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The negative relationship between corporate risk and corporate returns, also known as the "Bowman paradox," has been an important puzzle in strategy research that has motivated dozens of empirical studies. Theoretically, the paradox was explained with an appeal to contingent managerial preferences for risk or to heterogeneous managerial capabilities. A popular alternative view has been that the paradox is merely an empirical artifact and, thus, does not need to be explained with management theories. Furthermore, the view that the negative risk–return relationship does not need to be explained theoretically was reinforced to become a bottom line for nearly five decades of research on diversified firms—that the paradox cannot be explained theoretically based on the context of corporate diversification. This study counters that pessimistic view and develops a formal model to explain theoretically how the negative risk–return relationship exists in diversified firms due to the interplay of two types of economies of scope. Thus, the Bowman paradox is explained in this study parsimoniously, with the fundamental features of the context of corporate diversification that exist regardless of the variation in managerial preferences for risk or in managerial capabilities. [ABSTRACT FROM AUTHOR]

The voluminous strategy research on the determinants of corporate scope is often premised on a well-established property rights regime, which contrasts with the weak property rights protection that still characterizes most countries today. We address this gap by applying property rights theory to theorize and empirically examine how the strengthening of the property rights regime affects corporate scope. Our analysis exploits the enactment of a property law that enhanced the formal protection of private properties in China as a quasi-experiment. We show that with a strengthened property rights regime, the horizontal relatedness among private firms' businesses increases, but their vertical relatedness decreases, compared with state-owned firms. Further, these effects are less prominent for politically connected firms that are afforded informal protection of property rights. Our findings shed new light on the property rights regime as a critical determinant of firms' horizontal and vertical scope. [ABSTRACT FROM AUTHOR]

Among the most significant economic subjects for managers to succeed in the growth and development of businesses and organizations are economies of scope and cost- effectiveness. Many companies and manufacturing industries often undergo multiple stages in their production processes before attaining the final product. Most of the time, these companies typically incur both no-discretionary inputs and costs, as well as discretionary and controllable inputs and costs. In this kind of manufacturing company, cost effectiveness and economies of scope are two crucial elements for production and service success. This study explores the significance of these factors in the context of companies and manufacturing industries that undergo multiple stages before reaching the final product. This study presents models that assess the economies of scope and cost-effectiveness for both two-stage and single-stage (black box) systems so that, in these production systems, some indicators (inputs and intermediate sizes) are in-discretionary and uncontrollable. The link between the sections is investigated in two state-free and fixed links-in the two-stage model. The features of the suggested models are examined, and the impact of these data on economies of scope and cost-effectiveness is measured and evaluated. By understanding and quantifying these effects, managers can make informed decisions to optimize production processes and enhance overall organizational performance. The finding of this study provides valuable insights into how economies of scope and cost-effectiveness impact operational efficiency and resource allocation. [ABSTRACT FROM AUTHOR]

Research Summary: Acquisitions can shift the market structure of a digital platform in ways that affect subsequent entries and hence the platform's base of complementors. Synergies that complementor acquirers accrue can be entry‐deterring. We develop a two‐by‐two typology of acquisition synergies in a multisided platform based on the two sides of a platform market (user side or complementary‐technology side) and two sources of synergies (economies of scale or economies of scope). We then leverage over 279,000 app developers' entry decisions into product categories in Apple's iOS App Store, over 71 million customer reviews, and over 12,000 unique software development kits to construct measures of synergies. Our paper contributes to the platform literature by demonstrating the entry‐deterring effects of synergies that complementor acquirers can exploit. Managerial Summary: We develop the following typology of four types of acquisition synergies by integrating the multisidedness feature of digital platforms with the mainstream strategy research: complementary‐technology‐side economies of scope, complementary‐technology‐side economies of scale, user‐side economies of scope, and user‐side economies of scale. We show that (1) acquisition synergies are entry‐deterring, (2) synergies derived from economies of scope have stronger effects than those derived from economies of scale, and (3) synergies derived from the technology side have stronger effects than those derived from the user side. We highlight the significant competitive and regulatory implications of our findings. For example, one standard‐deviation increase in technology‐side economies of scope is associated with 55 deterred entries in 1 month or a $2.80 million potential loss in annual revenue. [Correction added on 15 July 2024, after first online publication: Research Summary and Managerial Summary have been corrected in this version.] Video abstract [ABSTRACT FROM AUTHOR]

