Positive Effect Of Competition Research Articles

Multi-dimensional competition in local governments, performance pressures, and corporate green innovation in China

ABSTRACT Based on the panel data of China’s listed companies from 2009 to 2020, this paper examines the relationship between multi-dimensional competition among local governments and corporate green innovation. It also investigates the influencing mechanism of performance pressures in this relationship. The results show that (1) Government competition with different motives has heterogeneous effects on green innovation. Growth and fiscal competition negatively affect green innovation, while investment attraction and regulation competition significantly positively affect green innovation. (2) The performance pressure significantly reduces the negative effect of fiscal competition and enhances the positive effect of investment attraction and regulation competition. (3) The regional heterogeneity analysis shows that investment attraction competition positively affects green innovation in the eastern, central, and western regions. While the impact of growth and fiscal competition in the eastern region is insignificant, the former is significantly negative in the central and western regions.

Competition in French hospital: Does it impact the patient management in healthcare?

<p class="MsoNormal" style="margin-top: 12pt; line-height: 12pt; text-align: justify;"><span lang="EN-US" style="font-family: 'times new roman', times, serif; font-size: 14pt;">This research paper examines changes in patient care management in acute care hospitals between 2001 and 2011. During this time, there were two opposing factors at play: the competition effect of the reform and the policymaker’s decision to reduce public hospitals across France. By studying the trends, it is evident that there has been a significant overall shift in patient care management during this period. This change could be attributed to the global competition effect and the concentration of in-patients in specific public facilities. Through the difference-in-difference method, the study analyzed time variations in the intensity of local competition. It was found that local competition had a negligible impact on patient care management. Additionally, the study revealed that there was a significant positive competition effect on high-technical procedures for the private sector, which is in line with the market segment where private sector hospitals have a leadership position and the pro-competitive reform intensified this position. The study also uncovered a negative competition effect on the length of stay for public hospitals. Prior to the implementation of the DRG-based payment reform, public sector hospitals were paid a global budget. However, after the reform was implemented, they had to shorten the length of stay to increase the number of stays. For-profit hospitals have always been paid based on the number of stays. The results are robust and consistent when alternative measures of local competition are used.</span></p>

Market Competition, Non-Interest Income and Risk-Taking of Small and Medium-Sized Banks

ABSTRACT Taking the data of 61 small and medium-sized commercial banks in China from 2014 to 2021 as a research sample, this paper conducts an empirical study on the relationship between market competition and the risk-taking of small and medium-sized banks, and further considers the moderating role of economic policy uncertainty and non-interest business income. The results show that the intensification of market competition increases the risk-taking of small and medium-sized banks. Meanwhile, economic policy uncertainty dampens the positive effect of market competition on bank risk-taking, and commission income and other non-interest income have important mediating effects in the relationship between market competition and bank risk-taking.

Are small- and medium-sized enterprises more likely to innovate when facing informal competition? Evidence from Kazakhstan

PurposeThis paper aims to investigate whether Kazakh small- and medium-sized enterprises (SMEs) that claim to compete with the informal sector are more likely to invest in innovation than their competitors who do not perceive such pressure.Design/methodology/approachLogistic regression and classification trees are performed on the Business Environment and Enterprise Performance Survey (2018–2020) to examine whether the degree of informal competition correlates with a firm's propensity to innovate.FindingsThe findings show that informal sector competition is a critical factor that shapes the organizational behaviour of Kazakh SMEs. There is a stimulating positive effect of informal competition on both product and process innovation, depending on its perceived intensity.Originality/valueThis study challenges conventional thinking that still views informal sector competition as a barrier to innovation and entrepreneurship by assessing whether innovation is compatible with informal entrepreneurial practice.

Bank competition and corporate employment: Evidence from the geographic distribution of bank branches in China

Using the geographic location data of 218,554 commercial bank branches in China, we find that an increasing number of bank branches in the vicinity of enterprises, namely bank competition, leads to higher corporate employment, particularly for non-SOEs and SOEs with less government influence. Channel analyses reveal that better access to banking facilitates information extraction and eases credit constraints for surrounding firms, which thus increases labor investment. In addition, fintech development moderates the positive effect of bank competition on corporate employment. An exogenous policy shock as well as two instrumental variables, are used to correct for endogeneity and our results remain consistent. The findings are also robust to alternative samples, proxies, and different fixed effects. Further analyses show that bank competition improves firms’ labor investment efficiency and upgrades their employment structures. Lastly, increased employment improves the firm performance of non-SOEs.

