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on Small Business Management |
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Issue of 2011‒09‒16
ten papers chosen by Joao Carlos Correia Leitao University of Beira Interior and Technical University of Lisbon |
| By: | Jakub Growiec; Fabio Pammolli; Massimo Riccaboni |
| Abstract: | We provide a detailed analysis of a model of innovation and corporate dy- namics that encompasses the Gibrat’s Law of Proportionate Effect and the Simon growth process as particular instances. The predictions of the model are derived in terms of (i) firm size distribution, (ii) the distribution of firm growth rates, and (iii-iv) the relationships between firm size and the mean and variance of firm growth rates. We test the model against data from the worldwide pharmaceutical industry and find its predictions to be in good agreement with empirical evidence on all four dimensions. |
| Keywords: | Business firm size; firm growth distribution; GibratÕ Law; Pareto distribution; lognormal distribution, size-variance relationship. |
| JEL: | C49 L11 L25 L65 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:trt:disawp:1017&r=sbm |
| By: | Czarnitzki, Dirk; Lopes Bento, Cindy |
| Abstract: | Applying a variant of a non-parametric matching estimator, we consider European funding and national funding as heterogeneous treatments, distinguishing and simultaneously analyzing the effect these treatments have on innovation input and performance. In terms of input, getting funding from both sources yields the highest impact. If funding from only one source is received, EU grants have higher effects. In terms of output, holding innovation expenditures constant, funding from both sources display higher sales of market novelties and future patent applications at the firm level. If only one grant is obtained, we find superiority for national funding. -- |
| Keywords: | Subsidies,Innovation,Policy Evaluation,Treatment Effects,Nonparametric matching estimation |
| JEL: | C14 H50 O38 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:11053&r=sbm |
| By: | Davide Castellani (Department of Economics, Finance and Statistics, University of Perugia and Centro Studi Luca D'Agliano, Milan); Fabio Pieri (Department of Economics, Finance and Statistics, University of Perugia) |
| Abstract: | The recent increase in R&D oshoring have raised fears that knowledge and competitive- ness in advanced countries may be at risk of `hollowing out'. At the same time, economic research has stressed that this process is also likely to allow some reverse technology transfer and foster growth at home. This paper addresses this issue by investigating the extent to which R&D oshoring is associated with productivity dynamics of European (NUTS2) regions. In particular, we explore whether R&D investments abroad have a dierent impact from those in manufacturing and other business activities. We nd that oshoring regions have higher productivity growth, but this positive eect fades down with the number of investment projects carried out abroad. However, a large and positive correlation emerge between the extent of R&D oshoring and the home region produc- tivity growth, supporting the idea that carrying out R&D abroad strengthen European competitiveness. |
| Keywords: | Regional Productivity, Foreign Investments, Europe, R&D Offshoring |
| JEL: | C23 F23 O47 O52 R11 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:eec:wpaper:1120&r=sbm |
| By: | Traci L. Mach; John D. Wolken |
| Abstract: | This paper examines the effects of credit availability on small firm survivability over the period 2004 to 2008 for non-publicly traded small enterprises. Using data from the 2003 Survey of Small Business Finances, we develop failure prediction models for a sample of small firms that were confirmed to have been in business as of December 2003, with particular attention to the impact of credit constraints. We find that credit constrained firms were significantly more likely to go out of business than non constrained firms. Moreover, credit constraint and credit access variables appear to be among the most important factors predicting which small U.S. firms went out of business during the 2004-2008 period even though an extensive set of firm, owner, and market characteristics were also included as explanatory factors. |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2011-35&r=sbm |
| By: | Barge-Gil, Andrés |
| Abstract: | Scholarly interest in the relationship between open strategies and innovation performance has been unfailing, and in recent years has even increased. The present paper focuses on inbound open strategies and reviews various approaches (transaction costs, competences, open innovation) dealing with firms´ decisions about these strategies. The different approaches result in different conclusions about the optimum level of openness. The different approaches are tested empirically taking account of the different degrees of openness (closed, semiopen, open, ultraopen) and their effects on sales of new–to-the-market products, and using a panel of Spanish firms from a CIS-type survey for 2004-2008. Our results show that closed and semiopen strategies are the most common among Spanish firms and that open strategies produce the best performance, while semiopen strategies are more effective than closed ones. These results hold across different subsamples based on firm size and industry, and are robust to different ways of defining the indicators and to different estimation methods. |
| Keywords: | open innovation strategies; collaboration; transaction costs; competences; CIS surveys; R&D; technology policy |
| JEL: | L2 D2 O3 |
| Date: | 2011–07–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:31298&r=sbm |
| By: | Oliver Falck; Christina Guenther; Stephan Heblich; William R. Kerr |
