nep-ent New Economics Papers
on Entrepreneurship
Issue of 2013‒04‒13
seventeen papers chosen by
Marcus Dejardin
Notre-Dame de la Paix University

  1. Girls will be Girls: An Experimental Study on Female Entrepreneurship By Artinger, Sabrina; Schade, Christian
  2. Credit rationing or overlending:Who is right ? By Jean Bonnet; Sylvie Cieply; Marcus Dejardin
  3. Entrepreneurship or Survival? Caste and Gender of Small Business in India By Ashwini Deshpande; Smriti Sharma
  4. Do entrepreneurs matter? By Becker, Sascha O.; Hvide, Hans K
  5. Risk tolerance and entrepreneurship By Hvide, Hans K; Panos, Georgios
  6. Are Academic Spin-Offs necessarily New Technology-Based firms? By Dina Cunha; Sandra T. Silva; Aurora A.C. Teixeira
  7. Corporate governance in newly listed companies By Audretsch, David B.; Lehmann, Erik E.
  8. The entrepreneur in economic theory: from an invisible man toward a new research field By Vera Catarina Rocha
  9. Time to IPO: Role of heterogeneous venture capital By MIYAKAWA Daisuke; TAKIZAWA Miho
  10. Trademark or patent? The effects of market structure, customer type and venture capital financing on start-ups' IP decisions By De Vries, G.A.; Pennings, H.P.G.; Block, J.H.
  11. Learning from Entrepreneurial Projects: A Typology By L Oerlemans; R M Bakker; P Kenis; J K Vermunt
  12. Impacts of a Micro-Enterprise Clustering Program on Firm Performance in Ghana By Jörg Peters; Maximiliane Sievert; Christoph Strupat
  13. A Unified Production and Matching Function: Implications for Factor Shares By Sephorah Mangin
  14. Promoting Successful Graduate Entrepreneurship at the University of Applied Sciences Schmalkalden, Germany By Andrea-Rosalinde Hofer; Jonathan Potter; Dana Redford; Jakob Stolt
  15. Promoting Successful Graduate Entrepreneurship at the Technical University Ilmenau, Germany By Andrea-Rosalinde Hofer; Jonathan Potter; Dana Redford; Jakob Stolt
  16. Promoting Successful Graduate Entrepreneurship at Fachhochschule Brandenburg, Germany By Andrea-Rosalinde Hofer; Jonathan Potter; Dana Redford; Jakob Stolt
  17. Innovation, espaces de co‐working et tiers-lieux : entre conformisme et créativité By Raphaël Suire

  1. By: Artinger, Sabrina; Schade, Christian
    Abstract: We experimentally investigate gender- and occupation-specific differences in market entry behavior and test whether female entrepreneurs are more willing to take strategic risk and engage in competition than other women. To facilitate strategic thinking, we induce asymmetric gain and loss experiences. We find that female entrepreneurs react to own gains and losses like other women and to opponents’ experiences like male entrepreneurs. Overall entry of female entrepreneurs is much lower than that of male entrepreneurs and does not differ from other women indicating that also female entrepreneurs dislike strategic competition. Risk aversion does not to account for this finding.
    Keywords: gender differences, entrepreneurship, occupational choice, gain and loss experiences, Labor and Human Capital, Teaching/Communication/Extension/Profession, D03, L26,
    Date: 2013–01
  2. By: Jean Bonnet (Normandie University, Caen, Faculty of Economics and Business Administration - CREM CNRS UMR6211, France); Sylvie Cieply (Normandie University, Caen, Institut Banque-Assurance - CREM CNRS UMR6211, France); Marcus Dejardin (Université Catholique de Louvain and University of Namur, CERPE, Belgium)
    Abstract: There is a widespread belief in both academic literature and policy circles that small firms are unable to obtain sufficient banking loans.This idea finds a strong theoretical support in credit rationing theory, as initiated by Stiglitz and Weiss (1981). However, this is vigorously challenged by De Meza and Webb (1987, 2000) suggesting contrastingly that firms can benefit from an excess of credit. This empirical article is the first to test these two theories using data on the access to credit for new French businesses during the mid 1990s. Our results show that credit rationing was not highly spread among French new firms. The story described by De Meza and Webb (1987) appears to be a much more realistic model. Finally, we identify factors closely associated with credit rationing and overlending.
