nep-ent New Economics Papers
on Entrepreneurship
Issue of 2008‒03‒01
seven papers chosen by
Marcus Dejardin
Notre-Dame de la Paix University

  1. Location Attributes and Start-Ups in Knowledge Intensive Business Services By Andersson, Martin; Hellerstedt, Karin
  2. What's in a name? An inquiry on the cognitive and entrepreneurial profile of the social entrepreneur By Cools, E.; Vermeulen, S.
  3. Rationality and Personality in a Restaurant Entry Game: Is there an Entrepreneurial Personality Type? By Ted Bergstrom; Jon Sonstelie
  4. Employment stability of entrants in newly founded firms : a matching approach using linked employer-employee data from Germany By Schnabel, Claus; Kohaut, Susanne; Brixy, Udo
  5. Show Me the Money: Access to Finance for Small Borrowers in Canada By Vladimir Klyuev
  6. International allocation determinants of institutional investments in venture capital and private equity limited partnerships By Groh, Alexander P.; Liechtenstein, Heinrich; Canela, Miguel A.
  7. Firms' Rationales for Interaction with Research Universities By Broström, Anders

  1. By: Andersson, Martin (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology); Hellerstedt, Karin (JIBS and Centre for Innovation Systems, Entrepreneurship and Growth (CISEG))
    Abstract: We study start-ups in Knowledge Intensive Business Services (KIBS) across regions in Sweden by individuals with a formally recognized capacity to produce and develop advanced business services. The empirical analysis is based on a theoretical framework which emphasizes both supply- and demand-side factors. Supply-side variables pertain to accessibility to knowledge and information upon which a new firm can be established. Demand-side variables refer to market-size and pertain to the ability to recover fixed start-up costs and economize on costs associated with face-to-face interaction. 78 percent of the KIBS founders have prior work experience from business services, suggesting that KIBS start-ups are more frequent in regions where the KIBS sector is already large. Controlling for the stock of potential entrepreneurs and the stock KIBS firms, we show that both supply- and demand-side factors influence KIBS start-up activity. Results are consistent with that KIBS start-ups are stimulated by the simultaneous presence of (i) knowledge resources conducive for the generation and diffusion of knowledge and ideas upon which new firms can be established and (ii) a large market. The findings suggest that the geography of KIBS is shaped in cumulative and self-reinforcing processes, and can explain the tendency of KIBS firms to agglomerate in large city-regions.
    Keywords: knowledge intensive business services; knowledge spillovers; start-ups; entrepreneurship; location
    JEL: L26 L84 R12
    Date: 2008–02–27
  2. By: Cools, E.; Vermeulen, S. (Vlerick Leuven Gent Management School)
    Abstract: Given the rise of social enterprises, the aim of this study is to get more insight into what typifies social entrepreneurs. Although entrepreneurship research has a long tradition in the study of the individual entrepreneur, there are not many studies on the profile of the social entrepreneur. Our research wants to extend the existing knowledge about who the entrepreneur is by comparing the cognitive and entrepreneurial profile of different types of entrepreneurs. Our inquiry addresses two main questions: (1) Does the cognitive style of social entrepreneurs differ significantly from the profile of commercial entrepreneurs? (2) Is there a significant difference between the entrepreneurial orientation (EO) of commercial and social firms? The data for this research are collected in two phases using two online surveys. For the cognitive styles (as measured with the Cognitive Style Indicator), we find no significant differences between commercial entrepreneurs (n = 152) and social entrepreneurs (n = 41). Looking at the entrepreneurial orientation of commercial and social enterprises, we find that commercial enterprises score significantly higher on EO than social enterprises. Interestingly, significant differences are found for the innovativeness and risk-taking dimensions of EO, but not for the proactiveness dimension. To conclude, we found that the cognitive-based approach is inadequate to capture the behavioral characteristics of social entrepreneurs within their organization. However, in the environment in which they operate, social entrepreneurs seem to behave differently than commercial entrepreneurs. Implications for further research and for practitioners and policy makers are discussed.
    Keywords: cognitive styles, entrepreneurial orientation, types of entrepreneurs, social entrepreneurship
    Date: 2008–02–11
  3. By: Ted Bergstrom (University of California, Santa Barbara); Jon Sonstelie (University of California, Santa Barbara)
    Abstract: Students in a large principles class participated in a market experiment in which they had opportunities to take entrepreneurial action. These students had also taken the Meyers-Briggs personality test. We explore the relation between personality characteristics and participation decisions.
    Keywords: entrepreneurship, personality test,
    Date: 2006–08–01
