nep-ent New Economics Papers
on Entrepreneurship
Issue of 2023‒04‒17
seven papers chosen by
Marcus Dejardin
Université de Namur

  1. The Effects of Startup Acquisitions on Innovation and Economic Growth By Christian Fons-Rosen; Pau Roldan-Blanco; Tom Schmitz
  2. How does the regional presence of foreign-owned multinational enterprises affect local start-up performance By Grillitsch, Markus; Martynovich, Mikhail; Nilsson, Magnus; Schubert, Torben
  3. Access to Credit after Emerging from Corporate Bankruptcy By Chloé Zapha; Banque de France
  4. A Search Model with Self-Employment and Heterogeneity in Managerial Ability By Eliane Badaoui; Olivier Bargain; Prudence Magejo; Eric Strobl; Frank Walsh
  5. Overcoming Financial Challenges for Small and Medium Enterprises: Strategies for Entrepreneurial Success By Amoa-Gyarteng, Karikari
  6. Competitive strategies of entrepreneurs in the traditional service sector By Fabien Eymas; Faouzi Bensebaa
  7. Situation de l’activité entrepreneuriale en France : Rapport 2021 du Global Entrepreneurship Monitor By Karim Messeghem; Frank Lasch; Justine Valette; Sophie Casanova; Jean-Marie Courrent; Walid Nakara; Sylvie Sammut; Roy Thurik; Olivier Torrès; Dorian Boumedjaoud

