nep-ent New Economics Papers
on Entrepreneurship
Issue of 2022‒03‒28
nine papers chosen by
Marcus Dejardin
Université de Namur

  1. Scaling Technology Ventures in Africa: New Opportunities for Research By Weiss, Tim; Perkmann, Markus; Phillips, Nelson
  2. Cultural diversity and innovation-oriented entrepreneurship By Paula Prenzel; Niels Bosma; Veronique Schutjens; Erik Stam
  3. Contractual Restrictions and Debt Traps By Ernest Liu; Benjamin N. Roth
  4. Environmental Awareness and Green Business Practices in the Small Business Sector: Empirical Evidence Using a Small and Medium-sized Enterprises Survey in Japan By Masahiko Shibamoto
  5. The evolving impacts of COVID-19 on small businesses since the CARES Act By John Eric Humphries; Christopher Neilson; Gabriel Ulyssea
  6. The Effect of External Innovation on Firm Employment By Guillermo Arenas Díaz; Andrés Barge-Gil; Joost Heijs; Alberto Marzucchi
  7. Intensification or Diversification: Responses by Anti Health-Pass Entrepreneurs to French Government Announcements By Christophe LEVEQUE; Haris MEGZARI
  8. Building an Entrepreneurial Spirit Based on Model, Brain Color and Myers Briggs Type Indicator (MBTI) By naryono, endang
  9. Contingent Relations Between Microcredit and Entrepreneurial Re-Engagement in Traditional Rural Contexts: An Exploration of the Case of Peasants From Madagascar By Patrick Valeau; Cousin Germain Ravonjiarison

  1. By: Weiss, Tim; Perkmann, Markus; Phillips, Nelson
    Abstract: Research on new venture creation in Africa is growing rapidly. This increasing interest reflects both the potential for entrepreneurship to contribute to the economic and social development of Africa, as well as the potential for this research to provide new insights that challenge and extend theories developed primarily from studies of North American and European new ventures. In this editorial essay, we argue for an expansion of this important research stream to include a focus on how technology ventures scale in Africa. We identify seven topics that offer interesting opportunities for research on scaling in Africa: (1) the effect of venture location on scaling; (2) the effect of founding team diversity on scaling; (3) the effect of entrepreneurial strategies on scaling; (4) the effect of nascent ecosystems on scaling; (5) the effect of the institutional environment on scaling; (6) the effect of nascent financial markets on scaling; and (7) the societal effects of scaling. We discuss each of these topics, their potential to contribute to the existing literature, and provide examples of African technology firms that have scaled to illustrate each topic. We conclude with a discussion of how African social, political, and regulatory change, combined with rapidly developing entrepreneurial ecosystems, are creating a context where the successful scaling of technology ventures is becoming increasingly common, and research is therefore increasingly valuable.
    Date: 2021–10–24
  2. By: Paula Prenzel; Niels Bosma; Veronique Schutjens; Erik Stam
    Abstract: A growing empirical literature has established a positive relationship between cultural diversity and entrepreneurship rates, often attributing this effect to innovative benefits of diversity. However, not all entrepreneurship is inherently innovative, raising the question of whether cultural diversity may increase the relative prevalence of entrepreneurs pursuing innovative instead of more replicative strategies. This study investigates the relationship between regional cultural diversity and the innovation-orientation of early-stage entrepreneurs and considers moderating factors by decomposing shares of foreign-born population by origin within and outside of the EU and by education level. Combining survey data from the Global Entrepreneurship Monitor with various measures of cultural diversity, we carry out a multilevel analysis for 166 European regions. The results suggest that entrepreneurs in more culturally diverse regions are significantly more likely to exhibit innovation-orientation. We find some evidence that this effect is supported by cognitive proximity as the share of EU-born foreign population is driving this result. Moreover, our analysis suggests that the effect of cultural diversity on innovative entrepreneurship is not due to human capital availability or moderated by entrepreneurs' absorptive capacity but rather stems from the diversity in cultural background itself.