  4. By: Schnabel, Claus; Kohaut, Susanne (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Brixy, Udo (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "Using a linked employer-employee dataset and taking the perspective of individuals rather than firms, this paper analyzes some effects of joining start-ups. We show that entrants in new firms differ from those joining incumbent firms, and we use a matching approach to compare a group of employees joining new firms in 1995/96 with a control group entering incumbent firms. Our results indicate that individuals' employment stability was higher in incumbent than in newly founded firms while their risk of becoming unemployed was lower. In particular in eastern Germany, joining firms that were older than six years was the best strategy." (author's abstract, IAB-Doku) ((en))
    JEL: J63 J64
    Date: 2008–02–20
  5. By: Vladimir Klyuev
    Abstract: This paper examines access to business finance by Canadian small and medium-sized enterprises (SMEs) and to housing finance by Canadian households (particularly non-prime borrowers) against the background of a fairly concentrated and protected banking industry. It finds access broadly adequate for the former group. However, given the dominance of the large banks and their fairly low risk tolerance, financing of riskier projects is a challenge. Problems with venture capital, plausibly related to the prevalence of tax-advantaged labor-sponsored funds, exacerbate the situation for the most innovative SMEs. The paper also finds the market for housing finance to be highly advanced and sophisticated. However, non-prime mortgage financing is in its infancy in Canada, and further development of that sector (while avoiding the excesses that beset the U.S. market in the last few years) would be beneficial. More broadly, despite recent innovations, options available to Canadians for financing house purchases are still somewhat limited, with scarce availability of mortgage maturities beyond five years particularly surprising. Further advances in securitization could help progress in both of these areas.
    Keywords: Bank credit , Canada , Financial risk , Financial systems ,
    Date: 2008–01–31
  6. By: Groh, Alexander P. (Montpellier Business School); Liechtenstein, Heinrich (IESE Business School); Canela, Miguel A. (University of Barcelona)
    Abstract: We examine the determinants of institutional investors when deciding on international capital allocation in Venture Capital and Private Equity Limited Partnerships; this is done through a questionnaire addressed to (potential) Limited Partners world-wide. The respondents provide information about their criteria for international asset allocation. The protection of property rights is the dominant concern, followed by the need to find local quality General Partners, and the quality of management and skills of local entrepreneurs. Furthermore, the expected deal flow plays an important role in the allocation process, while investors fear bribery and corruption. Public funding and subsidies do not play a role at all in the international allocation process. Hence, private money does not follow public money. The IPO activity and the size of local public equity markets are not as relevant as proposed by other researchers. Our results can support policymakers to increase the attractiveness of their countries for institutional investors and, thus, to receive more risk capital for innovation, entrepreneurship, employment and growth.
    Keywords: Venture Capital; Private Equity; International Asset Allocation; Institutional Investors;
    JEL: G11 G23 G24
    Date: 2008–01–11
  7. By: Broström, Anders (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)
    Abstract: R&D managers at 50 firms randomly selected from all firms who have formal relations with two research universities in Stockholm are being interviewed about their rationales for collaboration. Drawing on this material, a distinctive typology of rationales and the therewith associated effects from cooperative relations is presented. As expected, rationales related to innovation, in terms of invented or improved products or processes, are found to be the main drivers for interaction. As regards the nature of the innovation process leading to innovation, most respondents indicate that “indirect” relationships between collaboration outcomes and successful innovation dominate over “direct” appropriation of results. Contrasting open ended search rationales with pursuit of defined objectives, we find that both types are strongly represented among the studied collaborative linkages. We also find that interaction rationales often go beyond the pursuit of innovation per se; firms also work with university researchers to access academic networks, to develop its human capital and to realise direct business opportunities. The consequences of these findings for policy measures steered towards the strengthening of collaborative university-industry linkages are discussed.
    Keywords: R&D collaboration; technology transfer; university-industry linkages; innovation collaboration
    JEL: O32 O33 O38
    Date: 2008–02–26

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