US Intrafirm Trade: Sectoral, Country and Location Determinants in the 90s.

This paper studies the evolution and determinants of US interfirm trade between 1989-98. We will extend preview: similar econometric testing not only by using more recent data but also by considering inter-country differences In addition to inter-sectoral variation of interfirm trade. At the sectoral revet relevant factors appear to be technology intensity, the level of vertical integration, economies of scale and lh' Ie?eI of international production, as well as the impact of the geographic concentration of US parent firms. At the country level, the size of the market and some country specificities appear to favor interfirm trade while increasing levels of the tax rate on profits of th/ foreign country and economic distance disincentives this trade.

Empirical Tests Of Optimal Cognitive Distance

This article provides empirical tests of the hypothesis of ‘optimal cognitive distance’, proposed by Nooteboom (1999, 2000), in two distinct empirical settings. Variety of cognition, needed for learning, has two dimensions: the number of agents with different cognition, and differences in cognition between them (cognitive distance). The hypothesis is that in interfirm relationships optimal learning entails a trade-off between the advantage of increased cognitive distance for a higher novelty value of a partner’s knowledge, and the disadvantage of less mutual understanding. If the value of learning is the mathematical product of novelty value and understandability, it has an inverse-U shaped relation with cognitive distance, with an optimum level that yields maximal value of learning. With auxiliary hypotheses, the hypothesis is tested on interfirm agreements between pharmaceutical companies and biotech companies, as well as on interfirm agreements in ICT industries.innovation;organizational learning;ICT;biotechnology;alliances

Interfirms Collaboration - the Basis for Interorganizational Innovation

In the current economic environment, interfirm collaboration for innovation is increasingly present because of the opportunities for growth and development that it offers to the partners involved and it is included in the company’s strategy, designed primarily to obtain high competitiveness. This paper aims to highlight the forms/modalities of inter-firm collaboration through which interorganizational innovation is achieved (strategic alliances, strategic entrepreneurship), and organizational levels at which this occur (subsidiaries of multinational organizations, departments of R & D).innovation, interfirm collaboration, interorganizational innovation, coinnovation, incremental innovation, radical innovation, transformational leadership, strategic alliance, strategic entrepreneurship

Capabilities, Confusion, and the Costs of Coordination On Some Problems in Recent Research On Inter-Firm Relations

The arguably dominant approaches to the study of interfirm relations are the capabilities and organizational economics perspectives. This paper discusses their merits and weaknesses, concentrating on the capabilities perspective, which is argued to rest on rather weak foundations, particularly as a theory of economic organization (including interfirm relations). However, it is suggested that both perspectives may be seen as part of an overarching bargaining approach to economic organization (yet to be developed). Both perspectives have identified impediments to efficient bargaining.Interfirm relations, capabilities, organizational economics, research methodology

Transferring and creating technological knowledge in interfirm R&D relationships: The initiation and evolution of interfirm learning.

In this study, we examine the initiation and evolution of interfirm learning in interfirm R&D relationships. Based on in-depth case studies, we suggest that the process of learning in interfirm R&D relationships consists of different challenges: 1) initiating technological knowledge transfer, 2) continuing technological knowledge transfer, and 3) moving towards the joint creation of new technological knowledge. Our findings identify conditions needed to initiate knowledge transfer: the presence of legal knowledge transfer clauses, overlapping skills and equipment, fragile trust and organizational similarity. The continuance of knowledge exchange implies complementary modes of collaborating characterized by sharing technologies which are oriented towards different applications. Joint knowledge creation implies convergence on the level of applications which only becomes feasible when prior knowledge exchange processes have generated resilient levels of trust. These observations point to the relevance of conceiving and organizing interfirm R&D relationships in a timephased, differentiated manner.Applications; Case studies; Convergence; Exchange; Interfirm learning; Interfirm R&D; Knowledge; Knowledge creation; Knowledge transfer; Learning; Processes; R&D; Similarity; Studies; Technology; Trust;

Co-operative competition: a Foucauldian perspective

This paper considers the extent to which Michel Foucault's conception of power gives a useful explanation of power relations between firms. It examines the perceived shift in the nature of interfirm relations from the traditional model in which firms operate as autonomous units within a competitive industry, to the co-operative competition model whereby firms engage in co-operation at certain levels of their operations and compete at other levels. It argues that the concepts of power and competition are closely intertwined and that an understanding of how power operates can give a greater understanding of the nature of competition within an industry. However the issue of power relations in the presence of co-operative competition has not been adequately explored by the literature. An analysis of the type of power reflected in interfirm relations is held as being the key to understanding the simultaneous existence of co-operation and competition between firms

Economic Arguments in U.S. Antitrust and EU Competition Policy: Two Roads Diverged

In this paper, I compare economic arguments in U.S. Supreme Court antitrust and EU Court of Justice competition policy decisions on four topics: refusal to deal, predation, vertical contracts, and hor- izontal interfirm relations.

The Organization of Production and Economic Development

A formalization of the Coase-Williamson-Cheung theory of the firm is used to examine the trade-off between the firm and the market as institutions for organizing production in a dynamic, general equilibrium model with increasing returns to labor specialization. The model considers the interaction of internal and external transaction costs and the gains to labor specialization in determining important aspects of the organization of production including the degree of labor specialization, the size and specialization of firms and the pattern of interfirm trade. Endogenous growth is driven by capital accumulation and the division of labor. The evolution of economic organization is characterized by increases in labor specialization, interfirm trade, firm specialization (vertical disintegration) and firm employment.development; endogenous growth; labor specialization; dynamic model; institutions; division of labor; growth; transactions costs; coordination; coordination costs; contract enforcement; organization; neoinstitutionalism; traditional economy; interpersonal exchange; theory of the firm; interpersonal exchange

Corporate competition: A self-organized network

A substantial number of studies have extended the work on universal properties in physical systems to complex networks in social, biological, and technological systems. In this paper, we present a complex networks perspective on interfirm organizational networks by mapping, analyzing and modeling the spatial structure of a large interfirm competition network across a variety of sectors and industries within the United States. We propose two micro-dynamic models that are able to reproduce empirically observed characteristics of competition networks as a natural outcome of a minimal set of general mechanisms governing the formation of competition networks. Both models, which utilize different approaches yet apply common principles to network formation give comparable results. There is an asymmetry between companies that are considered competitors, and companies that consider others as their competitors. All companies only consider a small number of other companies as competitors; however, there are a few companies that are considered as competitors by many others. Geographically, the density of corporate headquarters strongly correlates with local population density, and the probability two firms are competitors declines with geographic distance. We construct these properties by growing a corporate network with competitive links using random incorporations modulated by population density and geographic distance. Our new analysis, methodology and empirical results are relevant to various phenomena of social and market behavior, and have implications to research fields such as economic geography, economic sociology, and regional economic development.Organizational networks; Interfirm competition; Economic geography; Social networks; Spatial networks; Network dynamics; Firm size dynamics