This paper evaluates economies of scale and scope, and the merger effect among national universities in Japan. We apply SUR for the total translog cost function in FY2014 and FY2018. The main results are: (i) there exist economies of scale as a whole university; (ii) but there exist no clear economies of scope except for in research; (iii) there are cost saving effects with mergers among single colleges, but not in the case of mergers of general universities and medical colleges, (iv) both the costs of a public and a private university are higher than those of a national university. [ABSTRACT FROM AUTHOR]

Competition usually increases firm productivity; but in network industries, effective competition requires vertical separation, which might reduce productivity and lead to a potential trade-off. We analyze the combined effect of competition and vertical separation on inefficient costs for US electricity industry restructuring. We estimate firm-level inefficiencies with the use of different nonparametric models of the technology and calculate net benefits with the use of difference-in-differences. The results depend on how we model the production technology and the length of the post-treatment horizon. The more flexible is the production frontier, the greater is the net benefit from divestiture and competition. Across our models the combined effect of divestiture and competition is positive. [ABSTRACT FROM AUTHOR]

This study examines the reasons why between 1979 and 2020 the number of abattoirs licenced to slaughter red blood livestock species in Great Britain fell from 1146 to 200, average throughput per abattoir increased, larger abattoirs specialised in the species slaughtered, and family owned abattoirs have been replaced by international companies owning multiple slaughterhouses and food processing factories. The study combines abattoir sector survey data with findings from a national survey of small abattoirs. Larger abattoirs have exploited economies of size and location to achieve the throughput necessary to supply multiple retailers and/or wholesale markets. Smaller abattoirs have exploited economies of scope to develop the bespoke butchering services needed to supply private kill customers. The high rate of closure of smaller abattoirs suggests the future of small-scale, locally based supply chains in which private kill services supply is threatened. The recently introduced Small Abattoir Fund offers grants towards the purchase of new equipment which will offer some relief. But smaller abattoirs must support their private kill customers by organising collection points for onward transport of livestock to the abattoir and local redistribution centres for meat and carcases. [ABSTRACT FROM AUTHOR]

Abstract The success requirement of managers’ progress, development and performance improvement lie in their attention to product variety and company effectiveness. Economies of scope (ES) examine the advantages of production or the services diversification of a company based on cost versus production by companies that produce the same products or services separately. Data Envelopment Analysis (DEA) is known as a suitable method for evaluating ES and cost effectiveness. DEA models are introduced with certain input and output costs, while many companies and manufacturing industries in different sectors of production and service provision may not have accurate information on available costs and outputs because of calculation errors, old information, and multiple repeated measurements. The estimation DEA for ES and cost effectiveness are sensitive to changes, also some parameters, such as cost and price, are fluctuated. Therefore, it is a requirement to focus on the interval DEA. Our most important goals in this article are: (1) we develop new DEA models to measure the ES and cost effectiveness of decision-making units (DMUs) under data uncertainty. These models will become non-linear and non-convex models; hence, (2) we identify an appropriate range for ES and cost effectiveness of DMUs from the optimistic and pessimistic viewpoints, allowing decision-makers can use the upper and lower limits or their combination depending on the optimistic and pessimistic viewpoints, (3) we apply our developed models to assess the ES and cost-effectiveness performance of 24 institutions, considering data uncertainties that may affect the quality and reliability of the results. (4) The proposed models’ features have been analyzed, and the impact of interval data on cost effectiveness and ES has been evaluated. The application description of the proposed models for determining ES and cost effectiveness shows that a company can exhibit economies of scope without necessarily being Cost Effectiveness.

While many firms in recent years have started to offer public Application Programming Interfaces (APIs), firms struggle with shaping digital platform strategies that align API design with aspired business goals and the demands of external developers. We address the lack of theory that explains the performance impacts of three API archetypes (professional, mediation, and open asset services). We couple survey data from 152 API product managers with manually coded API design classifications. With this data, we conduct cluster and regression analyses that reveal moderating effects of two value creation strategies (economies of scope in production and innovation) on the relationships between API archetype similarity and two API performance outcomes: return on investment and diffusion. We contribute to IS literature by developing a unifying theory that consolidates different theoretical perspectives on API design, by extending current knowledge on the performance effects of API design, and by empirically studying the distinct circumstances under which digital platforms facilitate economies of scope in production or in innovation. Our results provide practical implications on how API providers can align API archetype choice with the value creation strategy and the API's business objective. [ABSTRACT FROM AUTHOR]

