|
on Small Business Management |
|
Issue of 2012‒02‒20
twenty papers chosen by Joao Carlos Correia Leitao University of Beira Interior and Technical University of Lisbon |
| By: | Segarra Blasco, Agustí; Teruel Carrizosa, Mercedes |
| Abstract: | This paper analyzes the effect of firms’ innovation activities on their growth performance. In particular, we observe how important innovation is for high-growth firms (HGFs) for an extensive sample of Spanish manufacturing and services firms. The panel data used comprises diverse waves of Spanish CIS over the the period 2004-2008. First, a probit analysis determines whether innovation affects the probability of being a high-growth firm. And second, a quantile regression technique is applied to explore the determinants and characteristics of specific groups of firms (manufacturing versus service firms and high-tech versus low-tech firms). It is revealed that R&D plays a significant role in the probability of becoming a HGF. Investment in internal and external R&D per employee has a positive impact on firm growth (although internal R&D presents a significant impact in the last quantiles, external R&D is significant up to the median). Furthermore, we show evidence that there is a positive impact of employment (sales) growth on the sales (employment) growth. Keywords: high-growth firms, firm growth, innovation activity JEL Classifications: L11, L25, O30 |
| Keywords: | Empreses -- Innovacions tecnològiques -- Espanya, Empreses -- Creixement, 33 - Economia, 65 - Gestió i organització. Administració i direcció d'empreses. Publicitat. Relacions públiques. Mitjans de comunicació de masses, |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:urv:wpaper:2072/179669&r=sbm |
| By: | LE BAS Christian; MOTHE Caroline; NGUYEN Thi Thuc Uyen |
| Abstract: | In this paper, we will review the literature on technological innovation persistence and provide a general theoretical framework to analyze the main determinants of this innovative behavior. Moreover, no previous empirical study has taken into account organizational innovation practices as possible determinants of innovation persistence. We will therefore include them, as previous studies have shown the interaction effects between the two types of innovation, and produce empirical results on technical innovation persistence. A multinomial probit model was used to estimate the likelihood of belonging to each of the three longitudinal innovation profiles. Results confirm the differentiated impact of determinants on process and technological innovation persistence, and the effect of R&D intensity, R&D cooperation and competition intensity. As hypothesized, we also found that organizational innovation is a determinant factor for innovation persistence and, more generally speaking, for technological innovation, in particular organizational practices such as knowledge management and external partnerships. |
| Keywords: | Persistence; Innovation; Technological innovation; Organizational innovation; R&D |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:irs:cepswp:2011-54&r=sbm |
| By: | Daria Ciriaci (JRC-IPTS) |
| Abstract: | The objective of this study is to provide an analysis of the importance of design – defined as the procedures, choice of elements and technical preparation to implement a new product – and R&D investments as drivers of European firms’ innovation performance. In doing so, it partly compensates for the lack of empirical evidence in the literature by using non-anonymised data from the third wave of the European CIS, and estimating a system of simultaneous equations to tackle the endogeneity inherent in these investment choices and the externalities associated with them. The choice to use this time period rather than more recent is data-driven as this wave contains better information on design expenditures. Unlike the majority of CIS-based studies, the main variables of interest are continuous ones. In addition, although pure aesthetic changes are not included in the CIS definition of innovative design expenditures, the impact of this important dimension of product innovativeness is properly accounted for. The robustness of results confirms the crucial role of design investment for innovation success in 23 European countries for both the manufacturing and service sectors and its role as a complement to technological R&D and as a driver for user-centred incremental (new-to-the-firm) and radical (new-to-the-market) innovations. In particular it found an increase of 1% expenditure increases innovation sales by between 0.34% and 0.49%, while the same increase in R&D investment increases innovation sales by between 0.64% and 0.86%. Interestingly, while investing in design shows no statistically different innovation output returns for small, medium-sized and large enterprises, this is not the case for R&D expenditures. The policy conclusions are clear: design is a less costly alternative to R&D for many SMEs and a policy of supporting design should be considered, as this might be a more cost-efficient support strategy. |
| Keywords: | Intangibles, design, R&D investment, CIS, CDM model |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:wpaper:201108&r=sbm |
