nep-ent New Economics Papers
on Entrepreneurship
Issue of 2021‒06‒21
23 papers chosen by
Marcus Dejardin
Université de Namur

  1. Biased Sampling of Early Users and the Direction of Startup Innovation By Ruiqing Cao; Rembrand M. Koning; Ramana Nanda
  2. The Importance of Capital in Closing the Entrepreneurial Gender Gap: A Longitudinal Study of Lottery Wins By Sarah Flèche; Anthony Lepinteur; Nattavudh Powdthavee
  3. Does entrepreneurship increase the chance of the poor? By Rodriguez Torres, Omar
  4. Gathering round Big Tech: how the market for acquisitions reinforces regional inequalities in the US By Feldman, Maryann; Guy, Frederick; Iammarino, Simona; Ioramashvili, Carolin
  5. How different are necessity and opportunity firms? Evidence from a quantile analysis of the Colombian microenterprise sector By Rodriguez Torres, Omar
  6. Are Applying for and Receiving Subsidy Worth for Small Enterprises? Evidence from the Government Support Program in Japan By HASHIMOTO Yuki; TAKAHASHI Kohei
  7. Mission-Oriented Policies and the "Entrepreneurial State" at Work: An Agent-Based Exploration By Giovanni Dosi; Francesco Lamperti; Mariana Mazzucato; Mauro Napoletano; Andrea Roventini
  8. Effects of Covid-19 Related Government Response Stringency and Support Policies: Evidence from European Firms By Benedikt Janzen; Doina Maria Radulescu
  9. Impacts of the Covid-19 crisis: evidence from 2 million UK SMEs By Hurley, James; Karmakar, Sudipto; Markoska, Elena; Walczak, Eryk; Walker, Danny
  10. Will the AI revolution be labour-friendly? Some micro evidence from the supply side By Damioli, Giacomo; Van Roy, Vincent; Vertesy, Daniel; Vivarelli, Marco
  11. Local Bank, Digital Financial Inclusion and SME Financing Constraints: Empirical Evidence from China By Zhiqiang Lu; Junjie Wu; Hongyu Li; Duc Khuong Nguyen
  12. The effect of unemployment insurance benefits on (self-)employment: Two sides of the same coin? By Camarero Garcia, Sebastian; Hansch, Michelle
  13. Predicting French SME Failures: New Evidence from Machine Learning Techniques By Christophe Schalck; Meryem Schalck
  14. How does market competition affect firm innovation incentives in emerging countries? Evidence from Latin American firms. By Benavente, Jose Miguel; Zuniga, Pluvia
  15. (When) Does Patent Protection Spur Cumulative Research Within Firms? By Ashish Arora; Sharon Belenzon; Matt Marx; Dror Shvadron
  16. A taxonomy of European innovation clubs By Wirkierman, Ariel L.; Ciarli, Tommaso; Savonna, Maria
  17. Organisation Capital, Knowledge Spillover and Firm Performance: Evidence from Chinese Manufacturing Sector By Qing Li; Yanrui Wu
  18. The effectiveness of innovation policy and the moderating role of market competition: Evidence from Latin American firms By Benavente, Jose Miguel; Zuniga, Pluvia
  19. Coping with high decline: firms’ resilience to adversity By Silviano Esteve-Pérez; Fabio Pieri; Diego Rodriguez
  20. Assessing Smart Specialisation: The Entrepreneurial Discovery Process By PERIANEZ FORTE Inmaculada; WILSON James
  21. Advancing Research on Creativity in Family Firms By Julia Vincent Ponroy; Dianne; H.B. Welsh
  22. Business Dynamism and Productivity Growth under Abenomics: An Empirical Analysis Based on Micro Data from Japan's Economic Census for Business Activity (Japanese) By FUKAO Kyoji; KIM YoungGak; KWON Hyeog Ug; IKEUCHI Kenta
  23. Employment and Productivity Dynamics and Patent Applications Related to the Fourth Industrial Revolution (Japanese) By IKEUCHI Kenta

  1. By: Ruiqing Cao; Rembrand M. Koning; Ramana Nanda
    Abstract: Using data from a prominent online platform for launching new digital products, we document that the composition of the platform's ‘beta testers’ on the day a new product is launched has a systematic and persistent impact on the venture's success. Specifically, we use word embedding methods to classify products on this platform as more or less focused on the needs of female customers. We then show that female-focused products launched on a typical day – when nine in ten users on the platform are men – experience 45% less growth in the year after launch. By isolating exogenous variation in the composition of beta testers unrelated to the characteristics of launched products on that day, we find that on days when there are unexpectedly more women, this gender-product gap shrinks towards zero. Further, consistent with a sampling bias mechanism, we find that the composition of beta testers appears to impact VC decision making and the entrepreneur's subsequent product development efforts. Overall, our findings suggest that the composition of early users can induce systematic biases in the signals of startup potential, with consequential effects – including a shortage of innovations aimed at consumers who are underrepresented among early users.
