nep-ent New Economics Papers
on Entrepreneurship
Issue of 2021‒01‒11
twelve papers chosen by
Marcus Dejardin
Université de Namur

  1. Amundsen versus Scott: Are growth paths related to firm performance? By Coad, Alex; Daunfeldt, Sven-Olov; Halvarsson, Daniel
  2. Business Dynamics on American Indian Reservations: Evidence from Longitudinal Datasets By Randall Akee; Elton Mykerezi; Richard Todd
  3. Property Values and the Likelihood of Self-Employment By Hansson, Åsa; Kopsch, Fredrik
  4. Business Angels and Firm Performance: First Evidence from Population Data By Andersson, Fredrik W.; Lodefalk, Magnus
  5. The Color of Money: Federal vs. Industry Funding of University Research By Tania Babina; Alex Xi He; Sabrina T. Howell; Elisabeth Ruth Perlman; Joseph Staudt
  6. Place-based SME finance policy and local industrial revivals: An empirical analysis of a directed credit program after WW2 By Takano, Keisuke; Okamuro, Hiroyuki
  7. Local Industry Influence on Commercialization of University Research by University Startups By KANG Byeongwoo; MOTOHASHI Kazuyuki
  8. Fragile, yet resilient: Adaptive decline in a collaboration network of firms By Frank Schweitzer; Giona Casiraghi; Mario V. Tomasello; David Garcia
  9. Eco-inclusive entrepreneurship: Addressing climate change through technological innovation. The case of cleantech industry By Alina Petronela Alexoaei; Raluca Georgiana Robu
  10. Gender and start-up capital for agrifood MSMEs in Indonesia and Viet Nam By Ambler, Kate; de Brauw, Alan; Herskowitz, Sylvan; Murphy, Mike
  11. GIL Top Policy Lessons on Empowering Women Entrepreneurs By World Bank
  12. Capital Markets and SMEs in Emerging Markets and Developing Economies By World Bank Group

  1. By: Coad, Alex (Waseda Business School, Tokyo, Japan); Daunfeldt, Sven-Olov (Institute of Retail Economics (Handelns Forskningsinstitut)); Halvarsson, Daniel (The Ratio Institute, Stockholm)
    Abstract: In the race to the South Pole, Roald Amundsen’s expedition covered an equal distance each day, irrespective of weather conditions, while Scott’s pace was erratic. Amundsen won the race and returned without loss of life, while Scott and his men died. We investigate how firms’ sales growth deviate from the long-run average growth path. Our baseline results suggest that growth path volatility is associated with higher growth of sales and profits, but is also associated with higher exit rates. This is driven by firms with negative growth rates. For positive-growth firms, volatility is negatively associated with both sales growth and survival.
    Keywords: Firm dynamics; Sales growth; Firm exit; Growth paths; Scale-up; Postentry growth
    JEL: D22 L25 L26
    Date: 2020–12–28
  2. By: Randall Akee; Elton Mykerezi; Richard Todd
    Abstract: We use confidential US Census Bureau data to analyze the difference in business establishment dynamics by geographic location on or off of American Indian reservations over the period of the Great Recession, and subsequent recovery (2007-2016). We geocoded U.S. Census Bureau’s Longitudinal Business Database, a dataset with records of all employer business establishments in the U.S. for location in an American Indian Reservation and used it to examine whether there are differences in business establishment survival rates over time by virtue of their location. We find that business establishments located on American Indian reservations have higher survival rates than establishments located in comparable counties. These results are particularly strong for the education, arts and entertainment, wholesale and retail, and public administration industries. While we are not fully able to explain this result, it is consistent with the business establishments being positively selected with respect to survival given the large obstacles necessary to start a business on a reservation in the first place. Alternatively, there may be certain safeguards in a reservation economy that protect business establishments from external economic shocks.
