nep-ent New Economics Papers
on Entrepreneurship
Issue of 2010‒11‒20
eighteen papers chosen by
Marcus Dejardin
Notre-Dame de la Paix University

  1. Innovation, Entrepreneurship and Financial Market Cycles By Josh Lerner
  2. The Unobserved Returns to Entrepreneurship By Sarada, FNO
  3. Are Education and Entrepreneurial Income Endogenous and Do Family Background Variables Make Sense as Instruments?: A Bayesian Analysis By Jörn H. Block; Lennart F. Hoogerheide; A. Roy Thurik
  4. The importance of financial market development on the relationship between loan guarantees for SMEs and local market employment rates By Craig E. Armstrong; Ben R. Craig; William E. Jackson, III; James B. Thomson
  5. Success from Satisficing and Imitation: Entrepreneurs’ Location Choice and Implications of Heuristics for Local Economic Development By Berg, Nathan
  6. Gazelle companies: growth drivers and an evolution analysis By Oriol Amat; Jordi Perramon
  7. Successful Practices and Policies to Promote Regulatory Reform and Entrepreneurship at the Sub-national Level By Jacobo Pastor García Villarreal
  8. The Effects of Government-Sponsored Venture Capital: International Evidence By James A. Brander; Qianqian Du; Thomas F. Hellmann
  9. Entrepreneurship and Market Size. The Case of Young College Graduates in Italy. By Sabrina Di Addario; Daniela Vuri
  10. Strategic activities in support of young French SMEs By B. Branchet; B. Augier; J.P. Boissin; B. Quere
  11. Access to Business Subsidies: What Explains Complementarities and Persistency? By Heli Koski; Mika Pajarinen
  12. ICT and Innovation Activities: Evidence for UK SMEs By Dolores Añon Higón
  13. Création par nécessité et précarité: la face cachée de l'entrepreneuriat By A. Fayolle; W. Nakara
  14. Management entrepreneurial et orientation entrepreneuriale : deux concepts si differents ? By K. Randerson; A. Fayolle
  15. L'influence des caractéristiques du dirigeant et de l'équipe dirigeante sur le management financier de la PME en hyper-croissance : une approche par études de cas By Christine Teyssier
  16. Entrepreneuriat organisationnel : Enseignements stratégiques d'une approche comparée des principaux modèles By K. Randerson; A. Fayolle
  17. La reprise d'entreprise, une opportunité pour la mise en œuvre de la RSE en PME ? By S. Berger-Douce; Bérangère Deschamps
  18. La légitimation du repreneur d'entreprise : quels principes d'action pour les dispositifs d'accompagnement ? By Olivier Culliere

  1. By: Josh Lerner
    Abstract: While hard data is difficult to find, the financial crisis appears to have had a substantial negative effect on investors’ willingness to finance innovative entrepreneurship. This dearth of capital is particularly worrisome in light of the widely recognised need for innovative ventures—the so-called “green shoots”— to reignite economic growth after the world-wide recession. A growing body of evidence suggests a strong relationship between entrepreneurship, innovation, and economic growth. This document first reviews the evidence concerning the relationship between innovation and entrepreneurship. It then turns to understanding the consequences of market cycles for these activities. We look at the way that financial considerations impact the innovation investment decision, and innovation in entrepreneurial ventures specifically.<BR>Il est difficile de trouver des données objectives sur la question, mais la crise financière semble avoir eu un effet négatif sensible sur la disposition des investisseurs à financer les entreprises innovantes. Cette pénurie de capital est particulièrement inquiétante à la lumière du besoin largement admis d'entreprises innovantes – les fameuses « jeunes pousses » – pour relancer la croissance économique après la récession mondiale. De plus en plus d’éléments laissent à penser qu'il existe un lien fort entre entrepreneuriat, innovation et croissance économique. Ce document s’ouvre sur un examen des informations disponibles concernant la relation entre innovation et entrepreneuriat. Je m’efforce ensuite de cerner les conséquences des cycles des marchés sur ces activités. J’examine la façon dont les considérations financières se répercutent sur les décisions d’investissement en matière d'innovation, et plus précisément s’agissant de l’innovation réalisée dans les jeunes entreprises.
