|
on Small Business Management |
|
Issue of 2012‒03‒21
ten papers chosen by Joao Carlos Correia Leitao University of Beira Interior and Technical University of Lisbon |
| By: | Heli Koski; Mika Pajarinen |
| Abstract: | We use data from 15 508 Finnish companies with 10 or more employees for the years 2003-2008 to explore the relationship between employment growth and three endogenously determined business subsidy types (i.e. employment subsidy, R&D subsidy and the group of other business subsidies). We find a positive contemporary relationship between all business subsidy types and employment growth. In addition, our findings suggest that R&D subsidies further contribute to the firms’ employment for one year after and employment and other subsidies for three years after the reception of subsidies. After that, the differences between the subsidized and non-subsidized firms vanish. We further find in line with previous empirical studies that both product innovation and sales growth from a firm’s old products contribute to the firm’s employment growth. Innovation policy means successfully promoting product innovation should thus produce positive employment effects. Our empirical findings suggest that a positive employment effect of R&D subsidies is rather short-term though, and not likely a result of product innovation generated in the subsidized firms’ R&D projects. |
| Keywords: | Public subsidies ; enterprise policy ; industrial policy ; technology policy ; employment ; growth ; Finland |
| JEL: | J23 L10 L53 O25 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:aal:abbswp:12-02&r=sbm |
| By: | Luis F. Medrano E. (Friedrich Schiller University Jena, School of Economics and Business Administration) |
| Abstract: | The relationship between innovation and firm survival is analyzed for the population of German laser source producers from the beginning of the industry until 2005. Innovation effort is approximated by the generation of high quality patents in laser sources technology (IPC H01S) and by having patents with university inventors. Quality patents are defined as those in the upper quartile of the strongly right-skewed distribution of forward citations. Having quality patents is positive and statistically significantly associated with firm survival. New firms without relevant capabilities inherited at their birth may be capable of compensating for their lack of adequate pre-entry experience with corresponding innovative behavior. Having patents with university inventors is apparently not related to firm survival. |
| Keywords: | firm survival, patent citations, quality patents, university-inventor patents, innovation |
| JEL: | L25 M13 O30 O52 |
| Date: | 2012–03–09 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2012-009&r=sbm |
| By: | Roberto Antonietti |
| Abstract: | In this paper I assess the existence, and the magnitude, of technological externalities in the form of creativity spillovers that affect individual firms’ innovative intensity. Relying on a large sample of Italian manufacturing firms, I first estimate a knowledge production function; from this, I extract the residuals, which represent the unexplained part of the actual observed share of innovative sales, namely ‘innovativeness’. Then, I regress such a measure of firm innovativeness on a set of occupation-based, as well as density-based, indicators of creativity at the NUTS3 level, while controlling for firm localization, size and industry. I also control for endogeneity and non-linearity by estimating a two-stage least squares model and a generalized additive model respectively. My estimates show that: (i) there is a positive and highly statistically significant effect of creativity on innovativeness; (ii) the effect of creativity on actual innovative sales is weak, whereas I find a strong positive effect played by internal R&D labour; (iii) occupation-based measures of creativity outperform education-based measures of human capital; (iv) when controlling for the education content of jobs, firms’ innovativeness is affected more by the local availability of non-graduated creative workers than of graduated ones; (v) rather, a higher local availability of graduated creative workers affects the invention intensity of a city; (vi) the relationship between firm innovativeness and the local density of creative people is U-shaped, so that proximity-based knowledge externalities emerge only after a certain density threshold is reached, this occurring typically in larger urban areas, typically hosting design and service-based creative industries. |
| Keywords: | creativity; innovativeness; innovative sales; knowledge production function; proportions |
| JEL: | L60 O31 R10 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:trn:utwpol:1117&r=sbm |
