nep-ent New Economics Papers
on Entrepreneurship
Issue of 2021‒05‒31
eight papers chosen by
Marcus Dejardin
Université de Namur

  1. How is COVID Changing the Geography of Entrepreneurship? Evidence from the Startup Cartography Project By Catherine E. Fazio; Jorge Guzman; Yupeng Liu; Scott Stern
  2. Tax Progressivity and Self-Employment Dynamics By Arulampalam, Wiji; Papini, Andrea
  3. Efficiency of small and medium-sized real estate industry -An analysis on the period after the burst of the bubble economy using micro-data By Yasuo Goto
  4. On Immigration and Native Entrepreneurship By Duleep, Harriet; Jaeger, David A.; McHenry, Peter
  5. Perception of corruption influences entrepreneurship inside established companies By F. Javier Sanchez-Vidal; Camino Ramon-Llorens
  6. Public Support of Innovative Activity in Small and Large Firms in Mexico By Guerrero, Maribel; Link, Albert
  7. Drivers of SME Formation in Indian States: The Empirics By Pradhan, Jaya Prakash; Husain, Tareef
  8. Gründungserfolg von Wissenschaftlerinnen und Wissenschaftlern an deutschen Hochschulen - eine Längsschnittuntersuchung By Bijedić, Teita; Nielen, Sebastian; Schröder, Christian

