nep-ent New Economics Papers
on Entrepreneurship
Issue of 2007‒10‒27
nine papers chosen by
Marcus Dejardin
Notre-Dame de la Paix University

  1. Inequality for Wage Earners and Self-Employed: Evidence from Panel Data By Pedro Albarrán; Raquel Carrasco; Maite Martínez-Granado
  2. Size, Innovation and Internationalization: A Survival Analysis of Italian Firms By Giorgia Giovannetti; Giorgio Ricchiuti; Margherita Velucchi
  3. Barriers to Innovation faced by Manufacturing Firms in Portugal: How to overcome it? By Silva, Maria; Leitão, João; Raposo, Mário
  4. The effects of past entry, market consolidation, and expansion by incumbents on the probability of entry By Robert M. Adams; Dean F. Amel
  5. The dynamics of market structure and market size in two health services industries By Timothy Dunne; Shawn D. Klimek; Mark J. Roberts; Yi Xu
  6. Quantifying the Benefits of Entry into Local Phone Service By Nicholas Economides; Katja Seim; V. Brian Viard
  7. Export Dynamics in Colombia: Firm-Level Evidence By Jonathan Eaton; Marcela Eslava; Maurice Kugler; James Tybout
  8. Cultural Differences, Insecure Property Rights and the Mode of Entry Decision By Jiahua Che; Giovanni Facchini
  9. Influencia del talento del empresario y del tipo de página web en los resultados empresariales para las casas de turismo rural en España. Influence of the entrepreneurial talent and type of website on Rural Tourist House’s performance in Spain. By Nieto Arias, Jannine Waleska; Hernández Maestro, Rosa M.; Muñoz Gallego, Pablo A.

