nep-ent New Economics Papers
on Entrepreneurship
Issue of 2014‒03‒15
nine papers chosen by
Marcus Dejardin
University of Namur and Universite' Catholique de Louvain

  1. Cultures of Female Entrepreneurship By Foreman-Peck, James; Zhou, Peng
  2. Economic Crisis and Female Entrepreneurship: Evidence from Countries in Eastern Europe and Central Asia By Saumik Paul; Vengadeshvaran Sarma
  3. Aggregate Costs of Gender Gaps in the Labor Market: A Quantitative Estimate By Marc Teignier; David Cuberes
  4. Waste, Recycling and Entrepreneurship in Central and Northern Europe, 1870-1940 By Geoffrey G. Jones; Andrew Spadafora
  5. Non-Farm Entrepreneurship in Rural Africa: Patterns and Determinants By Nagler, Paula; Naudé, Wim
  7. Evaluation of Small Business Innovation Research Programs in Japan By Inoue, Hiroyasu; Yamaguchi, Eiichi
  8. SME Financing in Japan during the Global Financial Crisis: Evidence from Firm Surveys By Ono, Arito; Uesugi, Iichiro
  9. Revealing the Preferences of Social Financiers By Christoph Starke; Steffen Burchhardt

  1. By: Foreman-Peck, James (Cardiff Business School); Zhou, Peng (Cardiff Business School)
    Abstract: The present research shows how entrepreneurial culture contributes to the widely noted difference in entrepreneurial propensities between men and women. The consequences of the assumed differential importance of household and family generate testable hypotheses about the gender effects of entrepreneurial culture. The principal hypothesis is that there is a greater chance of females in ‘unentrepreneurial’ cultures being relatively entrepreneurial compared to males. Also women from different entrepreneurial cultures show greater similarity of behaviour (lower variance) than men. But proportionate gender gaps within entrepreneurial cultures are less than those between males of different cultures. These hypotheses are tested on US immigrant data from the 2000 census and are not rejected.
    Keywords: Entrepreneurship; Culture; Gender; Migrants
    JEL: D01 J15 J23 J61 J16
    Date: 2014–01
  2. By: Saumik Paul; Vengadeshvaran Sarma
    Abstract: Building on the theory of necessity entrepreneurship, we test whether female entrepreneurship was a part of the household coping mechanism facing the recent global crisis across 30 transition countries centered in Eastern Europe and Central Asia. The identification strategy relies on the self-reported crisis victimization indicators at the household level. Main findings indicate that female members from crisis-affected households are more willing to become entrepreneurs and have initiated firms at a significantly higher rate since 2007. The estimated outcomes are particularly critical for male headed households with propensity score matching and doubly robust tests supporting the main findings. We also find that prior entrepreneurial activity at the household level, acts as a catalyst for such female necessity entrepreneurship. Overall, the findings suggest that crisis perhaps worked as a contextual factor contributing to the creation of necessary entrepreneurship among women.
    Keywords: Female Entrepreneurship; Economic Crisis; Eastern Europe and Central Asia
  3. By: Marc Teignier (Facultat d'Economia i Empresa; Universitat de Barcelona (UB)); David Cuberes (University of Sheffield)
    Abstract: This paper examines the quantitative effects of gender gaps in entrepreneurship and labor force participation on aggregate productivity and income per capita. We simulate an occupational choice model with heterogeneous agents in entrepreneurial ability, where agents choose to be workers, self-employed or employers. The model assumes that men and women have the same talent distribution, but we impose several frictions on women's opportunities and pay in the labor market. In particular, we restrict the fraction of women participating in the labor market. Moreover, we limit the number of women who can work as employers or as self-employed and, finally, women who become workers receive a lower wage. Our model shows that gender gaps in entrepreneurship and in female workers' pay affect aggregate productivity negatively, while gender gaps in labor force participation reduce income per capita. Specifically, if all women are excluded from entrepreneurship, average output per worker drops by almost 12% because the average talent of entrepreneurs falls down, while if all women are excluded from the labor force income per capita is reduced by almost 40%. In the cross-country analysis, we find that gender gaps and their implied income losses differ importantly across geographical regions, with a total income loss of 27% in Middle East and North Africa and a 10% loss in Europe.
    Keywords: Span of control, Aggregate productivity, Entrepreneurship talent, Gender inequality
    JEL: E2 J21 J24 O40
    Date: 2014
  4. By: Geoffrey G. Jones (Harvard Business School, General Management Unit); Andrew Spadafora (Harvard Business School)
    Abstract: This working paper examines the role of entrepreneurs in the municipal solid waste industry in industrialized central and northern Europe from the late nineteenth century to the 1940s. It explores the emergence of numerous German, Danish and other European entrepreneurial firms explicitly devoted to making a profitable business out of conserving and returning valuable resources to productive use, while maintaining public sanitation and in many cases offering nascent environmental protections. These ventures were qualitatively different from both earlier small-scale private waste traders, and the late twentieth-century integrated waste management firms, and have been neglected in an era that historians have treated as a period of municipalization. These entrepreneurs sometimes had strikingly modern views of environmental challenges and the need to overcome them. They initiated processes for sorting and recycling waste materials that are still employed today. Yet it proved difficult to combine making profits and achieving social value in accordance with the "shared value" model of today. As providers of public goods such as health and sanitation and a cleaner environment the entrepreneurs were often unable to capture sufficient profits to sustain businesses. Recycled-goods markets were volatile. There was also a tension between the constant waste stream on the collection side and a seasonal/cyclical demand for recycled products. The frequent failure of these businesses helps to explain why in more recent decades private waste companies have been associated with late entry into recycling, often trailing municipal governments and non-profit entities.
