The importance of internal and external factors in business success
DOI:
https://doi.org/10.46661/revmetodoscuanteconempresa.5417Keywords:
business success, labour productivity, management practices, institutional qualityAbstract
Increasing the productivity of an economy requires improvements in the productivity of its companies, and therefore greater business success. It should be noted that a company on the road to success is more productive. The objective of this paper is to analyse how internal and external factors influence the labour productivity of companies. This paper provides evidence that recognises the importance of the quality of business management, on the one hand, and the factors related to the functioning of markets and institutions, on the other, in determining the productivity of companies. The results show that business management practices and the quality of the business environment jointly determine the productivity of companies. However, there are differences according to the size of the companies, so that smaller companies have lower business productivity that can be increased if they improve their management practices and their physical capital endowment per worker. In addition, if institutions invest in improving the environment in which businesses operate, they are more likely to achieve greater business success.
Downloads
References
Almunia, M., & López-Rodríguez, D. (2014). Heterogeneous Responses to Effective Tax Enforcement: Evidence from Spanish Firms. MPRA Paper 57408. https://mpra.ub.uni-muenchen.de/57408/2/MPRA_paper_57408.pdf
Banco Mundial (2015). Doing Business 2015. Going Beyong Efficiency. Comparing business regulations for domestic firms in 189 Economies, A World Bank Group Flagship Report, 12th edition, World Bank Group. Washington DC.
Blinder, A. S. (1973). Wage discrimination: reduced form and structural estimate, The Journal of Human Resources, 8(7), 436-455.
Bloom, N., & Van Reenen, J. (2007). Measuring and explaining management practices across firms and countries. The Quarterly Journal of Economics, 122(4), 1351-1408.
Bloom, N., & Van Reenen, J. (2010). Why do management practices differ across firms and countries? Journal of Economic Perspective, 24(1), 203-224.
Bloom, N., Mahajan, A., McKenzie, D., & Roberts, J. (2010). American Economic Review, 100(2), 619-662
Bloom, N., & Sadun, R. (2012). The Organization of Firms Across Countries. The Quarterly Journal of Economics, 127(4), 1663-1705.
Bloom, N., Genakos, R., Sadun, R., & Van Reenen, J. (2012a). Management practices across firms and countries. National Bureau of Economic Research, NBER Working Paper No. 17850, Cambridge, US.
Bloom, N., Schweiger, H., & Van Reenen, J. (2012b). The land that lean manufacturing forgot? Management practices in transition countries, Economics of Transition, 20(4), 593-635.
Bloom, N., Brynjolfsson, E., Foster, L., Jarmin, R., Saporta-Eksten, I., & Van Reenen, J. (2013). Management in America. Center for Economic Studies, CES 13-01.
Bloom, N., Lemos, R., Sadun, R., Scur, D., & Van Reenen, J. (2014). The new empirical economics of management. National Bureau of Economic Research, NBER Working Paper No. 20102, Cambridge, US.
Bloom, N., Sadun, R., & Van Reenen, J. (2017a). Management as a technology? National Bureau of Economic Research, NBER Working Paper No. 22327, Cambridge, US.
Bloom, N., Brynjolfsson, E., Foster, L., Jarmin, R., Patnaik, M., Saporta-Eksten, I., & Van Reenen, J. (2017b). What drives differences in management? National Bureau of Economic Research, NBER Working Paper No. 23300, Cambridge, US.
Broszeit, S., Fritsch, U., Görg, H., & Laible, M.C. (2016). Management practices and productivity in Germany. IZA Discussion Paper, No. 10370, Institute for the Study of Labor (IZA), Bonn.
Bruhn, M., Karlan, D., & Schoar, A. (2018). The Impact of Consulting Services on Small and Medium Enterprises: Evidence from a Randomized Trial in Mexico. Journal of Political Economy, 126(2), 635-687.
Brynjolfsson, E., & McElheran, K. (2016). Data in action: Data-driven decision making in U.S. manufacturing. Centre for Economic Studies, CES Working Paper 16-06, Washington DC.
Bryson, A., & Forth, J. (2018). The impact of management practices on SME performance. National Institute of Economic and Social Research. NIESR Discussion Paper No. 488, London.
