Structure Conduct Performance Paradigm Research Articles

The impact of electricity sales side reform on energy technology innovation: An analysis based on SCP paradigm

The Electricity Sales Side Reform (ESSR) is a market-oriented reform directly targeting the electricity terminal, aimed at fostering a diversified and fully competitive market structure, particularly to encourage energy technology innovation (ETI). This study establishes a Structure-Conduct-Performance (SCP) framework, selects Chinese A-share listed companies from 2013 to 2019 as the research subjects, and employs the multi-period difference-in-differences (DID) method to examine the impact of ESSR on ETI. The primary findings are as follows: (1) ESSR effectively promotes ETI, indicating that changes in market structure enhance energy innovation performance. (2) ESSR stimulates long-term innovation incentives rather than short-term profit impulse, signifying that it intensifies market competition, optimizes resource allocation, and guides information disclosure, thereby supporting firms' ETI. This validates the theoretical paradigm of SCP. (3) The positive impact of ESSR on ETI exhibits heterogeneity. On the electricity generation side, the catalytic effect of ESSR on ETI is more pronounced in regions with lower traditional energy endowments and greater green electricity generation potential. On the electricity sales side, the incentive effect is more prominent in regions with higher electricity prices and a lower capacity in the electricity sales market. On the electricity consumption side, the incentive effect is stronger for enterprises with a cleaner energy structure and increased green investments. Therefore, our research findings bridge gaps in the existing literature and offer valuable insights for achieving a high level of ETI and facilitating energy structure transformation.

Do intellectual property rights promote foreign direct investment inflows and technological exports in developing and developed countries?

PurposeThis study aims to analyse the intellectual property rights (INPR), foreign direct investment (FDI) inflows and technological exports of 32 developing and developed countries for the period of 2006–2020.Design/methodology/approachDiagnostic tests were used to confirm the panel least squares, fixed effect, random effect, feasible general least squares, dynamic ordinary least squares and fully modified ordinary least squares estimator results as well as to increase the robustness.FindingsAccording to the findings for the developing countries, trademark, patent and industrial design applications, each had a significant positive long-run effect on FDI inflows. In addition, there was a significant positive long-run relationship between patent applications and medium- and high-technology exports. Meanwhile, trademark and industrial design applications had a significant negative long-term effect on medium- and high-technology exports. In developed countries, patent and industrial design applications each have a significant negative long-term on medium- and high-technology exports. Furthermore, patent and trademark applications each had a significant negative long-run effect on FDI inflows.Originality/valueThis study contributes significantly to the focus that host countries evaluate the technology gaps between domestic and foreign investors at different industry levels to select the best INPR rules and innovation process by increasing international cooperation. Furthermore, the host countries should follow the structure–conduct–performance paradigm based on analysis of the market structure, strategic firms and industrial dynamics systems.

Measuring the Competition Index in the Indonesian Manufacturing Industry: The Structure–Conduct–Performance Paradigm

This study proposed a fresh measure of the competition index in the Indonesian manufacturing industry during the period of 1990–2015. The competition index was estimated using indicators in the dimensions of the structure–conduct–performance paradigm. This research used principal component analysis to weigh the indicators in a dimension as well as to weigh the dimensions of the structure–conduct–performance in the final estimation of the competition index. This study found that the Indonesian manufacturing industry had a low competition. The dimension of structure had the highest contribution to the competition index compared to the dimensions of conduct and performance. The performance was also positively affected by the structure and conduct variables. This research contributed to the literature by providing a new competition index using the complete aggregated dimensions of structure, conduct, and performance. Policymakers could also use this competition index to indicate the level of competition in the industry as well as the sources of competition.