    Date: 2010–03–18
  2. By: Sarada, FNO
    Abstract: This paper seeks to understand the returns to self-employment. The analysis is motivated by the empirical puzzle that most entrepreneurs enter and persist in self-employment, despite lower initial earnings and earnings growth (Hamilton, 2000). I propose a new hypothesis to make sense of this observation. In particular, reported income is unlikely to be a good measure of the return to self-employment given the underreporting incentive, and opportunities available to business owners. Moreover, business owners also have access to multiple avenues for compensating themselves and their employees. As such, any survey of business owners will face great difficulties in capturing the many ways in which business income can be received. As evidence for the potential importance of such understating, Slemrod (2007) reports that the evasion rate amongst non-farm proprietorships varies between 18 and 57 percent depending on industry. In this paper, I make use of the PSID to test my hypothesis. The estimation strategy relies on the presumption that reported consumption by the self-employed will not be systematically misreported, even though income can easily be. The results indicate that individuals report earning 27 percent less but appear to consume 5 percent more in self-employment. This implies a 32 percent differential between reported wage and consumption for the selfemployed, indicating that the former measure is not a good barometer of the financial returns to self-employment. Furthermore, this increased consumption does not seem to be offset by higher uncertainty as evidenced by my finding, that the variance in consumption while selfemployed is not significantly different than that in wage employment. Other results include that the self-employed work longer hours and that consumption is the same as that prior to self-employment for those who return to wage employment.
    Keywords: Entrepreneurship, wage and consumption
    Date: 2010–11–05
  3. By: Jörn H. Block; Lennart F. Hoogerheide; A. Roy Thurik
    Abstract: Education is a well-known driver of (entrepreneurial) income. The measurement of its influence, however, suffers from endogeneity suspicion. For instance, ability and occupational choice are mentioned as driving both the level of (entrepreneurial) income and of education. Using instrumental variables can provide a way out. However, three questions remain: whether endogeneity is really present, whether it matters and whether the selected instruments make sense. Using Bayesian methods, we find that the relationship between education and entrepreneurial income is indeed endogenous and that the impact of endogeneity on the estimated relationship between education and income is sizeable. We do so using family background variables and show that relaxing the strict validity assumption of these instruments does not lead to strongly different results. This is an important finding because family background variables are generally strongly correlated with education and are available in most datasets. Our approach is applicable beyond the field of returns to education for income. It applies wherever endogeneity suspicion arises and the three questions become relevant.
    Keywords: Education, income, entrepreneurship, self-employment, endogeneity, instrumental variables, Bayesian analysis, family background variables
    JEL: C11 L26 M13 J24
    Date: 2010
  4. By: Craig E. Armstrong; Ben R. Craig; William E. Jackson, III; James B. Thomson
    Abstract: We empirically examine whether a major government intervention in the small-firm credit market yields significantly better results in markets that are less financially developed. The government intervention that we investigate is SBA-guaranteed lending. The literature on financing small and medium size enterprises (SMEs) suggests that small firms may be exposed to a particular type of market failure associated with credit rationing. And SMEs in markets that are less financially developed will likely face a greater degree of this market failure. To test our hypothesis, we use the level of bank deposits per capita as our relative measure of financial market development, and we use local market employment rates as our measure of economic performance. After controlling for the appropriate cross-sectional market characteristics, we find that SBA-guaranteed lending has a significantly more (less) positive impact on the average annual level of employment when the local market is relatively less (more) financially developed. This result has important implications for public policy directives concerning where SBA-guaranteed lending should be directed.
    Keywords: Small Business Administration ; Financial markets ; Small business - Finance ; Employment
    Date: 2010
  5. By: Berg, Nathan
    Abstract: Decisions about location choice provide an opportunity to compare the predictions of optimization models, which require exhaustive search through very large choice sets, against the actual decision processes used by entrepreneurs choosing where to allocate investment capital. This paper presents new data on entrepreneurs’ self-described decision processes when choosing where to locate, based on scripted interviews with 49 well-placed business owners and senior managers in charge of location choice. Consideration sets are surprisingly small, especially among those who are successful. According to entrepreneurs’ own accounts, locations are frequently discovered by chance rather than systematic search. Few describe decision processes that bear any resemblance to equating marginal benefit with marginal cost as prescribed by standard optimization theory. Nearly all interviewees describe location choice decisions based on threshold conditions, providing direct evidence of satisficing rather than optimization. Imitation is beneficial for small investment projects. Decision process data collected here suggests a need to rethink standard policy tools used to stimulate local economic development.