A long-lasting dilemma on the efficient provision of services of general economic interest has become increasingly important in the waste management industry: competition or monopoly in municipal solid waste management. Previous literature has primarily examined the economics of scale and scope to provide an adequate response. Here, we contribute by investigating subadditivity in municipal solid waste management service costs. Subadditivity is a critical concept used to justify imperfect competition, which encourages natural monopolies where one producer will function more effectively than more firms. To test the hypothesis that a subadditivity in costs in waste management exists, we design a simulation based on empirical data for Milan, Italy. We compared the total production cost of the incumbent firm with the alternative hypothesis built by dividing the city into four areas and assigning each area to a different hypothetical firm. The results suggest that the existence of subadditivity results in 6% lower production costs, primarily stemming from business synergies, lower transactional costs, and optimization of productive resources and facilities. The evidence justifies, ceteris paribus, that the provision by a single firm is preferable to multiple firms in the analysis case. Implications for policies are straightforward. The one-fit rule approach fails to set the best condition for policymakers to create a level playing field transparently and efficiently for industry operators to perform efficiently. [ABSTRACT FROM AUTHOR]

Mixed farming systems are gaining interest both as a risk management strategy and to apply agroecological principles. This study set out to assess the sustainability of mixed systems compared to their specialized counterparts. The Orfee bioeconomic farm model was used to simulate three mixed farms: beef and dairy, beef and sheep, and cash crop and beef, under 1990–2017 prices and policies in France. Several sustainability criteria were computed at two scales (i) aggregated farm level, to assess whether mixed farms with several integrated enterprises performed better than if these enterprises were managed in specialized farms, and (ii) unit of product or labour to assess whether a product was produced more sustainably and a worker obtained higher and more stable income in a mixed farm. We found that mixed farms had less work peaks, lower global warming potentials and nitrogen balances, lower total production costs, higher and more stable net incomes than if their enterprises were managed in two specialized farms. However, profitability and income variability of the mixed farms were not better than the best performing specialized farm. The consumption of concentrate feed decreased in the mixed livestock farms but increased in the beef-crop farm that degraded feed-food competition.

Maple syrup production represents a prominent form of ton-timber forest production across the northeastern United States and Canada. Similar to farmers, maple syrup producers face complex size and scope decisions about the size or product diversification of their operation. Drawing upon 24 semi-structured interviews with small- and medium-sized producers in Maine, we apply the Theory of Planned Behavior (TPB) to identify factors contributing to producers’ size and scope decisions, including common challenges they face in achieving optimal size and scope. We find that attitude and perceived behavioral control guided by economic, personal, environmental and communal factors, contribute to size and scope decisions with minimal influence from perceived norms. Major challenges for maple syrup producers in achieving optimal size and scope include lack of capital to invest in technology upgrades and equipment, difficulty in finding additional accessible sugar and red maple stands, and lack of access to commercial kitchen facilities. We suggest future research, policy and management recommendations in addressing these challenges. These findings can help inform outreach and policy strategies to support the viability and sustainability of the maple syrup industry as well as be extended to other non-timber forest production practices.

The 2030 Sustainable Development Goals are highly interdependent. Lasting progress towards these goals requires collaboration among actors operating in diverse sectors and thematic domains. Yet, multi-sectoral collaboration is complicated by a variety of factors that tend to incentivise siloed action organised around individual interventions and budgets. This paper presents an analytical framework based on the concept of "economies of scope" for assessing and enhancing the efficiency of development projects for which there is a joint production process. We focus on the use of fair cost sharing methods such as the Shapley Value to dis-incentivise actors operating in inefficient siloes. [ABSTRACT FROM AUTHOR]

Medication Therapy Management (MTM) is a group of pharmacist-provided services that optimize individual patients' drug therapy outcomes. Since community pharmacies' primary business platform is the dispensing of medications, and providing MTM services is a secondary source of revenue, pharmacies with limited resources are operationally challenged when trying to efficiently deliver both types of services. To address this problem, we follow a queueing network approach to develop an operational model of a community pharmacy workflow. Through our model, we derive structural results to determine conditions for a pharmacy to achieve economies of scope when providing both prescription and MTM services. We also develop a process simulation to compare different scenarios according to our economies of scope model, varying in provided services, personnel, service demand, and other operational variables. Outcomes examined include profitability, service rate, and sensitivity of some operation variables to profitability. Based on our results, we provide practical insights to help community pharmacy administrators and healthcare policy makers in their decision process. [ABSTRACT FROM AUTHOR]