Readability of auditor reports: does audit market competition matter? Empirical evidence from Iran

PurposeWhile existing research explores the impact of audit market competition on audit fees and audit quality, there is limited investigation into how competition in the audit market influences auditors' writing style. This study examines the relationship between audit market competition and the readability of audit reports in Iran, where competition is particularly intense, especially among private audit firms.Design/methodology/approachThe sample comprises 1,050 firm-year observations in Iran from 2012 to 2018. Readability measures, including the Fog index, Flesch-Reading-Ease (FRE) and Simple Measure of Gobbledygook (SMOG), are employed to assess the readability of auditors' reports. The Herfindahl–Hirschman Index (HHI) is utilized to measure audit market competition, with lower index values indicating higher auditor competition. The concentration measure is multiplied by −1 to obtain the competition measure (AudComp). Alternative readability measures, such as the Flesch–Kincaid (FK) and Automated Readability Index (ARI) are used in additional robustness tests. Data on textual features of audit reports, auditor characteristics and other control variables are manually collected from annual reports of firms listed on the Tehran Stock Exchange (TSE).FindingsThe regression analysis results indicate a significant and positive association between audit market competition and audit report readability. Furthermore, a stronger positive and significant association is observed among private audit firms, where competition is more intense compared to state audit firms. These findings remain robust when using alternative readability measures and other sensitivity checks. Additional analysis reveals that the positive effect of competition on audit report readability is more pronounced in situations where the auditor remains unchanged and the audit market size is small.Originality/valueThis paper expands the existing literature by examining the impact of audit market competition on audit report readability. It focuses on a unique audit market (Iran), where competition among audit firms is more intense than in developed countries due to the liberalization of the Iranian audit market in 2001 and the establishment of numerous private audit firms.

Who benefits from quality competition in health care? A theory and a laboratory experiment on the relevance of patient characteristics.

We study how competition between physicians affects the provision of medical care. In our theoretical model, physicians are faced with a heterogeneous patient population, in which patients systematically vary with regard to both their responsiveness to the provided quality of care and their state of health. We test the behavioral predictions derived from this model in a controlled laboratory experiment. In line with the model, we observe that competition significantly improves patient benefits as long as patients are able to respond to the quality provided. For those patients, who are not able to choose a physician, competition even decreases the patient benefit compared to a situation without competition. This decrease is in contrast to our theoretical prediction implying no change in benefits for passive patients. Deviations from patient-optimal treatment are highest for passive patients in need of a low quantity of medical services. With repetition, both, the positive effects of competition for active patients as well as the negative effects of competition for passive patients become more pronounced. Our results imply that competition can not only improve but also worsen patient outcome and that patients' responsiveness to quality is decisive.

Exploring the ineffectiveness of gamification health management: a U-shaped relationship between competition and technological exhaustion

PurposeGamification design is considered an effective way of changing users' health behavior and improving their health management performance. Even though numerous studies have investigated the positive effect of gamification competition on users, little research has considered gamification's ineffectiveness and negative effects. In particular, how gamification competition affects users' technological exhaustion remains unclear.Design/methodology/approachAccording to flow theory and related research on gamification, this study discusses the nonlinear relationship between gamification competition and users' technological exhaustion. Furthermore, the authors analyze the moderating effect of user type (socializers and achievers) and users' health condition on this nonlinear relationship. Based on flow theory, the authors propose a series of research hypotheses. To test all research hypotheses, the authors collected information from 407 users via a questionnaire as the data for this study.FindingsThe empirical results found a U-shaped relationship between gamification competition and technological exhaustion. Technological exhaustion gradually decreases as competition increases until reaching the lowest point; after that, technological exhaustion gradually increases as competition increases. Further, being a socializer and health condition play a moderating role in the U-shaped relationship between competition and technological exhaustion.Originality/valueThis study's findings not only enrich the related research in flow theory and gamification, but also contribute to the effective design of gamification in health management platforms.