| By: | Christian Rupietta (Department of Business Administration, University of Zurich); Uschi Backes-Gellner (Department of Business Administration, University of Zurich) |
| Abstract: | This paper examines whether high quality, curriculum-based training at the workplace makes firms more innovative. Our dependent variable innovativeness is operationalized with four different measures: general innovation, product innovation, process innovation and patent applications. As explanatory variable we use regulated apprenticeship training programs with three to four years length of the type found in German speaking countries. We argue that this type of curriculum-based workplace training provides an additional source of knowledge in the knowledge production process through its innovative and steadily revised training curricula. We expect that this additional source of knowledge leads to higher innovation in training firms compared to non-training firms. Our empirical results show that up-to-date curriculum-based apprenticeship training is positively associated with all of the four innovation measures. Taking endogenous apprenticeship decision into account, the positive effect is only significant for general innovation and patent applications. |
| Keywords: | Apprenticeship training, Innovation, Education |
| JEL: | I20 O31 |
| Date: | 2012–03 |
| URL: | http://d.repec.org/n?u=RePEc:iso:educat:0074&r=sbm |
| By: | Luis Aguiar; Philippe Gagnepain |
| Abstract: | The goal of this paper is to assess the impact on the performance of firms that participate in Research Joint Ventures (RJVs) funded by the Fifth European Framework Programme for Research and Technological Development (EU-FP5). A special emphasis is made on the User-friendly Information Society (IST) programme, one of the most important thematic programmes of the EU-FP5. We use the funding available to the firms as an instrumental variable to account for self-selection and estimate the Local Average Treatment Effect (LATE) of participation by considering labor productivity and profit margin as performance measures. Our results show a large and positive impact of participation on the labor productivity of the firms, whereas the effect on profit margin is weaker. When taking into account the size of the RJV, we find that the positive impact on labor productivity comes mainly from participation in large projects and that participation in smaller RJVs has a negative effect on the profit margin |
| Keywords: | Research joint venture, R&D policy, Productivity, EU framework programme |
| JEL: | L24 L25 O31 O32 O38 |
| Date: | 2012–02 |
| URL: | http://d.repec.org/n?u=RePEc:cte:werepe:we1207&r=sbm |
| By: | Andries, Petra; Czarnitzki, Dirk |
| Abstract: | It is known that small firms rely mainly on the CEO's individual knowledge for developing innovations. Recent work suggests that this approach is inefficient since it underutilizes other employees' knowledge. We study to which extent using CEOs, managers and non-managerial employees' ideas enhances small firms' innovation performance. A Heckman selection model on 305 small firms shows that not only CEO's and managers', but also non-managerial employees' ideas contribute to innovation performance. However, contributions depend heavily on the individuals' area of expertise and on whether product or process innovation is desired. Our findings enrich the current view on the entrepreneurial team, but also warn against the implementation of one-size-fits-all employee involvement programs in small firms. -- |
| Keywords: | Employee involvement,upper echelon,non-managerial employees,innovation performance,small firms |
| JEL: | M12 O31 O32 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:12013&r=sbm |
| By: | Mariam Bruhn (World Bank); Dean Karlan (Economic Growth Center, Yale University); Antoinette Schoar (MIT) |
| Abstract: | We test whether managerial human capital has a first order effect on the performance and growth of small enterprise in emerging markets. In a randomized control trial in Puebla, Mexico, we randomly assigned 150 out of 432 small and medium size enterprises to receive subsidized consulting services, while the remaining 267 enterprises served as a control group that did not receive any subsidized training. Treatment enterprises were matched with one of nine local consulting firms and met with their consultants once a week for four hours over a one year period. Results from a follow-up survey, conducted after the intervention, show that the consulting services had a large impact on the performance of the enterprises in the treatment group: monthly sales went up by about 80 percent; similarly, profits and productivity increased by 120 percent compared to the control group. We also see a significant increase in the entrepreneurial spirit index for the treatment group, a set of questions designed to illicit the SME owners’ confidence in their ability to manage their business and deal with any future difficulties. However, we do not find any significant increase in the number of workers employed in the treatment group. |