Despite the growth of agrifood markets, and gradual structural transformation, smallholder farm households (SFHs) persist in Asia. Such patterns are at odds with the views that market growth should encourage more specialization whereby smallholders transition to either larger farmers or specialized non-farm households. Agrifood market participation is one of many factors that affect SFHs' expansion into the non-agricultural sector, including a range of other economic shocks or climate change, among others. Nonetheless, focusing explicitly on agrifood market participation is still important because of the particular economic pathways through which it potentially affects the economies of diversification into the non-agricultural sector. For example, market participation can transform households' economic environment by enabling them to exploit comparative advantage between food production and non-agricultural sector activities. At the same time, among various markets, participation in the agrifood market is unique in the sense that it is in the context of the consumption of "food" which is an absolute necessity, unlike the consumption of many other goods. In such a context, it is questionable whether SFHs are better off by fully specializing in nonagricultural sector activities and exiting from their own food production activities. Knowledge gaps, however, remain regarding the precise linkages between such agrifood market participation and SFHs' expansions into the non-agricultural sector. Using the panel household data in Vietnam, this study investigates how participation in agrifood markets affect smallholder households' economies of scope (EOS) in diversifying into agriculture and non-agricultural income-earning activities. We find that, greater agrifood market participation proxied by the increased food purchase is generally associated with increased EOS between agriculture and non-agricultural activities at the household level. Moreover, it leads to greater labor productivity in agriculture, and also increases female household members' diversifications into both agriculture and non-agricultural incomeearning activities. These effects are relatively stronger and more consistent than conventional indicators of agrifood product sales or proximity to the market. The findings suggest that, in addition to focusing on income potentials of increased agrifood commodity sales, policies that facilitate SFHs' increased purchase of food items from the market can have further complementary effects on their livelihood improvements. [ABSTRACT FROM AUTHOR]

The Vietnamese agricultural sector has experienced a dramatic structural change based on increased specialization in rice cultivation. However, small-scale rice-farmers have continued to grow multiple crops, especially in less developed provinces. While the literature advocates crop diversification for reasons of both economic and ecological sustainability, there lacks empirical evidence as to whether crop diversification brings efficiency and productivity gains to small farms. The present study is the first applications of the input-oriented stochastic distance function approach in estimating scale and scope economies using data of multi-crop farming households in Vietnam. We find strong evidence of product-specific economies of scale. Scope economies are also present for rice, vegetable, and other annual crop production. This suggests that crop diversification enhances efficiency and productivity. However, there still exists significant technical inefficiency in crop production, indicating opportunities to expand farm output at the existing level of inputs and technologies. More specifically, our empirical results indicate that it is desirable to expand vegetable and other annual crop production in mountainous areas while rice cultivation can be further expanded in delta and coastal regions.

Many companies and manufacturing industries produce their final product after going through several stages. Normally, in addition to the desirable products, these companies also have undesirable products that are considered as non-retrieval final products. However, by adding a stage for correction and recycling, their undesirable products can be used as resources, which improves economies of scope and cost-effectiveness. The purpose of this paper is to provide models for evaluating economies of scope and cost-effectiveness in two-stage supply chain systems which undesirable products will be given to the second stage for processing and modification and will be returned to the first stage after re-modification. By examining the characteristics of the proposed models, the effect of undesirable intermediate products between stages on cost-effectiveness and economic efficiency has been measured and evaluated. The results show that the proposed models are more accurate than the conventional model and the ability to effectively distinguish between cost and economic efficiency has been significantly improved. It is also possible to study the economic efficiency in the simultaneous production of products in the proposed models.