  1. By: Pedro Albarrán (Universidad Carlos III de Madrid); Raquel Carrasco (Banco de España); Maite Martínez-Granado (Euskal Herriko Unibertsitatea)
    Abstract: In this paper we study the evolution of income inequality for employees and self-employed workers. We highlight the importance of separately analyzing these different sources of income to gain a broader understanding of inequality. Using Spanish panel data on income and consumption from the ECPF for the period 1987-96, we decompose the variance of income shocks into a permanent and a transitory component. We find that there are noticeable differences in the evolution of income inequality, as well as in the relative importance of the permanent and transitory components across these groups. Our results point that the evolution of inequality can be basically explained by movements in the variance of the transitory component of income for the self-employed, while for the employees it is mainly driven by the variance of the permanent component, specially at the end of the period. Given these disparities, it seems that these two sources of income should be studied separately and that different policies are suitable for each group.
    Keywords: Permanent income inequality, transitory income inequality, consumption, selfemployment, panel data
    JEL: D12 D31 D91 E21
    Date: 2007–10
  2. By: Giorgia Giovannetti (Università degli Studi di Firenze, Dipartimento di Scienze Economiche); Giorgio Ricchiuti (Università degli Studi di Firenze, Dipartimento di Scienze Economiche); Margherita Velucchi (Università degli Studi di Firenze, Dipartimento di Statistica “G. Parenti”)
    Abstract: The birth of new enterprises and their survival in the market are often seen as a crucial variable of economic growth and competitiveness in a modern economy. This paper focuses on business demography of Italian firms, using a merged dataset between Capitalia-Reprint and AIDA, to identify the relationships among firms’ characteristics their demographic dynamics and survival. We show that size and technological level increases survival probability. Internationalized firms show higher failure risk: on average the competition is stronger on international markets, forcing firms to be more efficient. Finally, a long lasting successful internationalized firm is a high-tech, large and innovating firm.
    Keywords: Business Demography, Survival, Competitiveness, Internationalization
    JEL: C41 L11 L25 F21
    Date: 2007
  3. By: Silva, Maria; Leitão, João; Raposo, Mário
    Abstract: This paper aims to identify the barriers to innovation that influence the innovation capability of Portuguese industrial firms. The literature review about innovation makes use of two references approaches: (i) the systemic; and (ii) the networks and inter-organizational relationships. The database is obtained through the Community Innovation Survey II (CIS II) conducted by EUROSTAT. Furthermore, from the results several public policies are proposed in order to overcome the restraining factors of the entrepreneurial innovative capability.
    Keywords: Innovation; Entrepreneurial Innovative Capability.
    JEL: O38 O31
    Date: 2007–10–23
  4. By: Robert M. Adams; Dean F. Amel
    Abstract: The threat of entry is an important factor in the evaluation of the potential competitive effects of proposed mergers and acquisitions. In the evaluation of proposed bank mergers, a high probability of entry, or strong potential competition, is often found to mitigate the potential anticompetitive effect of a proposed horizontal merger. Because the probability of entry is not directly observed for each local market, variables such as per capita income, population growth and past entry are typically used to predict the probability of future entry. This study extends previous research on the determinants of entry into local banking markets. In addition to variables considered by past research, such as market demographic characteristics, branching deregulation and past merger activity, this study considers the effects on future entry of past entry and strategic barriers to entry, which are proxied by changes in incumbent branching, the presence of small incumbent firms and market concentration. The analysis uses data that allow a broader definition of entry than that used in most past research. In most of the previous studies, bank entry is defined as the creation of a new banking institution. We show that this definition is problematic and misses entry due to branch network extension by existing banks, which is substantial. Results of our analysis are consistent with past research where past research exists. In addition, we find significant negative relationships between strategic barriers to entry and entry. Assessment of the quantitative significance of the results, however, finds that very large changes in the explanatory variables are needed to cause substantial changes in the probability of entry into banking markets.
    Date: 2007
  5. By: Timothy Dunne; Shawn D. Klimek; Mark J. Roberts; Yi Xu
    Abstract: The relationship between the size of a market and the competitiveness of the market has been of long-standing interest to IO economists. Empirical studies have used the relationship between the size of the geographic market and both the number of firms in the market and the average sales of the firms to draw inferences about the degree of competition in the market. This paper extends this framework to incorporate the analysis of entry and exit flows. A key implication of recent entry and exit models is that current market structure will likely depend upon the history of past participation. The paper explores these issues empirically by examining producer dynamics for two health service industries, dentistry and chiropractic services.
    Keywords: Markets ; Industrial organization ; Service industries
    Date: 2007
  6. By: Nicholas Economides; Katja Seim; V. Brian Viard
    Date: 2007
  7. By: Jonathan Eaton; Marcela Eslava; Maurice Kugler; James Tybout
    Abstract: Using transactions-level customs data from Colombia, we study firm-specific export patterns over the period 1996-2005. Our data allow us to track firms' entry and exit into and out of individual destination markets, as well as their revenues from selling there. We find that, in a typical year, nearly half of all Colombian exporters were not exporters in the previous year. These new exporters tend to be extremely small in terms of their overall contribution to export revenues, and most do not continue exporting in the following year. Hence export sales are dominated by a small number of very large and stable exporters. Nonetheless, out of each cohort of new exporters, a fraction of firms go on to expand their foreign sales very rapidly, and over the period of less than a decade, these successful new exporters account for almost half of total export expansion. Finally, we find that new exporters begin in a single foreign market and, if they survive, gradually expand into additional destinations. The geographic expansion paths they follow, and their likelihood of survival as exporters, depend on their initial destination market.
    JEL: F10
    Date: 2007–10
  8. By: Jiahua Che; Giovanni Facchini
    Abstract: We develop a theory of a multinational corporation's optimal mode of entry in a new market. The foreign firm can choose between a licensing agreement, a wholly owned subsidiary or shared control (joint venture). In an environment in which property rights are insecure, opportunism is possible, and the identification of new business opportunities is costly, we show that the relationship between the quality of the institutional environment and the mode of entry decision is non-monotonic. Licensing is preferred if property rights are strictly enforced, while a joint venture is chosen when property rights are poorly enforced. For intermediate situations, the better use of local knowledge made possible by shared control under a joint venture works as a double-edged sword. On the one hand, it makes the monitoring activity of the multinational more credible, on the other it offers insurance to both parties, potentially compromising the incentives faced by the local partner.
    Date: 2007–10–15
  9. By: Nieto Arias, Jannine Waleska (Departamento de Administración y Economía de la Empresa, Facultad de Economía y Empresa, Universidad de Salamanca); Hernández Maestro, Rosa M. (Departamento de Administración y Economía de la Empresa, Facultad de Economía y Empresa, Universidad de Salamanca); Muñoz Gallego, Pablo A. (Departamento de Administración y Economía de la Empresa, Facultad de Economía y Empresa, Universidad de Salamanca)
    Abstract: El Turismo rural ha alcanzado un auge muy fuerte en España e internet se ha convertido en una herramienta vital en el sector. En este trabajo se persigue: 1) analizar la importancia del talento del empresario en la implantación de páginas web; 2) examinar la influencia de este talento y de las características de la página web sobre los resultados de la empresa y 3) determinar el efecto moderador de la experiencia del empresario. Con una muestra de 150 casas rurales en España y utilizando la metodología de ecuaciones estructurales, se observa cómo el contenido de la página web tiene una influencia sobre los resultados de la empresa, cómo la experiencia modera la relación entre el talento del empresario y los resultados y cómo la experiencia modera también la relación entre el talento y el diseño de la página web. In Spain, rural tourism has rapidly been on the increase and the internet has become an essential tool for this economic sector. The objectives of this project are: 1) to analyse the importance of the entrepreneurial talent on website’s implementation; 2) to study the influence of both the entrepreneurial talent and website’s features on enterprise’s performance; and 3) to determine the moderating effect of the businessman’s expertise. Based upon a sample of 150 Rural Tourist Houses in Spain and a Structural Equation Model, it should be noted: 1) the influence of the website’s contents on enterprise’s performance; 2) the businessman’s expertise moderating effect on entrepreneurial talent and performance relationship; and 3) the businessman’s expertise moderating effect on entrepreneurial talent and website design relationship.
    Keywords: Talento emprendedor, características de la página web, turismo rural, nuevas tecnologías. entrepreneurial talent, website features, rural tourism, new technologies.
    JEL: O14 O18 O32
    Date: 2007–04

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