|
on Entrepreneurship |
| By: | Gries, Thomas; Naude, Wim |
| Abstract: | The success of new start-up firms often depends on timing. It is valuable for the potential entrepreneur to wait for the right moment before starting a new firm. In this paper we provide a theoretical model to determine the optimal time for starting a new firm. We integrate insights from the real option theory with the theory on entrepreneurial market entry. An important and novel feature of our model is that it allows the start-up timing decisions of novice and serial entrepreneurs to be distinguished. |
| Keywords: | entrepreneurship, serial entrepreneurship, start-ups, real options, stochastic optimal control |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:rp2009-39&r=ent |
| By: | Nijkamp, Peter |
| Abstract: | Entrepreneurship has been a topical issue in the business administration literature, but in the past decade a wave of interest can be observed on the role of entrepreneurship in the economic growth literature. This paper aims to highlight the various contributions to the entrepreneurship literature from the perspective of regional economic development. After a broad overview, particular attention is given to the regional action space of entrepreneurs, including their social and spatial network involvement. The paper concludes with a future research agenda. |
| Keywords: | entrepreneurship, regional growth, action space, networks, SME, virtual organization, innovation |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:rp2009-08&r=ent |
| By: | Avanzini, Diego B. |
| Abstract: | Existing indicators of entrepreneurial activity (such as the Global Entrepreneurship Monitor, Entrepreneurship Barometer, FORA.s Entrepreneurship Index, OECD and Economic Commission.s sets of indicators, among others) and several variables that have been considered good proxies for entrepreneurship during the last decades seem to be unsuitable to capture the complex relationship among economic, social, and demographic factors driving entrepreneurial activity.In order to suggest a consistent methodology for measuring entrepreneurship, we review some of the most well-known theoretical dimensions of entrepreneurship and a selection of associated indicators is proposed. Indicators and measures are grouped under theoretical categories and a set of entrepreneurship indicators is constructed using multivariate statistical analysis (Consensus PCA based on NIPALS, with an extension of Probability PCA for dealing with missing values) for a panel of developed and developing countries. |
| Keywords: | entrepreneurship, index, principal components analysis |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:rp2009-41&r=ent |
| By: | Rooks, Gerrit; Szirmai, Adam; Sserwanga, Arthur |
| Abstract: | This paper discusses the characteristics and determinants of entrepreneurial behaviour in Uganda. It is based on a recent survey of urban and rural entrepreneurs, executed in May 2008. The main dependent variables are business success, gestation activities and innovative performance. The paper focuses in particular on the interplay of human and social capital in determining entrepreneurial performance. A prominent question in the literature is whether human capital and social capital act as complements or substitutes in furthering entrepreneurial dynamism.We find that Ugandan enterprises are predominantly very small and not very dynamic. Most enterprises are young, with little or no growth of employment since start-up. Only a very small subset of sample entrepreneurs could be classified as entrepreneur in the dynamic |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:rp2009-09&r=ent |
| By: | Pellegrino, Gabriele (Università Cattolica del Sacro Cuore); Piva, Mariacristina (Università Cattolica del Sacro Cuore); Vivarelli, Marco (Università Cattolica del Sacro Cuore) |
| Abstract: | This paper discusses the determinants of product innovation in young innovative companies (YICs) by looking at in-house and external R&D and at the acquisition of external technology in embodied and disembodied components. These input-output relationships are tested on a sample of innovative Italian firms. A sample-selection approach is applied. Results show that in-house R&D is linked to the propensity to introduce product innovation both in mature firms and YICs; however, innovation intensity in the YICs is mainly dependent on embodied technical change from external sources, while − in contrast with the incumbent firms − in-house R&D does not play a significant role. |
| Keywords: | R&D, product innovation, embodied technical change, CIS 3, sample selection |
| JEL: | O31 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4301&r=ent |
| By: | Amoros, Jose Ernesto |
| Abstract: | Over the last few years we have observed a prominent flourishing of empirical studies on the determinants of new business creation and its effect on the economy. The present study focuses on an important determinant of entrepreneurship: the quality of institutions. This paper is an empirical exploratory work that has the objective of uncovering the relationships between entrepreneurial dynamics and different variables related to the quality of government institutions, with an emphasis on developing countries. The study is based on the panel data of 60 countries that participated in the Global Entrepreneurship Monitor (GEM) project. The results indicate that the quality of institutions is a relevant factor for the distribution and type of entrepreneurial activities. Some implications for public policy are discussed. |
