Brian Ashcroft

New Firm Formation in the British Counties with Special Reference to Scotland

ASHCROFT B., LOVE J. H. and MALLOY E. (1991) New firm formation in the British counties with special reference to Scotland, Reg. Studies 25, 395–409. The counties of Great Britain exhibit marked variations in their rates of new firm formation, with the local authority regions of Scotland performing particularly poorly. A model is developed to explain these variations over the period 1980–6, and the following factors are found to be important: the expected income foregone in starting a new firm, and the probability of attaining this income; levels of home ownership; and relevant individual skills, such as experience of small firms and managerial skills. It is concluded that any policy which seeks to raise firm formation rates in the peripheral regions of the UK has to address certain aspects of the socioeconomic structure of these regions. ASHCROFT B., LOVE J. H. et MALLOY E. (1991) La creation de nouvelles entreprises dans les comtes britanniques et particulierement en Ecosse, Reg. Studies 25, 395–409. Le...

Corporate structure, ownership and the likelihood of innovation

An examination is conducted into the effect which external ownership and other aspects of corporate ownership structure have on the likelihood of innovation for a sample of manufacturing plants located in Scotland. Econometric estimation indicates that plant size, the presence of in-plant R&D, and non-UK ownership have a positive effect on the likelihood of innovation. Multiplant operation, market power and variations in industrial structure have no discernible effect on innovation. The finding that foreign ownership is positively associated with innovation contrasts with previous research conducted on manufacturing plants in Northern Ireland.

Firm births and employment change in the British counties: 1981–89

This paper explores the relationship between firm formation and net employment change at the country level of Britain during the 1980s. An augmented factor-demand model is specified and estimated across the 64 countries of Britain. The results offer support for the view that firm formation is strongly associated with net employment change in British countries. Moreover, when allowance is made for feedback effects due to the estimated simultaneity between new starts and net employment the impact of firm formation on estimated job change is even greater.

Market versus Corporate Structure in Plant-Level Innovation Performance

This paper examines the effect which market and corporate structure have on the extent of innovation for a sample of circa 300 manufacturing plants located in Scotland. Innovation is defined as the introduction of a commercially significant new product at the establishment level. The theoretical model of Geroski (1990) is extended to incorporate plant- level variables such as size, multiplant operation, the presence of R&D facilities and external/indigenous ownership. A distinction is made between the direct and indirect effects of these variables. Negative binomial estimations indicate that corporate structure influences are more important in determining the number of innovations than market structure and barrier to entry variables. Plant size, foreign ownership and the presence of R&D are all positively associated with innovation. Direct effects greatly outweigh indirect effects. Tobit estimations on the number of innovations per employee support the findings of Acs and Audretsch (1988) that smaller enterprises are more innovation intensive than larger enterprises, at least up to a limit of around 1200 employees. The positive effect of R&D arises principally from increasing the probability of a plant becoming an innovator, rather than from making a plant more innovation intensive. By contrast, the importance of size lies principally in encouraging further innovations among plants which are already innovators, but less than proportionately with the increase in employment size.

The importance of the first round in the multiplier process: the impact of Civil Service dispersal

In this paper an extended Keynesian regional multiplier model is developed and used to estimate the local impact of two proposed (but subsequently cancelled) moves in the UK programme of Government office dispersal. These moves were to have been the relocation of the Property Services Agency to Cleveland and part of the Ministry of Defence to the county of South Glamorgan. The multiplier formulation explicitly takes into account an important feature of Government office dispersal; that is, that a large proportion of the employees move with the job. The importance of the first round in the multiplier process is stressed, and quantitative estimates of the effects of varying the nature of the initial injection are given.

UK innovation policy : a critique

It is increasingly recognized that the production of new products and the development and diffusion of new production and organizational techniques are central to the competitiveness of both national and regional economies. Governments and agencies at all spatiallevels have therefore become involved in seelung to stimulate innovation. In the UK Government’s White Paper on Science and Technology and in the D T 1’s Competitiveness initiative, the promotion of innovation is given a central role. The available evidence does suggest that innovating firms both outperform non-innovators in terms ofprofitability and growth, and are more cyclically stable (GEROSKI and MACHIN, 1992). This would appear to provide prima facie justification for intervention. However, a recent comprehensive survey and analysis by the present authors of the innovation performance of Scottish manufacturing industy suggests that current UK innovation policy is largely irrelevant. In this article, we seek to explain why that is the case. In the next section we describe the main instruments ofUK innovation policy then briefly outline the main views on innovation policy drawn from a survey of, and interviews with, Scottish manufacturing firms. This is followed by a critique of the policy in the light of the experience of Scottish firms. Finally, the article concludes with some recommendations for changes to innovation policy in the UK.

The measurement of the impact of regional policies in Europe: a survey and critique

Ashcroft B. (1982) The measurement of the impact of regional policies in Europe: a survey and critique, Reg. Studies 16, 287–305. The paper examines the broad approaches and particular methods used to estimate the impact of regional policies in several European countries. The strengths and weaknesses of the major approaches are identified. The total effects, their components and the effects of individual policy instruments are considered. The theory and measurement of the costs and benefits of regional policy is examined. Some areas for further research are suggested.

Estimating the effects of government office dispersal: An application of demand constrained shadow wages

Abstract In this paper, a model is developed to identify the net national employment effect and the particular shadow wage associated with Government office dispersal. The approach views the opportunity cost of labour as being determined by a demand constraint reflecting the desire of Government to maintain a constant ‘pressure of demand’. The model allows for several simultaneous effects of dispersal on the ‘pressure of demand’ and specifies the operation of the labour market in some detail. The solution to the model shows the net employment effect to be positive suggesting the importance of dispersal as an instrument of regional policy.

Evaluating the Effects of External Takeover on the Performance of Regional Companies: The Case of Scotland, 1965 to 1980

A framework is suggested for the evaluation of the effects of external takeover on regional economic performance, and an approach is offered to identify the impact of takeover on the performance of the acquired firm. The approach is then applied to estimate the effects of external takeover on the performance of Scottish manufacturing companies between 1965 and 1980. The results show that external takeover improved sales performance but lowered rates of return in acquired firms. Employment was, in general, unaffected. Overall, the effects on acquired firms are judged to have been beneficial, but evidence of harmful effects on the wider regional economy suggests that it cannot be assumed that such takeovers will not be against the public interest.

External Control and Regional Development in an Integrated Europe

The process of European integration is generally perceived as an opening up to competition of both product and factor markets. Indeed, for many, the promotion of competition is the raison d’etre of the European ideal. However, while competition and market integration are important dimensions of the integration process they do not completely define it. Alongside market integration there exists a process of company integration and functional specialisation which is having, and will continue to have, profound implications for economic development in Europe’s peripheral regions. This process is taking the form of cross-border takeovers, movements of company functions between locations, inward investments, management buy-outs and so on. The rationale for these changes may be to take advantage of increased market opportunities, but will just as likely be motivated by concerns to limit and restrict the effect of increased competition. Whatever the motivation behind such change, the outcome is likely to be further increases in the degree to which companies and economic activities in the peripheral regions are controlled by firms outside the region typically in the ‘core’ regions of the EU. This is because ‘core’ regions attract a disproportionate number of the headquarters of companies, a process which continues, largely through takeovers and re-organisations, within member states of the EU such as Germany [Schackmann-Fallis (1989)] and the UK [Ashcroft, Coppins, and Raeside (1994)]. Such trends would, I suspect, be found in other EU countries if the data were available. Further European integration is likely to accelerate and adjust this process in favour of the ‘core’ regions of the wider European economy.