    JEL: L1 M13 O3
    Date: 2021–06
  2. By: Sarah Flèche (Centre d'Economie de la Sorbonne, CEP - London School of Economics); Anthony Lepinteur (University of Luxembourg - Department of Behavioural and Cognitive Sciences); Nattavudh Powdthavee (Warwick Business School and IZA)
    Abstract: Would improving women's access to capital reduce the gender entrepreneurial gap? We study this issue by exploiting longitudinal data on lottery winners. Comparing between large to small winners, we find that an increase in lottery win in period t-1 significantly increases the likelihood of becoming self-employed in period t. This windfall effect is statistically the same in magnitude for men and women; the top 25% winners (an average win = £831.16) in year t-1 report a significant increase in the probability of self-employment in year t by approximately 2 percentage points, which is approximately 20-30% of the gender entrepreneurial gap. These results suggest that we can causally reduce the gender entrepreneurial gap by improving women's access to capital that might not be as readily available to the aspiring female entrepreneurs as it is to male entrepreneurs
    Keywords: Gender inequality, self-employment; lottery wins; BHPS
    JEL: J16 J21 J24
    Date: 2021–05
  3. By: Rodriguez Torres, Omar (UNU-MERIT)
    Abstract: This paper investigates how entrepreneurship affects the likelihood of households graduating out of poverty. It analyses the effect of entrepreneurship in the outcomes of the households enrolled in the Colombian poverty reduction programme. A contribution to the Capability Approach is proposed with the inclusion of entrepreneurship as a 'functioning' linked to overcoming poverty. Entrepreneurship presents a great potential given its multidimensional nature. In its more basic conception, it is connected to income-generation, and in its more complex conception, it is related to the concept of agency. Using the Colombian UNIDOS programme (which is a programme focused on helping poor graduating out of poverty) as a case study, we employ a Probit Regression model with sample selection to model this mechanism. The results present a positive, statistically significant impact of entrepreneurial households in their probability of graduating out of poverty. The results confirmed that entrepreneurial households show a higher likelihood of escaping from poverty.