Macro investigation on China's engineering insurance industry: based on industrial organization theories

PurposeIn China, engineering insurance has been questioned as not being beneficial as expected. This paper seeks to further understand how China's engineering insurance industry functions and to provide a macro perspective explanation for engineering insurance's underdevelopment.Design/methodology/approachThree industrial organization hypotheses were extended to the engineering insurance context: structure conduct performance (SCP), relative market power (RMP) and efficiency structure (ES) hypotheses. This paper employed the Generalized Method of Moments (GMM) and Data Envelopment Analysis (DEA) bootstrap to test the hypotheses using panel data from 2008 to 2017.FindingsThe results suggest that the SCP paradigm is validated in China's engineering insurance market, indicating a concentrated market where the welfare of consumers (e.g. owners, contractors and designers) may be eroded. Several factors are identified to have significant impacts on engineering insurers' performance, such as the investment return, percentage of engineering business, the ratio of outstanding claims, the number of large contractors, market rivalry and entry barriers.Originality/valueDespite the sheer size of China's construction industry and the urgent need to improve risk management, the insurance industry that serves construction firms engineering insurance is underdeveloped. Engineering insurance is yet to be understood from a macro perspective, which may reveal the underlying reasons for engineering insurance's underdevelopment. The industrial organization theories provided a theoretical framework to test the functioning of this specific industry. The disaggregated data (engineering line specific) is employed to ensure effective regulation and policymaking.

Firm innovation and technical capabilities for enhanced export performance: the moderating role of competitive intensity

PurposeDrawing on the resource-based view (RBV) and structure–conduct–performance (SCP) paradigm perspectives, this study aims to investigate the influence of the innovation and technical capabilities of exporting organisations on their export performance moderate by competitive intensity.Design/methodology/approachPrimary data were collected from 162 Chinese manufacturer–exporter companies operating across China. The conceptual framework of this study, which incorporated the impact of RBV and SCP paradigm determinants on export performance through the interaction effect of competitive intensity, was tested using structural equation modelling (Smart-PLS).FindingsResults show that the technical and innovation capabilities can increase its export success in international markets. Furthermore, this research finds that competitive intensity moderates the positive relationship between technical capability and export performance but not the relationship between innovation capability and export performance.Originality/valueThis study presents a holistic assessment of the export performance of manufacturer–exporter enterprises by accounting for the overlooked effect of organisational capabilities through the moderating function of competitive intensity. This study has far-reaching consequences for export academics and practitioners, including the fundamental concept of an internationalizing small- and medium-sized enterprises, especially the manufacturers.

Assessing the nature of corporate environmental responsibility in Zimbabwe’s gold mining sector

Orientation: In Zimbabwe, mining is a significant economic sector but has adverse environmental impacts.Purpose: This article assesses environmental responsibility practiced by gold mining companies differentiated by ownership structure and assesses the ownership system that leads in environmental, social and governance practices.Motivation for the study: The adverse environmental impacts inherent in gold mining need assessments to gauge the integrity of the environmental stewardship using the structure–conduct–performance paradigm as an assessment framework.Design, methodology, approach: The mode of assessment is to establish, through the structure–conduct–performance paradigm, whether these governance systems affect the companies’ environmental performance, and if so, to what extent. The article uses a multiple case study design with a population of 35 large-scale gold mining companies that are members of both the Chamber of Mines of Zimbabwe and the Mine Industry Pension Fund, and 23 participated. The article uses a mixed methods approach using a questionnaire and structured interviews to collect quantitative and qualitative data, respectively. The study employed Kruskal–Wallis rank test, to rank the differences in governance structures’ performances.Findings: The results show that gold mining companies in Zimbabwe exercise environmental stewardship. Mining companies listed on foreign exchanges and local private limited companies exhibit more responsibility than other ownership types.Practical implications: Government policy to compel soil restoration and overburden management can improve these practices.Contribution/originality/value of the study: This study contributes to the burgeoning literature on corporate environmental responsibility by illuminating the possible role played by ownership structure in environmental responsibility.

Service supply chain resilience: a social-ecological perspective on last-mile delivery operations

PurposeConsidering the last-mile delivery service supply chain as a social-ecological system rather than just a firm-based service system, this research exploit the COVID-19 pandemic disruption to investigate how the supply chain develops resilience from a viewpoint that integrates a social-ecological perspective with the traditional engineering one.Design/methodology/approachThis research adopt a multi-case study approach using qualitative data collected via semi-structured interviews with executive-level managers from nine leading UK last-mile delivery companies. Data analysis is guided by a research framework which is developed by combining the social-ecological perspective with the structure–conduct–performance paradigm. This framework aids the investigation of the impacts of external challenges on companies' resilience strategies and practices, as well as performance, in response to disruptions.FindingsThe research identifies three distinct pathways to resilience development: stabilization, focussing on bouncing back to the original normal; adaptation, involving evolutionary changes to a new normal; transformation, involving revolutionary changes in pursuit of a new normal-plus. Three strategic orientations are identified as operating across these pathways: people orientation, digital orientation, and learning orientation.Originality/valueIn contrast to the manufacturing supply chain focus of most current research, this research concentrates on the service supply chain, investigating its resilience with a social-ecological perspective alongside the traditional engineering one.