| Keywords: | entrepreneurship, government institutions, Global Entrepreneurship Monitor |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:rp2009-07&r=ent |
| By: | Tamvada, Jagannadha Pawan |
| Abstract: | We examine returns to entrepreneurship using a standard measure of welfare, the per capita consumption xpenditure. Using quantile regressions, we find welfare hierarchy in occupations. The results suggest that, across the welfare distribution, entrepreneurs who employ others have the high-test returns in terms of consumption, while those entrepreneurs who work for themselves, that is, self-employed individuals, have slightly lower returns than the salaried employees. However, self-employment entails higher returns than casual labour and an escape from poverty. |
| Keywords: | entrepreneurship; self-employment; welfare; developing countries; quantile regressions |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:rp2009-21&r=ent |
| By: | Desai, Sameeksha |
| Abstract: | This paper discusses the difficulties associated with measuring entrepreneurship in developing countries. Three important dichotomies in the research on entrepreneurship are discussed: formal-informal, legal-illegal, and necessity-opportunity. Several common measures of entrepreneurship are outlined along with their relevance to developing countries, including self-employment, Global Entrepreneurship Monitor data, World Bank Group Entrepreneurship Survey data and OECD data. The implications of the current understanding of entrepreneurship are discussed with respect to institutions and economic development. |
| Keywords: | entrepreneurship, economic development, data, institutions |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:rp2009-10&r=ent |
| By: | Baliamoune-Lutz, Mina |
| Abstract: | We examine how institutional and policy reforms affect the relationship between entrepreneurship and growth. We perform Arellano-Bond GMM estimations on annual data (over the period 1990-2002) from a large group of developing countries and focus in particular on the interplay between policy and institutional reforms and entrepreneurship. We find that the joint effect of trade reform and entrepreneurship on growth is negative, suggesting that trade reform diminishes the positive effects of entrepreneurial ability on growth, while the joint effect of financial sector reform and entrepreneurship has a non-linear impact on growth. Financial sector reforms enhance the growth effect of entrepreneurship at initial levels and diminish it at high levels of reform. In addition, we find that the interplay of institutional reform and entrepreneurship does not seem to matter for the growth effects of entrepreneurship. |
| Keywords: | growth, entrepreneurship, institutions, policy reform |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:rp2009-04&r=ent |
| By: | Thurik, Roy |
| Abstract: | Entrepreneurship has emerged as an important element in the organization of economies. This emergence did not occur simultaneously in all developed countries. Differences in growth rates are often attributed to differences in the speed with which countries embrace entrepreneurial energy. This led to the political mandate to promote entrepreneurship. Hence, a clear and organized view is needed of what the determinants and consequences of entrepreneurship are. The present contribution tries to provide this view with a particular view on emerging economies. Entrepreneurship, its drivers and its consequences can be best understood using the model of the entrepreneurial economy which explains the functioning of the modern economy. This model differs from that of the earlier managed economy. Policies in emerging economies should aim at combining the two models. |
| Keywords: | entrepreneurship, small firms, economic growth, economic development, policy |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:rp2009-12&r=ent |
| By: | Kimhi, Ayal |
| Abstract: | This paper uses inequality decomposition techniques in order to analyse the consequences of entrepreneurial activities to household income inequality in southern Ethiopia. A uniform increase in entrepreneurial income reduces per capita household income inequality. This implies that encouraging rural entrepreneurship may be favourable for both income growth and income distribution. Such policies could be particularly successful if directed at the low-income, low-wealth, and relatively uneducated segments of the society. |
| Keywords: | entrepreneurship, income inequality, redistribution, Ethiopia, Africa |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:rp2009-05&r=ent |
| By: | Naude, Wim; Rossouw, Stephanie |
| Abstract: | We use data on 3,948 Chinese firms obtained from the World Bank.s Investment Climate Private Enterprise Survey to investigate early international entrepreneurship (international new ventures) in China. The extent of early international entrepreneurship in China is significant: 65 per cent of the exporting firms start export operations within three years. Foreign shareholders within the firm and an entrepreneur with previous exporting experience are noted to significantly increase the probability that a firm internationalizes early. However, we find marked differences in the behaviour of indigenous and foreign-invested firms. Thus, while business networks are significant for firms wishing to export indirectly and for older indigenous firms, it is noted to delay the internationalization process of indigenous firms. Also, for an indigenous firm, the greater the foreign experience of its entrepreneur, the less likely it is to start exporting early. |
