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on Small Business Management |
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Issue of 2013‒04‒20
nineteen papers chosen by Joao Carlos Correia Leitao University of Beira Interior and Technical University of Lisbon |
| By: | Esther Goya (Faculty of Economics, University of Barcelona); Esther Vayá (Faculty of Economics, University of Barcelona); Jordi Suriñach (Faculty of Economics, University of Barcelona) |
| Abstract: | This paper uses a structural model to analyse the impact of innovation activities, including intra- and inter-industry externalities, on the productivity of Spanish firms. To the best of our knowledge, no previous paper has examined spillover effects by adopting such an approach. Here, therefore, we seek to determine the extent to which the innovations carried out by others affect a firm’s productivity. Additionally, firm’s technology level is taken into account in order to ascertain whether there are any differences in this regard between high-tech and low-tech firms both in industrial and service sectors. The database used is the Technological Innovation Panel (PITEC) which includes 8,611 firms for the year 2009. We find that low-tech firms make the most of a range of factors, including funding and belonging to a group, to increase their investment in R&D. As expected, R&D intensity has a positive impact on the probability of achieving both product and, more especially, process innovations. Finally, innovation output has a positive impact on firm’s productivity, being greater in more advanced firms in the case of process innovations. Both intra- and inter-industry spillovers have a positive impact on firm’s productivity, but this varies with the firm’s level of technology. Thus, innovations made by firms from the same sector are more important for low-tech firms than they are for their high-tech counterparts, while innovations made by the rest of the sectors have a greater impact on high-tech firms. |
| Keywords: | Productivity, innovation, industry spillovers. JEL classification: D24, O33. |
| Date: | 2012–09 |
| URL: | http://d.repec.org/n?u=RePEc:aqr:wpaper:201207&r=sbm |
| By: | Alessandra Proto; Simone Tani; Joerg Bühnemann; Olaf Gaus; Mathias Raith |
| Abstract: | New and small firms can be important engines of job creation and local development when they identify and exploit entrepreneurial opportunities. We live in an economy more and more characterised by open innovation methods, where new companies and SMEs are benefitting from innovations, technological and non technological available on the market or from other companies and organisations part of their networks. Knowledge networks, understood as a three-component construction of (i) knowledge generation, (ii) knowledge transfer, and (iii) knowledge application, can play a crucial role in boosting companies performance. As many OECD researches shows, there is often a major networking gap, however, between knowledge sources in universities and research organisations and industry exploitation in new spin-off enterprises and SMEs. The analysis of the actors of the knowledge networks and the way they behave and interact with other component inside and outside the networks is a fundamental support to local policy making in entrepreneurship and innovation. <p>The OECD LEED Programme in cooperation with the University of Trento has prepared this paper to analyse in deep the behaviour of knowledge networks in two specific local contexts: the Autonomous Province of Trento in Italy and the Magdeburg Province in Germany. <p>The aim of this research project is to analyse the relevance of knowledge networks to entrepreneurship and the growth of young and small firms, the role of the different components and their interplay for network effectiveness, impeding and favouring factors, and the role of public policy. |
| Date: | 2012–01–31 |
| URL: | http://d.repec.org/n?u=RePEc:oec:cfeaaa:2012/2-en&r=sbm |
| By: | Daron Acemoglu (Department of Economics, Massachusetts Institute of Technology); Ufuk Akcigit (Department of Economics, University of Pennsylvania); Nicholas Bloom; William R. Kerr (Entrepreneurial Management Unit, Harvard University) |
| Abstract: | We build a model of firm-level innovation, productivity growth and reallocation featuring endogenous entry and exit. A key feature is the selection between high- and low-type firms, which differ in terms of their innovative capacity. We estimate the parameters of the model using detailed US Census micro data on firm-level output, R&D and patenting. The model provides a good fit to the dynamics of firm entry and exit, output and R&D, and its implied elasticities are in the ballpark of a range of micro estimates. We find industrial policy subsidizing either the R&D or the continued operation of incumbents reduces growth and welfare. For example, a subsidy to incumbent R&D equivalent to 5% of GDP reduces welfare by about 1.5% because it deters entry of new high-type firms. 0n the contrary, substantial improvements (of the order of 5% improvement in welfare) are possible if the continued operation of incumbents is taxed while at the same time R&D by incumbents and new entrants is subsidized. This is because of a strong selection effect: R&D resources (skilled labor) are inefficiently used by low-type incumbent firms. Subsidies to incumbents encourage the survival and expansion of these firms at the expense of potential high-type entrants. We show that optimal policy encourages the exit of low-type firms and supports R&D by high-type incumbents and entry. |
