Unpacking firm effects: modeling political alliances in variance decomposition of firm performance in turbulent environments

Detalhes bibliográficos
Autor(a) principal: Bandeira-de-Mello,Rodrigo
Data de Publicação: 2005
Outros Autores: Marcon,Rosilene
Tipo de documento: Artigo
Idioma: eng
Título da fonte: RAC. Revista de Administração Contemporânea (Online)
Texto Completo: http://old.scielo.br/scielo.php?script=sci_arttext&pid=S1415-65552005000500003
Resumo: In this paper, firm heterogeneity in turbulent environments is addressed. It is argued that previous studies have not taken into account effects of a turbulent environment, like the Brazilian context, in which firms must face a weak and erratic government. In such an environment, the large portion of variance usually attributed to firm effects may be explained, not by the usual assumptions of mainstream scholars, but by a more political view of firm differences, namely, the ability to manage valuable political alliances. To account for these differences, a multivariate performance measure was construed and a new factor, politics effects, has been introduced to the usual model. Company donations for campaign funds in elections was used as a proxy for this factor. A sample of 607 observations, of 177 firms in 15 sectors was used. Results suggest that the presence of politics effects were found to be not significant (using COV and Hierarchical ANOVA). However, different from previous studies, transient industry effects appear to be more important than stable effects. Findings also indicate that a better model specification for turbulent environments is needed and highlight the importance of the cost of capital.
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spelling Unpacking firm effects: modeling political alliances in variance decomposition of firm performance in turbulent environmentsfirm heterogeneityvariance decompositionfirm performanceturbulent environmentspolitical strategiesIn this paper, firm heterogeneity in turbulent environments is addressed. It is argued that previous studies have not taken into account effects of a turbulent environment, like the Brazilian context, in which firms must face a weak and erratic government. In such an environment, the large portion of variance usually attributed to firm effects may be explained, not by the usual assumptions of mainstream scholars, but by a more political view of firm differences, namely, the ability to manage valuable political alliances. To account for these differences, a multivariate performance measure was construed and a new factor, politics effects, has been introduced to the usual model. Company donations for campaign funds in elections was used as a proxy for this factor. A sample of 607 observations, of 177 firms in 15 sectors was used. Results suggest that the presence of politics effects were found to be not significant (using COV and Hierarchical ANOVA). However, different from previous studies, transient industry effects appear to be more important than stable effects. Findings also indicate that a better model specification for turbulent environments is needed and highlight the importance of the cost of capital.Associação Nacional de Pós-Graduação e Pesquisa em Administração2005-01-01info:eu-repo/semantics/articleinfo:eu-repo/semantics/publishedVersiontext/htmlhttp://old.scielo.br/scielo.php?script=sci_arttext&pid=S1415-65552005000500003Revista de Administração Contemporânea v.9 n.spe1 2005reponame:RAC. Revista de Administração Contemporânea (Online)instname:Associação Nacional de Pós-Graduação e Pesquisa em Administração (ANPAD)instacron:ANPAD10.1590/S1415-65552005000500003info:eu-repo/semantics/openAccessBandeira-de-Mello,RodrigoMarcon,Rosileneeng2009-03-24T00:00:00Zoai:scielo:S1415-65552005000500003Revistahttps://rac.anpad.org.br/index.php/racONGhttps://rac.anpad.org.br/index.php/rac/oairac@anpad.org.br1982-78491415-6555opendoar:2009-03-24T00:00RAC. Revista de Administração Contemporânea (Online) - Associação Nacional de Pós-Graduação e Pesquisa em Administração (ANPAD)false
dc.title.none.fl_str_mv Unpacking firm effects: modeling political alliances in variance decomposition of firm performance in turbulent environments