Effect of CEO transformational leadership on organizational ethical culture and firm performance: the moderating effect of competitive intensity

Purpose The purpose of this study is to adopt the upper echelon theory to analyze the effect of chief executive officer (CEO) transformational leadership on organizational ethical culture and its subsequent impact on firm performance. The study also integrates the knowledge from the structure–conduct–performance paradigm to test whether the high degree of competitive intensity that firms experience could weaken the effect of organizational ethical culture on firm performance. Design/methodology/approach Online survey data were obtained from firms in Thailand that were randomly selected from the directory provided by the Department of Business Development (n = 200). Partial least squares structural equation modeling was used to analyze the data. Findings Organizational ethical culture significantly meditates the effect of CEO transformational leadership on firm performance. Moreover, the moderating effect analysis illustrates that the positive effect of organizational ethical culture on firm performance tends to be lower when firms have a high level of competitive intensity in the market. Originality/value Overall, this study adds new knowledge to the literature by showing that, although ethical culture created by transformational leaders can lead to high firm performance, the market environment in terms of competitive intensity could mitigate this benefit.

Empirical evaluation of structure-conduct-performance paradigm as applied to the Iranian Islamic banking system

PurposeThis paper aims to investigate the impact of market structure and market share on the performance of the Islamic banks operating in the Iranian banking system based on the structure-conduct-performance (SCP) paradigm.Design/methodology/approachThe Iranian Islamic banking system’s market structure is evaluated by using the econometrics method to test the validity of the traditional SCP paradigm. For this purpose, the authors estimate a simple regression model that is consisted of several independent variables, such as the market share, bank size, real gross domestic product, liquidity and Herfindahl-Hirschman index as a proxy variable for concentration and one dependent variable, namely, the profit as a proxy for performance. The panel data includes a data sample of 22 Islamic banks operating from 2006 to 2019. Data are extracted from the balance sheet of Islamic banks and the time-series database of the Central Bank of Iran and World Bank.FindingsThe study’s findings indicate that both concentration and market share have a positive impact on the performance of banks in the Iranian Islamic banking system. This result is contradicted with both traditional SCP and efficient structure hypotheses; however, it confirms the existence of oligopoly or cartel in the Iranian Islamic banking system that few banks try to gain the highest share of profit and maintain their market share by colluding with each other. This result is in contradiction with other research studies about the market structure in the Iranian banking system that claimed that banks in Iran operate under monopolistic competition. In addition, it shows that the privatization of some banks in Iran does not improve and help competition in the Iranian banking system.Originality/valueThis paper is a pioneer empirical study analyzing the market structure, concentration and collusion based on the SCP paradigm in Iranian Islamic banking. The results of the study support the existence of collusive behavior among the Islamic bank in Iran that is not aligned with Sharia. This study clearly shows the difference between ideal Islamic banking and Islamic banking in practice in Islamic countries. This clearly indicates that only prohibiting some operations like receiving interest, gambling and bearing excessive risk is not enough. In fact, the Islamic banking system should be based on the Sharia rule in all aspects and much more modification and study have to be done to achieve an appropriate Islamic banking system. These possible modifications to overcome the issues of cartel-like market structure and collusive behavior in the Iranian Islamic banking system include making the Iranian banking system more transparent, letting foreign banks enter the Iranian banking system and minimizing the government intervention in the Iranian banking system.