| Keywords: | entry, growth, industrial policy, innovation, R&D, reallocation, selection |
| JEL: | E2 L1 |
| Date: | 2013–04–13 |
| URL: | http://d.repec.org/n?u=RePEc:pen:papers:13-018&r=sbm |
| By: | Koski, Heli |
| Abstract: | Abstract: The reported empirical findings using survey data from 531 Finnish companies show that for digitalized data-based innovation generated for both firm’s own and market needs, the firm’s ICT-specific absorptive capacity matters more than its general absorptive capacity arising from the firms’ investments in R&D and intangible assets. User-driven innovators differ from companies that do not produce new data-based solutions for their own use in three major dimensions: 1) they tend to use selective ICT outsourcing strategy, 2) they tend to involve more internal units closely to innovation activities and 3) they tend to use wider external knowledge search strategy. In other words, firms using data for producing innovative solutions for their own needs balance their relatively open innovation strategy with the close in-house innovation collaboration among different units, and further employ an ICT strategy that relies selectively on a firm’s own ICT-specific absorptive capacity and external ICT expertise. |
| Keywords: | user-driven innovation, open innovation, data-based products and services, ICT strategy, outsourcing |
| JEL: | D22 L20 O31 |
| Date: | 2013–03–21 |
| URL: | http://d.repec.org/n?u=RePEc:rif:wpaper:7&r=sbm |
| By: | Roberto Antonietti (University of Padova) |
| Abstract: | This paper assesses the existence of knowledge externalities in the form of creative human capital spillovers that affect firm innovative performance. Relying on a large sample of Italian manufacturing firms, a knowledge production function is estimated and the residuals regressed on regional creative workforce indicators interacted with spatial agglomeration variables and measures of knowledge transmission mechanisms. The estimates show that regional density of creative human capital has a positive effect on firm innovativeness only after a critical mass is achieved and only after accounting for the presence of local universities, industrial districts and entrepreneurial activities related to knowledge-intensive services. |
| Keywords: | creative human capital; innovativeness; knowledge production function; nonlinearity JEL: L60; O31; R10; R15 |
| Date: | 2013–02 |
| URL: | http://d.repec.org/n?u=RePEc:pad:wpaper:0159&r=sbm |
| By: | Luca Grilli (Department of Management, Economics, and Industrial Engineering, Politecnico di Milano); Paul H. Jensen (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne; Intellectual Property Research Institute of Australia, The University of Melbourne); Samuele Murtinu (Department of Management, Economics, and Industrial Engineering, Politecnico di Milano) |
| Abstract: | This paper tests the presence of an ‘entrepreneurial imprinting effect’ of founders’ human capital on entrepreneurial ventures’ performance. More specifically, we empirically explore the impact of entrepreneurs’ human capital on a firm’s sales growth performance by disentangling the effect of the stock of human capital possessed at foundation from the potential injections and losses of human capital due to exit of founders and/or addition of new owner-managers in the entrepreneurial team over time. Our analysis is based on a panel dataset composed of 338 Italian new technology-based firms (NTBFs) observed from 1995 (or since their foundation) to 2008 (or until their exit from the dataset). We consider the effects of several dimensions of entrepreneurial human capital on firm sales growth and estimate Gibrat law-type dynamic panel data models using OLS estimator and GMM-system estimator to control for endogeneity. Overall, our results point to a positive and significant presence of an ‘entrepreneurial imprinting effect’ exerted by founders’ specific work experience on venture growth which is robust to a series of controls. |
| Keywords: | Entrepreneurial ventures, imprinting effect, entrepreneurs’ human capital, firm growth, new technology-based firms |
| JEL: | L25 L26 O31 |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2013n14&r=sbm |
| By: | Karlsson, Charlie (Jönköping International Business School); Johansson, Börje (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology); R. Stough, Roger (George Mason University) |
| Abstract: | The purpose of this working paper is to provide a short overview of actual topics in contemporary research concerned with global, national, regional and local knowledge and innovation dynamics. In the text, we stress the importance to understand the current changes of the global and their implications for knowledge generation and innovation. Treating knowledge as a key resource for innovation shifts the focus from the innovation itself to the process of knowledge generation, transformation and diffusion, i.e. to knowledge dynamics. This necessitates integrating spatial aspects since knowledge generation and as a result, innovation exhibits a strong geographical clustering, which implies that innovation ability and innovation resources also are strongly clustered geographically in particular to urban regions. The role of interaction and proximity for knowledge generation and innovation is highlighted and instead it is stressed that relational, cognitive, organizational, social and institutional proximities are not substitutes or complements to spatial proximity but that they are all functions of the prevailing spatial proximity. Another important factor for interaction is social capital, which by fostering trust makes information and knowledge to diffuse faster. |