    Keywords: Capability approach, poverty reduction, entrepreneurship, public policy, enterprise policy
    JEL: I31 I32 L26 J48 L53
    Date: 2021–04–28
  4. By: Feldman, Maryann; Guy, Frederick; Iammarino, Simona; Ioramashvili, Carolin
    Abstract: Are the agglomeration economies of technology hubs augmented by a localized market for start-ups – acquisitions, and IPOs? How does this affect the ability of places outside of those hubs to foster digital startups as a tool of local economic development? We study this with a particular focus on acquisitions by the seven largest American digital platforms – Amazon, Alphabet [Google], Apple, Microsoft, Facebook, Oracle and Adobe, which we call, collectively, Big Tech. We cover the years 2001-2020. We show that firms acquired by Big Tech are, disproportionately to the sectors in which they operate, concentrated in major tech clusters, and particularly in the Silicon Valley (San Francisco/San Jose). Foreign acquisitions by Big Tech also show a marked concentration in a few countries, and particular places in those countries. NASDAQ IPOs of firms in relevant sectors are similarly concentrated. Acquisition, or the less common alternative, IPO, is the second major phase of financing for a digital start up. The first phase is commonly associated with venture capital (VC), and location proximate to venture capital companies has often been seen as a motivation for locating in a tech cluster. We find, however, that neither VC funding, nor funding an investor located in the Silicon Valley, predicts either acquisition by Big Tech, or IPO. Funding by any of the VCs that helped launch the Big Tech firms, however, is strongly associated with Big Tech acquisition. This suggests an important role for social networks in both the first and second phases of financing, but not necessarily a geographical role in the first phase. We argue that the acquisition market – and its effects on both the major tech hubs and the left behind rest – depends crucially on the proprietary control of access to various digital network products. Regulation of these markets, particularly in the form of common carrier status and open standards, could achieve a considerable re-balancing.
    Keywords: tech giats; market power; start-ups; acquisitions; regional inequality
    JEL: R12
    Date: 2021–05–01
  5. By: Rodriguez Torres, Omar (UNU-MERIT)
    Abstract: This paper explores the relationship between start-up motivation and business performance, by looking into the extent to which start-up motivation (necessity vs. opportunity) influences several business performance indicators. Using the Colombian Small and Microenterprise sector public dataset, we analyse the factors associated with microenterprise performance using a quantile regression approach to model the distribution of different measures of business performance. Among the findings, we present evidence of statistically significant differences among quantiles confirming the heterogeneity of start-up motivation and other firm characteristics of the firms operating in the sector. The results show that start-up motivation is a factor that explains the difference in the distribution of the business performance indicators under study. This findings contributes to the debate around the connection between entrepreneurship and growth in the context of developing economies. Even though firms motivated by necessity show a lower level of profit, in particular for the firms that perform relatively poorly, this is not necessarily associated with null or diminishing growth rates. Necessity is not necessarily a deterrent for growth. It needs to be understood as a means to support families that otherwise would have no income-generating opportunities.
    Keywords: Firm performance, entrepreneurship, public policy, new firms, enterprise policy
    JEL: L25 L26 J48 M13 L53 O25
    Date: 2021–04–28
    Abstract: This paper examines the effects of the Business Sustainable Subsidy (BSS) on small enterprises' productivity. The BSS aims productivity improvement and sustainable development of small enterprises by aiding a part of expenses for their business activities. We use rich firm data which contains the attributes and the accounting information of both applied and non-applied firms and examine the effects of receiving and applying for the subsidies. We employ sharp regression discontinuity design for the effects of reception and difference in differences design for that of application. Our empirical results show that significant differences in small enterprises' performance improvement were not evident between receiving the subsidies and not. On the other hand, we found that applicant small enterprises perform higher productivity and sales growth than not-applicant firms. We also robustly obtain the positive results of application impacts by difference in differences model with propensity score matching, controlling for preintervention levels and trends in the outcome. Our findings imply that application in itself promotes firms' voluntarily activities to their own business issues through external support, and leads to improve their productivity.
