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on Entrepreneurship |
| By: | Elert, Niklas (Research Institute of Industrial Economics (IFN)); Henrekson, Magnus (Research Institute of Industrial Economics (IFN)); Stenkula, Mikael (Research Institute of Industrial Economics (IFN)) |
| Abstract: | It is imperative that the economies of the European Union become more entrepreneurial to promote innovation and economic growth. To achieve these goals, we propose a reform strategy with respect to (i) the rule of law and the protection of property rights; (ii) the tax system; (iii) regulations governing savings, capital and finance; (iv) the organization of labor markets and social insurance systems; (v) regulations governing goods and service markets; (vi) regulations governing bankruptcy and insolvency; (vii) R&D, commercialization and knowledge spillovers; (viii) human capital investments; and (ix) informal institutions. Overall, the proposed institutional changes move in a liberalizing direction; however, one-size-fits-all policy reforms aimed at freer markets will not necessarily be successful. Instead, a successful reform strategy must consider country differences that affect the viability of reform without abandoning the long-term goal of institutional liberalization to promote entrepreneurship, innovation and growth |
| Keywords: | Entrepreneurship; European Union; Innovation; Institutions; Policy reform; Regulation; Self-employment |
| JEL: | L26 L50 M13 O31 P14 |
| Date: | 2017–01–26 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1150&r=ent |
| By: | Barirani, Ahmad (Copenhagen Business School); Sloof, Randolph (University of Amsterdam); van Praag, Mirjam C. (Copenhagen Business School) |
| Abstract: | We test the hypothesis, based on popular and theoretical perspectives, that entrepreneurs are more action-oriented than other occupational groups. We compare their playing strategies in an optimal stopping game using a randomized online experiment among 100s of entrepreneurs, managers and employees. Our experimental results show that entrepreneurs are indeed more action-oriented than others. We theorize that this is driven by their lower levels of loss aversion and higher levels of curiosity. Our empirical test results show that (i) entrepreneurs score indeed higher, on average, than managers and employees on curiosity and lower on loss aversion; (ii) the difference in action-orientedness between entrepreneurs and others vanishes when controlling for individual curiosity levels and (iii) an alternative treatment that provides subjects with counterfactual information (about what would have happened in case of stopping) increases their willingness to stop. Under some assumptions, the combination of these results leads to the conclusion that the higher action-orientedness of entrepreneurs can be linked to their greater curiosity, but not to their lower level of loss aversion. Hence, we find support for the intuitive idea that (curiosity driven) action-orientedness enhances the identification and/or exploitation of opportunities. |
| Keywords: | entrepreneurs, managers, employees, inaction, curiosity, loss aversion, lab-in-the field experiment |
| JEL: | L26 C93 D03 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10498&r=ent |
| By: | Colombelli, Alessandra; D'Ambrosio, Anna; Meliciani, Valentina; Francesco Quatraro, (University of Turin) |
| Abstract: | We investigate the determinants of the sectoral variety of newborn firms in different regional contexts. Based on the knowledge spillovers theory of entrepreneurship, we study the role of different dimension of knowledge variety, i.e. technological diversity and cultural diversity. This latter is measured with respect to the nationality of both foreign residents and foreign entrepreneurs. We use a unique dataset stemming from the combination of different sources of information. The results confirm that all the dimensions of knowledge variety are relevant in shaping the sectoral variety of newborn firms and point to the differential contribution of immigrant entrepreneurs in fostering the sectoral diversification in unrelated activities. |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:uto:labeco:201606&r=ent |
| By: | Paul A. Gompers; Sophie Q. Wang |