    Keywords: Environmental Entrepreneurship, business history;
    Date: 2014–03
  5. By: Nagler, Paula (Maastricht University); Naudé, Wim (Maastricht School of Management)
    Abstract: We are the first to provide a comparative empirical analysis of non-farm entrepreneurship in rural Africa, using the World Bank's unique LSMSISA dataset. This dataset covers six countries over the period 2005 to 2012. We find that rural enterprises tend to be small, informal household enterprises that provide predominantly goods and services to the local economy, and operate intermittently due to seasonality in farming. We furthermore establish that the likelihood of operating an off-farm enterprise depends on individual capabilities, household characteristics and institutional factors. While the results of some variables show consistency across the sample, we also find much heterogeneity, suggesting that rural entrepreneurship is also a response to country-level circumstances and policies. Although more than 50 years have passed since rural development was identified as a priority for African countries, rural entrepreneurship continues to fulfill mainly a risk-diversifying role. This may suggest that policies to foster effective rural-urban migration and wage employment in rural areas, have largely failed in Africa.
    Keywords: entrepreneurship, rural development, Sub-Saharan Africa, informal sector, labour markets, small business, SMEs
    JEL: Q12 O13 O55 M13 J43
    Date: 2014–02
    Date: 2014
  7. By: Inoue, Hiroyasu; Yamaguchi, Eiichi
    Abstract: Subsidizing small high-technology firms is now considered to be important in stimulating economies throughout the world. This is because fast growing small firms create new markets and jobs. The Small Business Innovation Research (SBIR) program has played an important role in the United States in subsidization providing two billion dollars every year. Japan started its own SBIR program inspired by that in the United States. This paper examines the direct effects of Japan's SBIR program through the attributes of firms. First, we compared the changes in sales, employment, and the number of patents between SBIR awardees and matching firms. However, SBIR awardees did not demonstrate better performance in sales or employment. Therefore, it seems that the direct effect of Japan's SBIR program has not produced positive results. However, it did increase the number of patents. Second, we examined the overall results by using regression models. Even with control variables, these results were unchanged. Therefore, we concluded that the results were robust.
    Keywords: Small business, Research policy, Innovation, SBIR, Japan
    JEL: O2 O3
    Date: 2014–02–24
  8. By: Ono, Arito; Uesugi, Iichiro
    Abstract: Employing data from a unique firm survey, this article examines small and medium-sized enterprise (SME) financing in Japan during the global financial crisis. The major findings of the article are two-fold. First, in terms of credit availability, loans extended by main banks were the “first line of defense” for most Japanese SMEs to deal with the crisis. In contrast, the role of trade credit provided by firms’ main suppliers was relatively limited. The Emergency Credit Guarantees (ECG) program introduced by the government in response to the crisis also helped to increase credit availability. Second, in terms of firms’ ex-post performance, loans extended by firms’ main bank and loans backed by government policy measures did not have any measurable impact. While the average profitability of firms that received these loans deteriorated more than that of firms that did not in 2009, the difference between these two groups vanished after 2010.
    Keywords: SME financing, main bank, trade credit, credit guarantees
    JEL: G21 G28 G30 G38
    Date: 2014–02
  9. By: Christoph Starke (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg); Steffen Burchhardt (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg)
    Abstract: Financiers of social entrepreneurs are typically characterized as having some form of prosocial or CSR related objective. While in some studies such objectives have been formulated on an analytically inconvenient level, other contributions are limited only to charity finance. In this paper we identify Fehr and Schmidt’s inequality aversion as an analytically tractable and most basic motivation of social financiers in general. Specifically, we show that the financiers’ decision structures and their observable behavior coincide with the experimental findings of Fehr and Schmidt (1999). Moreover, we derive behavioral implications for social entrepreneurs. Paradoxically, given that financiers do not prefer a self-consumption of the social service, they contribute more if the entrepreneur provides them nevertheless.
    Keywords: inequality aversion, social entrepreneurship, financier, public good, social service
    JEL: D03 D31 L26 L31
    Date: 2014–02

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