    Keywords: cultural diversity, entrepreneurship, innovation, European regions, multilevel analysis
    JEL: F22 L26 O30 R1
    Date: 2022–02
  3. By: Ernest Liu (Princeton University); Benjamin N. Roth (Harvard University)
    Abstract: Microcredit and other forms of small-scale finance have failed to catalyze entrepreneurship in developing countries. In these credit markets, borrowers and lenders often bargain over not only the interest rate but also implicit restrictions on types of investment. We build a dynamic model of informal lending and show this may lead to endogenous debt traps. Lenders constrain business growth for poor borrowers yet richer borrowers may grow their businesses faster than they could have without credit. The theory offers nuanced comparative statics and rationalizes the low average impact and low demand of microfinance despite its high impact on larger businesses.
    Keywords: credit markets, developing countries
    JEL: E51 O12
    Date: 2020–07
  4. By: Masahiko Shibamoto (Research Institute for Economics and Business Administration and Center for Computational Social Science, Kobe University, JAPAN)
    Abstract: This study argues that the heterogeneity in environmental awareness among business owners is a pivotal component in characterizing the implementation of green business practices in the small business sector. Specifically, using a large-scale survey of small and medium-sized enterprises (SMEs) throughout Japan, we show a gap between environmental awareness and green business practices in the small business sector; that is, SMEs are aware of environmental issues, but they do not practice green business to a large extent. Further, we quantitatively show that the environmental awareness of SMEs already practicing or attempting to practice green business tends to be greater than that of SMEs not practicing green business. Our empirical results support the link between environmental awareness as a business opportunity and green business practices. However, there is less evidence that environmental awareness divorced from management, such as the need to pass on a sustainable society to future generations, would be involved with green business practices in the small business sector. Our findings advocate that policymakers looking to strengthen environmental initiatives in the small business sector need to direct SMEs to build awareness of environmental issues related to their businesses.
    Keywords: Green business practices; Environmental awareness; Small business sector; Survey data; Japan
    JEL: L21 Q56
    Date: 2022–03
  5. By: John Eric Humphries (Yale University); Christopher Neilson (Princeton University); Gabriel Ulyssea (Oxford University)
    Abstract: This note provides new evidence on how small business owners have been impacted by COVID-19, and how these effects have evolved over time since the passage of the CARES Act. As part of a broader and ongoing project, we collected survey data from more than 8,000 small business owners in the U.S. from March 28th, one day after the CARES Act was passed, through April 20th. The data include information on their firm size, layoffs, beliefs about the future prospects of their businesses, as well as their awareness of existing government relief programs. We provide three main findings. First, by the time the CARES Act was passed, surveyed small business owners were already severely impacted by COVID-19-related disruptions, with 60% having laid of workers. Second, business owners’ expectations about the future are in general negative and have continuously deteriorated throughout our study period, with 37% of respondents in the first week reporting that they did not expect to recover within 2 years, growing to 46% by the last week. Third, we show that the smallest businesses had the least awareness of government assistance programs, the slowest growth in awareness after the passage of the CARES Act, and never caught up with the larger businesses. The latter indicate that small businesses may have missed out on initial Paycheck Protection Program funds because of low baseline awareness and differential access to information relative to larger firms.
    Keywords: COVID-19, Small business, CARES Act
    JEL: H00 H50 J00
    Date: 2020–04
  6. By: Guillermo Arenas Díaz (Dipartimento di Politica Economica, DISCE, Università Cattolica del Sacro Cuore); Andrés Barge-Gil (Department of Economic Analysis, Complutense University of Madrid, ICAE and GRIPICO, Madrid, Spain); Joost Heijs (Department of Applied Economics, Structure and History, Complutense University of Madrid, Madrid, Spain); Alberto Marzucchi (Gran Sasso Science Institute, Social Sciences, L'Aquila, Italia)
    Abstract: This paper analyses the effects of product innovations introduced by firms in upstream and downstream sectors and firms in the same sector on firm employment. To this aim, we extend the Harrison et al. (2014) model to analyse the relationship between firm innovation and employment to account for innovation in the same and related sectors. We employ panel data for the innovation activities of Spanish firms together with input–output data. The results show that product innovation by firms in the same sector harms the firm's employment, which is consistent with a business-stealing mechanism. A negative effect on employment is found for the introduction of new products in upstream sectors, which results in the reduction of labour in the focal firm. The type of labour that is displaced by innovations introduced by both same-sector and upstream firms is predominantly low-skilled. No significant effects are found for innovations introduced in downstream industries.