Haste Makes No Waste: Positive Peer Effects of Classroom Speed Competition on Learning

AbstractThis study investigates the effects of speed competition in classrooms on young pupils' learning outcomes. To examine how faster peers' speed affects slower pupils' speed and learning, we employ students' daily progress data in a self‐learning programme at BRAC primary schools in Bangladesh. The programme's unique setting allows us to address the reflection problem reasonably well. While speed competition could generate negative consequences, our results show overall positive peer effects on problem‐solving time and scores. The effects are stronger among peers with similar abilities, without negatively affecting others. Our results show efficiency gains from non‐market competition in education and learning.

Impact of competition and voucher school subsidy law on education quality in Chile

We analyzed the effect of competition and the Preferential School Subsidies (SEP) Law on the quality of Chilean schools for the period 2000-2013. We use dynamic panel regressions, and we show that competition has a positive and non-linear effect on education quality. The initial positive effect of competition on education quality is not persistent and is reversed for high levels of competition. The impact of competition on education quality also depends on the administrative dependence of schools. The SEP Law increased education quality, but through competition the inequality between public and private schools deepened. These results are relevant for the design of public policies aimed at reducing inequality in Chilean education.

Natural resources, political competition, and economic growth: An empirical evidence from dynamic panel threshold kink analysis in Iranian provinces

Using dynamic panel threshold kink model approach, this paper measures the threshold level of political competition maximizing economic growth in the provinces of Iran during the years 2000–2019 and analyzes the moderation role of political competition in functioning of the resource curse hypothesis. Our results show that various indicators of political competition have a threshold effect on economic growth and the nonlinear relationship between political competition and economic growth is confirmed as U-shaped, based on which political competition above the threshold level leads to more economic growth. We also find that political competition affects the functioning of resource curse hypothesis in the provinces of Iran by moderating the effect of oil revenues on economic growth. Considering the spatial effects in the dynamic panel threshold kink regression model, which has been modeled for the first time in the provinces of Iran, has led to the robustness of the research findings. Our findings support the positive and significant effect of political competition on economic growth in countries with natural resources.

Informal Competition and Innovation in Southeast Asian Countries: Examining the Moderating Influence of Gender

This study investigates the impact of informal competition on the innovation of Southeast Asian firms and the moderating role of female management in the informal competition–innovation nexus. In the Southeast Asian context, the informal sector employs around 78% of the working population, which is higher than the world average of 61% and the Asia-Pacific average of 68%. The analysis is based on firm-level data collected by the World Bank for eight Southeast Asian countries in 2015–2016. The quantitative analysis was conducted with the use of the multilevel mixed-effects logistic regression method to address the hierarchical/multilevel problem. Additionally, the potential endogeneity problem was taken into account with the use of the propensity score matching technique. The findings show that informal competition induces firms to increase their product and process innovations. Furthermore, female management is important in leveraging the positive effects of informal competition on innovation.

Augmenting Blockchain With Competition Law for a Sustainable Economic Evolution

Since its introduction, blockchain technology has been revered, ridiculed, dismissed, embraced, and presently has become too large to ignore, witnessing exponential growth. The obvious indicator of this growth is that research revolving around blockchain technology has already raised competition in the form of directed acyclic graphs and hashgraph, all of which fall under the umbrella of distributed ledger technology (DLT). Segueing on the back of visibly positive effects of competition, we arrive at the essence of our paper. We show that the current competition regimes around the world are inefficient at promoting and maintaining competition around the world, dominated by the behemoth technology enterprises that have successfully monopolized and monetized data, which is indubitably, one of the most important assets in today’s digital age. Data gathered from users fuels the algorithms, machine learning, and artificial intelligence programs employed by these tech giants, which further entrenches their monopolistic hold over cyberspace. Blockchain and DLTs, just like any other technology, pose new threats to the competition law regimes, while also allowing the authorities to utilize the technology themselves to explore new horizons involving smart contracts, Decentralized Autonomous Organizations (DAOs), Web 3.0, and enforce competition more effectively. In our paper, we briefly illustrate the challenges presented before the competition authorities by the assimilation of blockchain in the existing establishments, and how the competition authorities can themselves collude with blockchain stakeholders to take a holistic approach and establish a symbiotic relationship, which ensures that both, survive, prosper, and enhance consumer welfare.