    Keywords: Process Model; Bounded Rationality; Interview Data; Ethnic; Discrimination; Low income; Neighborhood; Lexicographic; Non-compensatory; Business Owners
    Date: 2010
  6. By: Oriol Amat; Jordi Perramon
    Abstract: Gazelle companies are relevant because they generate much more employment than other companies and deliver high returns to their shareholders. This paper analyzes their behavior in the years of high growth and their evolution in the following years. The main factors that explain their success are competitive advantages based on human resources, innovation, internationalization, the excellence in processes and a conservative financial policy. Nevertheless, as time goes by they can be divided in two groups: a group which continues having growth, but most of them with lower growth rates; and the rest which face great problems or even disappear. The present study identifies several key factors that explain this different evolution.
    Keywords: Gazelle companies, high-growth companies, financial information, business evolution, financial statements.
    JEL: L1 M41 M13
    Date: 2010–11
  7. By: Jacobo Pastor García Villarreal
    Abstract: This report is part of the OECD-Mexico initiative “Strengthening of Economic Competition and Regulatory Improvement for Competitiveness”. It summarises the findings of several case studies on best practices to promote regulatory reform and entrepreneurship at the sub-national level. It has benefited from the participation of three Mexican states (Baja California, Jalisco, and Puebla), as well as of three provinces from other countries, British Columbia (Canada), Catalonia (Spain), and Piemonte (Italy). By including both, Mexican and international experiences, this report derives practical lessons for sub-national governments to improve their regulatory quality and create dynamic business environments.
    Date: 2010–04
  8. By: James A. Brander; Qianqian Du; Thomas F. Hellmann
    Abstract: This paper examines the impact of government-sponsored venture capitalists (GVCs) on the success of enterprises. Using international enterprise-level data, we identify a surprising non-monotonicity in the effect of GVC on the likelihood of exit via initial public offerings (IPOs) or third party acquisitions. Enterprises that receive funding from both private venture capitalists (PVCs) and GVCs outperform benchmark enterprises financed purely by private venture capitalists if only a moderate fraction of funding comes from GVCs. However, enterprises underperform if a large fraction of funding comes from GVCs. Instrumental variable regressions suggest that endogeneity in the form of unobservable selection effects cannot account for these effects of GVC financing. The underperformance result appears to be largely driven by investments made in times when private venture capital is abundant. The outperformance result applies only to venture capital firms that are supported but not owned outright by governments.
    JEL: G24 H44 H81 O38
    Date: 2010–11
  9. By: Sabrina Di Addario (Bank of Italy); Daniela Vuri (Faculty of Economics, University of Rome "Tor Vergata")
    Abstract: We analyse empirically the effects of urbanization on Italian college graduates’ work possibilities as entrepreneurs three years after graduation. We find that doubling the province of work’s population density reduces the chances of being an entrepreneur by 2-3 percentage points. This result holds after controlling for regional fixed effects and is robust to instrumenting urbanization. Provinces’ competition, urban amenities and dis-amenities, cost of labour, earning differentials between employees and self-employed workers, unemployment rates and value added per capita account for more than half of the negative urbanization penalty. Our result cannot be explained by the presence of negative differentials in returns to entrepreneurship between the most and the least densely populated areas either. In fact, as long as they succeed in entering the most densely populated markets, young entrepreneurs are able to reap-off the benefits of urbanization externalities: the elasticity of entrepreneurs’ net monthly earnings with respect to population density is 0.02-0.03.
    Keywords: Labour market transitions; Urbanization.
