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1. Taxation and Innovation: What Do We Know?

   https://doi.org/10.3386/w27109  

   Akcigit, Ufuk ; Stantcheva, Stefanie ( November 2021 , Innovation and Public Policy)

   Goolsbee, Austan ; Jones, Benjamin (Ed.)

   Tax policies are a wide array of tools, commonly used by governments to influence the economy. In this paper, we review the many margins through which tax policies can affect innovation, the main driver of economic growth in the long-run. These margins include the impact of tax policy on i) the quantity and quality of innovation; ii) the geographic mobility of innovation and inventors across U.S. states and countries; iii) the declining business dynamism in the U.S., firm entry, and productivity; iv) the quality composition of firms, inventors, and teams; and v) the direction of research effort, e.g., toward applied versus basic research, or toward dirty versus clean technologies. We give ideas drawn from research on how the design of policy can allow policy makers to foster the most productive firms without wasting public funds on less productive ones. 

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2. The Rise of Pass-Throughs and the Decline of the Labor Share

   https://doi.org/10.1257/aeri.20210268  

   Smith, Matthew ; Yagan, Danny ; Zidar, Owen ; Zwick, Eric ( September 2022 , American Economic Review: Insights)

   We study the coevolution of the fall in the US corporate-sector labor share and the rise of business activity in tax-preferred pass-throughs. We find that reallocating activity to the form it would have taken prior to the Tax Reform Act of 1986 accounts for one-third of the decline in the corporate-sector labor share between 1978 and 2017. Our adjustments are concentrated among mid-market firms in services, magnifying the role of the manufacturing sector and superstar firms in driving the remaining decline in the labor share. Our findings highlight the importance of tax policy when measuring factor shares. (JEL D22, E25, H25, K34, L60, L80) 

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3. Dataset associated with U.S. Apparel Manufacturers Survey

   https://doi.org/10.25675/10217/234595  

   Miller, Nancy J. ; Engel-Enright, Carol ( January 2022 , Mountain Scholar)

   Firms do not continue and prosper purely on their own individual endeavors, as each firm is influenced by the activities of others, and thus direct and indirect relationships shape the firm’s strategic management. These relationships form the tactics by which knowledge and other strategically important resources are accessed and created. Forming and maintaining ties among members of a network have been the subject for numerous research studies in the social, economic, and business literature. Our work is framed by the resource-based view of the firm perspective along with social capital theory and its shared constructs in network theory. Prior findings suggest that networking ties are strategic actions generated for firm growth and continuance. The ties may be short-term or develop into long-term relationships. The purpose of this research is to fill some of the gaps in interorganizational networking strategy by analyzing five antecedents that have been suggested in the literature as individually associated with entrepreneurs’ engagement in network ties. In this way, our work provides another research avenue for examining networking’s contribution to strategic management. We hypothesized positive connections to entrepreneurs’ engagement in network ties from antecedents involving the firm’s knowledge absorptive capacity, business goals, entrepreneurial orientation, social interactions, and support from their environment. We tested our proposed macrolevel direct and moderating connections through an online survey of 125 U.S. apparel manufacturing firms. The apparel manufacturing sector in the U.S., as in many countries, has struggled with multiple disrupting factors contributing to the sector’s decline in firm continuance. Networks, serving to build domestic and international supply chain ties, may provide one solution for adapting the firm’s resources enhancing global competitiveness. Findings from OLS regression analyses support our hypothesized connections in that each of the five antecedents significantly contributed to entrepreneurs’ engagement in network ties; however, when all five were collectively examined only absorptive capacity, social interaction, and business goals were significant (R2 = 0.58). Further examination of moderation effects found the entrepreneurs’ perceptions of a supportive environment to modify both entrepreneurial orientation and business goals. The effects of a supportive environment on business goals’ relationship with network ties were greater when perceptions of a supportive environment decreased, while the effects of a supportive environment on entrepreneurship orientation’s relationship with network ties were greater when perceptions of a supportive environment increased. Future studies may direct attention to other industry sectors or countries for replication with larger sample sizes as we recognize the limitations to generalizability and scale refinement due to our limited sample size. Examining the five constructs sheds light on how an organization’s decisions may relate to engaging in networking and provides theoretical as well as practical implications that contributes to the larger organizational system framework. This dataset contains responses from 97 U.S. apparel manufacturers collected via an online survey during the fall of 2019. The apparel manufacturing sector in the U.S., as in many countries, has struggled with multiple disrupting factors contributing to the sector’s decline in firm continuance. Networks, serving to build domestic and international supply chain ties, may provide one solution for adapting the firm’s resources enhancing global competitiveness. The purpose of the study was to examine connections to entrepreneurs’ engagement in network ties from antecedents involving the firm’s knowledge absorptive capacity, business goals, entrepreneurial orientation, social interactions, and support from their environment. 