Explaining mutual fund behavior through the structure‐conduct‐performance lens

AbstractThis paper examines mutual funds. These are economically important as the largest institutional investors, and form an important principal‐agent relationship as custodians of retirement savings. Despite a huge literature, there is no agreed explanation of mutual fund behavior. This analysis links mutual fund research across disciplines under the structure‐conduct‐performance paradigm (SCP), which is widely used in strategy research to explain firm actions and results. SCP explains mutual fund actions after placing the fund manager at the center of fund operations, where their conduct is driven by structure of markets and the funds management industry. Structural influences on fund managers include unpredictability of markets, the oligopolistic nature of the mutual fund industry, and disengagement of clients. As a result, funds derive income as commission on assets under management, which is sub‐optimal for clients. In addition, fund managers' conduct is driven by their homogeneity and socialization with competitors and investee firms. While the most obvious role of fund managers is construction of investment portfolios, outperformance is not their sole, or perhaps even principal, objective. The SCP lens offers insights into mutual funds of value to fund managers, investors, regulators and executives of investee firms. This paper impounds evidence from real‐world data in theory to offer an actor‐centric perspective of investment which is an archetypal practitioner driven discipline.

Challenges and Opportunities Underlining Africa’s Aviation Landscape: A Multiple Lenses Analysis

Aim/Purpose: This study sought to apply the Structure Conduct Performance paradigm to Africa´s air transport landscape in general. To do that it examines the past, present and future expectations of four of Sub-Saharan Africa’s biggest avia-tion economies namely South Africa, Kenya, Ethiopia and Nigeria. Second-ary data containing historical passenger traffic was analysed and predictions for growth in the next ten years proposed. Background: There is consensus that overall the future of aviation in Africa has significant economic potential with significant other challenges needing to be overcome. The existence of a large land mass that requires connecting with itself, a growing population and specifically a growing middle class with an appetite for air travel, an extensive extractives sector and a growing tourism sector can provide the necessary demand conditions. In support of this, regional economic communities have led the way in implementation of Yamoussoukro Declaration (YD). This is especially so in West Africa through the West African Economic and Monetary Union (WAEMU) and the Banjul Accord Group (BAG), which have facilitated the development of the most, liberalized air transport market in Africa. At a higher level, the full implementation of YD requires that states disengage from the industry, liberalise access and facilitate the increased participation of the private sector. Some of the challenges that need to be actioned include high user charges and taxes, under-capitalization of African airlines and insufficient management experience, which have contributed significantly to the low profitability of African airlines. Methodology: The case study approach is generally used to generate an in-depth comprehension of a complex issue in real-life. It is an established research design that is used extensively in a wide variety of disciplines, particularly in the social sciences. The study adopts a quantitative methodology based on the selected regional sample of countries under study and adopts the Structure Conduct Performance (SCP) model as a framework for analysis. The data set was for the previous twenty years and it was exposed to linear extrapolation to determine the expected future growth. Trend lines were included and standard regression modelling revealed the R2 value for international and total air passengers per country. Findings: The research findings exposed the possibility of a significant upside in the development of the aviation industry in Africa ceteris paribus. In all the countries analysed it appears that the development of the industry is sup-ported by strong tourism and travel demand by international tourists, and the various individual country as well as continent-wide measures towards lib-eralization of the African airspace. Impact on Society: The findings of this study have shown that intra-Africa travel can be en-hanced by a strong collaboration between airlines and states. Some strong opportunities have arisen from the enhancement of deep ties between na-tional champions like Ethiopian Airlines and regional carriers in West Afri-ca. Indicating that cross border and cross airline partnerships are a key in-gredient for airlines to make a significant contribution to the economies in Africa.

Corporate sustainability strategies in institutional adversity: Antecedent, outcome, and contingency effects

AbstractThis study examines (i) how top‐level managerial institutional ties drive corporate sustainability strategies of emerging market firms operating under conditions of institutional adversity; (ii) the impact of corporate sustainability strategies on market performance; and (iii) the moderating role of financial resource slack on the relationships between corporate sustainability strategies and market performance. The study builds from institutional development logic and the structure–conduct–performance paradigm. Primary data are collected from 300 firms operating in a major sub‐Saharan African market. Findings show that top‐level managerial institutional linkages with regulatory national governmental officials, local community leaders, and top managers at other firms drive corporate proactive and responsive sustainability strategies, which in turn influence market performance. In addition, the findings reveal that financial resource slack strengthens the path between corporate proactive sustainability strategies and market performance, but not the path between corporate responsive sustainability strategies and market performance. Theoretical and practical implications are discussed.