  1. By: Christian Fons-Rosen (University of California in Merced); Pau Roldan-Blanco (Bank of Spain); Tom Schmitz (Queen Mary University of London and CEPR)
    Abstract: Innovative startups are frequently acquired by large incumbent firms. On the one hand, these acquisitions provide an incentive for startup creation and may transfer ideas to more efficient users. On the other hand, incumbents might acquire startups just to “kill” their ideas, and acquisitions can erode incumbents’ own innovation incentives. Our paper aims to assess the net effect of these forces. To do so, we build an endogenous growth model with heterogeneous firms and acquisitions, and calibrate its parameters by matching micro-level evidence on startup acquisitions and patenting in the United States. Our calibrated model implies that acquisitions raise the startup rate, but lower incumbents’ own innovation as well as the percentage of implemented startup ideas. The negative forces are slightly stronger. Therefore, a ban on startup acquisitions would increase growth by 0.03 percentage points per year, and raise welfare by 1.8%.
    Keywords: Keywords: Acquisitions, Innovation, Productivity growth, Firm dynamics.
    JEL: O30 O41 E22
    Date: 2022–12–09
  2. By: Grillitsch, Markus (CIRCLE, Lund University); Martynovich, Mikhail (CIRCLE, Lund University); Nilsson, Magnus (CIRCLE, Lund University); Schubert, Torben (CIRCLE, Lund University)
    Abstract: This paper analyses how the presence of foreign-owned multinational enterprises (MNEs) affects the performance of start-ups in the same region. Focusing on the population of Swedish start-ups and MNEs between 2007 and 2015, we investigate the relationship between start-up productivity and regional share of MNE employment. We find effects that differ by sectoral belonging of start-ups and MNEs. Notably, while the effects of the local presence of foreign-owned MNEs are negative when start-ups and local MNEs belong to the same sector, they are positive for the local presence of MNEs in related and (to some weaker extent) unrelated sectors. Moreover, we find that as start-ups mature the effect of the local presence of foreign-owned MNEs on start-up productivity increases, irrespective of their sectoral belonging. We interpret this as evidence of age-dependent processes of learning, legitimacy building, and resource accumulaton allowing start-ups to reap the benefits while mitigating negative effects of MNE proximity. Interestingly, we show that the documented effects are more pronounced for service firms, particularly in the knowledge-intensive sectors.
    Keywords: Productivity; start-ups; MNE
    JEL: M13 M16 R11
    Date: 2023–03–27
  3. By: Chloé Zapha (Banque de France - Banque de France, Université Paris Dauphine-PSL - PSL - Université Paris sciences et lettres, LEDa - Laboratoire d'Economie de Dauphine - IRD - Institut de Recherche pour le Développement - Université Paris Dauphine-PSL - PSL - Université Paris sciences et lettres - CNRS - Centre National de la Recherche Scientifique); Banque de France
    Abstract: This paper identifies the credit restrictions that small firms are facing after emerging from bankruptcy. Using the French credit register, I implement a differencein-difference strategy that exploits staggered removal of bankruptcy flags in the form of an exogenous change in credit ratings. I focus on small and medium businesses between 2012 and 2019 and show that the flag removal leads to an increase in bank credit of 1.7%. The flag removal does not make relationship banks forget about the past bankruptcy. Instead, it removes adverse information for new banks that subsequently start lending. As a result, financially constrained firms rely less on supplier debt and increase their investment by 15%.
    Keywords: Corporate Bankruptcy, Debt Restructuring, Credit Rating, Bank Lending Relationship, SMEs
    Date: 2023–01–26
  4. By: Eliane Badaoui; Olivier Bargain; Prudence Magejo; Eric Strobl; Frank Walsh
    Abstract: The view of informal employment as a last resort in the labour market has recently been challenged by numerous studies documenting the existence of a high degree of heterogeneity within the formal and informal sectors - in particular the presence of high-tier informal work corresponding to voluntary self-employment. There is currently not much theoretical support for these observations. We develop a formal model to explain this growing empirical evidence about substantial heterogeneity within formal/informal labour markets. In our model, workers may enter self-employment or search for jobs as employees, while allowing for heterogeneity across workers’ managerial ability. While workers with higher managerial ability will manage larger firms, workers with lower managerial ability will manage smaller firms and be in self-employment only when they cannot find a salaried formal/informal job. For the latter, self-employment in the informal sector is the outside employment option.
    Keywords: Self-employment; Managerial ability; Informal sector.
    JEL: J31 O17
    Date: 2023
  5. By: Amoa-Gyarteng, Karikari
    Abstract: The article discusses the challenges faced by small and medium-sized enterprises (SMEs) in obtaining finance, which is a critical issue for their growth and profitability. It highlights that SMEs often lack collateral and financial history which makes it difficult for them to obtain loans from traditional financial institutions. The article then explores two approaches to entrepreneurship, Effectuation and Bricolage, which focus on internal resourcefulness and making the most of what is available, regardless of long-term returns. The paper lists ten strategies that entrepreneurs can adopt including embracing affordability logic, engaging in networking and collaboration among others. By implementing these strategies, SMEs can overcome funding challenges and achieve sustainable growth.
    Keywords: Financial Challenges; Entrepreneurial Success; Effectuation; Bricolage; Dynamic Capabilities
    JEL: M1
    Date: 2023–03–25
  6. By: Fabien Eymas (Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar); Faouzi Bensebaa (UP8 - Université Paris 8 Vincennes-Saint-Denis)
    Abstract: This article aims better to understand the competitive behaviour of entrepreneurs in the traditional service sector. Based on the theoretical framework of competitive dynamics, this research has uncovered the existence of six competitive behaviours depending on these everyday entrepreneurs' focus of attention. Their behaviours vary according to whether the focus is on the exploitation of the entrepreneurs' resources, their interactions with their competitors, customers or suppliers. Thus, the drivers of the competitive strategies of entrepreneurs in the traditional service sector appear similar to those of large companies, apart from the importance traditionally given to rivalry, which appears to be less important.
    Abstract: Cet article vise à mieux comprendre le comportement concurrentiel des entrepreneurs du secteur des services traditionnels. En s'appuyant sur le cadre théorique de la dynamique concurrentielle, cette recherche a mis au jour l'existence de six comportements concurrentiels types selon la focalisation de l'attention de ces entrepreneurs ordinaires. Leurs comportements varient selon que l'accent soit mis sur l'exploitation des ressources des entrepreneurs, leurs interactions avec leurs clients, concurrents ou fournisseurs. Aussi les ressorts des stratégies concurrentielles des entrepreneurs du secteur des services traditionnels apparaissent-ils semblables à ceux des grandes entreprises, en dehors de l'importance traditionnellement donnée à la rivalité qui apparaît moindre.
    Keywords: Competitive behaviour, Competitive dynamics, Competitive strategies, Everyday enrtepreneurship, Interpretative phenomenological analysis, Analyse phénménologique interprétative, Comportement concurrentiel, Dynamique concurrentielle, Entrepreneurs ordinaires, Stratégies concurrentielles
    Date: 2021–12–17
  7. By: Karim Messeghem (UM - Université de Montpellier); Frank Lasch (Montpellier Business School - Montpellier Business School); Justine Valette (UM - Université de Montpellier); Sophie Casanova (UM - Université de Montpellier); Jean-Marie Courrent (UM - Université de Montpellier); Walid Nakara (Montpellier Business School); Sylvie Sammut (UM - Université de Montpellier); Roy Thurik (Montpellier Business School); Olivier Torrès (UM - Université de Montpellier, Montpellier Business School); Dorian Boumedjaoud (EDC - EDC Paris Business School)
    Abstract: The Global Entrepreneurship Monitor report highlights the situation of entrepreneurial activity in France, in particular in comparison with the G7 countries. This study is based on two data collections, one from the population aged 18-64 and the other from a panel of experts. The results make it possible to understand entrepreneurial activity through its determinants and its effects, and to characterize the entrepreneurial ecosystem. This report leads to useful proposals for political and economic decision-makers in connection with entrepreneurial education, women's entrepreneurship or entrepreneurial health.
    Abstract: Le rapport du Global Entrepreneurship Monitor met en lumière la situation de l'activité entrepreneuriale de la France en comparaison notamment avec les pays du G7. Cette étude est basée sur deux collectes de données, l'une auprès de la population des 18-64 ans et l'autre auprès d'un panel d'experts. Les résultats permettent de comprendre l'activité entrepreneurial à travers ses déterminants et ses conséquences, et de caractériser l'écosystème entrepreneurial. Ce rapport aboutit sur des propositions utiles aux décideurs politiques et économiques en lien avec l'éducation entrepreneuriale, l'entrepreneuriat féminin ou encore la santé entrepreneuriale.
    Keywords: Entrepreneuriat, intention, motivations, écosystème entrepreneurial
    Date: 2022–10–03

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