Cobb, C., & Douglas, P. (1928). A theory production, The American Economic Review, 18(1), 139-165.
Garicano, L., LeLarge, C., y Van Reenen, J. (2013). Firm size distorsions and the productivity distribution: Evidence from France. National Bureau of Economic Research, NBER Working Paper, No. 18841.
Huerta, E., & Salas, V. (2014). Tamaño de las empresas y productividad de la economía española. Un análisis exploratorio. Revista Mediterráneo Económico, 25, 167-191.
Huerta, E., & Salas, V. (2018). Productividad y tamaño de las empresas: ¿Dónde están las palancas para el cambio? En Huerta y Moral (editores), Innovación y Competitividad: Desafíos para la industria española, Capítulo XIV, Funcas, 427-462, Madrid, España.
Kumar, K., Rajan, R., & Zingales, L. (1999). What determines firm’ size? National Bureau of Economic Research, NBER Working Paper, No. 7208.
La Porta, R., López-de-Silanes, F., Shleifer, A., & Vish, R.W. (1997a). Determinants of External Finance. The Journal of Finance, 52(3), 1131-1150.
La Porta, R., López-de-Silanes, F., & Shleifer, A., y Vish, R.W. (1997b). Trust in Large Organizations. American Economic Review, 87(2), 333-338.
Mielgo, J.A. (2015). Una reflexión sobre el tamaño empresarial en España. Información Comercial Española, 885, 117-131.
Oaxaca, R.L. (1973). Male-female wage differentials in urban labor markets, International Economic Review, 14(3), 693-709.
OCDE (2017). Entrepreneurship at a Glance 2017, OECD Publishing, Paris, http://dx.doi.org/10.1787/entrepreneur_aag-2017-en
Rico, P., & Cabrer-Borrás, B. (2020a). Management practices and business labour productivity. Journal of Small Business Strategy, en prensa.
Rico, P., & Cabrer-Borrás, B. (2020b). Intangible capital and business productivity. Economic Research-Ekonomska Istraživanja, 33(1), 3034-3048, https://doi.org/10.1080/1331677X.2019.1699139
Salas-Fumás, V., Sanchez-Asin, J.J., & Storey, D. (2013). Occupational choice, number of entrepreneurs and output: theory and empirical evidence with Spanish data. SERIEs, 5, 1-24. https://doi.org/10.1007/s13209-013-0103-5
Salmerón, R., & Gómez, S. (2012). Relación entre los factores institucionales y el emprendimiento: análisis mediante técnicas cuantitativas. Revista de métodos cuantitativos para la economía y la empresa, 13, 54-72.
Schwab, K. (2015). The Global Competitiveness Report 2015–2016. World Economic Forum, Geneva. http://www3.weforum.org/docs/gcr/2015-2016/Global_Competitiveness_Report_2015-2016.pdf
Shahzad, K., Bajwa, S.U., Siddiqi, A.F.I., Ahmid F., & Raza, A. (2016). Integrating knowledge management (KM) strategies y processes to enhance organizational creativity y performance: an empirical investigation. Journal of Modelling in Management, 11(1), 154-179.
White, H. (1980). A Heteroscedasticity Consistent Covariance Matrix Estimator and a Direct Test of Heteroscedasticity. Econometrica, 48(4), 817-838.
Downloads
Published
How to Cite
Issue
Section
License
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
Submission of manuscripts implies that the work described has not been published before (except in the form of an abstract or as part of thesis), that it is not under consideration for publication elsewhere and that, in case of acceptance, the authors agree to automatic transfer of the copyright to the Journal for its publication and dissemination. Authors retain the authors' right to use and share the article according to a personal or instutional use or scholarly sharing purposes; in addition, they retain patent, trademark and other intellectual property rights (including research data).
All the articles are published in the Journal under the Creative Commons license CC-BY-SA (Attribution-ShareAlike). It is allowed a commercial use of the work (always including the author attribution) and other derivative works, which must be released under the same license as the original work.
Up to Volume 21, this Journal has been licensing the articles under the Creative Commons license CC-BY-SA 3.0 ES. Starting from Volume 22, the Creative Commons license CC-BY-SA 4.0 is used.