The coevolutionary relationship of technology, market and government regulation in telecommunications

The telecommunications industry has been undergoing tremendous technological changes, and owning to continuous technological advancement, it has maintained sustained prosperity and development. In this paper, the interplay between technology, market and government in telecommunications is discussed briefly, and then we introduce technology and government into the traditional SCP (Structure — Conduct — Performance) paradigm to develop an industry analysis framework called TG-M(SCP) (Technology — Government — Market (Structure — Conduct — Performance)). Based on this framework, we present the spiral co-evolution model which elaborates on the interaction mechanism of technological innovation with government regulation and market dynamics from the perspective of industry evolution. Our study indicates that the development of the telecommunications industry is the result of the coevolution of technology, government regulation and market forces, and among the three actors, technology is the fundamental driving force. Relative to the invisible hand (market) and visible hand (government), we conceptualize technology as the third hand, which fundamentally drives the development of telecommunications industry in coordination with the other two hands. We also provide several policy implications regarding these findings.

Antecedents of Brand Management Adaptation/Standardization and Its Influence on Firms’ Performance

In this paper we analyze the antecedents and consequences of brand adaptation/standardization strategies in case of developing country. To explore this impact we ground on Structure-Conduct-Performance paradigm (SCP) where structure (analyzed through domestic product acceptance and market structure) drives conduct (strategic choices regarding adaptation/standardization of brand management elements), which in turn drives performance (viewed through market share and costs). Our results indicate that adaptation/standardization is not equally applicable to all elements of brand management strategy. Rather, domestic products acceptance in a foreign market and market structure have different effects on the level of adaptation/standardization of brand’s product, pricing, distribution and promotion strategies. While market structure complexity increases importance of adaptation of all elements, greater domestic product acceptance allows for product and promotion strategies to remain standardized. Subsequently, adaptation/standardization of each element of the brand strategy differently influences brand market share in a foreign market and brand management costs. As a result, we learn that adaptation of pricing and promotion strategies will drive brand’s market share. However, adaptation of promotion strategy will also increase brand management costs, while distribution strategy adaptation, although having no effect on brand’s market share, will have an impact on decrease of brand management costs. DOI: http://dx.doi.org/10.5755/j01.ee.28.3.16884

The profitability of Chinese banks: impacts of risk, competition and efficiency

PurposeThis study aims to test the impacts of risk-taking behaviour, competition and cost efficiency on bank profitability in China.Design/methodology/approachA two-step generalized method of moments system estimator is used to examine the impacts of risk, competition and cost efficiency on profitability of a sample of Chinese commercial banks over the period 2003-2013.FindingsThe paper finds that credit risk, liquidity risk, capital risk, security risk and insolvency risk significantly influence the profitability of Chinese commercial banks. To be more specific, credit risk is significantly and negatively related to bank profitability; liquidity risk is significantly and positively related to return on assets (ROA) and net interest margin (NIM) but negatively related to return on equity (ROE); capital risk has a significant and negative impact on ROA and NIM but a positive impact on ROE; there is a significant and negative impact of security risk on bank profitability (ROA and NIM). It is found that Chinese commercial banks with higher levels of insolvency risk have higher profitability (ROA and ROE). Finally, higher competition leads to lower profitability in the Chinese banking industry, and Chinese commercial banks with higher levels of cost efficiency have lower ROA. In other words, the structure–conduct–performance paradigm rather than the efficient–structure paradigm holds in the Chinese banking industry.Originality/valueThis is the first paper to investigate the impact of different types of risk, including credit risk, liquidity risk, capital risk, security risk and insolvency risk, on bank profitability. This is the first study which uses more accurate measurements of efficiency and competition compared to previous Chinese banking profitability literature and which tests their impact on bank profitability. The findings not only provide a general picture on the risk, efficiency and competition conditions in the Chinese banking industry, but also give valuable information to the Chinese Government and to the banking regulatory authorities to make relevant policies.

