributing to different facets of entrepreneurship ventures. Training programmes, such as the business growth training, should be offered more frequently and target a higher number of entrepreneurs so that they too could benefit and acquire business management skills. The relevant stakeholders in the coconut sub-sector should leverage training on entrepreneurial marketing strategy in order to grow their business, suggested entrepreneurial strategies like guerilla and buzz marketing strategies, this are vital for the firm to grow.

Evaluating the effect of organizational architecture in developing science and technology parks under differing innovation environments

Science and Technology Parks (STPs) are often used as tools to foster regional development. They seek innovations, innovators and encourage innovation amongst the constituent firms, including by networking and knowledge spill over between the inhabitants, Universities and sources of capital. The low success rate of STPs led us to investigate how STP architecture can best cope with a changing and challenging innovation environment, through start-up to early maturity and full maturity, in a preliminary effort to arrive at an evidence-based scheme to help avoid failure.Three different types of architecture were investigated: open (market), star (hierarchy), and closed strong (adhocracy, ambidextrous). Open (market) architecture suffered both from high transaction costs while not protecting against poor decision-making. Results show that it is very beneficial to have a central Cluster Initiative (CI) controlling the decision-making process (star hierarchy) in the early stages of STP development, where potential gains and losses are relatively modest. However in the early maturity stage with commitment to a high-growth trajectory, a high quality of decision–making is required amongst managers and decisions are best taken by the CI with the input of optimally two individual on-cluster firms. The situation where CI is supported by good-quality decisions from on-cluster firms – an ad hoc, ambidextrous situation – is superior when good innovations abound and the STP has acquired some maturity. However, in environments with a surfeit of poor-fit innovations, this becomes a high-risk strategy with high potential losses and indeed in this situation, retaining a hierarchical (CI only) decision process is most helpful, even when the quality of decision–making amongst CI managers is poor. Results indicate that success involves attracting enough small innovative firms which - in turn - attract larger firms, whose detailed sector-relevant insight improves CI decision-making.

Does knowledge spill over across borders and technology regimes?

This paper investigates whether technology spills over across national borders and technology regimes. We advocate a modeling strategy where improvements in technical efficiency capture technology spillovers as industries absorb and implement the best-practice technology. Dynamic panel-based techniques are used to determine whether efficiency series move together in the long run (cointegrate) and/or move closer together over time (converge). We control for technological heterogeneity and for cross-sectional dependence in the data. For a panel of manufacturing industries in six EU countries, we find evidence of technology spillovers and convergence among industries’ efficiency levels across countries and mainly across adjacent technology regimes.

Regional Innovation System and Sustainable Competitiveness: Case Study on Food Processing SMEs in West Java and Lampung Provinces

The competitiveness of an industry, a region, and a nation is directly related to its innovation capacity which is resulting from an effective innovation system. National innovation system will only be effective if there is a good interaction and interdependency among industries, research institutions, education institution, and other supporting bodies such as financial institution, infrastructure, regulation etc. Former studies reveal that the innovation system in Indonesia has not functioned effectively [1]. In the absence of effective national innovation system, the regional government can take serious attempts to develop and strengthen its regional innovation system in order to enhance its regional competitiveness, especially in the era of regional autonomy. This paper is based on a research conducted by Center for Innovation LIPI in 2004. It briefly highlights some theoretical frameworks on regional innovation system especially in the food industry cluster and reviews the characteristics of food industry in West Java and Lampung Provinces using Michael Porter’s diamond model. The study reveals that there is a weak linkage amongst the elements of regional innovation system in the food industry, though the local government has made significant attempts to strengthen and improve the condition. However, it is identified that industry within the cluster has enjoyed some benefits though this is limited to trading efficiency (trade network) mostly due to geographical proximity; while knowledge spill over (knowledge network), the very core of the innovation system, within the cluster is still very insignificant. Finally it proposes some recommendation especially on the utilization of the existing supporting local actors to act as local facilitator especially to bridge the information gap amongst the elements of the innovation system.

Foreign direct investment: Domestic alliance experience as an antecedent to international expansion

This paper explores the extent to which multinational enterprise presence can affect local firms. More specifically, it investigates how alliances with foreign firms may bring about knowledge spill...

