Firm Size and the Relationship Between Wage Dispersion and Firm Performance

Author(s):  
Homero Zambrano

A simple theoretical model explains the divergent empirical results concerning the effect of wage dispersion on firm performance. First, causality in the relationship is clarified. Then, through the model, it is shown that firm performance is non-monotonic with respect to wage dispersion. Likewise, it is shown that large firms are more likely to benefit from a dispersed wage structure than small firms.

2017 ◽  
Vol 13 (1) ◽  
pp. 21-27 ◽  
Author(s):  
Basmah Altuwaijri ◽  
Lakshmi Kalyanaraman

We study the relationship of top management team’s (TMT) pay with firm performance with a sample of 80 firms listed on Saudi stock market. We find that firm performance and firm size emerge as significant variables in explaining TMT compensation. This is in line with many of the earlier studies which proxy the firm performance as the ability of the firm to pay higher compensation and firm size as a proxy for complexity of operations. We find that large firms and firms with better financial performance pay higher compensation to their TMT. When we group the firms into large firms and small firms, we find that firm size and firm performance are significant variables that influence TMT pay only in case of large firms. Our results show that firm size does not influence TMT pay and only firm performance impacts TMT pay.


1983 ◽  
Vol 43 (4) ◽  
pp. 953-980 ◽  
Author(s):  
David C. Mowery

The literature on the development of American industrial research suggests that during the twentieth century large firms “dominated” industrial research, and reaped the majority of the benefits from such activity. This paper utilizes new data to analyze both the relationship between firm size and research employment and the impact of research activity on firm growth and survival during 1921–1946. The results suggest that large firms were no more research-intensive than were small firms during the 1921–1946 period. Research activity significantly enhanced the probability of firms' survival among the ranks of the 200 largest manufacturing firms during 1921–1946. Research employment also improved the growth performance of both large and small firms during 1933–1946.


2019 ◽  
Vol 15 (3) ◽  
Author(s):  
Ken Yahagi

Abstract This paper presents a simple theoretical model to analyze the relationship between hate groups and hate crimes. This paper focuses on two important roles of hate groups; as providers of membership benefits for group members and as a coordination device for leadership. This paper shows that this interaction implies the possibility of multiple equilibria of the crime rate. This result explains why hate crimes and extreme criminal activities vary across communities and over time, and why a social shock such as 9/11 resulted in a rapid increase of hate crimes. Moreover, if hate groups work as coordination devices, the existence of hate groups may increase hate crimes. This result supports recent empirical results analyzing relationships between hate groups and hate crimes.


ILR Review ◽  
1996 ◽  
Vol 49 (4) ◽  
pp. 707-728 ◽  
Author(s):  
William E. Even ◽  
David A. MacPherson

The well-documented lower labor turnover in large firms than in smaller firms has been cited as evidence that large firms pay workers above their opportunity wage. This study investigates whether the relationship between firm size and turnover can instead be accounted for in part by size-related differences in the availability, portability, or generosity of pension plans. Analyzing extensive data for the years 1973–93, the authors find that pension coverage was associated with a greater reduction in worker turnover in large firms than in small firms. They also find that when appropriate controls for worker characteristics are employed, there is virtually no association between firm size and labor turnover for workers not covered by a pension.


1987 ◽  
Vol 12 (2) ◽  
pp. 41-52 ◽  
Author(s):  
Davinder Singh ◽  
Ronald P. Wilder ◽  
Kok Poh Chan

This study examines the relationship between firm size and tax rates. Contrary to other recent studies, these findings demonstrate that corporations in the smallest size group pay the highest effective corporate tax rates. 1 It is suggested that the higher tax rates of small firms can be explained in terms of selling, general and administrative expenses. Selling, general and administrative expenses as a ratio to sales are more than 50% higher for small corporations than for the largest firms in the non-durable manufacturing industry group.


2012 ◽  
Vol 38 (1) ◽  
Author(s):  
Marisa Dos Reis Azevedo Botelho ◽  
Adriano Filipe da Silva Maia ◽  
Luciano Augusto Vega Pires

