Drivers of firm performance: a holistic and multivariate panel data approach

Firm performance is important for a number of reasons related to job creation, firm survival, innovation, competiveness and overall economic performance; motivating a large body of research on its determining factors. It is essential to consider the macroeconomic environment in any firm performance analysis, as this determines the strategies employed by firms, as well as subsequent performance. Despite the imperative of such research, a lacuna exists in the literature. To address this gap, a holistic multivariate model is developed which relates firm performance to firm-level characteristics, firm strategy and key elements of the macroeconomic environment. This thesis, therefore, investigates the determinants of firm- level performance using descriptive analysis and System Generalised Method of Moments (SYS-GMM) regression models to analyse panel datasets from the Irish Census of Industrial Production and Annual Services Inquiry for 2,200 firms covering the manufacturing and services industries in Ireland over the period 1991-2007. This provides insights on the performance of firms during an export-led growth phase (1991-2000) and a credit-led domestic demand-driven growth phase (2001-2007) in the Irish economy. Results show that the performance of firms is strongly influenced by changes in the macroeconomic environment, with manufacturing firms showing higher employment growth during the period of export-led growth and higher turnover and productivity performance during the credit-led domestic demand-driven growth phase. The impact of firm strategy on firm performance is also moderated by macroeconomic conditions, with firms adopting strategies such as trade and training to increase turnover and productivity during the second growth phase. A strong negative firm size-growth effect is found which remained robust to time period, industry and ownership type. There are performance differentials between foreign and domestic firms, with domestic firms performing better than foreign firms in terms of employment and turnover, while foreign firms showed higher productivity performance. These results imply that small Irish-owned firms are important sources of job creation and output growth. Overall, in many of the firm performance model specifications in this study, the effect of the determinants on firm performance is dependent on the definition of firm performance and firm size employed. These results suggest the need to adopt a holistic multivariate approach to the study of firm performance which incorporates both internal (firm-specific characteristics and strategy) and external factors (the macroeconomic environment). The multidimensional nature of firm performance should also be taken into account through the use of multiple firm performance measures for any meaningful analysis. Finally, the findings suggest a potential role for policy aimed at ensuring macroeconomic stability, supporting small indigenous firms and improving their productivity so as to ensure that they are more competitive in global markets. This study not only makes an important contribution to the firm performance literature, the results also have possible policy implications in the area of small business development

An exploratory study of local social innovation initiatives for sustainable poverty reduction in Nigeria

The eradication of extreme poverty remains an intractable global challenge. This paper explores social innovation (SI) as a strategy for fostering sustainable poverty reduction in a developing country, Nigeria. Analysis is based on semi-structured interviews with founders of SI initiatives. Findings indicate SI as a sustainable poverty reduction strategy because it addresses: (i) some underlying causes of poverty such as poor nutrition and lack of access to education; (ii) different dimensions of sustainability (i.e., economic, social and environmental). The study also identifies socially innovative cultural practices such as traditional rotational saving/credit and apprenticeship schemes which help eradicate poverty by ensuring improved access to finance and encouraging entrepreneurship. Furthermore, results indicate local SI initiatives in Nigeria are largely private sector-led, while a weak institutional environ?ment hampers expansion. The study highlights the need for policy aimed at identifying, strengthening and scaling up innovative local practices, and creating favourable framework conditions for SI.</p

R&D grant and tax credit support for foreign-owned subsidiaries: Does it pay off?

Foreign-owned subsidiaries make significant contributions to national Research and Development (R&D) in many host countries. Policymakers often support subsidiaries through R&D grants and R&D tax credits. A key objective of this funding is to leverage R&D-driven firm performance benefits for the host economy. However, the subsidiary's parent firm may decide not to exploit the results from publicly-funded R&D projects in the host country. Therefore, supporting subsidiaries’ R&D presents a risk that significant amounts of public funding may translate into little, or no payoffs for the host economy. Our study provides the first evaluation of 1) whether public R&D funding stimulates additional R&D investment in subsidiaries, 2) whether policy-induced R&D drives subsidiary performance, and 3) the differential effects of R&D grants and R&D tax credits. Drawing on a unique panel dataset for Ireland (2007-2016), we find that both R&D supports drive subsidiary R&D, resulting in substantial host country firm performance benefit

Drivers of SME performance: a holistic and multivariate approach

To examine the drivers of small- and medium-sized enterprise (SME) growth, we adopt a holistic multivariate modelling approach, integrating macroeconomic determinants with the internal (firm characteristics and firm strategy) drivers more commonly investigated in firm growth studies. Utilising such an extended set of variables addresses a gap in the extant firm growth literature in relation to external growth factors, offering novel insights on the seeming randomness of firm growth. Our system generalised method of moments estimation results indicate that the macroeconomic environment influences firm growth both directly and indirectly. Based on the study of manufacturing SME growth in Ireland, our findings provide evidence on the integrated effects of macroeconomic conditions, firm characteristics and firm strategy for SME growth. They also highlight, from a theoretical perspective, the need to acknowledge the multidimensional nature of SME growth

Analysing the drivers of services firm performance: evidence for Ireland

We examine drivers of firm performance using a holistic multivariate model which relates services firm growth to firm-characteristic, firm strategy and macroeconomic variables. Using data for 905 services firms in Ireland over the period 2001-2007, we employ System Generalised Method of Moments estimations and multiple firm performance measures to address the possible endogeneity and multidimensionality of firm-level performance. This paper provides empirical evidence on the factors determining services firm performance and the channels through which this occurs. Results confirm the importance of macroeconomic conditions for firm performance. We also find that small services firms in Ireland grew quicker during this period

In praise of peer observation of teaching: inter-disciplinary reflections from early career

This paper presents critical reflections on the interdisciplinary peer observation experiences of early career lecturers at an Irish University in 2020. Participants (from electronic engineering, economics, history and law disciplines) engaged in a reciprocal peer observation of teaching process. This article highlights the observations and lessons learned from the experiences of the participants. In doing so, the study demonstrates the potential benefits of interdisciplinary peer observation, which may encourage early career teachers to adopt a similar approach for teaching observations in other higher-level education institutes.</p

R&D grants and R&D tax credits to foreign‑owned subsidiaries: Does supporting multinational enterprises’ R&D pay of in terms of frm performance improvements for the host economy?

The subsidiaries of foreign-owned multinational firms make significant contributions to national Research and Development (R&D) in many host countries. Policymakers in host countries often support subsidiaries’ R&D efforts, through R&D grants and R&D tax credits. A key objective of this funding is to leverage R&D-driven firm performance benefits for the host economy. However, the subsidiary's parent firm may decide not to commercially exploit the results from host country-funded R&D projects, in the host country. Therefore, supporting subsidiaries’ R&D presents a unique risk, that significant amounts of scarce public R&D funding may translate into little, or no firm performance payoffs for the host economy. To address this issue, we construct a unique panel dataset, containing 24,404 observations of firms in Ireland over a 10-year period. Using this rich data, we first evaluate the impact of R&D grants and R&D tax credits on subsidiaries’ R&D. We then examine the link between policy-induced R&D from each policy instrument, and subsidiaries’ firm performance in the host country. Our study provides the first evaluation of (1) whether public R&D funding stimulates additional R&D investment in subsidiaries, (2) whether policy-induced R&D drives subsidiaries’ firm performance in the host country, and (3) the differential effects of R&D grants and R&D tax credits. We find that both R&D policy instruments drive subsidiary R&D, and that the policy-induced R&D results in substantial host country improvements in turnover, exports, and value added. Our results suggest several policy implications, particularly for economies pursuing an R&D strategy which targets foreign-owned subsidiaries.</p