| By: | Slivko, Olga; Theilen, Bernd |
| Abstract: | This article provides a theoretical and empirical analysis of a firm's optimal R&D strategy choice. In this paper a firm's R&D strategy is assumed to be endogenous and allowed to depend on both internal firms. characteristics and external factors. Firms choose between two strategies, either they engage in R&D or abstain from own R&D and imitate the outcomes of innovators. In the theoretical model this yields three types of equilibria in which either all firms innovate, some firms innovate and others imitate, or no firm innovates. Firms'equilibrium strategies crucially depend on external factors. We find that the efficiency of intellectual property rights protection positively affects firms'incentives to engage in R&D, while competitive pressure has a negative effect. In addition, smaller firms are found to be more likely to become imitators when the product is homogeneous and the level of spillovers is high. These results are supported by empirical evidence for German .rms from manufacturing and services sectors. Regarding social welfare our results indicate that strengthening intellectual property protection can have an ambiguous effect. In markets characterized by a high rate of innovation a reduction of intellectual property rights protection can discourage innovative performance substantially. However, a reduction of patent protection can also increase social welfare because it may induce imitation. This indicates that policy issues such as the optimal length and breadth of patent protection cannot be resolved without taking into account specific market and firm characteristics. Journal of Economic Literature Classification Numbers: C35, D43, L13, L22, O31. Keywords: Innovation; imitation; spillovers; product differentiation; market competition; intellectual property rights protection. |
| Keywords: | Empreses -- Innovacions tecnològiques, Diferenciació de productes, Propietat intel·lectual, 33 - Economia, 65 - Gestió i organització. Administració i direcció d'empreses. Publicitat. Relacions públiques. Mitjans de comunicació de masses, |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:urv:wpaper:2072/179618&r=sbm |
| By: | Segarra Blasco, Agustí |
| Abstract: | This paper explores the factors that determine firm’s R&D cooperation with different partners, paying special attention on the role of tertiary education (degree and PhDs level) in facilitating the connection between the firms and the to scientific bodies (technology centres, public research centres and universities). Here, we attempt to answer two questions. First, are innovative firms that carry out internal and external R&D activities more likely to cooperate on R&D projects with other partners? Second, do Spanish innovative firms with a high participation of researchers with degrees or PhDs tend to cooperate more with scientific partners? To answer both questions we apply a three-dimensional approach on a firm level Panel Data with a sample of 4.998 manufacturing and services Spanish firms. First, we run a complementary test between external R&D acquisition and skilled research workers and find that firms which carry out external R&D activities obtain a greater return on R&D cooperation when they have skilled workers in R&D, especially in high-tech manufactures and KIS services. Second, we carry out a 2-step tobit model to estimate, in the first stage, the determinants that explain whether Spanish innovative firms cooperate or not; and in the second stage the factors that affect the choice of partners. And third, we apply an ordered probit model to test the marginal effects of explanatory variables on the different partners. Here we contrast some of the most interesting empirical hypotheses of previous studies, and which emphasize the role of employees with degrees and PhDs in facilitating cooperative R&D between firms and scientific partners. JEL classification: O31, O33, O38. Key words: Determinants R&D cooperation, industry-university flows, PhD research workers. |
| Keywords: | Empreses -- Innovacions tecnològiques, Col·laboracio empresa-universitat, 378 - Ensenyament superior. Universitats, 65 - Gestió i organització. Administració i direcció d'empreses. Publicitat. Relacions públiques. Mitjans de comunicació de masses, |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:urv:wpaper:2072/179621&r=sbm |
| By: | Gombau, Verònica; Segarra Blasco, Agustí |
| Abstract: | This paper analyses whether a firm’s absorptive capacity and its distance from the technological frontier affect the choice between innovation and imitation in innovative Spanish firms. From an extensive survey of 5,575 firms during the 2004-2009 period, we found two significant results. With regard to the role of absorptive capacity, the empirical evidence shows that when innovative firms have difficulties in accessing external information and hire skilled workers, their innovative capacity is reduced. Meanwhile, with regard to distance from the technological frontier, the firms that reduce this gap manage to increase their innovative capacity at the expense of imitation. To summarise, when we studied firms’ absorptive capacity and their relative position to the technological frontier in tandem, we found that the two factors directly affected firms' ability to innovate or imitate. Key words: R&D sources, innovation and imitation strategies, absorptive capacity, technological frontier, ordered probit. |