| Keywords: | Knowledge; innovation; proximity; knowledge economy; knowledge dynamics; knowledge networks; innovation ability; innovation resources; globalization; agglomeration; face-to-face interaction; urban regions; social capital |
| JEL: | O31 O32 O33 R12 |
| Date: | 2013–04–12 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0305&r=sbm |
| By: | Yanrui Wu (Business School, University of Western Australia) |
| Abstract: | To cope with the rising labour cost and protect the country’s deteriorating environmental conditions, Chinese policy makers have recently made a series of policy changes to promote innovation and hence the development of a knowledge-based economy in the country in the coming decades. As a result, China’s R&D spending has expanded substantially. This paper contributes to the understanding of R&D behaviour in China’s large and medium-sized firms and hence the role of Chinese firms in innovation. The latter has important implications not only for the transformation of the Chinese economy but also for the rest of the world as Chinese firms become increasingly active internationally. |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:uwa:wpaper:12-26&r=sbm |
| By: | Marie-Estelle Binet (University of Rennes 1 - CREM UMR CNRS 6211, France); François Facchini (University of Paris-Sud, Faculty Jean Monnet (France)) |
| Abstract: | This paper deals with the determinants of enterprise creation in the 22 French regions from 1994 to 2003. We then estimate a dynamic panel data model which allows spatial heterogeneity to be modelled and which is compared with a specification without spatial heterogeneity. The estimation results show that an appropriate consideration of spatial heterogeneity can lead to new insights. The results show: 1) that the Holcombe effect and the income effect have a statistically significant and positive impact for all regions; 2) that the age of the population and the size of the firms have the same negative effects for all regions with the exception of Ile-de-France; 3) that at the threshold of 10%, the refugee effect only concerns 10 regions out of 22; 4) that the effect of public R&D remains insignificant for 17 of the 22 regions, but becomes statistically significant in five regions and has a positive effect in three regions only, these being those which exhibit the highest per capita public R&D expenditure levels. Globally, Anselin's (1990) hypothesis, according to which the presence of spatial heterogeneity casts doubt upon the generalizability of theories in regional science, is thus in part confirmed. |
| Keywords: | Creation of enterprises, spatial heterogeneity, dynamic panel data, refugee effect, public R&D |
| JEL: | M13 O18 J21 |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:tut:cremwp:201312&r=sbm |
| By: | Olivier Hueber (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université Nice Sophia Antipolis (UNS)) |
| Abstract: | Sophia Antipolis was created by the public authorities to attract high value added activities on the French Riviera, in the aim of strengthening a local economy driven historically by tourism. The theoretical model that has inspired the creation of Sophia Antipolis is governed by a top-down approach. The agglomerations externalities, had not sprung up naturally from the dynamics of entreprises located in the cluster. The economic model of Sophia Antipolis is completely different of the traditional innovative district studied by Alfred Marshall (bottom-up approach). Nowadays, the cluster of Sophia-Antipolis is rich of external linkages, but poor of internal relations between the firms. In this local system of Innovation, a large numbers of actors in different sectors are present but any of them is sufficiently dominant to drive the cluster orientations. In this sense, this Local System of Innovation (LSI) is not reliable in the long run. Very few, almost no technological collaborations can be observed. The sustainability of the Sophia-Antipolis cluster does not really depend on the territory. the weakness of the cooperation between companies of the cluster can be partially explained by the local multinational firms which have their branch facilities located in the local system of innovation but at the same time their head office external to the cluster with main decision taken from outside, limiting the potential for local synergies and local collaboration. The aim of this paper is to understand the coordination mechanisms between enterprises and the main factors of success who made Sophia-Antipolis the largest technology park in the Europe. Such a study presents the Top-down strategy of developpement choosen by the government from the origins of Sophia-Antipolis to promote agglomeration externalities and the increasing returns to adoption gained by firms entering in the park. |
| Keywords: | clusters;entrepreneurship;innovative pole;network externality;agglomeration effect;Top-down;bottom-up |
| Date: | 2012–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-00806571&r=sbm |
| By: | Buchmann, Tobias; Pyka, Andreas |