    Keywords: Entrepreneurship, Great Recession, American Indians, Employment, Business Deaths
    Date: 2020–11
  3. By: Hansson, Åsa (Department of Economics, Lund University); Kopsch, Fredrik (Department of Real Estate Science, Lund University)
    Abstract: It is well known that capital constraints can hinder individuals to set up a business. Many business owners rely on own capital or capital from friends, fools and family in order to acquire required capital. In this paper, we study the role property plays for starting a business or becoming self-employed. Specifically, we investigate how property values and changes in property taxes affect the likelihood that an individual is or becomes self-employed using rich Swedish individual panel data. The paper studies the probability that an individual is or becomes self-employed using detailed individual tax return data from Sweden. The property tax reform in 2008 is utilized as a “natural experiment” to analyze whether a lower property tax increased the probability of becoming self-employed. The reform in 2008 lowered the property tax for especially highly assessed property. Hence, the reform is predicted to reduce capital constraints for individuals with highly assessed property. Lower tax payments increase property values and consequently individual wealth, and in addition, increases disposable income as the recurrent yearly tax is reduced. The detailed data also allow us to control for many other important confounding factors. For example, we can control for other financial assets such as accumulated wealth, and capital as well as labor income. Results indicate that once we identify the effect of property value by the tax reform, property value is associated with higher probability of being self-employed but the result for becoming self-employed vanishes.
    Keywords: entrepreneurship; self-employment; property value
    JEL: M13 R33 R38
    Date: 2020–12–10
  4. By: Andersson, Fredrik W.; Lodefalk, Magnus (The Ratio Institute)
    Abstract: Business angels dominate early stage investment in firms but research on the effects of their investment is scarce and limited by sample selection. We therefore propose an algorithm for identifying business angel investment in total population data. We apply the algorithm to study the effects of business angels on firm performance, using detailed and longitudinal total population data for individuals and firms in Sweden. Employing these data and a quasi-experimental estimator, we find that business angels engage in firms that already perform above par but that there also is a positive effect on subsequent growth, comparing with control firms. Firms with business angel investment perform better in terms of sales and employment growth and likelihood of becoming a high-growth firm. Contrary to previous research, we cannot find any impact on firm survival, however. Overall, our results underline the need to address sample selection issues both in identifying business angels and in evaluating their effects on firm performance.
    Keywords: Business angels; Firm performance; Sample selection; Population Data
    JEL: C23 G24 G32 L25
    Date: 2020–12–21
  5. By: Tania Babina; Alex Xi He; Sabrina T. Howell; Elisabeth Ruth Perlman; Joseph Staudt
    Abstract: U.S. universities have experienced a shift in research funding away from federal and towards private industry sources. This paper evaluates whether the source of funding – federal or private industry – is relevant for commercialization of research outputs. We link person-level grant data from 22 universities to patent and career outcomes (including IRS W-2 records). To identify a causal effect, we exploit individual-level variation in exposure to narrow federal R&D programs stemming from pre-existing field specialization. We instrument for the researcher’s funding sources with aggregate supply shocks to federal funding within these narrow fields. The results show that a higher share of federal funding reduces patenting and the chances of joining an incumbent firm, while increasing the chances of high- tech entrepreneurship and of remaining employed in academia. A decline in the federal share of funding is offset by an increase in the private share of funding, which has opposite effects. We conclude that the incentives of private funders to appropriate research outputs have important implications for the trajectory of university researcher careers and intellectual property.
    JEL: G18 G38 I2 O3
    Date: 2020–12
  6. By: Takano, Keisuke; Okamuro, Hiroyuki
    Abstract: This paper examined the effects on the performance of local SMEs of a modernization fund program for small business enterprises implemented by Osaka Prefecture in the early 1950s. Utilizing firm-level panel data based on business credit reports, we empirically evaluated the effects of the program. We found an improvement in production levels among the recipients. In addition, recipients in sectors related to munitions production or in industrial agglomerations specialized in these sectors achieved additional or larger improvements in their production levels.