    Date: 2021–05
  7. By: Giovanni Dosi (Scuola Superiore Sant'Anna, Pisa (Italy)); Francesco Lamperti (Institute of Economics and EMbeDS, Scuola Superiore Sant'Anna; RFF-CMCC European Institute on Economics and the Environment); Mariana Mazzucato (Institute for Public Purpose and Policy, University College London (London, UK)); Mauro Napoletano (Author-Workplace-Name: Université Côte d'Azur, CNRS, GREDEG, France; SKEMA Business School; OFCE Sciences-Po); Andrea Roventini (Institute of Economics and EMbeDS, Scuola Superiore Sant'Anna; Sciences Po, OFCE)
    Abstract: We study the impact of alternative innovation policies on the short- and long-run performance of the economy, as well as on public finances, extending the Schumpeter meeting Keynes agentbased model (Dosi et al., 2010). In particular, we consider market-based innovation policies such as R&D subsidies to firms, tax discount on investment, and direct policies akin to the "Entrepreneurial State" (Mazzucato, 2013), involving the creation of public research-oriented firms diffusing technologies along specic trajectories, and funding a Public Research Lab conducting basic research to achieve radical innovations that enlarge the technological opportunities of the economy. Simulation results show that all policies improve productivity and GDP growth, but the best outcomes are achieved by active discretionary State policies, which are also able to crowd-in private investment and have positive hysteresis effects on growth dynamics. For the same size of public resources allocated to market-based interventions, "Mission" innovation policies deliver significantly better aggregate performance if the government is patient enough and willing to bear the intrinsic risks related to innovative activities.
    Keywords: Innovation policy, mission-oriented R&D, entrepreneurial state, agent-based modelling
    JEL: O33 O38 O31 O40 C63
    Date: 2021–06
  8. By: Benedikt Janzen; Doina Maria Radulescu
    Abstract: In this paper we employ survey information on more than 10,000 Southern and Eastern European firms and panel data methods to assess the effects of the COVID-19-related lockdown and government support policies on the business operations of enterprises. Our findings reveal considerable size- and sector-related effect heterogeneity, with small firms, exporting firms and firms operating in the facility sector experiencing the largest losses in terms of sales. A complete lockdown leads to an average decrease in sales by approximately 64%. We also document a disproportionate impact on female self-employed. Furthermore, state aid in the form of deferral of payments or wage subsidies were the most effective government support instruments. For instance, wage subsidies saved up to 2.7 employees per firm in the surveyed enterprises.
    Keywords: Covid-19, firms, government support policies, panel data methods
    JEL: D22 H12 H32
    Date: 2021
  9. By: Hurley, James (Bank of England); Karmakar, Sudipto (Bank of England); Markoska, Elena (Bank of England); Walczak, Eryk (Bank of England); Walker, Danny (Bank of England)
    Abstract: We introduce a novel data set to analyze the impact of the Covid-19 crisis on SME cash flows. The crisis led to a sharp drop in economic activity in the UK, which hit SMEs harder than larger businesses. The data set comprises monthly information on all 2 million SMEs that have current accounts or debt with nine major banking groups, with roughly 5 billion data points in total. We document a few basic facts on UK SME cash flows during Covid-19. (1) The virus and the public health interventions coincided with a 30 percentage point reduction in turnover growth for the average SME. (2) There was significant heterogeneity in the turnover shock across SMEs, with the biggest reductions for younger SMEs in consumer-facing sectors in Scotland and London. (3) Cash flows were broadly flat on average and there was much less heterogeneity across SMEs. (4) SMEs with average turnover growth in 2020 were most likely to use the main government-guaranteed loan scheme for SMEs, as well as those in the hospitality sector in more affluent areas of the country. Our analysis provides a framework to monitor SMEs as the sector recovers from the pandemic.
    Keywords: Covid-19 pandemic; small and medium-sized enterprises; SMEs; government support schemes
    JEL: D22 E65 G30
    Date: 2021–06–11
  10. By: Damioli, Giacomo (European Commission, Joint Research Centre (JRC)); Van Roy, Vincent (European Commission, Joint Research Centre (JRC)); Vertesy, Daniel (UNU-MERIT, and the International Telecommunication Union); Vivarelli, Marco (UNU-MERIT, and Catholic University of Milan)
    Abstract: This study investigates the possible job-creation impact of AI technologies, focusing on the supply side, namely the providers of the new knowledge base. The empirical analysis is based on a worldwide longitudinal dataset of 3,500 front-runner companies that patented the relevant technologies over the period 2000-2016. Obtained from GMM-SYS estimates, our results show a positive and significant impact of AI patent families on employment, supporting the labour-friendly nature of product innovation in the AI supply industries. However, this effect is small in magnitude and limited to service sectors and younger firms, which are the leading actors of the AI revolution. Finally, some evidence of increasing returns seems to emerge; indeed, the innovative companies which are more focused on AI technologies are those obtaining the larger impacts in terms of job creation.