title Unpacking firm effects: modeling political alliances in variance decomposition of firm performance in turbulent environments
spellingShingle Unpacking firm effects: modeling political alliances in variance decomposition of firm performance in turbulent environments
Bandeira-de-Mello,Rodrigo
firm heterogeneity
variance decomposition
firm performance
turbulent environments
political strategies
title_short Unpacking firm effects: modeling political alliances in variance decomposition of firm performance in turbulent environments
title_full Unpacking firm effects: modeling political alliances in variance decomposition of firm performance in turbulent environments
title_fullStr Unpacking firm effects: modeling political alliances in variance decomposition of firm performance in turbulent environments
title_full_unstemmed Unpacking firm effects: modeling political alliances in variance decomposition of firm performance in turbulent environments
title_sort Unpacking firm effects: modeling political alliances in variance decomposition of firm performance in turbulent environments
author Bandeira-de-Mello,Rodrigo
author_facet Bandeira-de-Mello,Rodrigo
Marcon,Rosilene
author_role author
author2 Marcon,Rosilene
author2_role author
dc.contributor.author.fl_str_mv Bandeira-de-Mello,Rodrigo
Marcon,Rosilene
dc.subject.por.fl_str_mv firm heterogeneity
variance decomposition
firm performance
turbulent environments
political strategies
topic firm heterogeneity
variance decomposition
firm performance
turbulent environments
political strategies
description In this paper, firm heterogeneity in turbulent environments is addressed. It is argued that previous studies have not taken into account effects of a turbulent environment, like the Brazilian context, in which firms must face a weak and erratic government. In such an environment, the large portion of variance usually attributed to firm effects may be explained, not by the usual assumptions of mainstream scholars, but by a more political view of firm differences, namely, the ability to manage valuable political alliances. To account for these differences, a multivariate performance measure was construed and a new factor, politics effects, has been introduced to the usual model. Company donations for campaign funds in elections was used as a proxy for this factor. A sample of 607 observations, of 177 firms in 15 sectors was used. Results suggest that the presence of politics effects were found to be not significant (using COV and Hierarchical ANOVA). However, different from previous studies, transient industry effects appear to be more important than stable effects. Findings also indicate that a better model specification for turbulent environments is needed and highlight the importance of the cost of capital.
publishDate 2005
dc.date.none.fl_str_mv 2005-01-01
dc.type.driver.fl_str_mv info:eu-repo/semantics/article
dc.type.status.fl_str_mv info:eu-repo/semantics/publishedVersion
format article
status_str publishedVersion
dc.identifier.uri.fl_str_mv http://old.scielo.br/scielo.php?script=sci_arttext&pid=S1415-65552005000500003
url http://old.scielo.br/scielo.php?script=sci_arttext&pid=S1415-65552005000500003
dc.language.iso.fl_str_mv eng
language eng
dc.relation.none.fl_str_mv 10.1590/S1415-65552005000500003
dc.rights.driver.fl_str_mv info:eu-repo/semantics/openAccess
eu_rights_str_mv openAccess
dc.format.none.fl_str_mv text/html
dc.publisher.none.fl_str_mv Associação Nacional de Pós-Graduação e Pesquisa em Administração
publisher.none.fl_str_mv Associação Nacional de Pós-Graduação e Pesquisa em Administração
dc.source.none.fl_str_mv Revista de Administração Contemporânea v.9 n.spe1 2005
reponame:RAC. Revista de Administração Contemporânea (Online)
instname:Associação Nacional de Pós-Graduação e Pesquisa em Administração (ANPAD)
instacron:ANPAD
instname_str Associação Nacional de Pós-Graduação e Pesquisa em Administração (ANPAD)
instacron_str ANPAD
institution ANPAD
reponame_str RAC. Revista de Administração Contemporânea (Online)
collection RAC. Revista de Administração Contemporânea (Online)
repository.name.fl_str_mv RAC. Revista de Administração Contemporânea (Online) - Associação Nacional de Pós-Graduação e Pesquisa em Administração (ANPAD)
repository.mail.fl_str_mv rac@anpad.org.br
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