We show that, in the case when innovations are for sale, increased product market competition, captured by reduced product market profits, can increase the incentives for innovations. The reason is that the incentive to innovate depends on the acquisition price which, in turn, might increase...

Bounded rationality provides a fundamental economic explanation for non-rational modes of behavior. These non-rational modes underlie both the erratic perturbations of entrepreneurship and the systematic waves of diffusion they initiate which in turn guarantee that the economy operates out of...

The multinational firm (MNF) is introduced as the intersection between trade theory and the theory of the firm. I show that economies of scale associated with various knowledge inputs have made it possible for firms to grow large through internationalization and, once large, staying competitive...

The theory of the firm suggests that firms can respond to poor contract enforcement by vertically integrating their production process. The purpose of this paper is to examine whether firms' integration opportunities affect the way institutions determine international trade patterns. We find...

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Stylized facts indicate that small firms are responsible for a disproportionate share of innovative research. There are many possible explanations for this facto The paper seeks to understand this phenomena as the outcome of an optimal assignment of tasks across individuals and organizations. It...

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The firm is defined in terms of its financial objectives, achieved through human-based organizational competence, conferring scale economies on all other factors. Competence is developed through organizational learning, jointly produced with the value added of the firm, largely manifesting...

Despite the global reach of their commercial activities, many multinational firms have proved slow in internationalizing their boards of directors. Based on a panel study of the internationalization of the boards of 347 non-financial firms from the Nordic countries, we find a higher fraction of...

This paper deals with the physical location of firms although other interpretations are also possible. It is a well-known fact that firms in certain industries tend to cluster. However, since you would expect competition to be more intense when goods are less diversified in a locational sense...