nep-ent New Economics Papers
on Entrepreneurship
Issue of 2009‒10‒10
eight papers chosen by
Marcus Dejardin
Notre-Dame de la Paix University

  1. The evolution of the literature on entrepreneurship. Uncovering some under researched themes By Cristina Santos; Aurora A.C. Teixeira
  2. Better Means More: Property Rights and High-Growth Aspiration Entrepreneurship By Estrin, Saul; Korosteleva, Julia; Mickiewicz, Tomasz
  3. Approaching the Agora - Determinants of Scientists' Intentions to Purse Academic Entrepreneurship By Maximilian Goethner; Martin Obschonka; Rainer K. Silbereisen; Uwe Cantner
  4. Employment growth in newly established firms: is there evidence for academic entrepreneur's human capital depreciation? By Müller, Kathrin
  5. The Black Box of Business Dynamics By María Callejón; Vicente Ortún
  6. Product and Process Innovation and the Decision to Export: Firm-level Evidence for Belgium By Ilke Van Beveren; Hylke Vandenbussche
  7. Subsidizing Firm Entry in Open Economies By Pflüger, Michael P.; Suedekum, Jens
  8. Animal Spirits and the Composition of Innovation in a Lab-Equipment R&D Model By Pedro Rui Mazeda Gil

  1. By: Cristina Santos (Faculdade de Economia, Universidade do Porto); Aurora A.C. Teixeira (CEF.UP,Faculdade de Economia, Universidade do Porto; INESC Porto)
    Abstract: Recently bibliometrics techniques are being widely used to complement traditional qualitative reviews of the literature in given scientific areas. The majority of these reviews are based in large databases of articles published in ISI indexed journals, overlooking the richness of studies that are being published in key handbooks and books. This is particularly true in the case of entrepreneurship field. In the present paper we provide a survey of the literature based on an in-depth analysis of major handbooks, books and scientific journals in the field, identifying its major topics, their evolution across time and the current trends. From this exercise, we found that entrepreneurship education emerges as a recent theme with most of the papers in the area focusing on entrepreneurial universities, productivity of technology transfer offices, new firm creation and the environmental context. The largest part of these studies analyse US universities or universities from highly developed European countries, such as Germany, Sweden and United Kingdom. The review of the literature performed highlights that the theme of (higher education) students’ entrepreneurial intents is under researched. Furthermore, it uncovers that the (potential) link between university entrepreneurial models and the propensity of students for new venture creation is likely to constitute an interesting and challenging path for future research.
    Keywords: entrepreneurship, bibliometrics; universities
    Date: 2009–09
  2. By: Estrin, Saul (London School of Economics); Korosteleva, Julia (University College London); Mickiewicz, Tomasz (University College London)
    Abstract: This paper contrasts the determinants of entrepreneurial entry and high-growth aspiration entrepreneurship. Using the Global Entrepreneurship Monitor (GEM) surveys for 42 countries over the period 1998-2005, we analyse how institutional environment and entrepreneurial characteristics affect individual decisions to become entrepreneurs and aspirations to set up high-growth ventures. We find that institutions exert different effects on entrepreneurial entry and on the individual choice to launch high-growth aspiration projects. In particular, a strong property rights system is important for high-growth aspiration entrepreneurship, but has less pronounced effects for entrepreneurial entry. The availability of finance and the fiscal burden matter for both.
    Keywords: entrepreneurship, high-growth aspiration entrepreneurship, start-ups, property rights
    JEL: D23 D84 G21 J23 J24 K11 L26 P51
    Date: 2009–09
  3. By: Maximilian Goethner (Friedrich Schiller University Jena, Department of Economics, DFG RTG 1411 "The Economics of Innovative Change"); Martin Obschonka (Friedrich Schiller University Jena, Department of Developmental Psychology); Rainer K. Silbereisen (Friedrich Schiller University Jena, Department of Developmental Psychology); Uwe Cantner (Friedrich Schiller University Jena, Department of Economics, DFG RTG 1411 "The Economics of Innovative Change")
    Abstract: This study investigates predictors of scientists' intentions to commercialize their research through business founding. Analyzing a cross-sectional sample of 496 German scientists, we develop and test an intentions-based model of academic entrepreneurship combining personal and contextual factors. Empirical results demonstrate that intentions to start a science-based new venture are shaped by some personal characteristics (i.e., personal attitudes toward research commercialization, entrepreneurial control-beliefs, entrepreneurial self-identity, and prior entrepreneurial experience). Moreover, we find that the research context itself - i.e., normative influences of academic workplace peers - does not show a strong direct effect on entrepreneurial intentions. Moderator analyses deliver that peers have an influence primarily by person-context interactions via scientists' sense of identification with these peers. A mediation analysis further indicates that gender-related differences in entrepreneurial control-beliefs might help explain the widely-observed low proportion of female scientist-entrepreneurs.
    Keywords: Academic entrepreneurship, Entrepreneurial intentions, Entrepreneurial scientist, University-industry technology transfer, Theory of planned behavior, Gender
    JEL: L26 O33 O38 I23
    Date: 2009–10–02
  4. By: Müller, Kathrin
    Abstract: Human capital is known to be one of the most important predictors of a person's earnings. With regard to entrepreneurial success, founders' human capital is an important determinant of firm's employment growth as well. This paper investigates if the depreciation of a founder's academic knowledge affects a start-up's employment growth. The depreciation of academic knowledge is investigated by quantifying the effect of the time period which elapses after the founder has left university until the start-up is founded on firm's employment growth. Using quantile regressions, human capital depreciation is found to be of crucial importance for both ordinary academic start-ups and academic spin-offs, the founders of the latter suffering even more from human capital depreciation.
