nep-sbm New Economics Papers
on Small Business Management
Issue of 2010‒07‒10
eight papers chosen by
Joao Carlos Correia Leitao
University of Beira Interior and Technical University of Lisbon

  1. Does history matter for the relationship between R&D, Innovation and Productivity? By Huergo , E; Moreno, L
  2. Understanding the spanish business innovation gap: the role of spillovers and firms’ absorptive capacity By Paloma López-García; José Manuel Montero
  3. How Diverse is Entrepreneurship? Observations on the social heterogeneity of self-employment in Germany By Bögenhold, Dieter; Fachinger, Uwe
  4. Measuring the impact of international R&D cooperation: the case of Spanish firms participating in the EU Framework Programme By Barajas, A; Huergo, E; Moreno, L
  5. Pecuniary Knowledge Externalities and Innovation: Intersectoral Linkages and their Effects beyond Technological Spillovers By Agnieszka Gehringer
  6. A parsimonious default prediction model for Italian SMEs By Chiara Pederzoli; Costanza Torricelli
  7. Ownership Concentration, Family Control and Performance of Firms By Malika Hamadi
  8. Home Firm Performance after Foreign Investments and Divestitures By Dirk Engel; Vivien Procher

  1. By: Huergo , E; Moreno, L
    Abstract: This paper analyzes the relationship between R&D expenditures, innovation and productivity growth, taking into account the possibility of persistence in firms’ behaviour. We study this relationship for a sample of Spanish manufacturing firms between 1990 and 2005, estimating a model with four equations: participation in technological activities, R&D intensity, the generation of innovations and the impact of these technological outputs on total factor productivity growth. Our results reflect the existence of true state dependence both in the decision of R&D investment and in the production of innovations. The omission of this persistence leads to an overestimation of the current impact of innovations on productivity growth. However, the presence of persistence in technological inputs and outputs entails current R&D activities having long–run effects on a firm’s productivity.
    Keywords: CDM model; productivity growth; persistence in R&D and innovation.
    JEL: L6 D24 O3
    Date: 2010–05–10
  2. By: Paloma López-García (Banco de España); José Manuel Montero (Banco de España)
    Abstract: This paper investigates whether the existence of knowledge spillovers, differences in the capacity of f rms to assimilate them and disparities in some human resource management practices are related with the decision to innovate of Spanish f rms. In order to do this, we employ data from the “Central de Balances” database, which covers both manufacturing and services f rms during the period 2003-2007, and use an estimator proposed by Wooldridge (2005) for dynamic random effects discrete choice models. The empirical exercise provides evidence on the positive link between spillovers and the innovative behaviour of companies, not just for the knowledge generated in the same industry, but also for that generated in the same region or by the public sector. Moreover, this link is stronger for those f rms with a higher capacity to absorb those spillovers. This ability not only works through f rms’ R&D capabilities, but also through such factors as the quality of the labour force, the share of temporary employment and the amount of resources spent in training. In addition to these factors, we f nd that innovation performance exhibits a high degree of inertia. Further, some other observed f rm characteristics, such as size, sales growth, export behaviour, sector capital intensity or f nancial structure variables, are also found to be relevant determinants of the likelihood of innovation.
    Keywords: innovation, R&D, spillovers, absorptive capacity, skilled labour, temporary employment, dynamic RE probit model
    JEL: O32 C23 C25 J6 J24 L00
    Date: 2010–06
  3. By: Bögenhold, Dieter; Fachinger, Uwe
    Abstract: The discussion on entrepreneurship often treats entrepreneurs as agents of ideas of economic change and growth. Entrepreneurs are considered to serve as potential multipliers delivering individual and social wealth and prosperity. In that context entrepreneurship has been treated as a rather homogenous category, internal differences were not in the focus of academic talk. In public policy discourse entrepreneurship and the labour market category of self-employment are often used interchangeably. Images and interpretation of self-employment are mostly based on comparison of self-employment with other categories of wage or salary dependent labour market groups. This way self-employed people prove to become an averaged one-type figure. The proposed paper wants to highlight the other side of economic and social reality: the heterogeneity of self-employment. Referring to empirical data for the case of Germany the argumentation intends to illuminate different levels of social and economic integration of self-employed people. Working parameters and firm sizes, economic sectors of activity, income patterns, working hours and biographies have diversified and became increasingly heterogeneous so that further discussion is ultimately provoked: Which entrepreneurship are we talking about when talking entrepreneurship? Where are links between different fractions of the category of self-employment compared to each other and to other socio-economic groups? The contribution must be regarded as a theoretical and empirical task to connect entrepreneurship with debate on innovation, culture and finance.