| Keywords: | Empreses -- Innovacions tecnològiques -- Espanya, 33 - Economia, 65 - Gestió i organització. Administració i direcció d'empreses. Publicitat. Relacions públiques. Mitjans de comunicació de masses, |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:urv:wpaper:2072/179666&r=sbm |
| By: | Ajay K. Agrawal; Iain M. Cockburn; Alberto Galasso; Alexander Oettl |
| Abstract: | Large labs may spawn spin-outs caused by innovations deemed unrelated to the firm's overall business. Small labs generate demand for specialized services that lower entry costs for others. We develop a theoretical framework to study the interplay of these two localized externalities and their impact on regional innovation. We examine MSA-level patent data during the period 1975-2000 and find that innovation output is higher where large and small labs coexist. The finding is robust to across-region as well as within-region analysis, IV analysis, and the effect is stronger in certain subsamples consistent with our explanation but not the plausible alternatives. |
| JEL: | O31 R11 |
| Date: | 2012–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17793&r=sbm |
| By: | Gombau, Verònica; Segarra Blasco, Agustí |
| Abstract: | This paper explores how absorptive capacity affects the innovative performance and productivity dynamics of Spanish firms. A firm’s efficiency levels are measured using two variables: the labour productivity and the Total Factor Productivity (TFP). The theoretical framework is based on the seminal contributions of Cohen and Levinthal (1989, 1990) regarding absorptive capacity; and the applied framework is based on the four-stage structural model proposed by Crépon, Duguet and Mairesse (1998) for setting the determinants of R&D, the effects of R&D activities on innovation outputs, and the impacts of innovation on firm productivity. The present study uses a twostage structural model. In the first stage, a probit estimation is used to investigate how the sources of R&D, the absorptive capacity and a vector of the firm’s individual features influence the firm’s likelihood of developing innovations in products or processes. In the second phase, a quantile regression is used to analyze the effect of R&D sources, absorptive capacity and firm characteristics on productivity. This method shows the elasticity of each exogenous variable on productivity according to the firms’ levels of efficiency, and thus allows us to distinguish between firms that are close to the technological frontier and those that are further away from it. We used extensive firm-level panel data from 5,575 firms for the 2004-2009 period. The results show that the internal absorptive capacity has a strong impact on the productivity of firms, whereas the role of external absorptive capacity differs according to nature of the each industry and according the distance of firms from the technological frontier. Key words: R&D sources, innovation strategies, absorptive capacity, technological distance, quantile regression. |
| Keywords: | Empreses -- Innovacions tecnològiques, Productivitat industrial, 65 - Gestió i organització. Administració i direcció d'empreses. Publicitat. Relacions públiques. Mitjans de comunicació de masses, |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:urv:wpaper:2072/179622&r=sbm |
| By: | Anne-Laure Le Nadant, University of Caen Basse-Normandie, CREM-CNRS, UMR 6211; Frédéric Perdreau, University of St-Etienne, COACTIS, EA 4161 |
| Abstract: | Agency theory has historically presented buyouts as a superior governance framework that generates economic efficiencies in the short term but these transactions might have a negative impact on long-term growth and innovation. In this study, we use a strategic entrepreneurship perspective to argue that private equity firm's extensive network and relationships, and expertise and competencies help managers to innovate. Using a propensity score methodology, we provide an empirical analysis of the innovative efforts of a sample of 89 French manufacturing firms that underwent a buyout between 2001 and 2005. The matching estimates (average treatment on the treated, ATT) of the effect of LBOs on firm level of innovation expenditures in 2006 show no significant differences between LBO targets and comparable companies that did not go through an LBO. In contrast, we find significant effects of LBOs on both service innovation and marketing innovations in design and packaging and product promotion. Results suggest that private equity firms provide marketing capabilities or encourage managers of LBO targets to build new innovation strategies. |
| Keywords: | Buyouts, Innovation, Private Equity Firms, Strategic Entrepreneurship |
| JEL: | G24 G34 O30 |
| Date: | 2012–01 |