| Keywords: | entrepreneurship, internationalization, international new ventures, exports, China |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:rp2009-16&r=ent |
| By: | Yochanan Shachmurove (Department of Economics, University of Pennsylvania) |
| Abstract: | The Sultanate of Oman has a diversified economy, unlike many of its neighboring nations that rely almost entirely on oil revenues. Natural gas and several non-energy business sectors, such as tourism, fishing, light manufacturing, and agriculture are expanding rapidly. The Omani economy is one of the freest in its region. A relatively stable government and low taxes make Oman a desirable location for entrepreneurial ventures. Furthermore, foreign direct investment is welcomed. Tourism is the most attractive area for international entrepreneurs. Oil revenues, coupled with increasing foreign investment are likely to both diversify the Omani economic base and strengthen it. |
| Keywords: | Entrepreneurship; Small and Medium Sized Enterprises (SMEs); Business Ventures; Oman; Middle East; Oil; Tourism; Natural Gas; Foreign Direct Investment; Index of Economic Freedom; Oman-U.S. Free Trade Zone |
| JEL: | D23 E0 F14 F16 F23 F3 G2 K33 L26 L83 O1 O53 P1 P2 Q4 |
| Date: | 2009–07–20 |
| URL: | http://d.repec.org/n?u=RePEc:pen:papers:09-026&r=ent |
| By: | Yochanan Shachmurove (Department of Economics, University of Pennsylvania) |
| Abstract: | The State of Qatar is driven mainly by hydrocarbon revenues, which are estimated to support this tiny country for hundreds of years. The Qatari economy is becoming diversified with industries such as manufacturing, banking, social services, and tourism. Additionally, government financed health and educational services have increased rapidly. However, the Qatari government is not able to establish necessary laws and procedures which business requires. Despite recent changes, Qatari laws and regulations are not always friendly towards business ventures or foreign investment, hindering economic growth. Furthermore, enforcement of existing business regulations and rules are occasionally lacking. |
| Keywords: | Entrepreneurship; Small and Medium Sized Enterprises; Business Ventures; Qatar; Middle East; Oil; Tourism; Natural Gas; Foreign Direct Investment; Index of Economic Freedom |
| JEL: | D23 E0 F14 F16 F23 F3 G2 K33 L26 L83 O1 O53 P1 P2 Q4 |
| Date: | 2009–07–20 |
| URL: | http://d.repec.org/n?u=RePEc:pen:papers:09-025&r=ent |
| By: | Goedhuys, Micheline; Sleuwaegen, Leo |
| Abstract: | This paper studies the growth performance of a large set of entrepreneurial firms in ten manufacturing sectors of eleven Sub-Saharan African countries. The focus of the paper is on identifying those entrepreneurs. attributes and firm characteristics that tend to generate a significant number of high-growth firms in these countries. To this end, we use a quantile regression, which provides a more complete estimation of the growth distribution of firms conditional on different attributes. The results indicate that especially firms that engage in product innovation, have their own transport means and are connected to the internet through their own website are characterized by higher growth rates and display a more skewed distribution to the right, hosting a higher number of high-growth firms. The effect of the last two variables, which relate to distance-bridging modes of infrastructure, points to the self-reinforcing growth effects. |
| Keywords: | quantile regression, high-growth firms, firm growth, Africa |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:rp2009-11&r=ent |
| By: | Astrid Coates (ISE, University of Antwerp); Wim Van Opstal (HIVA, Catholic University of Leuven) |
| Abstract: | In the last two decades, several innovative legal frameworks for social entrepreneurship were developed across Europe. The differential success of these innovations raise certain questions. Is the intrinsic design of these legal frameworks optimal for social enterprises? Secondly, is the attractive capacity of these legal frameworks high enough to attract both new as existing social enterprises? And lastly, have these new legal frameworks reached full maturity? If this is not the case, these changes may well impede rather than encourage the development of social enterprises. In this paper, we look at the Belgian situation where an innovative framework was introduced and where multiple legal frameworks for social entrepreneurship coexist. By means of a multi-disciplinary approach involving law and economics, we investigate the joys and burdens of having numerous legal frameworks for social enterprises. We provide an introduction to the Belgian legal environment for social entrepreneurship, and argue that the current institutional design is suboptimal. Finally, we conclude with lessons that can be learned from the Belgian case relevant for other countries and contexts. |
| Keywords: | legal design, social enterprise |
| JEL: | K22 K23 L21 L31 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:hva:wpssce:0903&r=ent |
| By: | Bennett, John |