| Abstract: | In this paper we outline a conceptual framework for depicting network development patterns of interfirm innovation networks and for analyzing the dynamic evolution of an R&D network in the German automotive industry. We test the drivers of evolutionary change processes of a network which is based on subsidised R&D projects in the 10 year period between 1998 and 2007. For this purpose a stochastic actor-based model is applied to estimate the impact of various drivers of network change. We test hypotheses in the innovation and evolutionary economics framework and show that structural positions of firms as well as actor covariates and dyadic covariates are influential determinants of network evolution. -- |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fziddp:702013&r=sbm |
| By: | Gemmell, Norman; Kneller, Richard; McGowan, Danny; Sanz, Ismael; Sanz-Sanz, José F. |
| Abstract: | Firms that lie far behind the technological frontier have the most to gain from imitating the technology or management practices of others. That some firms converge relatively slowly to the productivity frontier suggests the existence of factors that cause them to underinvest in their productivity. In this paper we explore how far higher rates of corporate taxation affect firm productivity convergence by reducing the after tax returns to productivity enhancing investments for small firms. Using data for 11 European countries we find evidence for such an effect; productivity growth in small firms is slower the higher are corporate tax rates. Our results are robust to the use of instrumental variable and panel data techniques with quantitatively similar effects found from a natural experiment following the German tax reforms in 2001. |
| Keywords: | Productivity, taxation, convergence, |
| Date: | 2013–04–11 |
| URL: | http://d.repec.org/n?u=RePEc:vuw:vuwcpf:2705&r=sbm |
| By: | Wixe, Sofia (Jönköping International Business School) |
| Abstract: | This paper analyses the role of spatial externalities in explaining the average labour productivity of Swedish manufacturing firms. The empirical findings support MAR and Porter externalities as well as general urbanization economies, but not Jacobs externalities. In addition, the matching between the firm and the regional labour force is found to be productivity-enhancing. However, firm-specific characteristics, including the characteristics of the employees, are not to be forgotten. Especially since externalities are commonly associated with knowledge spillovers, and it is through the employees that the external knowledge is absorbed and channelled to the firm as a whole. |
| Keywords: | Firm productivity; spatial externalities; manufacturing; Sweden |
| JEL: | D24 L25 L60 R32 |
| Date: | 2013–04–12 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0306&r=sbm |
| By: | Rajshree Agarwal; Benjamin A. Campbell; April M. Franco; Martin Ganco |
| Abstract: | Our study examines the mediating effect of spin-out team characteristics on the relationship between founder quality and parent and spin-out performance. Since the ability to transfer or recreate complementary assets is a critical determinant of performance, we theorize and show that founders with greater ability impact both parent firm and spin-out performance by assembling teams that represent strong complementary human capital. Using linked employee-employer US Census data from the legal services industry, we find founding team size and tenure mediate the founder quality effect. Our findings have practical implications for both managers of existing firms and aspiring founders as it relates to their human resource strategies: the factor most salient to performance is not the individual quality per se, but the manner in which it impacts the transfer and spillover of complementary human capital. |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:13-17&r=sbm |
| By: | Zeting LIU (Laboratoire de Recherche sur l'Industrie et l'Innovation. ULCO) |
| Abstract: | Longtemps échappées à l’intention des pouvoirs publics, les PME chinoises sont aujourd’hui identifiées comme un enjeu important dans le Grand Bond en avant de l’innovation de la Chine. Si les études sur le système d’innovation en Chine et les grandes entreprises publiques sont abondantes, l’innovation des PME ainsi que les mesures publiques spécifiques qui leur ciblent sont toutefois relativement peu étudiées. Cette étude tente d’identifier la place des PME chinoises dans le système de recherche et productif depuis les réformes économiques et la transformation des institutions de recherche lancées en 1978 et de repositionner les PME dans les politiques d’innovation en Chine. En ce faisant, elle propose une nouvelle lecture de l’analyse de performance de l’innovation en Chine. After being ignored by the public authorities for a long time, the Chinese SMEs are nowadays identified as an important issue in China's Great Leap Forward of Innovation. While studies on the innovation system in China and large public enterprises are abundant, innovation by SMEs and the specific public measures targeting them are relatively little studied. This study attempts to identify the place of the Chinese SMEs in the research and productive system since the economic reforms and the transformation of research institutions in 1978 and to reposition the SME innovation policies in China. In this way, it proposes a new reading of the analysis of innovation performance in China. |
| Keywords: | system national d'innovation, PME, réforme institutionnelle, Chine |
| JEL: | O38 P2 O53 |
| Date: | 2013–03 |
| URL: | http://d.repec.org/n?u=RePEc:rii:riidoc:266&r=sbm |