    Keywords: Human capital depreciation,employment growth,academic entrepreneurship
    JEL: J23 J24 L25 L26
    Date: 2009
  5. By: María Callejón (Facultat d'Economia i Empresa, Avda. Diagonal 690, 08034 Barcelona, Spain); Vicente Ortún (Department of Economics and Business, Universitat Pompeu Fabra, Barcelona, Spain)
    Abstract: Research in business dynamics has been advancing rapidly in the last years but the translation of the new knowledge to industrial policy design is slow. One striking aspect in the policy area is that although research and analysis do not identify the existence of an specific optimal rate of business creation and business exit, governments everywhere have adopted business start-up support programs with the implicit principle that the more the better. The purpose of this article is to contribute to understand the implications of the available research for policy design. Economic analysis has identified firm heterogeneity as being the most salient characteristic of industrial dynamics, and so a better knowledge of the different types of entrepreneur, their behavior and their specific contribution to innovation and growth would enable us to see into the ‘black box’ of business dynamics and improve the design of appropriate public policies. The empirical analysis performed here shows that not all new business have the same impact on relevant economic variables, and that self-employment is of quite a different economic nature to that of firms with employees. It is argued that public programs should not promote indiscriminate entry but rather give priority to able entrants with survival capacities. Survival of entrants is positively related to their size at birth. Innovation and investment improve the likelihood of survival of new manufacturing start-ups. Investment in R&D increases the risk of failure in new firms, although it improves the competitiveness of incumbents.
    Keywords: Industrial dynamics, industrial policy, creative destruction, business demography.
    JEL: D21 L16 L52 M13 O25
    Date: 2009–09
  6. By: Ilke Van Beveren; Hylke Vandenbussche
    Abstract: Using data from the Community Innovation Survey for Belgium in two consecutive periods, this paper explores the relationship between firm-level innovation activities and the propensity to start exporting. To measure innovation, we include indicators of both innovative effort (R&D activities) as well as innovative output (product and process innovation). Our results suggest that the combination of product and process innovation, rather than either of the two in isolation, increases a firm¡¯s probability to enter the export market. After controlling for potential endogeneity of the innovation activities, only firms with a sufficiently high probability to start exporting engage in product and process innovation prior to their entry on the export market, pointing to the importance of self-selection into innovation.
    Keywords: Exports, Product innovation, Process innovation, Self-selection, Firm heterogeneity
    JEL: D24 F14 L25 O31 O33
    Date: 2009
  7. By: Pflüger, Michael P. (University of Passau); Suedekum, Jens (University of Duisburg-Essen)
    Abstract: Entrepreneurs who decide to enter an industry are faced with different levels of effective entry costs in different countries. These costs are heavily influenced by economic policy. What is not well understood is how international trade affects the government incentive to impact on entry costs, and how entry subsidies can be used strategically in open economies. We present a general equilibrium model of monopolistic competition with two (potentially) asymmetric countries and heterogeneous firms where government subsidizes entry of domestic entrepreneurs. Under autarky the entry subsidy indirectly corrects for the monopoly pricing distortion. In the autarky equilibrium these subsidies trigger entry, but they eventually do not lead to more but to better firms in the market. In the open economy there is another, strategic motive for entry subsidies as the tightening of domestic market selection also affects exporting decisions for domestic and foreign firms. Our analysis shows that entry subsidies in the Nash-equilibrium are first increasing, then decreasing in the level of trade openness. This implies a U-shaped relationship between openness and effective entry costs. Merging cross-country data on entry costs with international trade openness indices we empirically confirm this theoretical prediction.
    Keywords: firm entry, subsidies, heterogeneous firms, international trade, monopolistic competition, entry regulation, strategic trade policy
    JEL: F12 F13 H25 L11
    Date: 2009–08
  8. By: Pedro Rui Mazeda Gil (CEF.UP and Faculdade de Economia, Universidade do Porto)
    Abstract: We revisit the issue of self-fulfilling “waves of enthusiasm” as stationary rational expectations equilibrium outcomes in endogenous-growth models that merge the quality-ladders with the expanding-variety mechanism. By considering a lab-equipment specification with vertical-innovation intertemporal spillovers but no intersectoral spillovers, we extend previous results of a negative impact of animal spirits on both horizontal aggregate R&D and number of firms to a framework where decreasing returns to horizontal entry are not a necessary condition. In contrast, our general-equilibrium setting allows us to predict an effect of animal spirits on R&D composition impacting neither on aggregate growth nor on aggregate vertical R&D, as reduced outlays in “mature” industries compensate for the increased R&D intensity in newly-born industries.
    Keywords: endogenous growth, horizontal and vertical R&D, stationary sunspot equilibria
    JEL: O41 E32 D43 L16
    Date: 2009–09

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