nep-sbm New Economics Papers
on Small Business Management
Issue of 2013‒08‒16
five papers chosen by
Joao Carlos Correia Leitao
University of Beira Interior and Technical University of Lisbon

  1. Allocation of Human Capital and Innovation at the Frontier: Firm-Level Evidence on Germany and the Netherlands By Bartelsman, Eric; Dobbelaere, Sabien; Peters, Bettina
  2. What Does Politics Have to Do with Innovation? Economic Distribution and Innovation Policy in OECD Countries By Dan Breznitz; Amos Zehavi
  3. Regional and Sectoral Foreign Direct Investment in Portugal since Joining the EU: A Dynamic Portrait By Irina Melo; Alexandra Ferreira-Lopes
  4. Regional industrial structure, productivity, wealth and income distribution in German regions By Margarian, Anne
  5. Gibrat’s Law and the British Industrial Revolution By Klein, Alexander; Leunig, Tim

  1. By: Bartelsman, Eric (VU University Amsterdam); Dobbelaere, Sabien (VU University Amsterdam); Peters, Bettina (ZEW Mannheim)
    Abstract: This paper examines how productivity effects of human capital and innovation vary at different points of the conditional productivity distribution. Our analysis draws upon two large unbalanced panels of 6,634 enterprises in Germany and 14,586 enterprises in the Netherlands over the period 2000-2008, considering 5 manufacturing and services industries that differ in the level of technological intensity. Industries in the Netherlands are characterized by a larger average proportion of high-skilled employees and industries in Germany by a more unequal distribution of human capital intensity. Except for low-technology manufacturing, average innovation performance is higher in all industries in Germany and the innovation performance distributions are more dispersed in the Netherlands. In both countries, we observe non-linearities in the productivity effects of investing in product innovation in the majority of industries. Frontier firms enjoy the highest returns to product innovation whereas the most negative returns to process innovation are observed in the best-performing enterprises of most industries. In both countries, we find that the returns to human capital increase with proximity to the technological frontier in industries with a low level of technological intensity. Strikingly, a negative complementarity effect between human capital and proximity to the technological frontier is observed in knowledge-intensive services, which is most pronounced for the Netherlands. Suggestive evidence for the latter points to a winner-takes-all interpretation of this finding.
    Keywords: human capital, innovation, productivity, quantile regression
    JEL: C10 I20 O14 O30
    Date: 2013–07
  2. By: Dan Breznitz; Amos Zehavi
    Abstract: Despite the fact that the distributional impact of innovation has been recognized in the social science literature, hardly any work has been done on the distributional politics of innovation policy. This study offers a first step in this direction as well as asking whether a government’s ideology affects innovation policy from a distributional viewpoint. The paper uses both qualitative case study method and a statistical analysis of government R&D outlays for social purposes in twenty-six countries. In terms of innovation policy, neo-corporatist interest group representation is linked to relatively equitable public R&D investment and left-oriented governments are more likely to invest in social innovation than their rightist counterparts. Nevertheless, governments rarely consider innovation policy in distributive terms. Despite the significant distributional implications of innovation, it remains depoliticized in policy making.
    JEL: O38 D63 P50
    Date: 2013
  3. By: Irina Melo (Lusa, Portuguese News Agency and Instituto Universitário de Lisboa (ISCTE - IUL)); Alexandra Ferreira-Lopes (Instituto Universitário de Lisboa (ISCTE - IUL))
    Abstract: Despite the very few studies regarding FDI in Portuguese regions - especially regarding its effects - FDI can be an important catalyst for regional economic development and growth. This work studies the existing FDI in the Portuguese regions, analysing its distribution by NUTS III, the sectors in which FDI has more weight in each region, as well as it evolution between 1986 and 2009. Over the years analysed, the results show an increase in the number of firms with FDI in Portugal, although their relative weight remained constant. At the same time, these firms spread to all regions of the country, besides the main economic and services agglomerations (Lisboa and Porto). The regions attracted not only FDI for the sectors in which they have already been specialized, but also for other activities, diversifying the regional productive structure. The increase and diversification of FDI coincided with the tertiarisation of the economy, approaching the totality of the productive specialization of the country, while continuing to focus on manufacturing.
