nep-ent New Economics Papers
on Entrepreneurship
Issue of 2022‒12‒12
nine papers chosen by
Marcus Dejardin
Université de Namur

  1. Study Examining New Technologies and Sustainable Development with a Focus on Social Entrepreneurship By Preminger, Ambrose Jude
  2. Entrepreneurship and Economic Growth: A Cross-Sectional Analysis Perspective By Kim, Jungsuk; Castillejos-Petalcorin, Cynthia; Jinjarak, Yothin; Park, Donghyun; Quising, Pilipinas; Tian, Shu
  3. Microentrepreneurs' Gender Difference in Labor Demand By Oladipo, Oluwasheyi S.; Shim, Hyoung Suk
  4. The Economics of Women s Entrepreneurship: Evidence from Building Skills in Uganda By Lang, M; Seither, J
  5. German Financial State Aid during COVID-19 Pandemic: Higher Impact among Digitalized Self-Employed By Irene Bertschek; Joern Block; Alexander S. Kritikos; Caroline Stiel
  6. Does Corruption Discourage Entrepreneurship? By Park, Donghyun; Shin, Kwanho
  7. Working Paper 364 - ‘Catch Me if You Can’ On Drivers of Venture Capital Investment in Africa By Fadel Jaoui; Omolola Amoussou; Francis H. Kemeze
  8. Relationship Between Knowledge Management with Cost Leadership and Differentiation Strategies in Sumbawa Weaving SMEs: The Moderating Role of Organizational Design By Probosari, Ninik; Kusmayadi, Andi; Wijayani, Ari; Ardhanariswari, Kartika Ayu; Siregar, Ilham Ramadan Pandu Setia Negara; Viyani, Ari Okta
  9. Small and Medium Sized European Firms and Energy Efficiency Measures: A Probit Analysis By Guglielmo Maria Caporale; Cristiana Donati; Nicola Spagnolo

  1. By: Preminger, Ambrose Jude
    Abstract: The economy of today is characterized by rapid change at any given time. Adaptability is the key to success in such an environment. When one examines the historical development of economic theory, it becomes evident that the development of industry and the advancement of a community's economy are based on the development of new ideas and innovations. Without being at the forefront of science and innovation, it is unlikely that any country will be able to pass the development route. An important tool for achieving this goal is entrepreneurship. In an economic system based on entrepreneurship, innovators and owners of ideas are among the most important factors for the advancement of the system. Entrepreneurship is closely related to economic and social development, and it is considered an important indicator of development in developing countries today. In light of the special role and position of entrepreneurs in the process of economic growth and community development, many governments in developed and leading countries are attempting to foster the development of a number of community members with entrepreneurial characteristics. Aiming to maximize opportunities and exploit research achievements in order to promote entrepreneurship education and entrepreneurial activities. By promoting entrepreneurship and providing an environment conducive to growth and development, it will be possible to eliminate current issues and problems associated with entrepreneurship, as well as the unemployment of university graduates and the great problem of other unemployed persons. Research has shown that entrepreneurship can contribute to economic growth through a variety of channels. In order to create knowledge overflow in the new theories of growth, when the economy reaches sustainable status, income growth per capita would only be possible via knowledge growth, which would result in more efficient production technologies with greater productivity. With this context in mind, the intersection of social entrepreneurship, technology development, and sustainable development is very important in today's world. Developing entrepreneurship is essential to meeting these needs and achieving these goals.
    Keywords: Community Development; Entrepreneurial Activities; Entrepreneurship; innovation; Social Entrepreneurship, Sustainable Development, Sustainable Development and Technology.
    JEL: L26 O14 Q01
    Date: 2022–10–16
  2. By: Kim, Jungsuk (Sejong University); Castillejos-Petalcorin, Cynthia (Asian Development Bank); Jinjarak, Yothin (Asian Development Bank); Park, Donghyun (Asian Development Bank); Quising, Pilipinas (Asian Development Bank); Tian, Shu (Asian Development Bank)
    Abstract: Entrepreneurship, or the activity of starting and running a business, is a vital ingredient of economic growth and development. Entrepreneurs contribute to innovation, and they are central to dynamic Schumpeterian competition and broader economic dynamism. In this paper, we contribute to the entrepreneurship literature by performing cross-sectional analysis to examine the link between entrepreneurship and economic growth. We divide total early-stage entrepreneurship into opportunity-driven entrepreneurship versus necessitydriven entrepreneurship, and our sample economies into advanced economies versus developing economies. We do not find evidence of a positive link between aggregate entrepreneurship and economic growth. This is consistent with the hugely heterogenous nature of entrepreneurial activity. At a broader level, our empirical evidence points to the importance of distinguishing between different types of entrepreneurship and different groups of economies. In particular, for developing economies where manufacturing is relatively important, we find that opportunity-driven entrepreneurship is positively linked with growth.
