The Roles of Structured Management in the Formation of Transactional Relationships

Yusuke Imani and Atsushi Ohyama

No E-2021-07, TDB-CAREE Discussion Paper Series from Teikoku Databank Center for Advanced Empirical Research on Enterprise and Economy, Graduate School of Economics, Hitotsubashi University

Abstract: We empirically examine the roles of structured management in the formation of transactional relationships by using the Japanese version of Management and Organizational Practices Survey and the business-to-business transaction data from Teikoku Databank. Our unique approach is to use separate measures of productivity and managerial efficiency in this examination. Our main findings are summarized as follows: First, management scores (a proxy for managerial efficiency) are positively associated with a range of transactional partners even after a level of productivity is controlled for. Second, our estimation using an exogenous event caused by the Great East Japan earthquake appears to suggest that causality is at play in this relationship. Third, firms with higher management scores add and drop transactional partners more frequently than firms with lower management scores. Fourth, firms with higher management scores transact with larger firms. Finally, management scores are positively correlated with TFP, and negatively correlated with a measure of uncertainty. Further, the negative effect of uncertainty on the formation of transactional relationships is mitigated by managerial efficiency. Overall, the empirical results of this paper suggest that both production and managerial efficiency are important factors in facilitating the formation of transactional relationships.

Keywords: Management Practices; Productivity; Transactional Relationship (search for similar items in EconPapers)
JEL-codes: L2 M2 O32 O33 (search for similar items in EconPapers)
Pages: 48 pages
Date: 2022-02
New Economics Papers: this item is included in nep-eff
Note: February 3, 2022
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Persistent link: https://EconPapers.repec.org/RePEc:hit:tdbcdp:e-2021-07

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