| Abstract: | In this paper we document the patterns of labor market participation by women and ethnic minorities in venture capital firms and as founders of venture capital-backed startups. We show that from 1990-2016 women have been less than 10% of the entrepreneurial and venture capital labor pool, Hispanics have been around 2%, and African Americans have been less than 1%. This is despite the fact that all three groups have much higher representation in education programs that lead to careers in these sectors as well as having higher representation in other highly-compensated professions. Asians, on the other hand, have much higher representation in the venture capital and entrepreneurial sector than their overall percentages in the labor force. We explore potential supply side explanations including both education attainment as well as relevant prior job experience. We also explore the correlation between diversity and state-level variations. Finally, we discuss how these patterns are consistent with homophily-based hiring and homophily-induced information flows about career choices. We end the paper by discussing areas for future research. |
| JEL: | G2 G24 G3 J01 J11 J16 J24 J7 O15 O3 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:23082&r=ent |
| By: | Thomadakis, Apostolos |
| Abstract: | Venture capital can be a lifeline to innovative and growth-oriented start-ups and small businesses in need of external capital. In this ECMI Research Report, the author argues that the recently proposed changes to the Regulation on European Venture Capital Funds (EuVECA) fail to address three important issues that could further boost financing: the extension of the EuVECA Regulation to third-country managers, the reduction of the €100,000 entry ticket, without further compromises on investor protection, and the harmonisation of rules on managing requirements. He proposes a number of measures that could facilitate access to financing for start-ups and SMEs. |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:eps:ecmiwp:12022&r=ent |
| By: | Laura Barbieri (Dipartimento di Scienze Economiche e Sociali, Università Cattolica); Mariacristina Piva (Dipartimento di Scienze Economiche e Sociali, Università Cattolica); Marco Vivarelli (Istituto di Politica Economica, Università Cattolica) |
| Abstract: | This paper explores the employment impact of innovation activity, taking into account both R&D expenditures and embodied technological change (ETC). We use a novel panel dataset covering 265 innovative Italian firms over the period 1998-2010. The main outcome from the proposed fixed effect estimations is a labor-friendly nature of total innovation expenditures; however, this positive effect is barely significant when the sole in-house R&D expenditures are considered and fades away when ETC is included as a proxy for innovation activities. Moreover, the positive employment impacts of innovation activities and R&D expenditures are totally due to firms operating in high-tech industries and large companies, while no job-creation due to technical change is detectable in traditional sectors and SMEs. |
| Keywords: | Technology, innovation, R&D, embodied technological change, employment |
| JEL: | O31 O33 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:ctc:serie2:dises1620&r=ent |
| By: | Saul Estrin; Tomasz Mickiewicz; Anna Rebmann |
| Abstract: | We apply prospect theory to explain how personal and corporate bankruptcy laws affect risk perceptions of entrepreneurs at time of entry and therefore their growth ambitions. Previous theories have reached ambiguous conclusions as to whether countries with more debtor-friendly bankruptcy laws (i.e. laws that are more forgiving towards debtors in bankruptcy proceedings) are likely to have more entrepreneurs, or whether, creditor-friendly regimes have positive effects on new ventures via enhanced incentives for the supply of credit to entrepreneurs. Responding to this ambiguity, we apply prospect theory to propose that entrepreneurs do not attach the same significance to different elements of bankruptcy codes—and to explain which aspects of debtor-friendly bankruptcy laws matter more to entrepreneurs. Based on this, we derive and confirm hypotheses about the impact of aspects of bankruptcy codes on entrepreneurial activity using the Global Entrepreneurship Monitor combined with data on both personal and corporate bankruptcy regulations for 15 developed OECD countries. We use multilevel random coefficient logistic regressions to take account of the hierarchical nature of the data (country and individual levels). Because entrepreneurs and creditors are sensitive to different elements of the codes, there is scope for optimisation of the legal design of bankruptcy law to achieve both an adequate supply of credit and to encourage high-ambition entrepreneurship. |
| Keywords: | Entrepreneurship;High-aspiration entrepreneurship; Bankruptcy; Global entrepreneurship monitor |
| JEL: | K22 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:68997&r=ent |