Climate is likely to affect the productive structure of urban water supply systems through its effects on reservoirs' volume, water quality, and consumption. This paper investigates these effects by analyzing the role of temperature and rainfall in water utilities' costs with a multiple-equation cost function model and a rich firm-level database that describes the operations of 3845 firms from 2008 to 2018 in Brazil. Results reveal the presence of causal effects of rainfall and, in some cases, temperature on costs, with small firms being more vulnerable to cope with adverse (dry) weather. Results also suggest significant economies of scale and density yet to be realized by the industry. Considering the highly fragmented Brazilian urban water industry, the findings show potentially large cost savings associated with an eventual regional consolidation of operations, particularly under the realization of climate change scenarios that show hotter and drier weather conditions. [ABSTRACT FROM AUTHOR]

Julian Simon famously argued that economic growth is correlated with population growth. The basis for this correlation is what Simon refers to as the "ultimate resource," namely the human mind and the collective stock of dispersed, tacit, and inarticulate knowledge among individuals. Though not incorrect, this simple rendition of his argument does not do full justice to the inspiration that Simon took from the mainline of economic thought. The purpose of this paper is to situate Julian Simon's The Ultimate Resource as part of the mainline of development economics. I do so by developing an implicit and underappreciated relationship between entrepreneurship and economic growth in Simon's The Ultimate Resource. I argue that this correlation between economic growth and population growth is predicated on what Simon refers to as "economies of scope." This implies twofold. First, that a Smithian division of labor and a Hayekian division of knowledge emerge simultaneously, but are inherently predicated on a Misesian division of private property rights. Secondly, population growth is a proximate cause of economic growth, and therefore a by-product of a more fundamental institutional foundation: an ever-increasing scope in the ability of individuals to exchange ideas, goods, and services. [ABSTRACT FROM AUTHOR]

In analyzing the efficiency of electricity distribution companies, according to the economies of scale hypothesis, due to the existence of natural monopoly properties, larger firms are expected to be technically more efficient (ceteris paribus). To investigate this issue, this study assessed the technical efficiency, economies of scale, and economies of scope of Iranian electricity distribution companies during 2011-2017 and examined their relationship with company size. For this purpose, the stochastic frontier analysis technique and the input distance function approach were used. The results show that technical efficiency first decreases and then increases with increasing company size. The results also show that economies of scale are present in most companies, although the use of economies of scale decreases as company size increases. Finally, economies of scope were observed in all the companies studied, and their magnitude decreases as company size increases. Therefore, it can be said that the hypothesis of economies of scale implying higher technical efficiency of larger companies, is not confirmed, although the necessary condition for the establishment of a natural monopoly is present in Iranian electricity distribution companies

Mixed farming systems are gaining interest both as a risk management strategy and to apply agroecological principles. This study set out to assess the sustainability of mixed systems compared to their specialized counterparts. The Orfee bioeconomic farm model was used to simulate three mixed farms: beef and dairy, beef and sheep, and cash crop and beef, under 1990–2017 prices and policies in France. Several sustainability criteria were computed at two scales (i) aggregated farm level, to assess whether mixed farms with several integrated enterprises performed better than if these enterprises were managed in specialized farms, and (ii) unit of product or labour to assess whether a product was produced more sustainably and a worker obtained higher and more stable income in a mixed farm. We found that mixed farms had less work peaks, lower global warming potentials and nitrogen balances, lower total production costs, higher and more stable net incomes than if their enterprises were managed in two specialized farms. However, profitability and income variability of the mixed farms were not better than the best performing specialized farm. The consumption of concentrate feed decreased in the mixed livestock farms but increased in the beef-crop farm that degraded feed-food competition. [ABSTRACT FROM AUTHOR]

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Empty containers need to be repositioned from a surplus area to a shortage area, and the resulting economies of scope mean that the canvassing (i.e., the sale of transportation service) of two routes back and forth is no longer isolated. To study the liner company's canvassing strategy for round-trip routes, this paper considers a benchmark situation where one forwarder is responsible for two directions and three canvassing sequences with one direction one freight forwarder responsibility. The results indicate that the liner company should focus canvassing on fewer forwarders, and the forwarder should expand service scope. Under one direction one freight forwarder responsibility, it is not necessarily optimal for the liner company that the direction with low potential market demand canvasses first. Examining the preferences of the liner company and two forwarders in terms of canvassing strategy, we find that a triple-win situation can not be formed, but only a win-win situation can be formed between the two of the three participants. Although the canvassing strategy where the direction with high potential market demand canvasses first has the worst effect on balancing cargo flow, it is possible to increase the market share while improving the profit of the liner company. [ABSTRACT FROM AUTHOR]

