nep-sbm New Economics Papers
on Small Business Management
Issue of 2010‒02‒05
seven papers chosen by
Joao Carlos Correia Leitao
Polytechnic Institute of Portalegre and Technical University of Lisbon

  1. Family ownership, innovation and other context variables as determinants of sustainable entrepreneurship in SMEs: An empirical research study By Gerrit de Wit; Lorraine Uhlaner; Marta Berent; Ronald Jeurissen
  2. Does interdisciplinarity lead to higher employment growth of academic spinoffs? By Müller, Bettina
  3. The Importance of Labour Mobility for Spillovers across Industries By Johannes Pöschl; Neil Foster
  4. Business Taxation, Corporate Finance and Economic Performance By Christian Keuschnigg; Evelyn Ribi
  5. Innovative capability and financing constraints for innovation more money, more innovation? By Hottenrott, Hanna; Peters, Bettina
  6. Schumpeter versus Kirzner: An empirical investigation of opportunity types By Jeroen de Jong; Orietta Marsili
  7. Patent thickets, licensing and innovative performance By Cockburn, Iain M.; MacGarvie, Megan J.; Müller, Elisabeth

  1. By: Gerrit de Wit; Lorraine Uhlaner; Marta Berent; Ronald Jeurissen
    Abstract: This study focuses on the prediction of sustainable entrepreneurship, that is, behavior which demonstrates a firm’s concern about the natural environment, especially among small and medium sized enterprises (SMEs). Using a random sample of 642 Dutch SMEs we examine how organizational context (firm sector, size, ownership structure) and innovativeness influence SMEs engagement in sustainable entrepreneurship. Results show that manufacturing and construction firms, larger firms, family-owned firms, and firms with a more innovative orientation are more likely to report positive activity related to the natural environment. Results do not support the conclusion that the relationship between sustainable entrepreneurship and firm size is curvilinear. The paper discusses implications of the obtained results.  
    Date: 2010–01–22
  2. By: Müller, Bettina
    Abstract: Does heterogeneity in the educational backgrounds of the founders matter for firm success? Are team foundations more successful than single entrepreneurs? These questions are analysed using data on academic spinoffs in Germany. Firm success is measured by employment growth. I find that team foundations have higher employment growth than single entrepreneurs. Team foundations of engineers perform better when they have a business scientist in the team. However, different subjects per se and heterogeneity in the academic origins of the founders do not play a significant role for the employment growth of academic spinoffs. --
    Keywords: human capital,entrepreneurship,academic spinoffs,employment growth
    JEL: C12 L25 M13
    Date: 2009
  3. By: Johannes Pöschl (The Vienna Institute for International Economic Studies, wiiw); Neil Foster (The Vienna Institute for International Economic Studies, wiiw)
    Abstract: This paper addresses the link between productivity and labour mobility. The hypothesis tested in the paper is that technology is transmitted across industries through the movement of skilled workers embodying human capital. The embodied knowledge is then diffused within the new environment creating spillovers and leading to productivity improvements. A theoretical framework is presented wherein productivity growth is modelled through knowledge acquisition with respect to labour mobility. The empirical estimates confirm the existence of positive cross-sectoral knowledge spillovers and indicate that labour mobility has beneficial effects on industry productivity. Due to the fact that labour mobility is closely linked to input-output relations this finding provides evidence suggesting that part of the estimated productivity effects of domestic rent spillovers are in fact due to knowledge spillovers resulting from labour mobility.
    Keywords: knowledge spillovers, labour mobility, productivity, manufacturing, industry, human capital, growth
    JEL: J24 J60 O47
    Date: 2009–10
  4. By: Christian Keuschnigg; Evelyn Ribi
    Abstract: This survey of recent research in corporate finance discusses how business taxes, subsidies as well as a country's institutional development affect several important decision margins of heterogeneous firms. We argue that innovative firms, as a result of agency problems between insiders and outside investors, are most frequently finance constrained. We discuss how profit taxes reduce investment of constrained firms by their effect on cash-flow, and of unconstrained firms by their effect on the user cost of capital. Moreover, tax reform as well as tax financed R&D subsidies can enhance aggregate investment, innovation and efficiency by implicitly redistributing profits towards constrained firms where capital earns the highest return. We argue that the corporate legal form improves firms' access to external funds. We then explain the firms' choice between venture capital and bank financing and discuss how business taxation can affect venture capital financing on both the extensive and intensive margins. Finally, we review theory and evidence on how corporate finance may shape a country's comparative advantage in innovative industries as well as aggregate labor market performance when part of firms are finance constrained.
    Keywords: Financing constraints, innovation, business taxation, subsidies, entrepreneurial choice
    JEL: G38 H24 H25
    Date: 2010–01
  5. By: Hottenrott, Hanna; Peters, Bettina
    Abstract: This study presents a novel empirical approach to identify financing constraints for innovation based on the idea of an ideal test as suggested by Hall (2008). Firms were offered a hypothetical payment and were asked to choose between alternatives of use. If they choose additional innovation projects they must have had some unexploited investment opportunities that were not profitable using more costly external finance. That is, these firms have been financially constrained. We attribute constraints for innovation not only to lacking financing, but also to firms' innovative capability. Econometric results show that financial constraints do not depend on the availability of internal funds perse, but that they are driven by innovative capability. We find firms with high innovative capability but low financial resources to be most likely subject to financing constraints. Yet, we also observe constraints for financially sound firms that may have to put ideas on the shelf. --
    Keywords: Innovation,financing constraints,innovative capability,multivariate probit models
    JEL: O31 O32 C35
    Date: 2009
  6. By: Jeroen de Jong; Orietta Marsili
    Abstract: This paper empirically explores the distinction between Schumpeterian and Kirznerian opportunities by analyzing survey data of 184 high tech small business entrepreneurs. A multidimensional measure is developed documenting the extent in which entrepreneurial opportunities are either Schumpeterian or Kirznerian. It consists of five bipolar dimensions. We find that Schumpeterian opportunities are more likely to be pursued by innovative individuals with strong ambitions to grow their company. At the enterprise level, we find such opportunities in organizations with a strategic focus on proactive product development to satisfy future needs. Besides, Schumpeterian opportunities are found more often in relatively innovative organizations and pursued in rapidly growing markets. They seem to induce better growth in terms of sales and employment.
    Date: 2010–01–13
  7. By: Cockburn, Iain M.; MacGarvie, Megan J.; Müller, Elisabeth
    Abstract: We examine the relationship between fragmented intellectual property (IP) rights and the innovative performance of firms, taking into consideration the role played by in-licensing of IP. We find that firms facing more fragmented IP landscapes have a higher probability of in-licensing. For firms with small patent portfolios we also find a positive association between fragmentation and licensing costs as a share of sales. We observe a negative relationship between IP fragmentation and innovative performance, but only for firms that engage in in-licensing. In contrast, greater IP fragmentation is associated with higher innovative performance for firms that do not in-license. Furthermore, the effects of fragmentation on innovation also appear to depend on the size of a firm’s patent portfolio. These results suggest that the effects of fragmentation of upstream IP rights are not uniform, and instead vary according to the characteristics of the downstream firm. --
    Keywords: patent thickets,licensing,innovative performance
    JEL: O34 O31
    Date: 2009

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