  1. By: Catherine E. Fazio; Jorge Guzman; Yupeng Liu; Scott Stern
    Abstract: Leveraging data from eight U.S. states from the Startup Cartography Project, this paper provides new insight into the changing nature and geography of entrepreneurship in the wake of the COVID pandemic. Consistent with other data sources, following an initial decline, the overall level of state-level business registrations not only rebounds but increases across all eight states. We focus here on the significant heterogeneity in this dynamic pattern of new firm formation across and within states. Specifically, there are significant differences in the dynamics of new business registrants across neighborhoods in terms of race and socioeconomic status. Areas including a higher proportion of Black residents, and more specifically higher median income Black neighborhoods, are associated with higher growth in startup formation rates between 2019 and 2020. Moreover, these dynamics are reflected in the passage of the major Federal relief packages. Even though legislation such as the CARES Act did not directly support new business formation, the passage and implementation of relief packages was followed by a relative increase in start-up formation rates, particularly in neighborhoods with higher median incomes and a higher proportion of Black residents.
    JEL: L26 R12 R23
    Date: 2021–05
  2. By: Arulampalam, Wiji (University of Warwick); Papini, Andrea (European Commission, Joint Research Centre)
    Abstract: Analysis of the relationship between taxes and self-employment should account for the interplay between responses in self-employment and wage employment. To this end, we estimate a two-state multi-spell duration model which accounts for both observed and unobserved heterogeneity using a large longitudinal administrative dataset for Norway for 1993 to 2011. Our findings confirm theoretical predictions, and are robust to various changes to definitions and sample selections. A policy experiment simulating a flatter tax schedule in the year 2000 is found to encourage self-employment, delivering a net increase of predicted inflow into self-employment from 2.8% to 5.3%.
    Keywords: tax progressivity, income tax, self-employment, duration analysis
    JEL: H24 H25 J24 C41
    Date: 2021–05
  3. By: Yasuo Goto (Faculty of Social Innovation, Seijo University)
    Abstract: The real estate industry is a typical industry that suffered the most damage from the bursting of the bubble economy in Japan and seems to have not yet completely recovered from the severe situation overall. In this article we analyse the industry using comprehensive database which incorporate huge number of small and medium-sized enterprises. We confirmed that the real estate industry as a whole is not in a bad situation, but that the smallest tiers are performing poorly. It can be interpreted as not because of the large number of inefficient firms, but because of the high degree of inefficiency, in terms of inefficiency of firms which is evaluated with the criteria for “zombie” firm in this article. The average profit margin of SMEs in the real estate industry is relatively low, however, the proportion of zombie firms is not necessarily high. The problem is not the ratio of the number of zombies but the performance of zombies in the smallest class. In the real estate industry, relatively large-scale class generally has become out of the post-bubble situation. Improving the profitability of the smallest tier seems to be an unavoidable challenge for improving the performance of the industry as a whole.
    Keywords: firm dynamics, zombie firm, profit margin, bubble economy, small and medium-sized enterprises (SMEs), size-dependent policy
    JEL: P43 L25 M13 G32
    Date: 2021–05
  4. By: Duleep, Harriet; Jaeger, David A.; McHenry, Peter
    Abstract: We present a novel theory that immigrants facilitate innovation and entrepreneurship by being willing and able to invest in new skills. Immigrants whose human capital is not immediately transferable to the host country face lower opportunity costs of investing in new skills or methods and will be more exible in their human capital investments than observationally equivalent natives. Areas with large numbers of immigrants may therefore lead to more entrepreneurship and innovation, even among natives. We provide empirical evidence from the United States that is consistent with the theory's predictions.
    Keywords: immigration,innovation,entrepreneurship,human capital
    JEL: J15 J24 J39 J61 L26
    Date: 2021
  5. By: F. Javier Sanchez-Vidal; Camino Ramon-Llorens
    Abstract: Based on the Global Entrepreneurship Monitor (GEM) surveys and conducting a panel data estimation to test our hypothesis, this paper examines whether corruption perceptions might sand or grease the wheels for entrepreneurship inside companies or intrapreneurship in a sample of 92 countries for the period 2012 to 2019. Our results find that the corruption perception sands the wheel for intrapreneurship. There is evidence of a quadratic relation, but this relation is only clear for the less developed countries, which sort of moderate the very negative effect of corruption for these countries. The results also confirm that corruption influences differently on intrapreneurship depending on the level of development of the country.
    Date: 2021–05
  6. By: Guerrero, Maribel (University of North Carolina at Greensboro, Department of Economics); Link, Albert (University of North Carolina at Greensboro, Department of Economics)
    Abstract: The National Science and Technology Council (CONACYT) was established in 1970 by the Mexican government. CONACYT was formed to promote the scientific development and technological modernization of Mexico through developing high-level human resources, encouraging research projects, and disseminating scientific/technological information. In 2009, CONACYT launched the Innovation Stimulus Program (PEI) to foster enterprises’ innovation activities and to encourage collaboration on innovation activities among firms and between firms and public research institutes and higher education institutions. Based on an analysis of project data from the PEI program over the years 2009 through 2014 we found that large firms are more innovative than small firms. And, firms that are more innovative are those that had prior funded research, collaborated with universities in the funded research project, added new employees during the research project, and faced larger markets for their innovations.
    Keywords: Public program evaluation; innovation; R&D; Mexico;
    JEL: H32 O25 O31 O38 O54
    Date: 2021–05–19
  7. By: Pradhan, Jaya Prakash; Husain, Tareef
    Abstract: The development of small and medium enterprises (SMEs) sector is a key policy priority as these enterprises play a critical role in the growth and development process of any economy. The present study is motivated to explore the regional dimensions of entry of new SMEs across Indian states and sectors covering an extensive study period 1980─2007. It further expands the literature on formation of firms from the sub-national perspective, empirically uncovering regional factors that significantly determine the formation of new firms. Findings suggest that new SME formation in India is characterized by a concentrated regional pattern during the study period with a few regions accounting for disproportionate share of the number of new SMEs formed. Also, Indian sub-national entities exhibited considerably disparity in the entry rate of new SMEs. Regional factors like local market size, availability of skills, technological specialization of manufacturing sector, land transportation networks, and entrepreneurial culture tend to play positive role in the formation rate of SMEs in Indian states.
    Keywords: SMEs, India, Regions, Entry Rate
    JEL: L11 L26 R11
    Date: 2021–05–10
  8. By: Bijedić, Teita; Nielen, Sebastian; Schröder, Christian
    Abstract: Im Rahmen dieser Studie werden die Einflüsse auf den Gründungserfolg von Wissenschaftlerinnen und Wissenschaftlern an deutschen Hochschulen über einen Zeitraum von sieben Jahren analysiert. Der Prozess des Gründungserfolgs wird in drei Stufen untersucht - vom Planungsfortschritt in der Vorgründungsphase (I) über den Gründungsvollzug (II) bis hin zur Frühentwicklung der jungen Unternehmen (III). Dabei erweisen sich eigene Erfindungen, die Nutzung gründungsfördernder Infrastruktur sowie Kontakte in die Wirtschaft als Treiber für den Gründungserfolg, während insbesondere Defizite im Geschäftskonzept den Gründungserfolg in der Vorgründungsphase hemmen. Auf Basis der Ergebnisse können bisherige wirtschaftspolitische Unterstützungsmaßnahmen noch zielgruppenspezifischer angepasst und auf einzelne Prozessschritte der Gründung abgestimmt werden.
    Keywords: Gründungsprozess,Gründungserfolg,Hochschulangehörige,Wissenstransfer,entrepreneurial success,process-based view,academic entrepreneurship,knowledge transfer
    JEL: L20 L26
    Date: 2021

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