    Keywords: Credit Rationing, Overlending, Asymmetric information, New business
    JEL: L26 M13 D82 G21
    Date: 2013–03
  3. By: Ashwini Deshpande (Department of Economics, Delhi School of Economics, Delhi, India); Smriti Sharma (Department of Economics, Delhi School of Economics, Delhi, India)
    Abstract: We use unit-level data from the registered manufacturing segment of the Third and Fourth rounds of the Indian Micro, Small and Medium Enterprises (MSME) census data for 2001-2 and 2006-7 respectively, to understand the changes in involvement and dynamics not only of Dalits (officially, Scheduled Castes, or SCs), but also of other marginalized groups, specifically Adivasis (officially, Scheduled Tribes, or STs) and women, in this sector. We empirically estimate the growth rates for these enterprises and analyse the determinants, including caste and gender of the enterprise owner. We find clear and persistent caste and gender disparities in virtually all enterprise characteristics in the registered manufacturing MSME sector. The share of SC-ST ownership has declined over the period, SC-ST enterprises tend to be smaller, more rural than urban, have a greater share of owner-operated (single employee) units. The inter-state variation in share of ST-SC businesses reveals that with the exception of the tribal majority north-eastern states, SC and ST businesses are under-represented as compared to their share in state populations. The sectoral mix varies considerably by rural-urban location as well as by the caste and gender of the owner. The traditional stigmatizing association with leather-work continues to be one of the top five business activities for SCs and not for other caste groups. The gender-caste overlap indicates that the share of female-owned and female-managed enterprises is significantly greater among SC-ST-owned enterprises, than those owned by Others, and especially by Hindu upper-castes.The majority of the MSME workforce is employed in non-SC-ST owned firms. Also, there is evidence of homophily in OBC and upper-caste-owned firms, suggesting that the rise in Dalit entrepreneurship is key to increasing Dalit employment in the small business sector. While it is significant that there is now an emerging section of Dalit entrepreneurs, we find that most Dalit businesses occupy a very different place in the production chain, viz., that they are engaged in the bottom-of-the-ladder, low productivity, survival activities, as can be seen from our estimates of their lower rate of growth, after controlling for other characteristics. Thus, we find that entrepreneurship as a vehicle for social mobility for Dalits is yet to become a reality for India.
    Date: 2013–03
  4. By: Becker, Sascha O.; Hvide, Hans K
    Abstract: In the large literature on firm performance, economists have given little attention to entrepreneurs. We use deaths of more than 500 entrepreneurs as a source of exogenous variation, and ask whether this variation can explain shifts in firm performance. Using longitudinal data, we find large and sustained effects of entrepreneurs at all levels of the performance distribution. Entrepreneurs strongly affect firm growth patterns of both very young firms and for firms that have begun to mature. We do not find significant differences between small and larger firms, family and non-family firms, nor between firms located in urban and rural areas, but we do find stronger effects for founders with high human capital. Overall, the results suggest that an often overlooked factor -- individual entrepreneurs -- plays a large role in affecting firm performance.
    Keywords: entrepreneurship; firm performance; human capital
    JEL: D21 D24 G39 J23 L11 L25
    Date: 2013–01
  5. By: Hvide, Hans K; Panos, Georgios
    Abstract: A tradition from Knight (1921) argues that more risk tolerant individuals are more likely to become entrepreneurs, but perform worse. We test these predictions with two risk tolerance proxies: stock market participation and personal leverage. Using investment data for 400,000 individuals, we find that common stock investors are around 50 percent more likely to subsequently start up a firm. Firms started up by stock market investors have about 25 percent lower sales and 15 percent lower return on assets. The results are similar using personal leverage as risk tolerance proxy. We consider alternative explanations including unobserved wealth and behavioral effects.
    Keywords: entrepreneurial entry; entrepreneurial performance; firm entry; firm performance; firm productivity; firm survival; overconfidence; risk aversion; stock market participation
    JEL: C30 D14 D22 L26
    Date: 2013–02
  6. By: Dina Cunha (Faculdade de Economia, Universidade do Porto); Sandra T. Silva (Faculdade de Economia, Universidade do Porto, CEF.UP); Aurora A.C. Teixeira (Faculdade de Economia, Universidade do Porto, CEF.UP; INESC Porto, OBEGEF)
    Abstract: New Technology-Based Firms (NTBFs) have gained increasing economic relevance, supported by the recognition that they play an important role in national economies in the appearance of both new, high technology products and of new and emerging industries. Despite their economic importance, a number of alternative definitions for NTBFs are referred to in the literature, many of them adjusted to the aim of the study or the sample under observation. Such a lack of conceptualization reflects the variety of perspectives and interests of researchers, and has led to the need for a coherent framework to study NTBFs. Agreement has yet to be reached on which are the key characteristics of NTBFs. This lack of consensus in the conceptualization of NTBFs hinders the adequate applicability of the concept or a comparison among the different existing studies. Based on a sample of 30 Academic Spin- Offs (ASOs), and applying the criteria inferred conceptually, it was possible to conclude that, contrary to common wisdom, not all ASOs are NTBFs. Additionally, the ASOs classified as NTBFs, according to our criteria, differ significantly from the other ASOs, presenting a higher level of invested capital, higher R&D and internationalization intensity, and founding teams with a higher concentration of individuals with management capabilities.