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4. Direct and moderation effects on U.S. apparel manufacturers’ engagement in network ties

   https://doi.org/10.7341/20211733  

   J. Miller, Nancy ; Engel-Enright, Carol ; A. Brown, David ( January 2021 , Journal of Entrepreneurship, Management and Innovation)

   null (Ed.)

   PURPOSE: Firms do not continue and prosper purely on their own individual endeavors, as each firm is influenced by the activities of others, and thus direct and indirect relationships shape the firm’s strategic management. These relationships form the tactics by which knowledge and other strategically important resources are accessed and created. Forming and maintaining ties among members of a network have been the subject of numerous research studies in the social, economic, and business literature. Our work is framed by the resource-based view of the firm perspective along with social capital theory and its shared constructs in network theory. Prior findings suggest that networking ties are strategic actions generated for firm growth and continuance. The ties may be short-term or develop into long-term relationships. The intent of this research is to fill some of the gaps in interorganizational networking strategy by analyzing five antecedents that have been suggested in the literature as individually associated with entrepreneurs’ engagement in network ties. In this way, our work provides another research avenue for examining networking’s contribution to strategic management. We hypothesized positive connections to entrepreneurs’ engagement in network ties from antecedents involving the firm’s knowledge absorptive capacity, business goals, entrepreneurial orientation, social interactions, and support from their environment. METHODOLOGY: In our quantitative approach, we tested our proposed macrolevel direct and moderating connections through an online survey of 125 U.S. apparel manufacturing firms. The apparel manufacturing sector in the U.S., as in many countries, has struggled with multiple disrupting factors contributing to the sector’s decline in firm continuance. FINDINGS: The results from OLS regression analyses support our hypothesized connections in that each of the five antecedents significantly contributed to entrepreneurs’ engagement in network ties; however, when all five were collectively examined only absorptive capacity, social interaction, and business goals were significant (R2 = 0.58). Further examination of moderation effects found the entrepreneurs’ perceptions of a supportive environment to modify both entrepreneurial orientation and business goals. RESEARCH AND PRACTICAL IMPLICATIONS: The effects of a supportive environment on business goals’ relationship with network ties were greater when perceptions of a supportive environment decreased, while the effects of a supportive environment on entrepreneurship orientation’s relationship with network ties were greater when perceptions of a supportive environment increased suggesting further study of U.S. entrepreneurs’ perceptions of their environments. Entrepreneurs’ interested in building domestic and international supply chain ties may find network ties provide one solution for adapting the firm’s resources for global competitiveness. Future studies may direct attention to other industry sectors or countries for replication with larger sample sizes as we recognize the limitations to generalizability and scale refinement due to our limited sample size. ORIGINALITY AND VALUE: The examination of five constructs to shed light on how an organization’s decisions may relate to engaging in networks and provides theoretical as well as practical implications that contribute to the larger organizational system framework. 

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5. Social, Formal, and Political Determinants of Trade Under Weak Rule of Law: Experimental Evidence from Senegalese Firms

   https://doi.org/10.1177/00104140221089648  

   Bhandari, Abhit ( June 2022 , Comparative Political Studies)

   How do firms ensure secure exchange when the rule of law is weak and contracting institutions privilege the politically connected? In developing countries, firms may use social, formal, or political heuristics when selecting business partners, but how these factors jointly impact exchange remains understudied. In this article, I develop these theoretical mechanisms and test their impact with a conjoint experiment administered to 2389 formal and informal firms in Senegal. I find evidence in support of all three theories: To varying degrees, social, state, and political factors simultaneously impact firms’ sense of deal security and likelihood of exchange. The results demonstrate the substantial influence of formal predictors of exchange even in an overwhelmingly informal business environment, and also establish the countervailing effects of political connections on trade. These findings suggest that firms in developing countries must contend with an intricate political calculus to ensure their growth.

    

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