| URL: | http://d.repec.org/n?u=RePEc:tut:cremwp:201209&r=sbm |
| By: | Teruel Carrizosa, Mercedes; De Wit, Gerrit |
| Abstract: | High-growth firms have been shown to be a key factor for economic growth and structural change. This paper analyses the determinants of the number of high-growth firms in a country for 17 OECD countries between 1999 and 2005, using the Amadeus data set, the GEM data set, and others. The first contribution of this paper is that it is – as far as we know – the first empirical analysis of high-growth firms at the country level on the basis of actual measured growth. Second, we find indicative empirical evidence for three driving forces of high growth, viz. entrepreneurship, institutional settings, and opportunities for growth, all in accordance with theory and empirical findings in related fields of research. Third, the paper gives a tentative explanation of the differences in the average percentage of high-growth firms between countries. Finally, the paper gives some clues for policy makers how to promote high-growth firms. Keywords: high-growth firms, fast growing firms, entrepreneurship, institutional obstacles, opportunities for growth |
| Keywords: | Empreses -- Creixement, Emprenedoria, 33 - Economia, 65 - Gestió i organització. Administració i direcció d'empreses. Publicitat. Relacions públiques. Mitjans de comunicació de masses, |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:urv:wpaper:2072/179670&r=sbm |
| By: | Lee, Neil |
| Abstract: | A small proportion of high growth firms create the majority of all new jobs. For policymakers, it is important to know (1) the obstacles faced by high growth firms are and (2) the obstacles faced by firms with the potential to achieve high growth, but which are yet to achieve this. This investigates these issues using the UK Small Business Survey. It highlights six areas where high growth firms experience problems: obtaining finance, cash flow, recruiting staff, skill shortages, managerial skills and the availability and cost of premises. Potential high growth firms argue that cash flow, recruiting, the availability and cost of premises and managerial skills are important. They also argue that competition is a significant obstacle to their growth, perhaps implying their business strategy is problematic. |
| Keywords: | High growth firms; Barriers; gazelles; SMEs; Firm growth |
| JEL: | L0 D21 L2 L10 |
| Date: | 2011–11–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:36396&r=sbm |
| By: | Barajas, A.; Huergo , E.; Moreno, L. |
| Abstract: | The objective of the present study is to analyse the effect of technological cooperation on SMEs performance consideringtwo dimensions: technological and economic results. For that purpose, we use a data set containing information about participants in research joint ventures supported by the SME-specific measures of the sixth Framework Programme. Empirical evidence corroborates a direct and positive impact on technological assets of participants. On the part of the economic indicators, EBITDA per employee and sales are positively influenced by the improvement of technological background. The same results are found for productivity. All those effects are effective in the medium term, confirming that SMEs use to be involved in market-oriented R&D projects. |
| Keywords: | research joint ventures; SMEs; impact assessment |
| JEL: | L2 H81 O3 |
| Date: | 2012–01–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:36306&r=sbm |
| By: | Pedro Valadas Monteiro (Directorate of Agriculture and Fisheries for Algarve region and Research Centre for Spatial and Organizational Dynamics, University of Algarve); Teresa de Noronha (Faculty of Economics and Research Centre for Spatial and Organizational Dynamics, University of Algarve); Paulo Neto (Economics Department and Center for Advanced Studies in Management and Economics, University of Évora) |
| Abstract: | The purpose of the current paper is to provide a critical state-of-the-art review of current research on clusters and its correlation to innovation dynamics in small and medium-sized regions. In particular, we focus on the systematization of the main concepts and theoretical insights that are tributary to the cluster overview in terms of its relevance for the sustainability of the innovation processes, knowledge production and diffusion, which take place inside small and medium-sized regions. The present working paper takes into account the initial studies on English industrial districts (in the nineteenth century), passing through the Italian industrial districts (in the 70s and 80s of the twentieth century), until the modern theories of business clusters and innovation systems. These frameworks constitute the basis of an approach to endogenous development, which gives a central role to the interaction between economic actors, the society and the institutions and to the identification, mobilization and combination of potential resources within a particular geographical area. |
| Keywords: | Cluster; Innovation; Endogenous development; Territory. |
| JEL: | E23 D23 R12 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:cfe:wpcefa:2011_24&r=sbm |