| By: | Nguyen, Huu Chi (University of Paris 13); Nordman, Christophe Jalil (IRD, DIAL, Paris-Dauphine) |
| Abstract: | Using a unique panel of household businesses for Vietnam, this paper sheds light on the links between households' and entrepreneurs' social networks and business performance. We address two related questions. One first question asks if we can find evidence of a differentiated effect of employment of members of the family versus hired workers on the business performance. A second question tackles the respective effects of various dimensions of social networks on the business technical efficiency. The hypothesis is that, beyond the channel of labour productivity, entrepreneurs that are confronted with an unfavourable social environment may produce less efficiently and realize a lower output than what could be possible with the same amount of resources. We find evidence of a marginal productivity differential between family and hired labour and highlight results consistent with the presence of adverse social network effects faced by households running a business, in particular ethnic minorities. We stress the importance of professional networks for successful entrepreneurship. |
| Keywords: | family labour, kinship and ethnic ties, sharing norms, social network capital, Informality, household business, panel, Vietnam |
| JEL: | D13 D61 O12 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10482&r=ent |
| By: | Bergner, Sören Martin; Bräutigam, Rainer; Evers, Maria Theresia; Spengel, Christoph |
| Abstract: | This paper discusses the impact and the appropriateness of tax incentives for small and medium-sized enterprises (SMEs) in the European Union. First, we provide a survey of implemented tax incentives specifically targeted at SMEs in the 28 EU Member States. Building hereon, we measure the impact of these regimes on the effective tax burdens of targeted companies. We find that SME tax incentives are a commonly used measure among European policy makers. The vast majority of regimes, however, only marginally reduce the tax liability of SMEs. If major reliefs are available, they mostly stem from special tax rates whereas tax credits and special allowance play a minor role. In the second main part of the analysis, we examine the arguments potentially justifying the usage of SME tax incentives. As a main result, small firms per se do not create more jobs and innovations nor do they face insurmountable financing constraints. The existence of market failures commonly associated with SMEs - and possibly warranting the use of SME tax incentives - can therefore not be confirmed. Instead, disproportionate tax compliance costs for small entities constitute the most compelling argument for a special tax treatment. These compliance costs can most appropriately be addressed by administrative reliefs. Special tax rates, tax credits and allowances, in contrast, are not only inefficient but also ineffective in this regard. Instead of improving the neutrality of the overall tax system, the latter are likely to add further distortions and unnecessary complexity. Altogether, the focus of policy-makers should thus shift from providing discriminatory incentives to the design of a generally neutral and simple tax system, which would benefit small as well as large enterprises. |
| Keywords: | SME,Tax Policy,European Union |
| JEL: | H24 H25 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:17006&r=ent |
| By: | Llanto, Gilberto M.; del Prado, Fatima Lourdes E. |
| Abstract: | Aside from physical capital and human resource, private firms are also advised to invest in innovations to be more productive and profitable. However, it is important to ensure such investment is well-spent. This study found that product and process innovations do lead to increase in sales and profits, and improve labor productivity. It also showed that firm size, age, and foreign equity are important factors leading firms to innovate. |
| Keywords: | Philippines, innovation, small and medium enterprises, process innovation, firm performance, product innovation, SMEs |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:phd:rpseri:rps_2016-02&r=ent |
| By: | Stevenson, Marcie; Artz, Georgeanne |