Knowledge Spillover Versus Economic Bonding Theories - The Inclinations of the Nigerian Auditing Firms

This paper examines the inclination of the Nigerian auditing firms to the various theories on auditor independence i.e. the Knowledge Spill over (KSo) and Economic Bonding (EB) theories. Researches have been conducted in different countries by different researchers ascertaining which theory their auditors would support. Hence, the aim of this study is to determine the bent of mind of the Nigerian auditing firms. The survey questionnaire was employed to elicit information from the auditors. Four states across the poles of the nation formed the population of the study from which the sample was drawn. One hundred and one questionnaires were distributed and sixty-two were retrieved, representing sixty-one percent. The mean scores were used to analyze the data and the t-test and z-test statistics were employed to test the hypothesis using stata 9 software. The study finds that Nigerian auditing firms are in support of the KSo theory. This finding was only supported by the variable size while the other two variables (experience and regulating institution) did not support the theory. We therefore recommend strict regulatory follow ups to ensure adherence to the Nigeria’s corporate governance requirements.

Subsidies for Learning in Renewable Energy Technologies Under Market Power and Emission Trading

Under perfect competition on the output market, first best technology subsidies in the presence of learning by doing are justified by knowledge spill overs that are not accounted for by individual companies. First best output subsidies are thus depending directly on the learning effects and are, if applicable, positive. Considering electricity markets, a setting of imperfect competition is more appropriate. We show that the second best output subsidy for learning by doing in renewable energies takes the market distortion due to imperfect competition into account and is of ambiguous sign. Based on simulations with a European electricity market model, we find that second best renewable energy subsidies are positive and only insignificantly impacted by market power. By contrast, the welfare gains from an optimal subsidy are considerably higher compared to a hypothetical situation of perfect competition.

Does knowledge spill to leaders or laggards? Exploring industry heterogeneity in learning by exporting

In recent years the international trade literature has focused on the effects of exporting and its benefits in an open economy. Scholars note that engaging in trade enhances knowledge spillovers, and results in income growth and income convergence among trading partners. Although the macro-literature has long addressed economic convergence, there has been relatively little research examining the effect of exporting on ex post firm performance. Likewise, there has been little research that examines the differential learning-by-exporting effects across industries. In this paper we build upon the convergence literature to argue that engaging in exporting provides firms, especially firms in technologically lagging industries, the opportunity to benefit disproportionately from knowledge spillovers. Using a sample of Spanish manufacturing firms from 1990 to 1997, we investigate empirically how exporting differentially influences the innovative outcomes of firms in technologically leading vs lagging industries. We find evidence that firms in technologically lagging industries (in which Spain lags the global technology frontier) learn more from exporting than those firms in technologically leading industries (in which Spain is at, or near, the global technology frontier). The results enrich the traditional convergence argument by suggesting that industry heterogeneity matters to knowledge transfer, and stands to play a substantial role in reducing knowledge gaps.

Relative Backwardness or Absorptive Capacity: How Does Knowledge Spill Over Across Borders?

In this paper we search for evidence of North-South trade-related knowledge spillovers from a sample of five major OECD countries to 45 developing countries using panel data. We then extend the analysis to examine whether the impact of domestic factors affects the extent of knowledge spillovers. In particular, we investigate whether knowledge spillovers are stronger, the further a country is behind the technological leader, or whether they are stronger in countries with higher levels of absorptive capacity. Our results suggest that the impact of trade-related knowledge spillovers on growth does not depend upon how far a country is behind the technological leader, but that knowledge spillovers are stronger in countries with higher levels of absorptive capacity.

The Market for External Audit Services in the Public Sector: An Empirical Analysis of NHS Trusts

This study investigates the market for audit services in the UK National Health Service (NHS). The market has a number of interesting features, including the presence of the Audit Commission as a regulator, appointer and provider of audit services. Following a theoretical overview of audit pricing in the NHS, evidence is provided on the behaviour of private sector auditors in an environment where audit risk characteristics differ from the private sector. The research also investigates, for the first time in the public sector, the relationship between audit fees and non–audit (consultancy) fees. Comparisons are also drawn between audit fees in the public and private sectors in an analysis of audit fees by industry. Despite some key similarities, the study shows that a number of differences exist between private and public sector audit fee models. In particular, we find no evidence of Big 6 (or mid–tier) auditor premiums, but we do find a significant negative relationship between audit and consultancy fees providing support for the ‘knowledge spill–over’ hypothesis. In addition, the fees charged to trusts appear significantly lower than their private sector counterparts, despite trust auditors having additional duties to perform. Possible explanations for this finding are offered in the paper.