    Keywords: self-employment; heterogeneity; entrepreneurship
    JEL: D01 J23
    Date: 2010–05
  4. By: Barajas, A; Huergo, E; Moreno, L
    Abstract: The objective of this paper is to analyse the effects of international R&D cooperation on firms’ economic performance. Our empirical analysis, based on Spanish firms’ participation in the Framework Programme (FP) between 1995 and 2005, has confirmed that: (1) cooperation within the FP has a positive impact on the technological capacity of firms, captured through intangible fixed assets and (2) the technological capacity of firms is positively related to their economic performance, measured by labour productivity.
    Keywords: International R&D cooperation; Framework Programme; Impact assessment
    JEL: L2 H81 O3
    Date: 2009–11–17
  5. By: Agnieszka Gehringer
    Abstract: The aim of the paper is to discuss and to provide evidence for the existence of pecuniary knowledge externalities, considered here as the main cause of positive disequilibrium experience by downstream producers. This last effect, confirmed by the empirical analysis here performed, contrasts the postulates of the model of growth through creative destruction due to Aghion & Howitt (1992), where downstream producers remain very much passive in front of new technological knowledge externally generated.
    Keywords: pecuniary knowledge externalities, endogenous growth, creative destruction, Input-Output
    Date: 2010–06–19
  6. By: Chiara Pederzoli; Costanza Torricelli
    Abstract: In the light of the fundamental role played by small and medium enterprises (SMEs) in the economy of many countries including Italy and of the specific treatment of this issue within the Basel II regulation, the aim of this work is to build a default prediction model for the Italian SMEs. Specifically, we develop a logit model based on financial ratios: using the AIDA database, we focus the attention on a specific region in Italy, Emilia Romagna, where SMEs represent the firms’ majority . We find that a parsimonious model based on only four explanatory variables fits well the default data.
    Keywords: credit default prediction; SMEs; Basel II
    JEL: G28 G31
    Date: 2010–06
  7. By: Malika Hamadi (Luxembourg School of Finance, University of Luxembourg)
    Abstract: This paper explores the relationship between firm performance, measured by Tobin's Q and very powerful controlling shareholders in a sample of Belgian listed firms. The paper shows that overall the largest shareholders have a negative effect on firm performance. Nevertheless, in family firms the effect of large controlling shareholders on performance is positive except when they are organized in voting blocks. Firms related to coordination centers display higher performance associated with large shareholders. The paper shows that the presence of a second shareholder in the firm has no significant effect.
    Keywords: Ownership concentration, family firms, voting blocks, Tobin's q
    JEL: G3 G32 G34
    Date: 2010
  8. By: Dirk Engel; Vivien Procher
    Abstract: ‘Being international’ has nearly become an undisputed aim for firms in a globalized world. Several papers find a positive relationship between foreign direct investment (FDI) and the home performance of firms. In this paper we address the “FDI – export” relationship to better understand this pattern. Furthermore, by presenting first results on firm’s post-divestiture employment growth at home we are able to provide a more comprehensive view on fi rm performance after stepping in and out of foreign markets. We apply a propensity score matching technique in combination with a difference-in-difference estimator to analyze the performance dynamics of French firms that invested abroad or carried out foreign divestitures during the period 2000-2007. FDI has on average a positive home firm eff ect in terms of export share, operating turnover and employment. Industry differences reveal that firms in high-tech industries experience a strong increase in their home performance, whereas firm performance in low-tech industries increases only moderately in post-investment periods. In contrast, the divestiture impact on the post-divestiture performance is rather negligible.
    Keywords: Foreign markets; entry and exit; firm performance
    JEL: F21 F23 D21 L25
    Date: 2010–04

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