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on Entrepreneurship |
| By: | Douhan, Robin (Research Institute of Industrial Economics (IFN)); Norbäck, Pehr-Johan (Research Institute of Industrial Economics (IFN)); Persson, Lars (Research Institute of Industrial Economics (IFN)) |
| Abstract: | What explains the world-wide trend of pro-entrepreneurial policies in the last few decades? We study entrepreneurial policy in a lobbying model taking into account the con.ict of interest between entrepreneurs and incumbents. It is shown that international market integration leads to more pro-entrepreneurial policies. It becomes more difficult to protect the profits of incumbent firms from entrepreneurial entry and pro-entrepreneurial policies make foreign entrepreneurs less aggressive. Making use of the Doing Business database, we find, consistent with our theory, evidence that international openness reduces barriers to entry for new entrepreneurs and that the effect is stronger in countries with more rent-seeking governments. |
| Keywords: | Entrepreneurship; Regulation; Innovation; Market Integration; Lobbying |
| JEL: | D73 F15 L26 L51 O31 |
| Date: | 2009–08–24 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0807&r=ent |
| By: | Baltzopoulos, Apostolos (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology) |
| Abstract: | Past research on the effects of agglomeration externalities on regional economic development is inconclusive and has focused mainly on employment growth and innovative output. This paper considers the link between agglomeration externalities and entrepreneurship. It does so by looking at the importance of Marshallian specialization and Jacobian diversity externalities for regional entrepreneurial output implementing an individual level data set that allows considering not only the effect on total number of start-ups but also on the propensity of the entrepreneur to start his new venture in an industry he has previous experience in. The results suggest that while Marshallian externalities have a positive, Jacobian externalities have a negative effect on regional entrepreneurial output. However, Jacobian externalities increase the probability that an entrepreneur will start a firm in an industry he has relevant experience in, especially in the case of knowledge intensive industries. |
| Keywords: | Entrepreneurship; externalities; spatial agglomeration |
| JEL: | O12 O18 R11 R30 |
| Date: | 2009–08–26 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0190&r=ent |
| By: | Karlsson, Charlie (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology); Johansson, Börje (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology); Stough, Roger R. (School of Public Policy, George Mason University) |
| Abstract: | This paper is an introductory overview highlighting some of the current knowledge as regards three critical questions related to the emerging knowledge economy: i) Why does human capital and talent tend to agglomerate in large urban regions?, ii) How does this agglomeration affect the location of different types of economic activities?, and iii) How does this agglomeration affect regional growth? There are different underlying agglomerative forces creating spatially concentrated increasing returns to scale. Also, cities become centres of various amenities due to general increases in real incomes offering people spare time activities. One major reason for the agglomeration of production in urban regions and metro¬politan areas today is the existence of various positive externalities, providing good settings for industries and firms with knowledge-intensive and knowledge-creation activities, specialised business service firms and headquarters of multinational firms. There are strong tentative empirical evidences that the agglomeration of human capital contributes to regional development and growth. However, there is uncertainty concerning the size of the human capital externalities. |
| Keywords: | Human Capital Externalities; Talent; Knowledge Creation; Knowledge Spillover; Agglomeration; Urban Region; Regional Growth |
| JEL: | D62 D83 J24 R12 R23 |
| Date: | 2009–08–26 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0191&r=ent |
| By: | Baltzopoulos, Apostolos (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology) |
| Abstract: | The present study carries out a mutli-level analysis of entrepeneurship by considering the choice of the individual to leave his job position to become self-employed. A comprehensive data-set matching the individual to his place of work allows controlling for the characteristics of both the firm and the region he worked in before starting his own firm. The results suggest that small firms spawn entrepreneurs more frequently and individuals working in larger regions that are characterized by larger local markets, higher accumulation of knowledge resources and higher population density are more likely to transcend into entrepreneurship. I also find evidence that people are more likely to select the path of self-employment in the face of weak local competition. |
| Keywords: | Entrepreneurship; self-employment; externalities |
| JEL: | D01 O12 O18 R10 |
| Date: | 2009–08–26 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0189&r=ent |
| By: | Yu, Li; Jolly, Robert W.; Orazem, Peter |
| Abstract: | We introduce a taxonomy that classifies industries using three criteria: net growth in the number of firms; the interrelationship between firm entry and firm exit; and the degree of urban-bias in industry growth. We show that in 9 of 15 two-digit NAICS industries investigated, there is evidence of urban bias consistent with a comparative advantage to starting a business in urban markets. The urban advantage is due primarily to faster firm entry rates. Urban and rural firms have similar firm exit rates, consistent with a presumption that there are equal expected profit rates conditional on entry across markets. Urban areas grow faster because they induce faster firm entry and not because urban firms are more likely to succeed. |
| Keywords: | Entry – Exit Pattern, Taxonomy, Urban-Bias, Expansion, Churning, Entrepreneurship, Economic Development |
| JEL: | L2 |
| Date: | 2009–08–27 |
| URL: | http://d.repec.org/n?u=RePEc:isu:genres:13108&r=ent |
| By: | Douhan, Robin (Research Institute of Industrial Economics (IFN)); van Praag, Mirjam (University of Amsterdam) |
| Abstract: | We combine two empirical observations in a general equilibrium occupational choice model. The first is that entrepreneurs have more control than employees over the employment of and accruals from assets, such as human capital. The second observation is that entrepreneurs enjoy higher returns to human capital than employees. We present an intuitive model showing that more control (observation 1) may be an explanation for higher returns (observation 2); its main outcome is that returns to ability are higher in higher control environments. This provides a theoretical underpinning for the control-based explanation for higher returns to human capital for entrepreneurs. |
| Keywords: | Entrepreneurship; Ability; Occupational Choice; Human Capital; Wage Structure |
| JEL: | I20 J24 J31 L26 |
| Date: | 2009–08–20 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0805&r=ent |
| By: | Salman, A. Khalik (CAFO, Växjö University); von Friedrichs, Yvonne (CAFO, Växjö University); Shukur, Ghazi (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology) |
| Abstract: | This paper employs a time series cointegration approach to evaluate the relationship between manufacturing firm failure and macroeconomic factors for the Swedish manufacturing sector in the period 1986 – 2006. It uses quarterly data for this period. We found that in long run a firms’ failure is negatively related to the level of industrial activity, money supply, GNP and economic openness rate, and positively related to the real wage. Time series Error Correction Model (ECM) estimates suggest that macroeconomic risk factors impinge on firm failures on the same direction in both the short run and the long run and that adjustment to stabilise the relationship is quite slow. |
| Keywords: | firm failure; macroeconomic factors; cointegration analysis; diagnostic tests |
| JEL: | D01 D02 |
| Date: | 2009–08–26 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0185&r=ent |
| By: | Jan Schnellenbach; Thushyanthan Baskaran; Lars P. Feld |
| Abstract: | We analyze the rise and decline of the steel and mining industries in the regions of Saarland, Lorraine und Luxemburg over a long period, from the mid-19th century to 2003. Our main focus in on the period of structural decline in these industries after the second world war. Differences in the institutional framework of these regions are exploited to analyze how the broader fiscal constitution sets incentives for governments to either obstruct or to encourage structural change in the private sector. Our main result is that fiscal autonomy of a region subjected to structural change in its private sector is associated with a relatively faster decline of employment in the sectors affected. Contrary to the political lore, fiscal transfers are not used to speed up the destruction of old sectors, but rather to stabilize incomes. |
| Keywords: | structural change; fiscal federalism; grants in aid; creative destruction Length 31 pages |
| JEL: | E63 E64 H54 H77 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:esi:evopap:2009-08&r=ent |