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on Entrepreneurship |
| By: | SUZUKI, Shinya; OKAMURO, Hiroyuki |
| Abstract: | This study explores the determinants of orientation toward international business expansion by academic startups, focusing on their technological capabilities, availability of public support, regional characteristics of their location, and research standards of their parent universities. Based on unique survey data of 457 academic startups in Japan and by estimating an ordered logit model, we find that academic startups are strongly oriented toward expanding its business internationally if they have high technological capabilities, received public support, are established in locations with a high ratio of exporting small firms, or are affiliated with a parent university with an excellent level of research. |
| Keywords: | Academic startups, international business expansion, public support |
| Date: | 2015–03 |
| URL: | http://d.repec.org/n?u=RePEc:hit:ccesdp:55&r=ent |
| By: | Frank M. Fossen; Johannes König |
| Abstract: | We estimate the impact of a differential treatment of paid employees versus self-employed workers in a public health insurance system on the entry rate into entrepreneurship. In Germany, the public health insurance system is mandatory for most paid employees, but not for the self-employed, who usually buy private health insurance. Private health insurance contributions are relatively low for the young and healthy, and until 2013 also for males, but less attractive at the other ends of these dimensions and if membership in the public health insurance system allows other family members to be covered by contribution-free family insurance. Therefore, the health insurance system can create incentives or disincentives to starting up a business depending on the family’s situation and health. We estimate a discrete time hazard rate model of entrepreneurial entry based on representative household panel data for Germany, which include personal health information, and we account for non-random sample selection. We estimate that an increase in the health insurance cost differential between self-employed workers and paid employees by 100 euro per month decreases the annual probability of entry into self-employment by 0.38 percentage points, i.e. about a third of the average annual entry rate. The results show that the phenomenon of entrepreneurship lock, which an emerging literature describes for the system of employer provided health insurance in the USA, can also occur in a public health insurance system. Therefore, entrepreneurial activity should be taken into account when discussing potential health care reforms, not only in the USA and in Germany. |
| Keywords: | Health insurance, entrepreneurship lock, self-employment |
| JEL: | L26 I13 J2 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp733&r=ent |
| By: | Åstebro, Thomas (HEC Paris); Tåg, Joacim (Research Institute of Industrial Economics (IFN)) |
| Abstract: | Recent research has shown that entrepreneurs who start incorporated firms are fundamentally different from entrepreneurs who start sole proprietorships. This difference suggests that incorporation status may distinguish the self-employed with no ambition to hire from entrepreneurs who plan to hire others.In this paper, we show that this intuition is correct. Using a dataset with over 24 million observations and more than 230,000 entries into entrepreneurship, we show that newly incorporated entrepreneurs create 50% more jobs than sole proprietors. The result derives from the fact that high-ability individuals are more likely to form incorporated ventures. While there is selection from both tails of the ability distribution into starting incorporated ventures – that is, both stars and misfits start corporations – it is primarily individuals with low ability, the misfits, who start sole proprietorships. This does not, however, mean that the aggregate number of jobs created by the incorporated is higher. Since more entrepreneurs in total become sole propri etors, the sole proprietors initially contribute more to aggregate job creation than the incorporated. |
| Keywords: | Entrepreneurship; Incorporation; Job creation; Occupational choice; Self-employment; Stars and misfits |
| JEL: | J24 L26 |
| Date: | 2015–03–06 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1059&r=ent |
| By: | Ayyagari,Meghana; Demirguc-Kunt,Asli; Maksimovic,Vojislav |
| Abstract: | Is it the institutions or firm characteristics at birth that shape startups and their early growth in developing countries? Using comprehensive data from the Indian Annual Survey of Industries this paper addresses this question by studying the early lifecycle of firms across diverse institutional environments of regions in India. It finds that the size and characteristics of a start-up at entry are persistent over the first eight years of a firm's life. However, given these initial conditions at entry, institutions do not have much explanatory power in determining growth. The comparative growth rates of large and small start-ups are not significantly different across states with different local institutions or industries with differing reliance on external finance or need for fixed capital. But institutions, particularly the availability of credit, do have an impact on the initial entry process. Access to external finance is associated with greater overall entry, and also smaller sized entry. The results do not appear to be driven by endogeneity of access to credit or sample selection. The results show that the channel through which institutions affect the relative outcomes of young firms is through the initial distribution of firm characteristics at entry rather than their effect on the performance of the firms post entry. |