    JEL: R12 J24 J21
    Date: 2010–11–08
  10. By: B. Branchet (CERAG - Centre d'études et de recherches appliquées à la gestion - CNRS : UMR5820 - Université Pierre Mendès-France - Grenoble II); B. Augier (CERAG - Centre d'études et de recherches appliquées à la gestion - CNRS : UMR5820 - Université Pierre Mendès-France - Grenoble II); J.P. Boissin (CERAG - Centre d'études et de recherches appliquées à la gestion - CNRS : UMR5820 - Université Pierre Mendès-France - Grenoble II); B. Quere (CERAG - Centre d'études et de recherches appliquées à la gestion - CNRS : UMR5820 - Université Pierre Mendès-France - Grenoble II)
    Abstract: In this paper we closely study young French Small and Medium Enteprises (SMEs). We highlight the structure of this target firms and we build a typology of corresponding business models. The business models stemming from this typology are typical (to the greatest extent possible) and actionable. We are particularly intersted in indentifying groups of SMEs where gouvernement assistance would be particularly effective and strategically valuable for the national economy. One of our conclusins is that the typology is not based on a classical growth model that reflects progressive phases of developement in the life of a young firm. Furthermore, it is ineffective and wasteful to focus governement assistance efforts on firms based on their age. We identify groups of business models where assistance would be more effecient and strategically more effective.
    Keywords: SME ; growth ; growth model ; typology
    Date: 2010
  11. By: Heli Koski; Mika Pajarinen
    Abstract: Our empirical analysis using an extensive database on the allocation of busi-ness subsidies in Finland during the years 2004–2008 finds that large firms are less likely to exit support system and more likely to continue receiving both support from one organization only and simultaneous support from multiple organizations. Large firms’ propensity to transit between subsidies of different organizations is also higher than that of the smaller ones. Our study detects another interesting characteristic of the Finnish business subsidy system : the existence of agency-specific loyal customers. Firm size relates positively to the probability of a firm becoming the agency-specific customer of any public support provider, while the effect of other firm-level factors on this probability varies among the agencies. In addition to this, various parts of our analysis suggest that there is also a group of firms – comprising more likely larger firms – that tends to obtain support simultaneously from at least from two different organizations over several years. This finding is, as is the existence of agency-specific loyal customers, contrary to the basic principles of business subsidy system originally designed for providing temporary aid for companies.
    Keywords: public subsidies, complementarities, transitions, persistency
    JEL: L53 O25
    Date: 2010–11–11
  12. By: Dolores Añon Higón (Departamento de Economía Aplicada II, Universidad de Valencia)
    Abstract: There is a continuous commitment of policy makers in the UK to supporting innovation in small and medium firms. For these policy initiatives to be successful, an understanding of the factors driving innovation activities is required. In this study, we focus on the role that Information and Communication Technologies (ICT) play in the innovation performance of UK small and medium sized enterprises (SMEs). Using data drawn from the 2004 Annual Small Business Survey (ASBS) database, we show that ICT operate primarily as efficiency-enhancing technologies, although specific market oriented applications (i.e. website development) exhibit a potential to create competitive advantage through product innovation.
    Keywords: ICT, Product Innovation, Process Innovation, SME, Bivariate Probit
    JEL: D24 O30
    Date: 2010–11
  13. By: A. Fayolle (CERAG - Centre d'études et de recherches appliquées à la gestion - CNRS : UMR5820 - Université Pierre Mendès-France - Grenoble II); W. Nakara (Groupe ESC Montpellier - Ecole de commerce)
    Abstract: Qui pourrait imaginer que la figure de l'entrepreneur puisse être touchée, d'une manière ou d'une autre, par la précarité et la pauvreté ? L'entrepreneur, dans la littérature et dans la société, incarne tout autre chose : prise de risque et d'initiatives, sens des responsabilités, capacité d'action, orientation vers les résultats, opportunisme, parfois, etc. Souvent, la figure de l'entrepreneur, héritage de la pensée schumpétérienne, est chargée d'héroïsme et ce qu'accomplissent les entrepreneurs relèverait plutôt d'un registre d'actions hors de la portée du commun des mortels (Cunningham et Lischeron, 1991). Par ailleurs, une des formes populaires de l'entrepreneuriat, la création d'entreprise, est présentée, avec insistance, par nombre de penseurs et de décideurs, dans les domaines de l'économie et de la politique, comme une réponse au problème du chômage et donc, dans une certaine mesure, de la précarité (Rapiau, 2010). Nous soutenons, dans ce travail, la thèse que les mesures actuelles et passées destinées à encourager la création d'emploi et la création d'entreprise par des individus demandeurs d'emplois et/ou dans des situations difficiles contribuent très fortement au développement de formes d'entrepreneuriat contraint qui pourraient avoir des conséquences extrêmement préjudiciables pour les individus concernés et pour notre société dans son ensemble (Fayolle, 2010). L'objectif de notre communication est d'apporter un premier éclairage sur ces formes particulières d'entrepreneuriat qui sont vraisemblablement amenées à se développer fortement dans le contexte de mutations et de ruptures que nous vivons. Dans la suite de ce texte, nous allons brièvement resituer l'entrepreneuriat de nécessité dans le champ de 'entrepreneuriat, lequel connaît une mutation profonde, puis nous présenterons les résultats des enquêtes que nous avons réalisées avant d'avancer quelques implications de notre travail.