| Keywords: | enterprise growth, entrepreneurship, managerial capital |
| JEL: | D21 D24 L20 M13 O12 |
| Date: | 2012–02 |
| URL: | http://d.repec.org/n?u=RePEc:egc:wpaper:10010&r=sbm |
| By: | Andreas Koch; Jochen Späth; Harald Strotmann |
| Abstract: | While the majority of existing studies on the determinants of post-entry firm growth focus on the role of the founders or on the impact of firm-specific characteristics like size, age or industry affiliation, a possible impact of the characteristics of a start-up’s workforce on post-entry growth has been widely neglected in the literature so far. Based upon a comprehensive panel dataset of establishments in Germany, this paper contributes to fill this gap and examines the role of the initial employment structure with respect to qualification, age, gender and nationality for post-entry employment growth measured both in terms of employees and in terms of full-time equivalents. Moreover, it is analyzed whether the use of flexible work forms like regular part-time and / or marginal employment in the year of foundation affects post-entry growth. Our empirical results confirm that in particular the initial qualification structure of a start-up’s employees matters for post-entry growth. Establishments using flexible work forms show higher post-entry growth with respect to total hours worked, but a significantly lower growth with respect to the number of employees. |
| Keywords: | start-ups, post-entry performance, firm growth, job quality, flexibility, human capital |
| JEL: | J24 L10 L25 |
| Date: | 2012–02 |
| URL: | http://d.repec.org/n?u=RePEc:iaw:iawdip:78&r=sbm |
| By: | Martin, Roman (CIRCLE, Lund University) |
| Abstract: | Within the literature on innovation systems, there are a growing number of scholars emphasizing the importance of differentiated knowledge bases underlying innovation activities. The existing work on knowledge bases is largely grounded on in-depth case studies; while surprisingly little effort has been done so far to operationalize the concept in a more systematic manner. In this paper, an attempt is made to develop a scheme of analysis to identify the knowledge base of a regional economy. We suggest using occupation data in association with a location quotient analysis, to assess whether a regional economy has a particular strength in one (or more) knowledge bases. To bring the analytical scheme into practice and assess it, we apply it on the county level in Sweden. The results are explained and contrasted with insights on the regional economies taken from secondary sources. We conclude that the proposed scheme of analysis leads to fairly reliable results, and could stimulate further empirical research on differentiated knowledge bases. |
| Keywords: | differentiated knowledge base; regional innovation system; Sweden |
| JEL: | O32 |
| Date: | 2012–02–27 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lucirc:2012_003&r=sbm |
| By: | Dirk Engel; Timo Mitze; Roberto Patuelli; Janina Reinkowski |
| Abstract: | This paper evaluates the R&D enhancing effects of two large public grant schemes for the German biotechnology industry (BioRegio, BioProfi le). Both grant schemes are organized in the form of contents for cooperation with the goal to foster the performance of innovative firms by their organization in research clusters. We apply a Difference-in-Differences estimation technique in a generalized linear model framework, which allows us to control for different initial regional conditions in R&D activity of the biotech sector. Our econometric findings support the view that winners generally outperform non-winning participants during the treatment period, thus indicating that exclusive funding as well as the stimulating effect of being a “winner” have positive effects on R&D activity in the short-term. Apart from this direct winner effect, for the non-winning participants no beneficial indirect effect due to a mobilization of local actors during the application phase could be detected. Finally, first attempts in estimating the long-term effects of the contests for cooperation approach on the winner regions’ R&D activity in the post-treatment period show ambiguous results. |
| Keywords: | Biotechnology; R&D policies; cluster; difference-in-differences estimation |
| JEL: | O38 C23 |
| Date: | 2012–01 |
| URL: | http://d.repec.org/n?u=RePEc:rwi:repape:0311&r=sbm |