    Keywords: entrepreneurship; economic growth; development
    JEL: L26 M13 O47
    Date: 2022–10–11
  3. By: Oladipo, Oluwasheyi S. (State University of New York at Old Westbury); Shim, Hyoung Suk (CUNY - College of Staten Island)
    Abstract: This paper empirically examines firm owners' gender difference in labor demand. We estimate the average treatment effect (ATE) of female ownership on employment of the firm using the 2007 Survey of Business Owners (SBO) Public Use Micro Sample (PUMS), provided by the U.S. Census Bureau. Because female microentrepreneurs potentially demand more labor so as to allocate time for household production, we hypothesize a condition under which female microentrepreneurs employ more, and that is, if they are free from financial constraints. We show first that the estimation of the ATE for female ownership can have a downward selection bias that may yield negative ATE estimates, and this downward selection bias comes from male owners being less financially constrained than female owners. We then perform the two-stage least squares (TSLS) estimation using two sets of instrumental variables (IVs), which are indicator variables for i) inheritance; and ii) loans from bank or family/friend. The estimation results present that the female owner effect on labor demand as local average treatment effect (LATE) is identified and consistently estimated by using the IVs. From the main model estimation, we find a positive and statistically significant female owner effect that female owners hire more employees than male owners by about 25.8%.
    Keywords: entrepreneurship, gender, labor demand, startups
    JEL: G31 J16 J22 J23 L26 M13
    Date: 2022–11
  4. By: Lang, M; Seither, J
    Abstract: In contexts where women have few opportunities for wage work, entrepreneurship may be one of the only avenues for economic inclusion. However, women-owned businesses are often less profitable than their male-owned counterparts, and many microenterprises do not grow. Can removing skills-based barriers to productive entrepreneurship increase women’s incomes and, if so, what happens when women become productive entrepreneurs? We randomize a program targeting ultra-poor women in Uganda that promotes business and entrepreneurship skills development. Removing these barriers generates large effects on business creation and increases profits by 105% relative to control. Treated women heavily re-invest their profits, spending only 23% on household consumption. As a result, we detect no effects on household welfare within our study period. However, we document significant, positive spillovers to other women and children in the community. Our results highlight the importance of skills-based constraints to productive entrepreneurship while pointing to remaining barriers to private sector development.
    Keywords: Entrepreneurship, Firm growth, Behavioral development economics
    JEL: D13 D23 D91 J16 O12
    Date: 2022–11–11
  5. By: Irene Bertschek; Joern Block; Alexander S. Kritikos; Caroline Stiel
    Abstract: In response to strong revenue and income losses that a large share of the self-employed faced during the COVID-19 pandemic, the German federal government introduced a €50bn emergency aid program. Based on real-time online-survey data comprising more than 20,000 observations, we analyze the impact of this program on the subjective survival probability. In particular, we investigate how the digitalization level of the self-employed influences the program’s effectiveness. Employing propensity score matching, we find that the emergency aid program had only moderately positive effects on the confidence of the self-employed to survive the crisis. However, the self-employed whose businesses were highly digitalized, benefitted much more from the state aid compared to those whose businesses were less digitalized. This holds true only for those self-employed in advanced digitalization stages, who started the digitalization processes already before the crisis. Moreover, taking a regional perspective, we find suggestive evidence that the quality of the regional broadband infrastructure matters in the sense that it increases the effectiveness of the emergency aid program. Our findings show the interplay between governmental support programs, the digitalization levels of entrepreneurs, and the regional digital infrastructure. The study helps public policy to increase the impact of crisis-related policy instruments.