| By: | Riccardo Crescenzi (London School of Economics); Andrés Rodríguez-Pose (IMDEA Social Sciences) |
| Abstract: | This paper discusses recent developments in the literature on local and regional innovative performance in order to show how an 'integrated' conceptual framework based on the cross-fertilisation of different theories can serve as a foundation for the comparative analysis of territorial innovation dynamics in both developed and developing countries. The paper outlines a conceptual framework to explain the differences between innovation systems and their geography by drawing on elements of endogenous growth, new economic geography and regional innovation systems. This framework forms the basis of the subsequent analysis of the differences in innovative capacity between the European Union, the Unites States – as the leader system to be challenged – and China and India as emerging competitors for international technological leadership. The systematic analysis of a large body of empirical literature shows important differences between the spatial patterning of 'emerging' (China and India) and 'mature' (EU and US) innovation systems. |
| Keywords: | innovation systems; geography; endogenous growth; new economic geography; Europe; United States; China; India |
| Date: | 2012–02–10 |
| URL: | http://d.repec.org/n?u=RePEc:imd:wpaper:wp2012-02&r=sbm |
| By: | Alvaro Escribano; Szabolcs Blazsek |
| Abstract: | This paper studies the dynamic interactions and the spillovers that exist among patent application intensity, secret innovation intensity and stock returns of a well-defined technological cluster of firms. We study the differential behavior when there is an Innovation Leader (IL) and the rest of the firms are Innovation Followers (IFs). The leader and the followers of the technological cluster are defined according to their patent innovation activity (stock of knowledge). We use data on stock returns and patent applications of a panel of technologically related firms of the United States (US) economy over the period 1979 to 2000. Most firms of the technological cluster are from the pharmaceutical-products industry. Interaction effects and spillovers are quantified by applying several Panel Vector Autoregressive (PVAR) market value models. Impulse Response Functions (IRFs) and dynamic interaction multipliers of the PVAR models are estimated. Secret patent innovations are estimated by using a recent Poisson-type patent count data model, which includes a set of dynamic latent variables. We show that firms’ stock returns, observable patent intensities and secret patent intensities have significant dynamic interaction effects for technologically related firms. The predictive absorptive capacity of the IL is the highest and this type of absorptive capacity is positively correlated with good firm performance measures. The innovation spillover effects that exist among firms, due to the imperfect appropriability of the returns of the investment in R&D, are specially important for secret innovations and less relevant for observed innovations. The flow of spillovers between followers and the leader is not symmetric being higher from the IL to the IFs. |
| Keywords: | Patent count data model, Stock market value, Secret innovations, Absorptive capacity, Technological proximity, Panel Vector Autoregression (PVAR), Impulse Response Function (IRF), Efficient Importance Sampling (EIS) |
| JEL: | C15 C31 C32 C33 C41 |
| Date: | 2012–01 |
| URL: | http://d.repec.org/n?u=RePEc:cte:werepe:we1202&r=sbm |
| By: | Francesca Mameli; Simona Iammarino; Ron Boschma |
| Abstract: | This paper investigates the impact of regional sectoral diversity on regional employment growth in Italy over the period 1991-2001. Assuming that externalities may be stronger between industries selling similar products or sharing the same skills and technology (i.e. related industries), we analyze the role of different forms of sectoral variety at the Local Labour System (LLS) level. Our results show strong evidence of a general beneficial effect of a diversified sectoral structure but suggest also the need to differentiate the analysis between manufacturing and services. In particular, overall local employment growth seems to be favoured by the presence of a higher variety of related service industries, while no role is played by related variety in manufacturing. When looking at diversity externalities between macro-aggregates, the service industry is affected by related variety in manufacturing, while no evidence of externalities is found from tertiary sectors to manufacturing. |
| Keywords: | related variety, knowledge spillovers, agglomeration economies, regional growth, Italy |
| JEL: | D62 O18 O52 R11 |
| Date: | 2012–02 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:1203&r=sbm |
| By: | Jan de Kok; Haibo Zhou; Chantal Hartog |