| Abstract: | We identify the impact of local firm concentration on incumbent performance with a quasi natural experiment. When Germany was divided after World War II, many firms in the machine tool industry fled the Soviet occupied zone to prevent expropriation. We show that the regional location decisions of these firms upon moving to western Germany were driven by non-economic factors and heuristics rather than existing industrial conditions. Relocating firms increased the likelihood of incumbent failure in destination regions, a pattern that differs sharply from new entrants. We further provide evidence that these effects are due to increased competition for local resources. |
| Keywords: | Agglomeration, competition, firm dynamics, labor, Germany |
| JEL: | R10 L10 H25 O10 J20 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:cep:sercdp:0088&r=sbm |
| By: | Christian Cordes; Peter J. Richerson; Georg Schwesinger |
| Abstract: | In infant industries, a great share of new market opportunities is depleted by firms that spinoff from incumbents. A model emphasizing the relation between incumbents' evolving corporate cultures and the generation of spinoffs explains this regularity in industry evolution. Organizations reach a critical size that entails the collapse of a cooperative culture and triggers the exodus of personnel founding own firms. Thereby, organizations with a cooperative culture active in a dynamic business environment provide ideal training grounds for potential founders. We relate our findings to empirical evidence on developmental patterns in industries, such as genealogies and performance of spinoffs. |
| Keywords: | Spinoff Formation, Critical Firm Size, Firm Performance, Industry Evolution, Corporate Culture Length 23 pages |
| JEL: | C61 D21 L25 L26 M13 M14 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:esi:evopap:2011-11&r=sbm |
| By: | Bjuggren, Per-Olof (The Ratio Institute and Jönköping International Business School); Duggal, Rubecca (Jönköping International Business School and Center for Family Enterprise and Ownership in Jönköping); Giang, Dinh Tung (Jönköping International Business School) |
| Abstract: | Family firms are entities that possess and contribute greatly to all economies worldwide. In the following study we investigate capital structures and ownership dispersion among Swedish family firms. In order to find concluding results, we proceed with a regression between leverage and family business, leverage and family firm age, and leverage and ownership dispersion. Our regression outcomes support a U- shaped relationship between family ownership dispersion and leverage, but do not confirm a relation between leverage and family business. Earlier studies made in the field have generated differing results; however, there are some studies that are actually in line with our findings. A unique database developed at Jönköping University is used that enables us to obtain access to firm level data. Earlier studies in the same genre have only had access to industry level data. |
| Keywords: | Family firms; Capital structure; Closed medium sized enterprises; Ownership Dispersion; Corporate Governance |
| JEL: | G30 |
| Date: | 2011–09–06 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0175&r=sbm |
| By: | Maria Cipollina (University of Molise); Giorgia Giovannetti (University of Florence and European University Institute); Filomena Pietrovito (University of Molise); Alberto Franco Pozzolo (University of Molise, Centro Studi Luca d’Agliano and MoFiR) |
| Abstract: | The theoretical literature has discussed different channels through which foreign direct investments (FDI) promote host country’s economic growth, but empirical analyses have so far been inconclusive. In this paper we provide evidence that FDI have a positive and statistically significant growth effect in recipient countries, using a panel of 14 manufacturing sectors for (a sample of) developed and developing countries over the period 1992 - 2004. Moreover, we find that this effect is stronger in capital intensive and in technologically advanced sectors, highlighting the importance of sector characteristics. We find that the growth enhancing effect comes primarily from an increase in total factor productivity (TFP) and from capital accumulation. FDI not only contribute to physical capital accumulation, but also generate positive technological spillovers. Our results are robust to the inclusion of other determinants of economic growth. We also address the issue of potential endogeneity and results are confirmed. Policy implications of our findings are important, especially for developing countries, where the growth enhancing promotion of foreign investment in capital intensive and technologically advanced sectors is at the heart of the debate. |
| Keywords: | Foreign direct investment; Economic growth; Capital intensity, Technological progress; Patents; Total factor productivity |
| JEL: | F23 F36 F43 O16 |
| Date: | 2011–09–06 |
| URL: | http://d.repec.org/n?u=RePEc:csl:devewp:313&r=sbm |
| By: | Hu, Zhining; Zheng, Jianghuai; Wang, Jialing |
| Abstract: | This article investigates the effect of industrial linkages on firm performance in Chinese development zones, using Jiangsu Province as a case study. An ordered response model based on the dependent variable being ordinal was developed. The empirical results reveal an insignificant relationship between industrial linkages and firm performance. Our interpretation of this finding mainly lies with the global and domestic challenges that have changed the way participating firms operate and organize in the development zones of Jiangsu. When many other economic factors take precedence over industrial linkages in driving superior firm performance, firms feel it less important to get closer to their suppliers or customers, therefore weakening the impact of industrial linkages. Although this article primarily focuses on development zones in Jiangsu Province, the findings and discussion will provide insights for other development zones in China that may be, reviewing their development strategies because most of them have similar development problems. |
| Keywords: | Industrial linkages; Development zones |
| JEL: | F23 L23 O20 |
| Date: | 2011–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:33127&r=sbm |