    Keywords: New technology-based firms; Academic Spin-offs; Portugal
    JEL: O30 O32
    Date: 2013–01
  7. By: Audretsch, David B.; Lehmann, Erik E.
    Abstract: Topics in corporate governance have been around in the literature almost for a century, most of the theoretical and empirical work has focused on the large and public company. While this research has improved our understanding of how large corporations are governed, corporate governance in small and medium sized enterprises and in particular in entrepreneurial and newly listed firms has rarely been studied. This essay offers a reflective overview of corporate governance mechanisms in entrepreneurial and newly listed companies and of why and how governance mechanisms differ from those in large and publicly traded corporations. In contrast to the traditional approach in corporate governance, we do not rely on the agency perspective as a work-horse to analyze governance problems. Instead we focus on either market or institutional based mechanisms in corporate governance. This opens the view on governance problems in newly listed companies outside the narrow view of either an agency or free-market perspective. Instead, the following study tries to bridge the different perspectives on corporate governance. From the broad set of mechanisms in corporate governance discussed in the literature, we focus only on a small subset which is prevalent in newly listed companies like the product and capital market, the market for corporate control, boards of directors and capital structures. --
    Date: 2013
  8. By: Vera Catarina Rocha (CEF.UP, FEP; CIPES)
    Abstract: Mainstream economics had great difficulty in fitting entrepreneurship into its theory and for long time the theoretical firm remained “entrepreneurless”. However, from the early 20th century onwards, we identify strong attempts of key economists to recognize the role of the entrepreneur as an explanatory force of several economic phenomena. This paper analyzes the evolution of economic thought on entrepreneurship, and in particular the path through which the entrepreneur (re)entered into economic theory over the 20th century, leading to the new and increasingly independent research field Economics of Entrepreneurship. The analysis goes through the main Economics fields where the (re)discover of the entrepreneur figure was most remarkable - namely Labor Economics, Microeconomics and Industrial Organization, and Economic Growth and Development - searching for the rationality to include the entrepreneur figure into the analyses of particular economic phenomena. The study is enriched by a brief bibliometric analysis, which helps to set forth a chronological trace of the entrepreneurship research within Economics literature.
    Keywords: Entrepreneurship, Entrepreneur, Economic Thought, Labor Economics, Industrial Organization, Economic Development and Growth
    JEL: B00 J01 L26 O10
    Date: 2012–05
  9. By: MIYAKAWA Daisuke; TAKIZAWA Miho
    Abstract: Venture Capital (VC) is often syndicated to invest. The characteristics of each syndicate can vary not only in the number of VC but also in the heterogeneity of VC types included in a syndicate (e.g., bank-dependent, independent, and public etc.). This paper empirically studies how these two characteristics are related to the dynamics of client firms' Initial Public Offerings (IPOs). We test whether the IPOs of VC-backed entrepreneurial firms tend to be achieved in shorter periods when financed by many and/or heterogeneous VC. The results of our hazard estimation show that the hazard ratio of IPOs increases not only when the number of VC sources in a syndicate increases but also when the VC become more heterogeneous. The latter result implies the existence of the complementarity among heterogeneous VC in the process of screening and managerial value added. We also confirm that such positive impact of heterogeneous VC becomes more sizable in the absence of bank-dependent VC. This implies that complementarity among VC arises when the uncertainty about venture firms, which could diminish, for example, due to the existence of informed VC, remains high.
    Date: 2013–03
  10. By: De Vries, G.A.; Pennings, H.P.G.; Block, J.H.
    Abstract: We analyze the initial intellectual property (IP) right of 4,703 start-up entrants in the US, distinguishing between trademark and patent applications. The results show that start-ups are more likely to file for a trademark instead of a patent when entering into more competitive market structures. Further, we find that start-ups with a focus on distribution that serves end-consumers are more likely to file for a trademark and that start-ups that operate upstream and sell to other businesses are more likely to file for a patent. Lastly, the external influences on a start-up‟s management, such as the involvement of a venture capitalist (VC), affect IP applications. The increased incentive of VC-backed start-ups to become operational on the market makes them more likely to file initial IP in the form of a trademark rather than a patent. Among other factors, we control for R&D and advertising intensity in the industry and distinguish between more technical and more service-driven industries.
    Keywords: competition;intellectual property;trademarks;venture capital;patents
    Date: 2013–04–09
  11. By: L Oerlemans; R M Bakker; P Kenis; J K Vermunt
    Abstract: This article explores the process of learning from inter-organizational projects by SMEs. We analyse a sample of 1,500 SMEs to empirically develop a typology of different types of projects and conduct an in-depth comparative case study in each of the types. We find that 1) differences between project types influence the degree of project-based learning by SMEs, and 2) the mechanisms by which SMEs learn from projects can be unintentional, haphazard, and resemble learning by bricolage. These findings lead us to question the deliberate and pro-active nature of organizational learning that has been central to recent theory development.