    Keywords: Innovation, technological change, patents, employment, job-creation
    JEL: O31 O33 O34 E24
    Date: 2021–04–20
  11. By: Zhiqiang Lu; Junjie Wu; Hongyu Li; Duc Khuong Nguyen
    Abstract: This paper investigates the impact of local banks and digital financial inclusion on small and medium enterprise (SME) financing constraints. Using data of Chinese SMEs for the period 2007?2017, our robust results find (1) SMEs financing constraints are negatively associated with the proportion of local bank branches and the degree of digital financial inclusion; (2) the effect of local banks is more pronounced for small, transparent, and firms in the regions less dependent on bank credit; and (3) local bank branches and digital financial inclusion have a substitution effect on alleviating SMEs financial constraints. The findings shed light on how digital finance technologies could influence traditional SME-bank relationship and have important policy and managerial implications.
    Keywords: local banks; digital financial inclusion; financing constraints; SMEs; China.
    Date: 2021–01–01
  12. By: Camarero Garcia, Sebastian; Hansch, Michelle
    Abstract: Although a meaningful percentage of firms are created out of unemployment and current active labor market policies in Europe often subsidize unemployed individuals to start their own businesses, little is known about the role of unemployment insurance (UI) generosity for selfemployment. By using Spanish administrative data including previously unavailable information on self-employment, we exploit a reform-driven exogenous cut in UI benefits to identify its causal effect on general employment and decompose it into the effects on self-employment and re-employment. Exploiting a discontinuity in the UI benefit schedule which changed as a result of the 2012 Spanish labor market reform, we estimate the causal reform effects on the extensive margin of (self-)employment and on unemployment duration. We find heterogeneous effects on the extensive margin: while the job-finding rate increases, the startup rate decreases. Over different time horizons, the negative effect on self-employment (35-50%) outweighs the positive effect on employment (5-33%). Our UI benefit duration elasticity estimates indicate that reduced UI benefits extend unemployment duration for individuals transitioning into self-employment but shorten unemployment for individuals finding re-employment. Due to the reform's unintended consequences for self-employment, its general employment effect is much smaller than claimed by analyses that focus only on employment.
    Keywords: Social Insurance,Self-Employment,Spain,Unemployment Insurance
    JEL: H75 J64 J65 J68 L26
    Date: 2021
  13. By: Christophe Schalck; Meryem Schalck
    Abstract: The aim of this study is to provide new insights into French small and medium-sized enterprises (SME) failure prediction using a unique database of French SMEs over the 2012?2018 period including both financial and nonfinancial variables. We also include text variables related to the type of activity. We compare the predictive performance of three estimation methods: a dynamic Probit model, logistic Lasso regression, and XGBoost algorithm. The results show that the XGBoost algorithm has the highest performance in predicting business failure from a broad dataset. We use SHAP values to interpret the results and identify the main factors of failure. Our analysis shows that both financial and nonfinancial variables are failure factors. Our results confirm the role of financial variables in predicting business failure, while self-employment is the factor that most strongly increases the probability of failure. The size of the SME is also a business failure factor. Our results show that a number of nonfinancial variables, such as localization and economic conditions, are drivers of SME failure. The results also show that certain activities are associated with a prediction of lower failure probability while some activities are associated with a prediction of higher failure.