    Keywords: Création ; nécessité ; précarité ; entrepreneuriat
    Date: 2010
  14. By: K. Randerson (CERAG - Centre d'études et de recherches appliquées à la gestion - CNRS : UMR5820 - Université Pierre Mendès-France - Grenoble II); A. Fayolle (CERAG - Centre d'études et de recherches appliquées à la gestion - CNRS : UMR5820 - Université Pierre Mendès-France - Grenoble II)
    Abstract: Le management entrepreneurial (Stevenson, 1983) peut-il être assimilé à l'orientation entrepreneuriale (Miller, 1983) concept développé et largement utilisé pour mesurer l'intensité entrepreneuriale d'une organisation ? Nous montrons que ces deux concepts sont distincts bien que conduisant tous deux vers l'entrepreneuriat organisationnel (Brown et al., 2001). Ensuite, nous conduisons une étude comparative des modèles d'entrepreneuriat organisationnel qui sont basés sur, ou intègrent, l'orientation entrepreneuriale (OE), afin d'identifier si les dimensions du management entrepreneurial peuvent être considérées comme des facteurs organisationnels affectant l'OE. Nous soulignons que le caractère dynamique de ce type d'entrepreneuriat appelle à des recherches qualitatives supplémentaires afin de donner un contenu au concept. Ceci permettrait, notamment, aux praticiens d'identifier les mécanismes et processus qui maintiennent l'intensité entrepreneuriale à un bon niveau et d'agir sur ces derniers quand cette intensité fait défaut. Ce contenu donnerait au monde académique un matériau pour réexaminer l'opérationnalisation de l'orientation entrepreneuriale, nécessité soulignée par Basso et al., (2009), et confirmée par Lumpkin et al., (2009)
    Keywords: Management Entrepreneurial ; Orientation Entrepreneuriale ; entrepreneuriat organisationnel ; mode de management favorisant l'entrepreneuriat organisationnel
    Date: 2010
  15. By: Christine Teyssier (COACTIS - Université Lumière - Lyon II : EA4161 - Université Jean Monnet - Saint-Etienne)
    Abstract: Plusieurs études récentes montrent que les caractéristiques des dirigeants de PME en hyper-croissance (histoires et expériences professionnelles, aptitudes managériales et motivations personnelles au regard de la croissance de leur entreprise) de même que la composition des équipes dirigeantes et les interactions entre les membres, seraient des facteurs clés dans la mise en place de dispositifs spécifiques de management financier, et donc de soutien à l'hyper-croissance. Nous adoptons une méthodologie qualitative basée sur trois études de cas de PME industrielles en hyper-croissance de la région Rhône-Alpes, afin de mieux comprendre les modalités du management financier dans ce type d'entreprise. Nous validons les hypothèses selon lesquelles les expériences professionnelles antérieures du dirigeant et la composition de l'équipe dirigeante sont des facteurs explicatifs aux différences de management financier observées entre les PME en hyper-croissance. Plus précisément, nous montrons que les dirigeants plus expérimentés mettent en place, de façon proactive, des dispositifs de "protection" contre les risques d'une trop grande pression financière pouvant être engendrée par la forte croissance, donnant alors une impression de relative "sérénité" financière au sein de leur entreprise.