O trabalho analisa a relação entre inovação e porte das empresas, com o objetivo de diferenciar a contribuição de grandes e pequenas empresas para a atividade de inovação. A análise é realizada através das características do esforço inovativo empreendido pelas empresas, obtido pela relação entre receita de vendas egastos em atividades inovativas. Primeiramente, analisam-se as evidências teóricas e empíricas sobre o tema, com ênfase na literatura que resgata as contribuições schumpeterianas e os testes de suas hipóteses principais. Na seqüência, são apresentados dados recentes sobre esforço inovativo, destacando as diferenças entre empresas de portes distintos, no tocante a gastos em P&D, aquisição externa de P&D, aquisição de outros conhecimentos externos e aquisição de máquinas e equipamentos. São utilizadas as bases de dados da CIS 6 (Community Innovation Survey, 2008) e da PINTEC 2005/2008 (Pesquisa de Inovação Tecnológica). A análise destes dados indica que o conjunto das pequenas empresas que inovaapresenta um esforço inovativo superior ao das empresas de grande porte na maior parte dos países analisados, o que destaca a importância destas empresas para a atividade de inovação.Abstract: The main purpose of this paper is to analyze the relationship between innovation and size of the firms, in order to show that the contributions of large and small firms to the innovation activity are distinct. This is done by means of the analysis of the innovative efforts features, which happens to be the ratio of innovations expenditures by sales. First of all, the main theoretical and empirical evidences concerning this subject are investigated, emphasizing the schumpeterian contributions and his assumptions tests. Next, recent data on innovative efforts are presented to highlight the distinctions between different sized firms, with respect to R&D expenditures, acquisition of external R&D, acquisition of other external knowledge and acquisition of machinery and equipment. We use the databasesCIS6 (Community Innovation Survey, 2008) and PINTEC 2005/2008 (Pesquisa de Inovação Tecnológica). The conclusion of this work is that innovative smallfirms present an innovative effort greater than large firms in almost all countries considered, a fact that remarks the relevance of small firms to innovation nowadays.Key-words: technology innovation; innovative effort; firm size; SMEs.JEL: L25; O30; O31.


2006 ◽  
Vol 12 (3) ◽  
pp. 209-222 ◽  
Author(s):  
Martie-Louise Verreynne

ABSTRACTThis paper argues that individual small firms just like large firms, place differing emphasis on strategy-making and may employ different modes of strategy-making. It offers a typology of the different modes of strategy-making that seem most likely to exist in small firms, and hypothesises how this typology relates to performance. It then describes the results of an empirical study of the strategy-making processes of small firms. The structural equation analysis of the data from 477 small firms with less than 100 employees indicates among other results that the simplistic, adaptive, intrapreneurial and participative modes of strategy-making exist in these small firms. Of these modes, the simplistic mode exhibits the strongest relationship with firm performance.


2019 ◽  
Vol 0 (0) ◽  
Author(s):  
Euncheon Lim ◽  
Dohyeon Kim

Abstract Although a cumulative body of literature explains entrepreneurial orientation (EO) and firm performance, there remain differing views on the mechanisms underlying this relationship. The purpose of this study is to investigate the effect of EO on firm performance by considering the roles of dynamic capabilities (DC) and corporate entrepreneurship (CE). We propose that DC and CE mediate the relationship between EO and firm performance, and our empirical results support these propositions. This study fills a gap in the literature on the EO–performance relationship by considering the linkages among disposition, capabilities, and activities in the South Korean context.


2016 ◽  
Vol 23 (2) ◽  
pp. 429-447 ◽  
Author(s):  
Agnes L. DeFranco ◽  
Cristian Morosan ◽  
Nan Hua

The heavily fragmented hotel industry, embracing the changes in their guests’ use of electronic devices, has spent considerable resources to incorporate electronic commerce (e-commerce) practices. The extant literature offers inconclusive findings with regard to the effect of e-commerce on firm performance, especially when firm size is considered. Given the high fragmentation of size in the hotel industry, understanding its role in the deployment of e-commerce could result in substantial benefits for both hotel firms and consumers. Using the financial performance of 689 observations of over 110 hotels during 2007–2012, this study finds that e-commerce expenses positively impact firm performance, and that firm size moderates the relationship between e-commerce expenses and firm performance.


Author(s):  
Julien Granata ◽  
Frank Lasch ◽  
Frédéric Le Roy ◽  
Léo-Paul Dana

Research on coopetition – the simultaneous occurrence of competition and cooperation among firms – is usually limited to the realm of large firms. While some research has examined the motives and outcomes of coopetition among small- and medium-sized business, little is known about how coopetition is managed among micro-firms. The French wine sector is dominated by micro-firms, among which coopetition is common. Focusing on the Pic Saint Loup area in south-eastern France, this article analyses how micro-firms manage coopetition. While we observe similarities in coopetition with respect to large firms, a distinct micro-firm coopetition mode is identified: (a) contrary to expectations, the management of coopetition is highly formalised in micro-firms; (b) as with large firms, the management of micro-firm coopetition requires a separation between competition and cooperation, but such separation occurs outside the firm – in the form of a collective structure; and (c) in contrast to large firms, small firms exhibit an increase in individual-level dimensions of coopetition with decreasing firm size. We conclude that policy should encourage coopetition among micro-firms provided that it is tailored to micro-firm specificities.


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