    Keywords: same sector, downstream and upstream sectors, product innovation, employment growth
    JEL: J23 O31 O33 L6
    Date: 2022–02
  7. By: Christophe LEVEQUE; Haris MEGZARI
    Abstract: We study the extent to which French entrepreneurs mobilized in an online collective action against the generalization of the health-pass policy in summer 2021. We document the dynamics of registrations on the website where entrepreneurs could claim they would not check the health-pass of their clients. We first note an over-representation of complementary and alternative medicine (CAM) practitioners among the mobilized people. We also suggest that professionals related to the touristic industry mobilized on the website. Second, we show that the government announcements led to an increase in the mobilization. However, they did not affect the diversity of the entrepreneurs joining the action. This lack of diversity may have restricted the pool of potential participants as well as limited the identification of the “public opinion” to the mobilization.
    Keywords: Covid-19, Collective actions, Protests, CAM, Health-pass, Anti-pass movements
    JEL: D71 I18
    Date: 2022
  8. By: naryono, endang (STIE PASIM SUKABUMI)
    Abstract: One of the characteristics of an entrepreneur is that his thoughts and insights are oriented towards Action rather than just dreaming, wishing and talking. An entrepreneur always faces risk with uncertainty and limitations in every problem he faces. If we only speak words and do not take action, all opportunities that exist will turn into disasters and calamities in our lives. A drafter or theorist, works with data and is rarely in the field. On the other hand, an entrepreneur spends 95% of his time in the field with his employees, suppliers and customers. Because working with data, in order to be valid and scientific, a drafter must be accustomed to testing the data, building a model and doing validation. What will be a problem if a drafter does not master the situation and information in the field and can become doubtful about his decision so that he tends to repeat the cycle again. Namely collecting data that causes him to be spindly and more oriented to the mind than Action. On the other hand, an Action-oriented person is a person who has a high level of effectiveness. To study the characteristics of an Action-oriented person using the model of an effective person
    Date: 2021–10–16
  9. By: Patrick Valeau (UR1 - Université de Rennes 1 - UNIV-RENNES - Université de Rennes); Cousin Germain Ravonjiarison
    Abstract: A travers l'étude exploratoire des parcours de quinze paysans malgaches ayant bénéficié de plusieurs microcrédits, nous questionnons les relations possibles entre ce dispositif et le réengagement entrepreneurial des bénéficiaires dans le cadre de très petites entreprises agricoles au sein de sociétés rurales traditionnelles. Transposant le modèle établi par Valéau (2007) à ce contexte, nous focalisons notre attention sur les dimensions psychologiques de ce processus. Nous examinons tout d'abord les doutes et les contradictions liées aux conditions de vie, mais aussi à un contexte traditionnel rural où l'innovation n'est pas la norme. Nos résultats montrent qu'à partir de conditions relativement similaires, les individus rencontrés se différencient progressivement les uns des autres au regard de leur réengagement entrepreneurial et, ce faisant, des stratégies et des performances de leur très petite entreprise. Nous identifions trois formes de réengagements tour à tour fondés sur la subsistance, la diversification et la croissance. Différentes pistes pour de futures recherches et des implications pratiques en matière de sélection et d'accompagnement des bénéficiaires sont discutées en opposant à un point de vue exclusivement commercial, des approches sociales et solidaires.
    Date: 2021

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