    Keywords: place-based policy, postwar revival, directed credit, modernization, Osaka
    JEL: H84 N95 O12 R51 R58
    Date: 2020–10
  7. By: KANG Byeongwoo; MOTOHASHI Kazuyuki
    Abstract: This study investigates how regional conditions affect university startups using data from Japan. We use the list of university startups compiled by METI, covering more than 2,000 firms, linked with JPO patent information. The study found that technical field of patents obtained by university startups are influenced by local industry characteristics. In addition, in terms of commercialization of university patents, commercialization by university startups is more locally proximate, as compared to cases realized through university industry collaborations. Our results provide implications that regional conditions must be considered when setting academic entrepreneurship policies.
    Date: 2020–11
  8. By: Frank Schweitzer; Giona Casiraghi; Mario V. Tomasello; David Garcia
    Abstract: The dynamics of collaboration networks of firms follow a life-cycle of growth and decline. That does not imply they also become less resilient. Instead, declining collaboration networks may still have the ability to mitigate shocks from firms leaving, and to recover from these losses by adapting to new partners. To demonstrate this, we analyze 21.500 R\&D collaborations of 14.500 firms in six different industrial sectors over 25 years. We calculate time-dependent probabilities of firms leaving the network and simulate drop-out cascades, to determine the expected dynamics of decline. We then show that deviations from these expectations result from the adaptivity of the network, which mitigates the decline. These deviations can be used as a measure of network resilience.
    Date: 2020–11
  9. By: Alina Petronela Alexoaei (The Bucharest University of Economic Studies); Raluca Georgiana Robu (The Bucharest University of Economic Studies)
    Abstract: The article covers the role of entrepreneurs in developing climate-resilient solutions and business models for sustainable development with a special focus on technological innovation. Building on the concept of social entrepreneurship, the research attempts to investigate the role and the reasons that explain entrepreneurs? engagement in climate change mitigation and in developing new eco-inclusive technologies. The focus will lay on the case of the cleantech industry by attempting to provide a definition of the industry, an analysis of the typology of the financing involved the sectors with the largest impact, and the most innovative types of projects. The results are meant to anticipate key directions and serve as a possible guide to future entrepreneurs and investors interested in cleantech businesses.
    Keywords: Eco-inclusive entrepreneurship, cleantech, social entrepreneurs, sustainable entrepreneurship, climate change
    JEL: L26 O44 O13
  10. By: Ambler, Kate; de Brauw, Alan; Herskowitz, Sylvan; Murphy, Mike
    Abstract: Micro, small, and medium enterprises (MSMEs) in developing countries frequently face financial con-straints undermining their ability to reach their full production potential. These constraints include expo-sure to uninsured risk, lack of suitable savings technologies, and expensive or inaccessible credit. Such challenges may be particularly acute for MSMEs operating in the agrifood system, in value chains be-tween farmers and retailers, where the seasonality and structure of these value chains creates unique financing needs relative to other sectors. Moreover, constraints affecting MSME performance in one part of the value chain may impact other value chain actors both up and downstream, including smallholder farmers, consumers, and exporters. As has been observed more broadly about MSMEs, marginalized groups such as women, low-income households, and ethnic minorities often face additional barriers to finance and adoption suitable financial services.1 If so, then the most vulnerable populations may be unintentionally excluded from emerging economic opportunities in the agriculture sector.
    Keywords: VIET NAM, VIETNAM, SOUTH EAST ASIA, ASIA, INDONESIA, gender, small and medium enterprises, agrifood systems, value chains, capital, start-up
    Date: 2020
  11. By: World Bank
    Keywords: Gender - Gender and Development Gender - Gender and Economic Policy Poverty Reduction - Inequality Private Sector Development - Enterprise Development & Reform Social Protections and Labor - Skills Development and Labor Force Training
    Date: 2020–01
  12. By: World Bank Group
    Keywords: Finance and Financial Sector Development - Access to Finance Finance and Financial Sector Development - Finance and Development Finance and Financial Sector Development - International Financial Markets Private Sector Development - Emerging Markets Private Sector Development - Small and Medium Size Enterprises
    Date: 2020

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