The effect of pruning on yield of cocoa trees is mediated by tree size and tree competition

In cocoa cultivation pruning is considered an essential yield-enhancing practice but its effects on cocoa tree growth and yield, and how these are mediated by tree size and competition are poorly understood.Here, we evaluate the impact of experimental pruning on: light interception, leaf flushing and the number of flowers and of developing, wilted and harvested pods. The pruning treatment removed an average 26.4% of cocoa tree aboveground biomass and was aimed to create an open cup-shaped crown. Stem basal area and sum of neighbor tree basal area were used as proxies for tree size and tree competition, respectively. All response variables were analysed at tree level as a function of pruning, tree size and tree competition using generalized linear mixed effect models.After one year, pruned trees recovered initial losses in whole-canopy light interception but maintained a more uniform distribution of light in the canopy. Pruning directly increased flushing activity, while the effect on the other variables was mediated by the interaction with tree size and competition. Pruning increased the positive effect of tree size and competition on flower number and similar effects were found for small pod number. The latter effect was counterbalanced by an increase of pod wilting in pruned trees under high competition, resulting in similar numbers of large and harvested pods on the stem in pruned and unpruned trees. For pods in the canopy, pruning did enhance the positive effect of tree size and strongly reduced the negative effect of competition on pod number. As canopy pods made up 60% of the total, similar pruning effects were found for the total number of harvested pods. The predicted net effect of pruning on the number of harvested pods varied greatly with tree size and competition, ranging from -58% for small trees under low competition, to +150% for large trees under high competition. This large variability stresses the importance of individual-level analysis to quantify pruning effects and calls for more attention to individual tree characteristics in training and practice of cocoa pruning. The pruning-induced reduction of negative competition effects suggests that pruning can contribute to realizing high-density cocoa stands.

Product market competition, venture capital, and the success of entrepreneurial firms

We document a positive effect of product market competition (PMC) on venture capital (VC) staging. Employing large tariff rate reductions as an exogenous shock to PMC, we find that large tariff reductions lead to a greater likelihood of staged financing and a larger number of financing rounds. Cross-sectional analyses reveal that the effect is stronger for entrepreneurial firms that are younger, operate in high-tech and manufacturing industries, or receive investments from less reputable and inexperienced VCs. Our findings are consistent with the notion that by mitigating business uncertainty and survival risk, VC staging acts as a complement to PMC for enhancing entrepreneurial firms’ success.

Can competition improve hospital quality of care? A difference-in-differences approach to evaluate the effect of increasing quality transparency on hospital quality

Public reporting on the quality of care is intended to guide patients to the provider with the highest quality and to stimulate a fair competition on quality. We apply a difference-in-differences design to test whether hospital quality has improved more in markets that are more competitive after the first public release of performance data in Germany in 2008. Panel data from 947 hospitals from 2006 to 2010 are used. Due to the high complexity of the treatment of stroke patients, we approximate general hospital quality by the 30-day risk-adjusted mortality rate for stroke treatment. Market structure is measured (comparatively) by the Herfindahl–Hirschman index (HHI) and by the number of hospitals in the relevant market. Predicted market shares based on exogenous variables only are used to compute the HHI to allow a causal interpretation of the reform effect. A homogenous positive effect of competition on quality of care is found. This effect is mainly driven by the response of non-profit hospitals that have a narrow range of services and private for-profit hospitals with a medium range of services. The results highlight the relevance of outcome transparency to enhance hospital quality competition.

Competitive market space in the context of the need to increase the competitiveness of the Russian economic system