| Keywords: | Labor Markets,Labor Policies,Microfinance,Environmental Economics&Policies,Banks&Banking Reform |
| Date: | 2015–03–06 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:7207&r=ent |
| By: | OGAWA Kazuo; TOKUTSU Ichiro |
| Abstract: | This study is an empirical attempt to compare the exporting behavior of small and medium-sized enterprises (SMEs) with large firms from the viewpoints of export market participation decision (extensive margin) and export volume decision (intensive margin), using firm-level panel data. We find that firm size is an important determinant of both extensive margin and intensive margin decision for SMEs as well as large firms. In contrast, productivity affects only the intensive margin of export for both SMEs and large firms. Quantitatively, the contribution of productivity to export volume is much larger for large firms. Financial factors are also important determinants of export. Liquidity reserve has positive effects on the extensive margin of export for SMEs and large firms. Moreover, financial institutions play an important role in supporting the export activities of SMEs. |
| Date: | 2015–03 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:15031&r=ent |
| By: | Dessi, Roberta; Yin, Nina |
| Abstract: | This paper explores a new role for venture capitalists, as knowledge intermediaries. A venture capital investor can communicate valuable knowledge to an entrepreneur, facilitating innovation. The venture capitalist can also communicate the entrepreneur's innovative knowledge to other portfolio companies. We study the costs and benefits of these two forms of knowledge transfer, and their implications for investment, innovation, and product market competition. The model also sheds light on the choice between venture capital and other forms of finance, and the determinants of the decision to seek patent protection for innovations. Our analysis provides a rationale for the use of contingencies (specifically, patent approval) in VC contracts documented by Kaplan and Stromberg (2003), and for recent evidence on patterns of syndication among venture capitalists. |
| Keywords: | venture capital, knowledge intermediaries, contracts, innovation, competition, patents. |
| JEL: | D82 D86 G24 L22 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:29010&r=ent |
| By: | Crespi G.A.; Tacsir E.; Vargas F. (UNU-MERIT) |
| Abstract: | Innovation is fundamental for economic catching-up and raising living standards. Evidence demonstrate a virtuous circle in which RD spending, innovation, productivity, and per capita income mutually reinforce each other and lead to long-term, sustained growth rates and may foster job creation. Previous evidence highlights that Latin America and the Caribbean LAC has great potential to benefit from investment and policies that foster innovation. However, one important limitation of previous research on innovation in LAC is the absence of harmonised and comparable indicators across the different countries. This seriously limits the possibility to infer policy conclusions that are not affected by country specificities with respect to data quality and coverage. Also, most of this research is focused on estimating firm level correlations without attempting to identify market failures or other limitations which harm innovation investment or which could guide policy. In this paper, a wide range of innovation indicators are analysed in order to describe the innovation behaviour of manufacturing firms in LAC using the Enterprise Survey ES database. Our objective is to understand the main characteristics of innovative firms in LAC and to gather new evidence with regard to the nature of the innovation process in the region. In this paper we apply a structural model based on Crepon, Duget and Mairesse 1998, to estimate the determinants of innovation RD and its impact on total factor productivity. We pay special attention to whether there is heterogeneity in the effects of investments in innovation on productivity and whether there is any evidence of spillovers that could guide policy design. We found strong evidence concerning the relationships between innovation input and output, and innovation output and productivity. We found that private returns to innovation depend on the type of innovation, being larger for product than process innovation. Furthermore, we found some evidence that spillovers are stronger in the case of product than process innovation. It was also found that innovation returns are higher for the most productive firms. This increasing relationship between returns and productivity is not consistent with an interpretation that financial constraints cause more harm to low productivity firms. However, it is consistent with alternative interpretations about the lack of innovation opportunities in the case of low productivity firms or that low private returns are the results of poor appropriability. |
| Keywords: | Microeconomic Analyses of Economic Development; Industrialization; Manufacturing and Service Industries; Choice of Technology; Innovation and Invention: Processes and Incentives; Technological Change: Choices and Consequences; Diffusion Processes; Economic Growth and Aggregate Productivity: General; |
| JEL: | O12 O14 O31 O33 O40 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:unm:unumer:2014092&r=ent |