    Date: 2013–03–04
  12. By: Jörg Peters; Maximiliane Sievert; Christoph Strupat
    Abstract: Widely considered as an important backbone of economies in developing countries, micro- and small enterprises face several constraints in doing business in Ghana. The creation of industrial zones (IZ) with improved access to infrastructure and secured land tenure is a potential remedy to promote local economic development. In this paper, we assess the effects of an intervention on business performance that establishes or upgrades IZs for micro- and small enterprises in Ghana based on firm-level data on 227 enterprises. Lacking reliable baseline data and an appropriate control group, we use retrospective questions to reconstruct the situation before the intervention. Furthermore, in order to account for general changes in the local economic environment, we examine regional agricultural market development over time. The results show that the establishment of IZs leads to the creation of new firms, but for existing firms that relocated to the IZs the effects on firm performance are negative.
    Keywords: Project evaluation; firm clustering; micro-enterprises
    JEL: O14 O22 L69
    Date: 2013–03
  13. By: Sephorah Mangin (Becker-Friedman Institute, University of Chicago)
    Abstract: This paper develops microfoundations for a unified aggregate production function. Labor market frictions are naturally built into the aggregate production function because matching and production are two aspects of a single process. Entrepreneurs with heterogeneous productivity levels hire capital and compete for workers. If no entrepreneurs approach a given worker he is unemployed, otherwise the entrepreneur with the highest productivity hires the worker. The model provides new insights into the behavior of factor shares. If the entrepreneurs' productivity distribution is Pareto, the aggregate production function is Cobb-Douglas only in the limit as frictional unemployment disappears. In this limiting case, factors are paid their marginal product and factor shares are constant. Outside this limit, factor shares are not generally constant, enabling us to examine their behavior. A key prediction of the model is that labor's share is counter-cyclical provided that workers' outside option is sufficiently high.
    Date: 2012
  14. By: Andrea-Rosalinde Hofer; Jonathan Potter; Dana Redford; Jakob Stolt
    Abstract: This report presents the findings of a review of current strategies and practices in entrepreneurship support provision at the University of Applied Sciences Schmalkalden. The report also presents a selection of international learning models with the aim of providing inspiration for new approaches at the University of Applied Sciences Schmalkalden. The following questions have been investigated: What are current strategies and practices in university entrepreneurship support? How accessible is entrepreneurship support for students and graduates? How well is the university entrepreneurship support integrated into the wider local entrepreneurship support system? The report presents achievements and challenges in light of the above questions and advances recommendations for future action.
    Date: 2013–04–03
  15. By: Andrea-Rosalinde Hofer; Jonathan Potter; Dana Redford; Jakob Stolt
    Abstract: This report presents the findings of a review of current strategies and practices in entrepreneurship support provision at the Technical University Ilmenau. The report also presents a selection of international learning models with the aim of providing inspiration for new approaches at the Technical University Ilmenau.
    Date: 2013–04–03
  16. By: Andrea-Rosalinde Hofer; Jonathan Potter; Dana Redford; Jakob Stolt
    Abstract: The FH Brandenburg is a relatively young university for applied sciences and plays a role in supporting regional development. While it has three departments: Engineering, Informatics and Media, and Business and Management, the FH Brandenburg specialises in Informatics and Business Informatics and has special study programmes in Security management, Medical informatics and Energy efficiency.
    Date: 2013–04–03
  17. By: Raphaël Suire (University of Rennes 1 - CREM UMR CNRS 6211 - Institute for Digital Economics, Competition and Innovation (IDEC))
    Abstract: A third‐place (Oldenburg, 1991) is a place, most of time urban place, which is not exactly neither an office nor a home. This place is mainly dedicated to individual social capital building and relational asset production. Bars, cafe, airport or any public or private places with WiFI hot spot are third-­‐places. In the line of this seminal definition, a co-­‐ working place is a third-­‐place with some strong specificities dedicated to entrepreneurship and innovation that we would like to address in this paper.These places have emerged mainly in digital cities or cities with a technological or digital industrial sector. One of the raison d’être of this place is above all to help structuring epistemic community as well as give support to market and social innovation. Especially in France, local initiatives of this sort are burgeoning around “Cantine” (Canteen) and “network of Canteens”2 and the main issue of this chapter is to understand how these local initiatives around co-working places can help territory to enhance their market innovative capabilities and its disruptive and collective innovation potential. Having that in mind we suggest that a co-­‐working place can under specific condition reinforce a conformism lead to lock-­‐in situation whereas creativity and disruptive innovation are maximize under very specific structural configuration. Consequently, we suggest some good local public practices.
    Keywords: Innovation, third-place
    Date: 2013–01

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