    Keywords: SME; failure prediction; Machine learning; XGBoost; SHAP values
    JEL: G33 C41 C46
    Date: 2021–01–01
  14. By: Benavente, Jose Miguel (Inter-American Development Bank (IADB)); Zuniga, Pluvia (UNU-MERIT)
    Abstract: The role of market competition on firm innovation remains a controversial policy question, especially in the context of developing countries. This paper presents new empirical evidence about the impact of market competition on firm innovation engagement in Colombian and Chilean manufacturing industries. We correct for the endogeneity of market competition using instruments proxying entry costs and policy interventions (i.e. competition decisions and entry law reforms), our results are like those of developed countries. Market competition increases firm propensity to invest in innovation in manufacturing enterprises and this relationship is linear in Chilean while in Colombian industries it takes the form of an inversed-U shape relation. The impact of competition is decreasing with the level of sector asymmetry -as preconised in the literature, while the impact of firm distance to the frontier affects firm innovation engagement differently in the two countries. In Chile, competition raises innovation incentives for the third and fourth productivity quartiles while no impact is found for firms in the first (bottom) two quartiles. In contrast, in Colombia market competition raises innovation engagement across regardless their firm productivity position but effects are stronger in the medium range (second and third quartiles). Our main results are robust to controlling for past innovation engagement, import competition and business dynamics.
    Keywords: Market Competition, Innovation, Technology Purchasing, Productivity, Latin American Firms
    JEL: O32 D41 O47 D24
    Date: 2021–05–19
  15. By: Ashish Arora; Sharon Belenzon; Matt Marx; Dror Shvadron
    Abstract: We estimate the effect of patent protection on follow-on investments in corporate scientific research. We exploit a new method for identifying an exogenous reduction in the protection a granted patent provides. Using data on public, research-active firms between 1990 and 2015, we find that firms decrease follow-on research after a reduction in patent protection, as measured by a drop in internal citations to an associated scientific article. This effect is stronger for smaller firms and in industries where patents are traded less frequently. Our findings are consistent with a stylized model whereby patent protection is a strategic substitute for commercialization capability. Our results imply that stronger patents encourage follow-on research, but also shift the locus of research from big firms toward smaller firms and startups. As patent protection has strengthened since the mid-1980s, our results help explain why the American innovation ecosystem has undergone a growing division of innovative labor, where startups become primary sources of new ideas.
    JEL: O30 O32 O34
    Date: 2021–06
  16. By: Wirkierman, Ariel L. (Institute of Management Studies(IMS), Goldsmiths, University of London); Ciarli, Tommaso (UNU-MERIT, and Science Policy Research Unit (SPRU), University of Sussex); Savonna, Maria (Science Policy Research Unit (SPRU), University of Sussex, and Department of Economics and Finance, Luiss University)
    Abstract: The paper provides a novel, empirically grounded map of innovation 'clubs' in the EU, based on a unique analysis of micro-aggregated, country-level data. Using exploratory factor analysis we articulate innovation variables in a taxonomy of four 'latent' innovation theories: Network-Innovation-System, Kaldorian, New-Growth-Theory, and Schumpeterian. We then characterise clusters of countries ('clubs'), based on their performance against this taxonomy, and design a new map of EU innovation clubs. We identify an articulated map of EU innovation hierarchy beyond the rather well-known 'core-periphery' structure, and interpret how some of the peripheries are functional to the 'consolidated core' of innovative countries, raising an issue of long-term sustainability of such hierarchies. We also find that even the most innovative clusters show concerning weaknesses. The strongest cluster in terms of its innovation system does not seem to exploit its full potential and lags behind with respect to radical product innovations. Instead, the leading cluster in terms of radical product innovations is strongly dependent on external innovative activity, is focused on scale-intensive sectors, and has a fairly weak innovation system. The periphery of small countries that show a healthy network structure, do so because they mainly include supplier-dominated firms, reliant on innovation inputs from the core. We offer some reactions on innovation policy within a broader view of EU cohesion.