| Abstract: | Economic studies of firm survival suggest that capital acquisition and asset fixity are some of the biggest challenges facing start-up firms today, especially in rural areas. The Value-Added Producer Grant (VAPG) program was established by USDA’s Rural Business-Cooperative Service in 2001 to help independent producers and similar organizations develop value-added agricultural businesses, many of which are located in rural areas. Utilizing information on Value-Added Producer Grant recipients from 2001 to 2011 in Iowa and North Carolina coupled with National Establishment Time-Series data from 1990 to 2011, we use survival analysis to estimate the effects of a VAPG on firm survival. Recipients are matched with firms in the same industry and state, starting in the same year, who did not receive VAPG funding to estimate the effect of the grant on firm survival. Preliminary results suggest that, after controlling for other characteristics than affect firms survival, receiving a VAPG had a positive and significant impact on firm survival length. For start-up firms, preliminary estimates suggest that survival times are nearly doubled. For more established firms (those that were in business at least three years before receiving a grant), the effects are larger, with survival times increasing 6 times for recipient firms. |
| Keywords: | Agribusiness, Community/Rural/Urban Development, |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:ags:saea17:252785&r=ent |
| By: | KANI Masayo; MOTOHASHI Kazuyuki |
| Abstract: | This paper provides empirical analyses to understand the management of external technology sourcing using a novel dataset of new product development (NPD) projects in Japanese firms and focusing on the difference between bilateral and unilateral contract-based alliances. External technology sourcing takes various forms that can be divided into two categories: bilateral alliances, such as joint research and development (R&D), and unilateral alliances, such as licensing and commissioned R&D. The former style involves the dynamic process of joint R&D with a partner, whereas the latter involves the straightforward process of technology acquisition from a partner. In the first analysis in this paper, the determinants of the sourcing strategy for each contract type are investigated, and we find that bilateral contracts are more often used for exploratory projects, whereas in-house development is more often used for exploitation projects. Unilateral contracts are more relevant for projects mitigating contractual hazards. The second analysis looks into the relationship between the type of technology sourcing and its performance. We find that bilateral contract-based technology sourcing is more likely to lead to novel innovation than in-house development, but this difference in performance disappears when controlling for the type of NPD project and the firm's managerial resources. |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:16104&r=ent |
| By: | Cagla Okten |
| Keywords: | Finance and Financial Sector Development - Microfinance Private Sector Development - Small and Medium Size Enterprises Gender - Gender and Development Social Protections and Labor - Labor Markets Poverty Reduction - Inequality |
| Date: | 2015–12 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:25410&r=ent |
| By: | Holz, Michael; Nielen, Sebastian; Paschke, Max; Schröder, Christian; Wolter, Hans-Jürgen |
| Abstract: | Die vorliegende Studie untersucht mit Hilfe theoretischer Analysen und vertiefender Exper-teninterviews, welche Herausforderungen und Chancen für mittelständische Unternehmen mit der Mitwirkung in (globalen) Wertschöpfungsketten verbunden sind. In Wertschöpfungsketten mit hohem Wettbewerbsdruck üben börsennotierte Endhersteller häufig einen hohen Kostensenkungs- und Innovationsdruck aus und diktieren den Zulieferern ihre Bedingungen. Demgegenüber legen mittelständische Endhersteller mehr Wert auf fairen Dialog und Interessenausgleich. Zur Reduzierung von Abhängigkeiten und Machtasymmetrien können Zulieferer verschiedene Upgrading-Strategien verfolgen, darunter eine kontinuierliche Innovationsorientierung sowie die verstärkte Produktion von modular aufgebauten Produkten. In mehreren Zulieferbranchen lassen sich Konzentrationstendenzen beobachten, die u. a. durch einen hohen Internationalisierungsdruck verursacht werden. |
| Keywords: | Globale Wertschöpfungsketten,Globale Vernetzung,KMU,Mittelstand,Global Value Chains,Global Networks,SMEs,German Mittelstand |
| JEL: | F61 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifmmat:252&r=ent |
| By: | Dobrin, Kirill (Russian Presidential Academy of National Economy and Public Administration- Stolypin Volga Region Institute of administration); Davydenkova, Anastasia (Russian Presidential Academy of National Economy and Public Administration- Stolypin Volga Region Institute of administration); Zakharova, Irina (Russian Presidential Academy of National Economy and Public Administration- Stolypin Volga Region Institute of administration) |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:ppaper:p16101&r=ent |