This study explores how firms decide in which businesses to further invest and from which businesses to withdraw resources by examining the detailed product portfolios of firms in the global semiconductor industry. Results show that resource redeployment within incumbent businesses is more prevalent than via new entry or complete exit, since the former is more flexible and easily reversible than the latter. This study further finds that, while underutilized resources may drive resource redeployment, resource shortage by a newly entered or expanding incumbent business may also siphon resources away from other incumbent businesses, leading to their exit or temporary retrenchment. Fabless firms with resource that are more fungible, scalable, and decomposable vis‐a‐vis integrated device manufacturers show a more flexible and gradual pattern of resource redeployment. Managerial summary: In fast‐moving environments, firms should quickly redeploy resources to more promising business areas. We find fabless firms with more fungible, scale free, and decomposable resources engage in more active resource redeployment than integrated device manufacturers with specialized fabs and equipment, like Intel or Samsung. Redeployment among the latter requires a well‐planned, synchronized approach so as to avoid idle resources. As such, in order to take advantage of dynamic resource redeployment, managers should begin by assessing the characteristics of firm resources along these dimensions. Managers may also consider business model transformation to separate their activities by specializing in areas in which they can best utilize their resources and capabilities, like fabless firms and foundries in the semiconductor industry. [ABSTRACT FROM AUTHOR]

A long-lasting dilemma on the efficient provision of services of general economic interest has become increasingly important in the waste management industry: competition or monopoly in municipal solid waste management. Previous literature has primarily examined the economics of scale and scope to provide an adequate response. Here, we contribute by investigating subadditivity in municipal solid waste management service costs. Subadditivity is a critical concept used to justify imperfect competition, which encourages natural monopolies where one producer will function more effectively than more firms. To test the hypothesis that a subadditivity in costs in waste management exists, we design a simulation based on empirical data for Milan, Italy. We compared the total production cost of the incumbent firm with the alternative hypothesis built by dividing the city into four areas and assigning each area to a different hypothetical firm. The results suggest that the existence of subadditivity results in 6% lower production costs, primarily stemming from business synergies, lower transactional costs, and optimization of productive resources and facilities. The evidence justifies, ceteris paribus, that the provision by a single firm is preferable to multiple firms in the analysis case. Implications for policies are straightforward. The one-fit rule approach fails to set the best condition for policymakers to create a level playing field transparently and efficiently for industry operators to perform efficiently.

This paper is motivated by the ongoing debate on university reform in Vietnam. In particular, there is a need to quantify the level of governmental support for public universities and examine whether or not such a support is adequate. To this end, the present paper estimates training costs per student in different disciplines within the Vietnamese public university education system in 2010. The various estimates of unit costs are based on the definitional approach which defines unit cost as the ratio of total costs over output. In measuring total costs, private costs incurred by university students (apart from formal tuition fees) are excluded. Further, the opportunity cost method employed emphasizes implicit costs such as imputed land rent. The total output is based on weighted student numbers. Unit costs are then estimated using a variety of primary (from survey) and secondary data sources. The results obtained suggest that the unit costs of public university education in Vietnam vary considerably between disciplines. The results also support the presence of economies of scale and scope in higher education and a negative relationship between unit costs and teaching quality proxies. The overall unit cost of public universities in Vietnam is very low in absolute terms when comparing with other countries. However, unit cost relative to GDP per capita in Vietnam is more comparable with those of neighboring countries. Nevertheless, the findings of the paper imply that more resources need to be allocated to the public university sector as part of an urgently needed university reform in Vietnam. [ABSTRACT FROM AUTHOR]

Current policy responses to COVID-19 disruption and care backlogs suggest potential changes to the location and structure of hospital healthcare supply. However, few studies investigating the cost effects of hospital reorganisation consider changes in the mix of outputs or test for the existence of economies of scope in hospital healthcare. Attempts to create dedicated hubs to address healthcare demand backlogs could have unintended adverse cost effects where these are provided outside existing hospital arrangements. To evaluate this, we investigate the existence and size of economies of scope in English hospital healthcare. We use cost and activity data from the English NHS, linked to aggregated staff wage information and information taken from hospital financial statements. Cost and activity data was obtained from NHS England's Costing Publications. Wage data was extracted from the NHS's Electronic Staff Record via the NHS England Workforce Statistics Team, and published hospital financial accounts were aggregated and linked together at the organisation level. General Surgery exhibited positive economies of scope when provided alongside other healthcare, as to a lesser extent did General Medicine and Obstetric/Gynaecology healthcare. There was little evidence for economies of scope in Diagnostic and Pathology services, Orthopaedics, or Emergency Care. Few (2/28) output cross-products (cost complementarities) were statistically significant, but Baumol's wider definition of scope economies demonstrates that scope economies are present in some specialties. Policymakers seeking to maximise the amount of healthcare provided and minimise the costs of doing so may wish to consider retaining General Surgery, General Medicine and Obstetric/Gynaecology healthcare supply alongside the provision of other clinical specialties. There is limited evidence that reconfiguring supply by centralizing other specialty groups into fewer providers would increase costs. • General surgery, general medicine, and obs/gynae lower costs in other specialties. • Diagnostics, orthopaedics, and A&E care did not lower costs elsewhere. • Policymakers could lower costs by colocating relevant hospital specialties. [ABSTRACT FROM AUTHOR]