    Keywords: Innovation theories, National Innovation System, Exploratory Factor Analysis, European cohesion policy
    JEL: O30 O52 C38
    Date: 2021–05–11
  17. By: Qing Li (Qing Li, SHU-UTS SILC Business School, Shanghai University); Yanrui Wu (Business School, The University of Western Australia)
    Abstract: This study explores organisation capital and its spillover effects among Chinese manufacturing firms. By linking patent data with China’s annual survey of industrial enterprises database, we examine technological proximity as one potential channel for organisational spillover but find weak evidence. This result is consistent with previous findings from developed countries. In contrast, organisation capital is found to generate positive spillover in China when geographical proximity is considered. In other words, it is found that spillover from organisation capital is likely among Chinese firms due to geographical proximity rather than technological proximity.
    Keywords: Organisation capital; knowledge spillover; intangible capital; patent portfolio; Chinese firms
    JEL: D21 D24 L22
    Date: 2021
  18. By: Benavente, Jose Miguel (Inter-American Development Bank (IADB)); Zuniga, Pluvia (UNU-MERIT)
    Abstract: The objective of this paper is to evaluate whether market competition matters for the effectiveness of innovation policies. Using data for Chilean and Peruvian manufacturing firms, we implement propensity matching techniques combined with differences-in-differences estimation to evaluate the impact of innovation subsidies on the post-treatment innovation investment effort of firms and test whether such impact differs according to the intensity of competition. We corroborate the existence of "crowding-in" effects in beneficiaries when compared to a control group of untreated firms. The subsidy impact is found either only significant in highly competitive sectors or larger in more competition-intensive industries -compared to low competition ones. Thus, we confirm that market competition plays a moderating role in the effectiveness of innovation policies to stimulate firm innovation investment. The results are robust to different matching and estimation methods. Our results therefore suggest that market contexts should be considered in the design of innovation policies.
    Keywords: Innovation Subsidies, Innovation Policy, Market Competition Latin American firms
    JEL: O38 O31 R38 H71
    Date: 2021–05–19
  19. By: Silviano Esteve-Pérez; Fabio Pieri; Diego Rodriguez
    Abstract: This work investigates the factors that precipitate a firm’s sudden decline, which is defined as a short-term heavy contraction in firm size, and examines firms’ performance in the aftermath of a high-decline (HD) event. The empirical analysis reveals patterns of HD events over the business cycle and across markets, providing insights into the factors that enable firms’ resilience in terms of better growth performance after an HD event. Firms that upgrade their production processes and invest in human capital show better growth trajectories in the aftermath of an HD event.
    Keywords: high-decline events, business cycle, resilience, growth trajectories
    JEL: D22 D23 L25 L60
    Date: 2021
  20. By: PERIANEZ FORTE Inmaculada (European Commission - JRC); WILSON James
    Abstract: The entrepreneurial discovery process (EDP) is widely conceived as an inclusive, evidence-based process of stakeholder engagement that produces information about the potential for new activities, thus enabling effective targeting of research and innovation policy. How this interactive process should be stimulated and organised remains highly context-dependent. This document analyses new evidence collected on the smart specialisation policy experience across European Union (EU) regions and countries during the 2014-2020 programming period as part of a broader analytical exercise carried out by the Smart Specialisation Platform of the European Commission’s Joint Research Centre (JRC). To this end, the document is developed in six sections. After an introduction, section 2 reviews existing literature related to the entrepreneurial discovery process with a specific focus on the mechanisms and practices used by countries and regions to foster entrepreneurial discovery processes within their Research and Innovation Strategies for Smart Specialisation (RIS3). Section 3 and 4 explain the research questions addressed by this study and the data and methodology applied. Section 5 presents and analyses the main findings of our study. Finally, section 6 provides some final thoughts and conclusions.