    Keywords: Self-employment, emergency aid, treatment effects, COVID-19, entrepreneurship, digitalization, resilience
    JEL: C14 H43 L25 L26 J68 O33
    Date: 2022
  6. By: Park, Donghyun (Asian Development Bank); Shin, Kwanho (Korea University)
    Abstract: Although entrepreneurship plays a key role in economic development, it remains largely unknown. The reason is that it is challenging to measure entrepreneurship objectively and identify its determinants. In this paper, we analyze the effect of a particular feature of the institutional landscape, namely corruption, on entrepreneurship. It is expected that corruption discourages entrepreneurship since it undermines fair competition. We employ two proxies for entrepreneurship that are widely used in the literature: (i) nascent entrepreneurship collected from Global Entrepreneurship Monitor; and (ii) entry rate defined as the number of new firms divided by the total number of previous year’s registered businesses, collected from the World Bank Group Entrepreneurship Survey. We find that better control of corruption promotes entrepreneurship. Our findings are preserved when we add other determinants of entrepreneurship which are drawn from the literature. When we use legal origins as instruments for corruption, our results remain essentially the same.
    Keywords: entrepreneurship; corruption; institution; corporate tax; legal origin
    JEL: D22 D53 D73 E02 E60 G38
    Date: 2022–09–02
  7. By: Fadel Jaoui (African Development Bank); Omolola Amoussou (African Development Bank); Francis H. Kemeze (African Development Bank)
    Abstract: This paper investigates the determinants of venture capital investments across 25 African countries over the period 2014-2019. In particular, it considers the significance of innovation and digitalization in Africa’s venture capital activity. The results show that digital infrastructure, high-technology exports, internet coverage, market size, minority investor protection, and government effectiveness are the main drivers of venture capital deals in Africa over the period examined. More generally, these findings highlight that digital infrastructure and connectivity, innovation and institutional frameworks all play an important role in shaping a favorable environment to attract venture capital funding.
    Keywords: Venture capital, Digitalization, Innovation, Africa JEL classification: G18, G24, O33
    Date: 2022–07–08
  8. By: Probosari, Ninik; Kusmayadi, Andi; Wijayani, Ari; Ardhanariswari, Kartika Ayu; Siregar, Ilham Ramadan Pandu Setia Negara; Viyani, Ari Okta
    Abstract: Small and Medium Enterprises (SMEs) are the main drivers of the economy in developing countries, one of which is Indonesia. Several SMEs still need to be developed in Indonesia, especially for the 3T region (lagging, leading, and outermost). Sumbawa is one of these areas. The majority of SMEs in the Sumbawa area are weaving SMEs. Weaving SMEs in this region still have problems in terms of SME competitiveness, innovation, and SME creativity. Therefore, they have not been able to compete with SMEs outside the 3T area. Thus, the importance of competitive strategy and knowledge management can encourage the management of information into knowledge that can be used for strategic decision-making, especially the competitive strategy of SMEs. This study will examine the application of knowledge management to SMEs in Sumbawa and whether the applied knowledge management can encourage the creation of a competitive strategy for Sumbawa SMEs. The research was conducted by census/saturated sampling to produce accurate results. The results show that the application of knowledge management in Sumbawa SMEs is proven to influence SMEs' competitive strategy. The study also contributes to new research on the role of organizational design that can affect knowledge management's influence on competitive strategy.
    Date: 2022–09–19
  9. By: Guglielmo Maria Caporale; Cristiana Donati; Nicola Spagnolo
    Abstract: This paper investigates the factors (such as different sources of financing, energy audits and internal monitoring activities) affecting the propensity of European small and medium sized enterprises (SMEs) to adopt energy efficiency measures (EEMs). For this purpose, a Probit model is estimated using data from the 2017 Flash Eurobarometer survey covering a large sample of European firms. The analysis is carried out for the full sample as well as for clusters based on an environmental performance index (EPI) and on the level of economic development in turn. The results indicate that internal financing always has a positive effect on a firm’s propensity to adopt EEMs. Private external sources of financing appear to be more important for Western European firms as well as for those located in countries with a greater level of environmental awareness; in the latter, when firms combine private financing with energy audits or internal monitoring activities the propensity to adopt EEMs increases further. By contrast, in the Eastern Countries this occurs when firms simultaneously rely on public funds and monitoring activities.
    Keywords: energy efficiency measures, EPI, financing, SMEs
    JEL: G32 O16 Q40
    Date: 2022

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