Selection bias and unobservable heterogeneity applied at the wage equation of European married women

This paper utilizes a panel data sample selection model to correct the selection in the analysis of longitudinal labor market data for married women in European countries. We estimate the female wage equation in a framework of unbalanced panel data models with sample selection. The wage equations of females have several potential sources of.

Are parties domocratizing themselves? the evolution of leardership selection in Spain (1977-2008)

The aim of this paper is to verify, for the Spanish case, whether between 1977 and 2008 has increased the internal democracy of the major political parties (PSOE, AP / PP, PCE / IU, PNV and CDC). To do this, we will focus on their leadership selection processes, one of the key elements associated with intra-party democracy. The paper is going to introduce data on four different dimensions of leadership selection: the certification process, the voting procedure, the inclusiveness of the selectorate and, finally, the degree of competitiveness. The results will show that have been few changes in the leadership selection processes of the Spanish political parties since 1977. However, the results of the Spanish case will also be used to suggest some preliminary links between the four dimensions.

Knowledge of Catalan, public/private sector choice and earnings: Evidence from a double sample selection model

This paper explores the earnings return to Catalan knowledge for public and private workers in Catalonia. In doing so, we allow for a double simultaneous selection process. We consider, on the one hand, the non-random allocation of workers into one sector or another, and on the other, the potential self-selection into Catalan proficiency. In addition, when correcting the earnings equations, we take into account the correlation between the two selectivity rules. Our findings suggest that the apparent higher language return for public sector workers is entirely accounted for by selection effects, whereas knowledge of Catalan has a significant positive return in the private sector, which is somewhat higher when the selection processes are taken into account.

Like milk or wine: Does firm performance improve with age?

Our empirical literature review shows that little is known about how firm performance changes with age, presumably because of the paucity of data on firm age. For Spanish manufacturing firms, we analyse the firm performance related to firm age between 1998 and 2006. We find evidence that firms improve with age, because ageing firms are observed to have steadily increasing levels of productivity, higher profits, larger size, lower debt ratios, and higher equity ratios. Furthermore, older firms are better able to convert sales growth into subsequent growth of profits and productivity. On the other hand, we also found evidence that firm performance deteriorates with age. Older firms have lower expected growth rates of sales, profits and productivity, they have lower profitability levels (when other variables such as size are controlled for), and also that they appear to be less capable to convert employment growth into growth of sales, profits and productivity.

Accounting conservatism and firm investment efficiency

Conservatism, through the timelier recognition of losses in the income statement, is expected to increase firm investment efficiency through three main channels: (1) by decreasing the adverse effect of information asymmetries between outside equity holders and managers, facilitating the monitoring of managerial investment decisions; (2) by increasing managerial incentives to abandon poorly performing projects earlier and to undertake fewer negative net present-value investments; and (3) by facilitating the access to external financing at lower cost. Using a large US sample for the period 1990-2007 we find a negative association between conservatism and measures of over- and under- investment, and a positive association between conservatism and future profitability. This is consistent with firms reporting more conservative numbers investing more efficiently and in more profitable projects. Our results add to a growing stream of literature suggesting that eliminating conservatism from accounting regulatory frameworks may lead to undesirable economic consequences.

On the effect of the geographical scope of agglomeration economies on firm location

This article analyses how agglomeration economies shaped the location decisions of new manufacturing start-ups in Catalan municipalities in 2001-2005. We estimate whether the locations of new firms are spatially autocorrelated and whether this phenomenon is industry-specific. Our aim is to estimate the geographical scope of agglomeration economies on firm entries. The data set comes from a compulsory register of manufacturing establishments (REIC: Catalan Manufacturing Establishments Register). JEL classification: R1, R3 Keywords: firm location; spatial autocorrelation

Growth, selection and appropriate contracts

We study a dynamic model where growth requires both long-term investment and the selection of talented managers. When ability is not ex-ante observable and contracts are incomplete, managerial selection imposes a cost, as managers facing the risk of being replaced tend to choose a sub-optimally low level of long-term investment. This generates a trade-off between selection and investment that has implications for the choice of contractual relationships. Our analysis shows that rigid long-term contracts sacrificing managerial selection may be optimal at early stages of economic development and when access to information is limited. As the economy grows, however, knowledge accumulation increases the return to talent and makes it optimal to adopt flexible contractual relationships, where managerial selection is implemented even at the cost of lower investment. Better institutions, in the form of a richer contracting environment and less severe informational frictions, speed up the transition to short-term relationships.

Like milk or wine: Does firm performance improve with age?

Our empirical literature review shows that little is known about how firm performance changes with age, presumably because of the paucity of data on firm age. For Spanish manufacturing firms, we analyse the firm performance related to firm age between 1998 and 2006. We find evidence that firms improve with age, because ageing firms are observed to have steadily increasing levels of productivity, higher profits, larger size, lower debt ratios, and higher equity ratios. Furthermore, older firms are better able to convert sales growth into subsequent growth of profits and productivity. On the other hand, we also found evidence that firm performance deteriorates with age. Older firms have lower expected growth rates of sales, profits and productivity, they have lower profitability levels (when other variables such as size are controlled for), and also that they appear to be less capable to convert employment growth into growth of sales, profits and productivity. Keywords: firm age, firm growth, LAD, financial structure, vector autoregression JEL CODES: L25, L20

Staffing strategies in SME's: determinants of external recruitment and internal promotion

The purpose of this paper is to examine the determinants of use internal or external labour market to fill a firm vacancy in SME’s taking into account the differences existing among blue and white collar jobs. Following different theories we can identify three main reasons for use internal candidates rather than external ones‐ firm specific knowledge, adverse selection problems and motivation‐. However, there are others factors that might affect this choice but the last theories don’t take into account. In this paper we try to shed some light on what are these other factors that may affect firm decision to use internal or external labour market. Particularly we analyses the relationship among new technologies, innovation activity and firm location on the staffing strategy. The results shows difference behaviour on the decision to fill a vacancy using internal or external labour markets between manufacturing and service firms, and this decision depends not only on firm internal characteristics, like technological complexity or innovation activity, but also on firm location. The results also support the hypothesis of ports of entry especially in the manufacturing sector.