| Abstract: | Are firm growth and firm survival related to each other? This paper tests the hypothesis that the relationship between firm growth and firm survival can be characterised by an inverted U-shaped relation. This hypothesis is confirmed by our estimations. At the same time, the results indicate that the top of the inverted U-shaped relation occurs at very high growth rates. This suggests that for the large majority of enterprises, the relationship between firm growth and firm survival can be better described by a positive relationship rather than an inverted U-shaped relationship. Although these results are preliminary, they suggest that policies that aim to increase the number of fast-growing firms have no negative effects on the rate of firm deaths. |
| Date: | 2012–02–02 |
| URL: | http://d.repec.org/n?u=RePEc:eim:papers:h201119&r=sbm |
| By: | Fabiano COMPAGNUCCI (IUAV - Venezia); Augusto CUSINATO (IUAV - Venezia) |
| Abstract: | The spatial implications of fordist and district-based patterns of development have had a profound effect on the debate about the role of the city. While the city is reputed to be the crucial provider of fixed social capital within the fordist model, its role seems more nuanced, if not disputable, when the district model prevails. This disregard for the city is probably due to (a) the fact that the revival of the debate on marshallian industrial districts (IDs) has placed strong emphasis on the agglomeration economies internal to the districts themselves, when not emphasising the burden of urban diseconomies; and (b) the countryside roots of most district pioneers. The quarrel was further fuelled with the advent of ICTs, and the feasibility of displacing productive phases at a global level. The paper argues that this is only the early part of the history. The advent of ICTs has had not only functional consequences but also an important impact on the internal organisation of firms and industry and on economic geography as a whole. It has also made knowledge and innovation the crucial drivers of the competitiveness of firms and local economic systems. The notion of knowledge has profoundly changed too, and the main change consists in the shift that is occurring within the industry itself from the ontological to the hermeneutical approach. According to this view, the main hypothesis is that the city is a crucial socio-spatial device for knowledge generation. The paper investigates this issue on both the theoretical and the empirical level by introducing a new analytical category - "Knowledge-creating services (KCS)". With reference to the Italian case, the outcomes corroborate the above hypothesis and open an original perspective on the relationships between the city and IDs in the knowledge age: the city is shown to be not only the gateway for functionally connecting IDs with the global market but also a true Knowledge-creating District. Within this new situation, a reassessment is needed of the relationships between IDs and the city, due to the misalignment that is likely to occur between competences in "producing" manufactured goods and knowledge. |
| Keywords: | city, industrial districts, knowledge economy |
| JEL: | O18 R11 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:anc:wpaper:365&r=sbm |
| By: | Yun Jung Kim; Linda Tesar; Jing Zhang |
| Abstract: | Using Korean firm-level data on publicly-listed and privately-held firms together with firm exit data, we find strong evidence of the balance-sheet effect for small firms at both the intensive and extensive margins. During the crisis, small firms with more short-term foreign debt are more likely to go bankrupt, and experience larger sales declines conditional on survival. The extensive margin accounts for a large fraction of small firms’ adjustment during the crisis. Consistent with many studies in the literature, large firms with larger exposure to foreign debt paradoxically have better performance during the crisis at both the intensive and extensive margin. |
| JEL: | E44 F32 F34 |
| Date: | 2012–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17756&r=sbm |
| By: | Jan de Kok; Gerrit de Wit |
| Abstract: | In this paper we give partly new arguments why in our view the so-called dynamic classification method should be favored when determining the contribution of small businesses to job creation. To begin with, it is the only method that attributes consistently job creation or loss to the size class in which it actually takes place. On top of this, dynamic classification has two further advantages: (i) it is not viable to the so-called regression to the mean bias, and (ii) no micro data are needed to apply it. Using dynamic classification we analyze the job creation of different size classes for the 27 Member States of the European Union. Our major findings are: - For the EU as a whole, smaller firms contribute more to job creation than larger firms. Net job creation rates decrease with each firm size class. - This pattern occurs in most industries but not in all: the manufacturing industry and trade industry show different patterns. - At the level of individual countries, the net job creation rate also tends to decrease with each firm size class, but this relationship is not perfect. In only 8 Member States does the net job creation rate decrease with each firm size class. |
| Date: | 2012–02–06 |
| URL: | http://d.repec.org/n?u=RePEc:eim:papers:h201203&r=sbm |