| By: | Abdolkarim Sadrieh (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg); Daniel Cracau (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg) |
| Abstract: | The theory of "Judo Economics" describes an optimal entry strategy for small firms. Using a capacity limitation, small firms force dominant market incumbents to accommodate. In this article, we study the power of Judo economics as an entry strategy in different market environments. We find experimental evidence supporting the theory in the original setting with a monopolistic, dominant market incumbent. When we introduce a cost advantage for small firms, profits go down. This can be explained by incumbents responding aggressive towards large entrants. For settings with multiple market incumbents, results are reversed. There, a cost advantage strengthens small firms and pricing below the incumbents' marginal cost provides the unique entry strategy. |
| Keywords: | Judo economics, Market entry, Price competition, Capacity limitation, Experimental economics |
| JEL: | D43 L11 |
| Date: | 2013–02 |
| URL: | http://d.repec.org/n?u=RePEc:mag:wpaper:130001&r=sbm |
| By: | Sophie BOUTILLIER (Laboratoire de Recherche sur l'Industrie et l'Innovation. ULCO) |
| Abstract: | L’objectif de cette étude est de présenter les grandes phases du développement de l’entrepreneuriat à Dunkerque depuis le 19e siècle. Depuis cette période, l’économie dunkerquoise s’est développée sur la grande industrie et l’emploi salarié. Au cours du temps, l’industrie s’est transformée mais elle est restée dominante et l’emploi salarié également. La crise économique des années 1970 a remis en cause cette évolution. Des mesures de politique publique ont été prises pour promouvoir la création d’entreprise. Cependant, le nombre de créations d’entreprises reste faible. On ne devient pas patron par décret ! Nos conclusions s’appuient principalement sur une enquête réalisée en 2011 sur 80 nouveaux entrepreneurs. The aim of this article is to present the large phases of the development of entrepreneurship in Dunkirk since the 19th century. Since this period, the development of the economy of Dunkirk has been based on big industrial enterprises and on salaried employment. The industrial activity changed all along the period, but big industry remained strong as well as salaried employment too. The economic crisis of 1970s stopped this evolution. Public policies are now oriented toward the promotion of new businesses. Nevertheless, the number of creation of new enterprises remains low. People cannot become entrepreneur by law! Our conclusions are based on a case study achieved in 2011 on the new entrepreneurs in the city of Dunkrik (North of France). |
| Keywords: | entrepreneuriat, industrialisation, politique publique d'innovation |
| JEL: | L2 O1 O3 |
| Date: | 2013–02 |
| URL: | http://d.repec.org/n?u=RePEc:rii:riidoc:265&r=sbm |
| By: | Arturo Galindo; Marcela Melendez |
| Abstract: | Credit has been found to be a catalyst for economic growth, as it spurs investment, enhances productivity, allows costs to be spread out over time, improves resource allocation, and enables investors to cope better with macroeconomic volatility. Most studies focus on the relationship between financial development and growth at the country level, while few analyze the relationship at the firm level. Using a panel-shaped firm-level dataset of Colombian firms and employing the methodology developed by Love and Zicchino (2006), this paper examines whether the response of firms to financial and real shocks varies according to firm size and across different levels of firm productivity. The study finds that financial shocks have a significant positive impact on firm growth, which is larger for larger firms and more productive firms that export. The results indicate that something is preventing smaller firms from taking full advantage of access to external financing. |
| JEL: | G32 O54 |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:idb:wpaper:idb-wp-395&r=sbm |
| By: | Edward L. Glaeser; Sari Pekkala Kerr; William R. Kerr |
| Abstract: | Measures of entrepreneurship, such as average establishment size and the prevalence of start-ups, correlate strongly with employment growth across and within metropolitan areas, but the endogeneity of these measures bedevils interpretation. Chinitz (1961) hypothesized that coal mines near Pittsburgh led that city to specialization in industries, like steel, with significant scale economies and that those big firms led to a dearth of entrepreneurial human capital across several generations. We test this idea by looking at the spatial location of past mines across the United States: proximity to historical mining deposits is associated with bigger firms and fewer start-ups in the middle of the 20th century. We use mines as an instrument for our entrepreneurship measures and find a persistent link between entrepreneurship and city employment growth; this connection works primarily through lower employment growth of start- ups in cities that are closer to mines. These effects hold in cold and warm regions alike and in industries that are not directly related to mining, such as trade, finance and services. We use quantile instrumental variable regression techniques and identify mostly homogeneous effects throughout the conditional city growth distribution. |
| Keywords: | Entrepreneurship, Industrial Organization, Chinitz, Agglomeration, Clusters, Cities, Mines |
| JEL: | L0 L1 L2 L6 N5 N9 O1 O4 R0 R1 |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:13-15&r=sbm |