Workers cooperation within the firm: an analysis using small and medium size firms

We investigate the determinants of teamwork and workers cooperation within the firm. Up to now the literature has almost exclusively focused on workers incentives as the main determinants for workers cooperation. We take a broader look at the firm's organizational design and analyze the impact that different aspects of it might have on cooperation. In particular, we consider the way in which the degree of decentralization of decisions and the use of complementary HRM practices (what we call the .rm.s vertical organizational design) can affect workers'collaboration with each other. We test the model's predictions on a unique dataset on Spanish small and medium size firms containing a rich set of variables that allows us to use sensible proxies for workers cooperation. We find that the decentralization of labor decisions (and to a less extent that of task planning) has a positive impact on workers cooperation. Likewise, cooperation is positively correlated to many of the HRM practices that seem to favor workers'interaction the most. We also confirm the previous finding that collaborative efforts respond positively to pay incentives, and particularly, to group or company incentives.

Profitability, uncertainty and multi-product firm product proliferation: The Spanish car industry

This article studies how product introduction decisions relate to profitability and uncertainty in the context of multi-product firms and product differentiation. These two features, common to many modern industries, have not received much attention in the literature as compared to the classical problem of firm entry, even if the determinants of firm and product entry are quite different. The theoretical predictions about the sign of the impact of uncertainty on product entry are not conclusive. Therefore, an econometric model relating firms’ product introduction decisions with profitability and profit uncertainty is proposed. Firm’s estimated profits are obtained from a structural model of product demand and supply, and uncertainty is proxied by profits’ variance. The empirical analysis is carried out using data on the Spanish car industry for the period 1990-2000. The results show a positive relationship between product introduction and profitability, and a negative one with respect to profit variability. Interestingly, the degree of uncertainty appears to be a driving force of entry stronger than profitability, suggesting that the product proliferation process in the Spanish car market may have been mainly a consequence of lower uncertainty rather than the result of having a more profitable market. Keywords: Product introduction, entry, uncertainty, multiproduct firms, automobile JEL codes: L11, L13

Profitability, uncertainty and multi-product firm product proliferation: The Spanish car industry

This article studies how product introduction decisions relate to profitability and uncertainty in the context of multi-product firms and product differentiation. These two features, common to many modern industries, have not received much attention in the literature as compared to the classical problem of firm entry, even if the determinants of firm and product entry are quite different. The theoretical predictions about the sign of the impact of uncertainty on product entry are not conclusive. Therefore, an econometric model relating firms’ product introduction decisions with profitability and profit uncertainty is proposed. Firm’s estimated profits are obtained from a structural model of product demand and supply, and uncertainty is proxied by profits’ variance. The empirical analysis is carried out using data on the Spanish car industry for the period 1990-2000. The results show a positive relationship between product introduction and profitability, and a negative one with respect to profit variability. Interestingly, the degree of uncertainty appears to be a driving force of entry stronger than profitability, suggesting that the product proliferation process in the Spanish car market may have been mainly a consequence of lower uncertainty rather than the result of having a more profitable market

Regional Determinants of Firm Entry in a Developing Country

Regional policies aiming to attract new firms are largely based on evidence that originates from Europe, the USA and Japan. This may raise doubts about the usefulness of such policies when applied to developing economies. This paper addresses this issue by providing estimates of the determinants of firm entry in the Argentinean provinces. We find that most of the determinants used in previous studies analysing developed countries are still relevant. However, there is a need for additional explanatory variables that reflect the specificities of developing economies. Key words: firm entry, regional economics, Argentina. JEL: R12; R30; C33

Measuring sustained superior performance at the firm level

This paper proposes a two-dimensional Strategic Performance Measure (SPM) to evaluate the achievement of sustained superior performance. This proposal builds primarily on the fact that, under the strategic management perspective, a firm's prevalent objective is the pursuit of sustained superior performance. Three basicconceptual dimensions stem from this objective: relativity, sign dependence, and dynamism. These are the foundations of the SPM, which carries out a separate evaluation of the attained superior performance and of its sustainability over time. In contrast to existing measures of performance, the SPM provides: (i) a dynamic approach by considering the progress or regress in performance over time, and (ii) a cardinal measurement of performance differences and its changes over time. The paper also proposes an axiomatic framework that ameasure of strategic performance should comply with to be theoretically and managerially sound. Finally, anempirical illustration of the Spanish banking sector during 1987-1999 is herein provided by discussing some relevant case

Enhanced Model Selection for motion segmentation

In this paper a novel rank estimation technique for trajectories motion segmentation within the Local Subspace Affinity (LSA) framework is presented. This technique, called Enhanced Model Selection (EMS), is based on the relationship between the estimated rank of the trajectory matrix and the affinity matrix built by LSA. The results on synthetic and real data show that without any a priori knowledge, EMS automatically provides an accurate and robust rank estimation, improving the accuracy of the final motion segmentation