Innovation's Impact on SMES' Financial Performance through Voluntary Disclosed Information

The purpose of this paper is to study the effect of innovation on Small and Middle-sized Enterprises’ performance in comparison with the effect of the industrial activity of the company. The economical measuring of performance was made by Cash Flow over Total Asset. As independent variables we used two indicators based on the information voluntarily disclosed by the companies, one to measure innovation and the other to catalogue the activity differently than the industrial classifications. The sample included a total of 920 companies from the Spanish automobile components industry (81% SMEs and 19% large companies). The results show that 2008 crisis is the factor with the greatest impact on the results; the companies that innovate the least experience a lower cash flow on assets, companies with a medium level of innovation, mainly Middle-Sized firms, have best results; moreover, the efficiency of innovation is reduced beyond a threshold that marks the boundary between the Structure–Conduct–Performance paradigm and the Resource–Based Approach.

Competition and Industry Performance: A Panel VAR Analysis in Indian Manufacturing Sector

This study tries to investigate the relationship between competition and performance in a dynamic framework in the post liberalisation era with the help of Structure Conduct Performance paradigm. By employing panel VAR estimation procedure on 23 Indian manufacturing industries that comprise of BSE listed manufacturing firms, the study finds that Structure Conduct Performance paradigm does not always hold true in Indian manufacturing scenario in the post liberalisation period. This might be because with the introduction of competition in the market, the larger firms are still practising anticompetitive strategies to have a control over the market. The relationship between performance and conduct indicates that competition has not fully succeeded in eliminating the imperfections from the market.

English

This study focuses on analyzing the functioning of the marketing systems of jew’s mallow (Corchorus olitorius) produced in Agbedranfo (Dogbo), Southwest Benin. The methodological approach used was based on the Structure-Conduct-Performance paradigm (SCPA). A total of 60 producers, 28 retailers and 4 wholesalers were sampled. The results identified two jew’s mallow marketing systems based on sales periods and production locations: marketing system of jew’s mallow production was based on lowlands and of upland jew’s mallow marketing system. The net margin for jew’s mallow produced in Agbedranfo was 3.24 for producers, 9.67 for retailers and 8.37 for wholesalers in lowland jew’s mallow marketing system. However, the relative net margins of these actors in the marketing system of upland jew’s mallow were low. Moreover, a Gini coefficient of 0.34 showed an equal distribution of the gross margins obtained in the marketing system of lowland jew’s mallow. The study therefore, concludes that wholesalers and retailers have higher net margins than producers. Thus, a dialogue between marketing stakeholders themselves, extension agents, non-governmental oragnisations (NGOs), and public authorities is therefore desired. Key words: Jew’s mallow, marketing, profitability, SCP paradigm, margin.

Thirteen Editions of The Structure of American Industry: An I.O. Perspective

This article examines the content and longevity of The Structure of American Industry, edited first by Walter Adams and later by James Brock, through its 13 editions. The changing composition of industry case studies and their contributors are chronicled. The application of the Structure–Conduct–Performance paradigm for the study of industries is also assessed. As representatives of the approach and themes of the book, the chapters on Steel and on Public Policy are explored as they evolve through the multiple editions. The impact of the 13 editions is assessed in light of other books that contain industry case studies [L1, L22, L6].

SCP-relevance and class-effect in performance – A comparative analysis of restaurants and petroleum firms

The importance of industry-specific factors for a firm's performance has often attracted the attention of researchers, managers, and investment analysts. This research uses random-effect variance component analysis to examine the relevance of structure-conduct-performance (SCP) paradigm in the context of restaurant and petroleum/natural gas firms. The study further investigates class-effect in firm performance by analyzing whether the relative importance of industry-and-firm-level effects varies across different performance groups. Results suggest a direct relevance of the SCP paradigm and industry-specific factors for firm performance, and a distinct dominance of industry-effect over firm-effect regardless of the choice of accounting or value based performance measures. Results further reveal varying roles of industry and firm-level factors (corporate or strategic) across middle-of-the road and non-average (exceptional) performance groups. As such the importance of SCP paradigm and the strategic role of both industry-and-firm effect factors for value creation in US based restaurant firms is better understood.