The potential of pastoral land use to create positive environmental, economic, and social outcomes is constrained by a “way of seeing” land and people through the eyes of Modernity and mechanical determinism. That ontology of land is compounded and reinforced by positivism, and the associated hierarchical and dis-integrated epistemology around the culture:nature nexus – including what is seen as “objective” science and technology driving practise. Both the ontology and epistemology of our Modern land use culture drive a reduction of ethics, relationship, and meaning to the measured utility of either production or dollars within a “resource sufficiency” view of the land factory. The consequence is not just the non-realisation of potential synergies and multiple functions underpinning value and resilience within the socio-ecological systems associated with pastoral land. It also degrades the “functional integrity” of those integrated systems and increases the fragility and multiple negative outcomes to local economic, environmental, and social functions. This study examines the underlying philosophical thoughtscapes of Modern agri-business models and contrasts those models with the emerging alternatives: from reducible universally-quantifiable machines to post-industrial thought; including post-normal science, integrated complex adaptive systems, and emerging work shifting homogeneous “economies of scale” industrialism to realising potential “economies of scope” by building functional and self-organising systems. It further examines the potential scope to be gained using three specific examples: multi-functional integrated landscapes, resilience theory specific to drought, and market value chains.

An introduction is presented in which the guest editors discuss the theme of the issue, the scope, antecedents, and consequences of Innovation in the digital economy.

This study develops a theory of due diligence in corporate acquisitions. Using a formal model, the study situates due diligence in the context of economies of scope, which are often sought by acquiring organizations that have incomplete information about such economies. Relatedness, the key determinant of economies of scope, and ambiguity, the key determinant of incomplete information, are used to derive the optimal due diligence effort and the returns to an acquiring organization that result from that effort. The derived predictions qualify both the general appeal to extensive due diligence and the general recognition of the costliness of due diligence. These predictions can be tested in future empirical research on corporate acquisitions and may guide corporate acquirers on the optimal allocation of their due diligence efforts in the mergers and acquisitions market. [ABSTRACT FROM AUTHOR]

Size is a central characteristic of organizations. While previous studies point to size differences among nonprofit sport clubs, size effects have not yet been investigated systematically. The concepts of economies of scale and economies of scope are used to explain size advantages. Yet, club theory stresses that benefits from sharing production costs only exist until some point and decrease afterward. The purpose of this study is to examine size effects in sport clubs using data from two nationwide online surveys in Germany (n = 19,345) and Switzerland (n = 6,098). The results support the existence of economies of scope, since costs decrease with increasing number of different sports (not codes) offered in the same club. Yet, clubs only benefit from reduced costs until some point supporting club theory. Organizational size has a significant effect on various organizational problems. The findings have implications for the management of sport clubs and for policy makers. [ABSTRACT FROM AUTHOR]

Like other nations, Vietnam annually subsidies higher education via state budget to maintain academic operations of public institutions. However, the question of how to fairly and appropriately distribute state funding to public institutions is still challenging, therefore unfair distribution to some extent influence their cost efficiency. Using the quadratic cost function with random effects for a panel structure of 2011/12–2013/14, this paper aims to estimate economies of scale and scope of public universities and to seek for explaining whether the even application of standardized "one size fits all" policy in distributing public budget works or not when the cost analysis is stratified into rural and urban universities. The findings show that public universities are cost-inefficient in their performance and there are no economies of scale and scope in public universities. Even distribution of delivering state funding is more likely to be ineffective for public universities due to their different characteristics. Further, integrated teaching at various levels of higher education could be advantageous for rural universities but might not to be the case for their urban counterparts. In the end, policy implications for ameliorating the performance of public institutions are suggested. [ABSTRACT FROM AUTHOR]