| Abstract: | We analyse potential dynamic benefits for a firm from having the option of adopting informal status. Informality may be a stepping stone, without which formality might never be achieved. This result obtains for a broad range of realistic parameter values, suggesting a potential dynamic case for government support of informal firms. Informality may alternatively play a converse role as a consolation prize, a firm only entering an industry (formally) because it recognizes that if profitability is disappointing, it can switch to informality. However, this result obtains for a range of parameter values so narrow to be of no practical significance. |
| Keywords: | informality; entrepreneurship |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:rp2009-19&r=ent |
| By: | Kritikos, Alexander S. (DIW Berlin); Kneiding, Christoph (World Bank); Germelmann, Claas Christian (Saarland University) |
| Abstract: | In developing and transition economies, microlending has become an effective instrument for providing micro businesses with the necessary financial resources to launch operations. In the industrialized countries, with their highly developed banking systems, however, there has been ongoing debate on the question of whether an uncovered demand for microlending services exists. The present pilot study explores customer preferences for microlending products in Germany. Among the interviewed business owners, 15% reported revolving funding needs and an interest in microloans. We find that potential recipients of microloan products are retail business owners, foreign business owners, and persons who had previously received private loans. Furthermore, financial products should feature rapid access to short-term loans. |
| Keywords: | entrepreneurship, microlending, market research |
| JEL: | G21 D12 M31 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4292&r=ent |
| By: | Massimo Riccaboni; Fabio Pammolli; Sergey V. Buldyrev; Linda Ponta; H. Eugene Stanley |
| Abstract: | The relationship between the size and the variance of firm growth rates is known to follow an approximate power-law behavior σ(S) similar to S^-β(S) where S is the firm size and β(S) almost equal to 0.2 is an exponent weakly dependent on S. Here we show how a model of proportional growth which treats firms as classes composed of various number of units of variable size, can explain this size-variance dependence. In general, the model predicts that β(S) must exhibit a crossover from β(0) = 0 to β(∞) = 1/2. For a realistic set of parameters, β(S) is approximately constant and can vary in the range from 0.14 to 0.2 depending on the average number of units in the firm. We test the model with a unique industry specific database in which firm sales are given in terms of the sum of the sales of all their products. We find that the model is consistent with the empirically observed size-variance relationship. |
| Keywords: | patent disclosure; innovation; r&d competition |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:trt:rockwp:052&r=ent |
| By: | Gian Luca Clementi; Thomas F. Cooley; Sonia Di Giannatale |
| Abstract: | We study the problem of an investor who buys an equity stake in an entrepreneurial venture, under the assumption that the former cannot monitor the latter’s operations. The dynamics implied by the optimal incentive scheme is rich and quite different from that induced by other models of repeated moral hazard. In particular, our framework generates a rationale for firm decline. As young firms accumulate capital, the claims of both investor (outside equity) and entrepreneur (inside equity) increase. At some juncture, however, even as the latter keeps on growing, invested capital and firm value start declining and so does the value of outside equity. The reason is that incentive provision is costlier the wealthier the entrepreneur (the greater is inside equity). In turn, this leads to a decline in the constrained–efficient level of effort and therefore to a drop in the return to investment. |
| JEL: | E0 L11 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15192&r=ent |
| By: | Cristina Arellano; Yan Bai; Jing Zhang |
| Abstract: | This paper studies the impact of cross-country variation in financial market development on firms' financing choices and growth rates using comprehensive firm-level datasets. We document that in less financially developed economies, small firms grow faster and have lower debt to asset ratios than large firms. We then develop a quantitative model where financial frictions drive firm growth and debt financing through the availability of credit and default risk. We parameterize the model to the firms' financial structure in the data and show that financial restrictions can account for the majority of the difference in growth rates between firms of different sizes across countries. |
| JEL: | E22 F2 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15193&r=ent |
| By: | Levon Barseghyan; Riccardo DiCecio |
| Abstract: | Entry costs vary dramatically across countries. To assess their impact we construct a model with endogenous entry and operation decisions by firms and calibrate it to match the U.S. distribution of firms by age and size. Higher entry costs lead to greater misallocation of productive factors and lower TFP and output. In the model, countries with entry costs in the lowest decile of the distribution have 2.32 times higher TFP (3.43 in the data) than countries in the highest decile. As in the data, higher entry costs are associated with higher mean and variance of the employment distribution across firms. |
| Keywords: | Industrial productivity ; Economic development |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedlwp:2009-005&r=ent |