Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/30579
Authors: 
Dostie, Benoît
Jayaraman, Rajshri
Year of Publication: 
2009
Series/Report no.: 
CESifo Working Paper 2684
Abstract: 
This paper asks whether adversity spurs the introduction of process innovations and increases the use of managerial incentives by firms. Using a large panel data set of workplaces in Canada, our identification strategy relies on exogenous variation in adversity arising from increased border security along the 49th parallel following 9/11. Our longitudinal difference-in-differences estimates indicate that firms responded to adversity by introducing new or improved processes, but did not change their use of managerial incentives. These results suggest that the threat of bankruptcy may provide impetus for improving efficiency.
JEL: 
L20
O31
M52
J33
Document Type: 
Working Paper

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