nep-sbm New Economics Papers
on Small Business Management
Issue of 2012‒04‒03
five papers chosen by
Joao Carlos Correia Leitao
University of Beira Interior and Technical University of Lisbon

  1. The Impact of Consulting Services on Small and Medium Enterprises: Evidence from a Randomized Trial in Mexico By Mariam Bruhn; Dean Karlan; Antoinette Schoar
  2. Innovation and employment in economic cycles. By Mario Pianta; Matteo Lucchese
  3. The co-evolution of research institutes with universities and user needs: a historical perspective By Magnus Gulbrandsen
  4. How does obtaining intellectual property rights impact technology commercialization strategy? Reconciling the competing effects on licensing vs. financing By Simon Wakeman

  1. By: Mariam Bruhn (World Bank); Dean Karlan (Economic Growth Center, Yale University); Antoinette Schoar (MIT)
    Abstract: We test whether managerial human capital has a first order effect on the performance and growth of small enterprise in emerging markets. In a randomized control trial in Puebla, Mexico, we randomly assigned 150 out of 432 small and medium size enterprises to receive subsidized consulting services, while the remaining 267 enterprises served as a control group that did not receive any subsidized training. Treatment enterprises were matched with one of nine local consulting firms and met with their consultants once a week for four hours over a one year period. Results from a follow-up survey, conducted after the intervention, show that the consulting services had a large impact on the performance of the enterprises in the treatment group: monthly sales went up by about 80 percent; similarly, profits and productivity increased by 120 percent compared to the control group. We also see a significant increase in the entrepreneurial spirit index for the treatment group, a set of questions designed to illicit the SME owners’ confidence in their ability to manage their business and deal with any future difficulties. However, we do not find any significant increase in the number of workers employed in the treatment group.
    Keywords: enterprise growth, entrepreneurship, managerial capital
    JEL: D21 D24 L20 M13 O12
    Date: 2012–02
  2. By: Mario Pianta (Department of Economics, Society & Politics, Università di Urbino "Carlo Bo"); Matteo Lucchese (Department of Economics, Society & Politics, Università di Urbino "Carlo Bo")
    Abstract: This article explores the way economic cycles influence the relationship between innovation and employment in manufacturing industries. We investigate whether the ups and downs of cycles alter the possibility of exploiting technological opportunities and affecting patterns of job creation. A model that explains industries’ employment change by combining technology and demand is proposed; the empirical test is based on data on 21 manufacturing sectors from 1995 to 2007 for Germany, France, Italy, the UK, the Netherlands and Spain. Results show that, in upswings, employment change is affected by new products, exports and wage growth, while during downswings new processes contribute to restructuring and job losses.
    Keywords: Innovation, Cycles, Employment, Demand.
    JEL: L6 J20 O30 E32
    Date: 2012
  3. By: Magnus Gulbrandsen (Centre for Technology, Innovation and Culture, University of Oslo)
    Abstract: Many countries have a sector of research institutes that have been set up to promote industrial growth and help with users’ problem solving. Not formally part of the higher education sector, research institutes are significantly less understood and studied than universities. This paper and analyses the co-evolution of institutes and industry and the co-evolution of institutes and universities in Norway, using the framework of Whitley (2002, 2003). It is shown that there seems to be a dominant collaborative approach to developing innovative competences in Norway to which the institutes have had to adapt. Long traditions for external R&D collaboration in Norwegian industry and a structure of small low-tech firms have led to the establishment of a set of industry-specific institutes, a development reinforced by periods of isolation from industry perspectives at the universities. Alternative approaches to developing innovative competences have largely failed. Despite a low level of reputational competition in the public science system, research institutes have nevertheless contributed to increasing the level of intellectual pluralism and flexibility, creating opportunities for combinations of academic work and applied problem-solving. With weaker policy co-ordination and convergence in the funding criteria for all public science, there may be a risk that research in this system becomes more fragmented and isolated.
    Date: 2012–03
  4. By: Simon Wakeman (ESMT European School of Management and Technology)
    Abstract: The importance of obtaining intellectual property (IP) rights for commercializing innovation is well established. Separate streams of literature have shown a positive relationship between IP rights and both product licensing and third-party (especially VC) financing. However, since raising third-party finance enables an innovating firm to continue commercializing its innovation alone, product licensing and raising third-party finance may be considered substitutes and the impact of obtaining IP rights on commercialization mode is unclear. This paper attempts to reconcile these two competing effects of obtaining IP rights. The paper empirically examines the relationship between the status of the primary patent covering an innovation and whether the innovating firm’s licenses its innovation or raises external finance. The results show that patent filing significantly increases the likelihood of raising finance, while patent allowance has a positive effect on licensing. These results suggest that patent filings may act signals to financial investors but when it comes to licensing IP rights matter most as appropriability mechanisms.
    Keywords: intellectual property, licensing, financing, innovation, strategy
    Date: 2012–03–22
  5. By: Nazlina Zakaria Author_Email: (Universiti Utara Malaysia (Malaysia)); Dr. Siti Rohaida Mohamed Zainal (Universiti Sains Malaysia (Malaysia)); Prof. Dr. Aizzat Mohd. Nasurdin (Universiti Sains Malaysia (Malaysia))
    Keywords: Human resource management practices, organizational performance and small and medium enterprises (SMEs)
    JEL: M0
    Date: 2011–10

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