    Keywords: Hyper-croissance ; Finance ; Caractéristiques du dirigeant
    Date: 2010–10–27
  16. By: K. Randerson (CERAG - Centre d'études et de recherches appliquées à la gestion - CNRS : UMR5820 - Université Pierre Mendès-France - Grenoble II); A. Fayolle (CERAG - Centre d'études et de recherches appliquées à la gestion - CNRS : UMR5820 - Université Pierre Mendès-France - Grenoble II)
    Abstract: Ce travail effectue une étude comparative de différentes modélisations de l'entrepreneuriat organisationnel. Nous étudions ces modèles à travers des prismes différents, afin de mettre en lumière leurs similitudes et leurs différences, notamment dans leur manière de relier les notions de stratégie et d'entrepreneuriat. Cette étude s'inscrit dans une actualité brûlante, car des travaux récents (Lumpkin, 2009) ont souligné des faiblesses dans le construit d'orientation entrepreneuriale, sur lequel sont construits de nombreux modèles et un décalage entre le construit et les outils habituellement utilisés pour le mesurer. Elle apporte à la littérature une approche comparative originale des modélisations principales utilisées pour conceptualiser l'entrepreneuriat organisationnel
    Keywords: entrepreneuriat organisationnel ; stratégie ; orientation entrepreneuriale; management entrepreneurial
    Date: 2010
  17. By: S. Berger-Douce (LARIME - IAE de Valenciennes - IAE de Valenciennes); Bérangère Deschamps (CERAG - Centre d'études et de recherches appliquées à la gestion - CNRS : UMR5820 - Université Pierre Mendès-France - Grenoble II, IAE de Grenoble - IAE de Grenoble)
    Abstract: Depuis quelques années, à l'instar des grandes entreprises, les PME s'engagent chemin faisant dans des démarches de Responsabilité Sociale d'Entreprise (RSE) (Quairel et Auberger, 2005). Les obstacles à cette implication sont pourtant nombreux : au-delà de leurs ressources limitées (financières, humaines, en temps), elles doivent gérer l'ensemble des changements organisationnels induits par la RSE. La reprise d'entreprise, quant à elle, constitue une étape de rupture dans la vie des organisations. A ce titre, ce papier de recherche propose de considérer le processus repreneurial (Deschamps, 2000) comme une opportunité de mettre en œuvre une démarche de RSE en PME. Une approche qualitative exploratoire (Hlady-Rispal, 2002) auprès de deux PME françaises familiales a été menée afin d'investiguer notre question de recherche. Les premiers résultats semblent indiquer que le processus repreneurial peut être considéré comme un moment propice pour la mise en œuvre d'une démarche de RSE en PME. Cependant, l'analyse suggère de préciser les conditions favorables à cette mise en œuvre en termes de posture du repreneur, de processus organisationnels et de préparation de sa transmission par le cédant. Les pistes de recherche s'orientent vers un approfondissement de nos propositions par un travail à plus grande échelle (en multipliant les cas de reprise étudiés) et par un élargissement au-delà des PME familiales (permettant de s'affranchir de leurs spécificités en matière de RSE) (Astrachan, 1988).
    Keywords: RSE ; reprise d'entreprise ; management de la reprise
    Date: 2010
  18. By: Olivier Culliere (CERI - ISTEC - CERI - ISTEC)
    Abstract: Alors que la recherche dédiée au thème de l'accompagnement à la création d'entreprise s'étoffe, cet article, à la suite de travaux récents, porte sur l'aide dans le contexte de reprise d'entreprise. Il se focalise sur la question de la contribution de l'accompagnement en matière de construction de la légitimité du repreneur d'entreprise. Le traitement de la problématique est de type conceptuel. Le cadre théorique relatif au processus de reprise et au besoin de légitimité est d'abord proposé. S'ensuit une discussion dédiée à l'accompagnement. Ceci est fait au travers d'une revue documentaire et empirique, préalable à un focus sur les difficultés du repreneur à acquérir une légitimité. Dans notre optique de soutien à l'entrepreneur, une grille de définition de l'aide à la légitimation du repreneur est finalement proposée, au regard de laquelle une série d'actions ciblées d'accompagnement sont proposées.
    Keywords: Reprise d'entreprise, légitimité, accompagnement
    Date: 2010–06–16

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