    Keywords: smart specialisation, smart specialisation strategies, entrepreneurial discovery process, innovation policies
    Date: 2021–05
  21. By: Julia Vincent Ponroy; Dianne; H.B. Welsh
    Abstract: This chapter explores creativity in family businesses and asks the important question : Do family businesses represent organizational contexts likely to encourage creativity? We begin by defining creativity and outline the antecedents to creativity. Next, we discuss the connection between creativity and innovation and the characteristics in family firms that foster or hinder creativity from both organizational and individual perspectives. Concerning measurement, we offer Psychological Capital (PsyCap) as a potential new avenue with merit to analyze creativity in family firms. We discuss what research has been conducted so far on PsyCap, creativity and family firms and describe further directions. We conclude that creativity is an area ripe for research that may unlock some of the unanswered questions that have plagued the field and might offer practical solutions for family firm competitiveness and longevity.
    Keywords: family firms, creativity, Psychological Capital
    Date: 2020–01–01
  22. By: FUKAO Kyoji; KIM YoungGak; KWON Hyeog Ug; IKEUCHI Kenta
    Abstract: What was the state of business dynamism in the first half of Abenomics, when productivity increased relatively well? This paper analyzes this issue by conducting a productivity dynamics analysis of labor productivity and TFP using questionnaire information from the Economic Census for Business Activity for 2011 and 2015. In addition, we investigated what category of firm was the main drivers of productivity growth. The main source of productivity growth during this period was productivity growth within firms (within effect) for labor productivity, but for TFP growth, it was not the within effect but the reallocation effect (the covariance effect due to the increase in the market share by firms with higher productivity growth rates, the between effect in which firms with higher productivity increased their market share, and the entry of new firms with higher productivity). Although the exit effect was negative because firms with high productivity exited the market, it can be said that the driving force behind productivity growth during this period was the reallocation of resources across firms. The reallocation effect was particularly prevalent in the larger group of firms and in the non-manufacturing sector rather than in the manufacturing sector. The observations on the relationship between the firm size, firm age and productivity growth within firms showed that TFP growth rate was highest for the second-largest group of firms in the non-manufacturing sector, which were 20-30 years old, and highest for the smallest group of firms in the manufacturing sector, which were less than 10 years old. On the other hand, the productivity gap between firms widened, and market concentration (as measured by the Herfindahl-Hirschman Index, HHI) fell, while the average mark-up ratio (sales divided by total costs) rose. The increase in mark-up was not due to increased market share by firms with high mark-up rates. The increases occurred mainly within individual firms, and regardless of firm size or age. The mark-up rate increased especially in the manufacturing sector with a high ratio of exports, which may be due to the depreciation of the yen.
    Date: 2021–03
  23. By: IKEUCHI Kenta
    Abstract: In recent years, the development of new digital-related technologies such as artificial intelligence (AI) and Internet-of Things (IoT) and their industrial applications have been attracting attention. These technological developments collectively are called the "Fourth Industrial Revolution" which is set to bring about major changes in industrial structure. On the other hand, previous research using national / industrial level data has pointed out that progress in digitization widens the productivity gap between companies and reduces the dynamics of the market. Therefore, this research analyzes the relationship between the development of technologies related to the Fourth Industrial Revolution such as artificial intelligence and IoT and market dynamics using Japanese firm-level micro datasets. The patent data is combined with the Basic Survey of Japanese Business Structure and Activities, Census of Manufacture, Economic Census for Business Frame, Economic Census for Business Activity and Establishment and Enterprise Census of Japan to build firm-level panel data and to examine how the research and development activities related to the Fourth Industrial Revolution, such as artificial intelligence and IoT, are associated with the productivity and employment growth of business establishments and firms, and discuss the policy implications. The results of this study show that the development of technologies related to the Fourth Industrial Revolution such as AI and IoT are associated with the dynamics of productivity and employment in firms. The development of AI-related technologies has particularly benefited large firms, with limited benefits to small and medium-sized firms.
    Date: 2021–03

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