The article considers the conceptual framework of the content essence of competition, the conditions for the formation of approaches for high competitiveness of business entities as the main element of the functioning of the market economy. The article analyzes the current state of the competitive market space in Russia. A comparative assessment of the state of the Russian competitive environment in 2016 and 2020 is carried out in the context of: determining the areas with the highest (and lowest) degree of influence on the competitive market, guidelines for strengthening competitive positions, positive effects of competition for business entities, etc. The key directions of increasing the competitiveness of business entities are formulated. An up-to-date set of methods for assessing competitiveness is presented. The advantages of healthy competition in the system of market relations for the growth of the welfare of economic entities, the economic development of the country and, accordingly, the improvement of the standard of living of the population are determined. In Russia, at present, the development and implementation of state programs for the development of small and medium-sized businesses in the regions is insufficient for the formation of an effective competitive market environment for the economy in the regions. While the development of healthy competitive relations allows the most effective impact on market mechanisms in the regions, and also contributes to the sustainable development of socio-economic, technical areas of the economy. And the key task of the state in this case is to provide opportunities for realizing the competitive potential of the region, that is, its readiness for effective competition and sustainable functioning of a certain competitive market environment. The formation of such an environment ensures the effectiveness of interregional and international relations of the region, which leads to positive effects in the socio-economic development of the state as a whole.

Impact of Competition on Innovations of IT Industry: An Empirical Investigation

ABSTRACT Innovation and competition are two major pillars in the information technology (IT) industry. In this paper, we examine the causal relationship between product market competition and innovations in the IT industry. We measure the innovations from both the quantity (number of patents) and the quality (number of non-self citations) perspectives. Based on the Herfindahl-Hirschman Index and natural experiments, we find robust evidence that the competition has a positive effect on the innovations of the IT industry. Specifically, after the exogenous shock to the market (import tariff cuts and thus increased industry competition), the number of patents per IT firm increases by 27.3 percent, and the number of non-self citations per IT firm increases by 38.2 percent on average. The effects are more pronounced in the more competitive sectors. Our study highlights the importance of the competition in the IT industry and suggests that the positive effect of competition on innovation in the IT context is likely to be driven by the parallel search effect. Our findings contribute to the recent policy debate and suggest that reducing import barriers may bring important welfare gains through innovations in the IT industry.

When an Industry Peer Is Accused of Financial Misconduct: Stigma versus Competition Effects on Non-accused Firms

Research on misconduct suggests that accusations against industry peers generate negative consequences for non-accused firms (a “stigma effect”). Yet, building on research on competitive dynamics, we infer that such accusations can benefit non-accused firms that compete with these peers (a “competition effect”). To reconcile these opposing perspectives, we posit that the negative stigma effect will increase with greater product market overlap between the non-accused firm and its accused peer, up to a point, beyond which the positive competition effect will counterbalance it. We further conjecture that the competition effect will be relatively more pronounced when the market classification used by investors for assessing the market overlap is more fine-grained. Accordingly, we suggest that more sophisticated investors, who rely on more fine-grained market classifications, increase their shareholdings in non-accused firms to a greater extent than less sophisticated investors as the market overlap between the non-accused firm and the accused peer increases. Using elaborate data on products and investments, we analyze investors’ shareholdings and stock market returns of non-accused firms in the U.S. software industry following accusations of financial misconduct by their industry peers, and we find support for our predictions. Our study elucidates the interplay between stigma and competition following misconduct by industry peers.

Gender Differences in Performance Under Competition: Is There a Stereotype Threat Shadow?

The gender gap in income and leadership positions in many domains of our society is an undisputed pervasive phenomenon. One explanation for the disadvantaged position of women put forward in the economic and psychology literature is the weaker response of women to competitive incentives. Despite the large amount of literature trying to explain this fact, the precise mechanisms behind the gender difference in competitive responsiveness are still not fully uncovered. In this paper, we use laboratory experiments to study the potential role of stereotype threat on the response of men and women to competitive incentives in mixed-gender competition. We use a real effort math task to induce an implicit stereotype threat against women in one treatment. In additional treatments we, respectively, reinforce this stereotype threat and induce a stereotype threat against men. In contrast to much of the literature we do not observe that women are less competitive than men, neither when there is an implicit nor when there is an explicit stereotype threat against women. We attribute this to two factors which differentiates our experiment from previous ones. We control, first, for inter-individual performance differences using a within-subject design, and, second, for risk differences between non-competitive and competitive environments by making the former risky. We do find an adverse stereotype threat effect on the performance of men when there is an explicit stereotype threat against them. In that case any positive performance effect of competition is nullified by the stereotype threat. Overall, our results indicate that a stereotype threat has negative competitive performance effects only if there is information contradicting an existing stereotype. This suggests that the appropriate intervention to prevent the adverse effect of stereotype threat in performance is to avoid any information referring to the stereotype.