Enterprise risk management (ERM) is the approach of managing all risks faced by an enterprise in an integrated, holistic fashion. This research investigates whether the utilization of the ERM approach helps firms achieve economies of scale and scope. We use detailed survey data of German property-liability insurance companies that allows us to construct continuous measures of ERM quality. We find that ERM quality positively moderates the size-scale efficiency relationship, and we find that ERM positively moderates the diversification-revenue scope efficiency relationship, indicating that ERM facilitates economies of scale and economies of scope with respect to revenue complementarities. We do not find any evidence of economies of scope with respect to cost complementarities. Our results suggest that ERM's impact on economies of scale and scope is one answer to the question of how ERM can create value. [ABSTRACT FROM AUTHOR]

This study investigates the potential economies of scope in the Norwegian public hospital sector after a major structural and organizational reform. Economies of scope refers to potential cost savings occurring from the scope of production rather than the scale. We use a data driven approach to distinguish between relatively specialized and differentiated hospitals. Using registry data spanning the period 2013-2019, we use non-parametric data envelopment analysis with bootstrapping procedures to investigate the potential presence of economies of scope. This is done separately for three different dimensions of which hospital production can be either specialized or differentiated. The findings suggest that economies of scope are present in the Norwegian hospital sector, meaning that there are cost savings related to the optimal differentiation of the activity. It is difficult to conclude on how these findings relate to the reform., (© 2024. The Author(s).)

This article examines the empirical performance of alternative frontier estimators’ ability to replicate a known underlying technology and economic measures such as multi-product and product-specific economies of scale, and economies of scope. A cross sectional Monte Carlo procedure to simulate data is used to evaluate a two-sided error system, an OLS system restricting errors to be above the cost frontier, the stochastic frontier method, and data envelopment analysis (DEA). The data are generated assuming a half-normal distribution, and a uniform distribution. Data were also simulated with single and two output firms. The DEA estimator was most robust in estimating the “true” cost frontier and associated economic measures including data sets without single output firms and less effected by distributional assumptions.

General hospitals across the world are becoming larger (i.e., admitting more patients each year) and more complex (i.e., offering a wider range of services to patients with more diverse care needs). Prior work suggests that an increase in patient volume in a hospital service is associated with reduced costs per patient in that service. However, it is unclear how volume changes in one service affect the costs of the other services in the same hospital. This paper investigates such volume-cost spillover effects between elective and emergency admissions and across specialties, using condition-level panel data comprising all acute hospital trusts in England over a period of 10 years. We provide evidence that increased elective volume at a hospital is associated with an increase in the cost of emergency care (a negative spillover). Furthermore, for emergency admissions, we find evidence that increased emergency activity in one specialty is associated with lower costs of emergency care in other specialties (a positive spillover). By contrast, we find no evidence of spillover effects across specialties for elective admissions. We discuss the implications of these findings for individual hospital growth strategies and for the regional organization of hospital systems. This paper was accepted by David Simchi-Levi, operations management. [ABSTRACT FROM AUTHOR]

Banks' business models are assumed to affect efficiency, as documented in the banking supervisory priorities of the European Union (EU) for 2016–2018 and the 2014 structural reform proposal for the EU banking sector. We investigate evidence of economies and diseconomies of scope for the EU. We find cost economies of scope and revenue diseconomies of scope, resulting in profit diseconomies of scope. Separating commercial from investment activities generates economic inefficiencies on costs but efficiencies on revenues and profits. Economies of scope are affected by bank size, liquidity, competition in the banking industry, and the European sovereign debt crisis. [ABSTRACT FROM AUTHOR]

This paper examines how knowledge created by firm experience (learning economies) and scale and scope economies affect performance in firms' development activities. The empirical results suggest that each factor has a significant effect on development performance. Moreover, knowledge that results from greater experience within a particular technological area, when combined with knowledge spillovers from greater scope in other technological areas, significantly improves development performance. The results suggest that experience shapes and facilitates firms' abilities to absorb knowledge spillovers. Our empirical findings thus provide a more nuanced examination of the drivers of performance and have implications for the management of firms' development activities. Copyright © 2006 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]