nep-ent New Economics Papers
on Entrepreneurship
Issue of 2015‒08‒25
seven papers chosen by
Marcus Dejardin
Université de Namur

  1. Stunted growth : why don't African firms create more jobs ? By Iacovone,Leonardo; Ramachandran,Vijaya; Schmidt,Martin
  2. Identifying and spurring high-growth entrepreneurship : experimental evidence from a business plan competition By Mckenzie,David J.
  3. Basel III and SME access to credit : Evidence from France By Thomas Humblot
  4. Imaging the future of entrepreneurship education: scenarios building as shuttles to the future. By Fabienne Bornard; Caroline Verzat; Chrystelle Gaujard
  5. An Inquiry into the Epistemic Properties of Entrepreneurs' Theories of Action By Fabrice Cavarretta; Nathan Furr
  6. Transfer of Know-how for SMEs in Georgia, Moldova and Ukraine. White Paper: Moldova By Magdolna Sass; Oliver Kovacs; Lidis Garbovan; Renata Anna Jaksa

  1. By: Iacovone,Leonardo; Ramachandran,Vijaya; Schmidt,Martin
    Abstract: Many countries in Africa suffer high rates of underemployment or low rates of productive employment; many also anticipate large numbers of people to enter the workforce in the near future. This paper asks the question: Are African firms creating fewer jobs than those located elsewhere? And, if so, why? One reason may be that weak business environments slow the growth of firms and distort the allocation of resources away from better-performing firms, hence reducing their potential for job creation. The paper uses data from 41,000 firms across 119 countries to examine the drivers of firm growth, with a special focus on African firms. African firms, at any age, tend to be 20-24 percent smaller than firms in other regions of the world. The poor business environment, driven by limited access to finance, and the lack of availability of electricity, land, and unskilled labor have some value in explaining this difference. Foreign ownership, the export status of the firm, and the size of the market are also significant determinants of firm size. However, even after controlling for the business environment and for characteristics of firms and markets, about 60 percent of the size gap between African and non-African firms remains unexplained.
    Keywords: Labor Policies,E-Business,Environmental Economics&Policies,Small Scale Enterprise,Microfinance
    Date: 2013–12–01
  2. By: Mckenzie,David J.
    Abstract: Almost all firms in developing countries have fewer than 10 workers, with the modal firm consisting of just the owner. Are there potential high-growth entrepreneurs with the ability to grow their firms beyond this size? And, if so, can public policy help alleviate the constraints that prevent these entrepreneurs from doing so? A large-scale national business plan competition in Nigeria is used to help provide evidence on these two questions. The competition was launched with much fanfare, and attracted almost 24,000 entrants. Random assignment was used to select some of the winners from a pool of semi-finalists, with US$36 million in randomly allocated grant funding providing each winner with an average of almost US$50,000. Surveys tracking applicants over three years show that winning the business plan competition leads to greater firm entry, higher survival of existing businesses, higher profits and sales, and higher employment, including increases of over 20 percentage points in the likelihood of a firm having 10 or more workers. These effects appear to occur largely through the grants enabling firms to purchase more capital and hire more labor.
    Keywords: E-Business,Business Environment,Microfinance,Competitiveness and Competition Policy,Business in Development
    Date: 2015–08–12
  3. By: Thomas Humblot (Larefi - Laboratoire d'analyse et de recherche en économie et finance internationales - Université Montesquieu - Bordeaux 4)
    Abstract: This paper investigates Basel III potential effects on SME access to bank credit. In an innovative empirical framework, French small firms are studied using microdata over the 2008-2013 periods. We conclude that the new regulation will have an M-shaped impact. Eventually, Basel III eliminates low profitable exposures regardless of their regulatory charge alleviations, restricts risky positions despite of their profitability and digs SME funding gap. Only regulatory adjusted dominant risk/return profiles are funded. On average, no reduction in credit matu-rity nor in volume is observable. The overall effect ultimately depends on banks' initial position.
    Date: 2014
  4. By: Fabienne Bornard (INSEEC, CRE-EM Lyon - CRE EM Lyon); Caroline Verzat (Novancia - Novancia); Chrystelle Gaujard (école HEI Lille)
    Abstract: Our contribution tries to analyze a course framework for future entrepreneurs. Transmissive pedagogies don’t work at all for developing an entrepreneurial mindset (Honig, 2004, Neck & Greeene, 2011, Sarasvathy & Venkataraman, 2010). We decided to use scenario building traditionally used for strategy (Boaventura & Fishman, 2008) on the one hand for co-elaborating new strategies for entrepreneurship education and on the other hand for the development of creative imagination (Csikszentmihalyi, 1996, Nyström, 1993, Fillis & Rentschler, 2005) of all stakeholders: students, teachers and entrepreneurs. We trace a path from critical reflective analysis (Mezirow, 1991) of existing higher education institutions and their educational practices to pedagogical refoundation (Fayolle, 2013). Our contribution addresses 4 subjects : strategy, process, learning outcomes and stands of all stakeholders.
    Date: 2014–10–23
  5. By: Fabrice Cavarretta (Management Department - Essec Business School); Nathan Furr (Brigham Young University)
    Abstract: Boundedly rational managerial actors struggling to process information often use a limited set of “theories of action,” or simple rules. However, simple rules may have a hierarchical structure, with some simple rules guiding others. Assuming the existence of such “keystone rules,” we establish the complexity of determining an efficient set, and therefore the necessity of using meta-heuristic approaches. We explore the development of “keystone rules” among entrepreneurs as a genetic algorithm, where the computationally hard problem of picking rules is solved by social calculation. We find that the emergent keystone rules among the observed entrepreneurs do not match existing “scientific” theories but have particular epistemic properties. The identification of keystone rules could fill a theoretical gap between the rational decision and the social construction perspectives.
    Date: 2014
  6. By: Magdolna Sass; Oliver Kovacs; Lidis Garbovan; Renata Anna Jaksa
    Abstract: The report focuses on the potential of the development of small and mid-size businesses in Moldova. It provides an economic overview of the country, and then analyzes various best practices and lessons learned from the development of SMEs in the Visegrad countries, especially Hungary. The report provides a description of economic developments, main trade figures, relevant labor developments, migration and the role of remittances and defines the bottlenecks for SME development in the country. The authors built their analysis on available literature and statistics as well as their own survey and interview series. The study highlights six case studies relevant for SME development selected for deeper investigation such as simplified tax schemes, online tax reporting, entrepreneurship education, agriculture and producers’ organizations, the wine industry and issues of measurement of the SME sector. Finally the report draws up potential intervention schemes for Moldovan stakeholders and provides further recommendations for longer term initiatives and actions taken for the support of economic and SME development.
    Keywords: SME development, economic development, Moldova, Visegrad countries
    JEL: L25 H2 J6 O2 Q1
    Date: 2015
  7. By: Francesco Quatraro (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS - UNS - Université Nice Sophia Antipolis); Marco Vivarelli (Università Cattolica del Sacro Cuore - Facoltà di Scienze bancarie, finanziarie e assicurative - Università Cattolica del Sacro Cuore di Milano)
    Abstract: The aim of this paper is to provide an updated survey of the "state of the art" in entrepreneurial studies, with a particular focus on developing countries (DCs). In particular, the same concept of "entrepreneurship" will be critically discussed, then moving to the institutional, macroeconomic and microeconomic conditions affecting the entry of new firms and the post-entry performance of newborn firms.
    Date: 2014–11–04

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