    Keywords: Keywords: Regional FDI, Regional Distribution of the Economic Activity of Multinationals, Productive Specialization of the Regions, Cluster Analysis, Shift-Share Analysis, Portugal
    JEL: F21 F23 R12
    Date: 2013–07
  4. By: Margarian, Anne
    Abstract: For the impartial observer of German regions, differences in regional industrial structures and prosperity are quite obvious. On the one hand, there are regions characterised by different industries, firm structures and labour qualification profiles. On the other hand, some of these regions are prosperous, dynamic and growing in terms of inhabitants, labor force and income while others suffer from high unemployment, low tax base and an unsatisfactory income situation. The link between the two observations is mainly acknowledged by theories of a Schumpeterian origin as it has frequently been observed that different industries differ in their propensity for innovation. Once the rigid assumptions of standard economic theory are consequentially dropped, it becomes evident that the regional industry mix might have significant implications for the local income distribution as well. Depending on the mobility of different kinds of labour it will thereby also affect regional development in terms of population dynamics. The present study asks, whether these postulated differentiated relationships between industrial structure and socio‐economic fundamentals can be identified statistically and whether they depend on agglomeration effects. Therefore, a cross‐sectional estimation with observations on district level (NUTS 3) is carried out in a mediated moderation approach. This approach allows for the differentiation between direct and indirect effects and for the identification of conditional effects, depending, for example, on regions' remoteness. The analysis starts with the creation of eight factors that efficiently describe districts' industrial structures. The factors are consistent with the industrial innovation type taxonomy created by Pavitt. In the final model the regional industrial structure, as described by these factors, explains socio‐economic fundamentals that indicate the regions' productivity, its income distribution and its population dynamics. -- Der unvoreingenommene Beobachter von Deutschlands Regionen bemerkt schnell die ausgeprägten Unterschiede in der regionalen Unternehmensstruktur und Einkommenssituation. Einerseits sind die Regionen durch verschiedene Branchenzusammensetzungen, Betriebsgrößenverteilungen und Qualifikationsstrukturen der Beschäftigten gekennzeichnet. Andererseits sind einige der Regionen wohlhabend, dynamisch und weisen eine positive Bevölkerungsentwicklung auf, während andere unter hoher Arbeitslosigkeit, geringen Steuereinnahmen und einer unbefriedigenden Einkommenssituation leiden. Der Zusammenhang zwischen den beiden Beobachtungen wird vor allem von Theorien Schumpeterianischen Ursprungs hergestellt, die auch auf der Beobachtung gründen, dass unterschiedliche Branchen sich in ihrer Innovationsneigung unterscheiden. Werden die strikten Annahmen der Standardökonomie einmal fallen gelassen, wird die Möglichkeit deutlich, dass die regionale Branchenzusammensetzung auch Einfluss haben kann auf die Einkommensverteilung in der Region. Abhängig von der unterschiedlichen Mobilität Beschäftigter verschiedener Bereiche steht die regionale Industriestruktur dann auch direkt im Zusammenhang zur lokalen Bevölkerungsdynamik. Diese Studie untersucht, ob diese erwarteten differenzierten Beziehungen zwischen der regionalen Industriestruktur und verschiedenen sozio‐ökonomischen Fundamentaldaten statistisch identifiziert werden können und ob sie von Agglomerationseffekten beeinflusst werden. Zu diesem Zweck wird eine Querschnittsanalyse basierend auf Beobachtungen auf Landkreisebene in einer "moderated mediation" Schätzung durchgeführt. Diese Schätzung ermöglicht die Unterscheidung zwischen direkten und indirekten Effekten und die Identifizierung bedingter Effekte, die zum Beispiel von der Zentralität von Regionen abhängen. Die Untersuchung beginnt mit der Bildung von acht Faktoren, die die regionale Industriestruktur effizient abbilden können. Diese Faktoren korrespondieren mit der branchenbezogenen Innovationstypen Taxonomie von Pavitt. Im Schätzmodell erklärt die regionale Industriestruktur, abgebildet durch die acht Faktoren, sozio‐ökonomische Daten zur regionalen Produktivität, Einkommensverteilung und Bevölkerungsentwicklung.
    Keywords: Industrial structure,Agglomeration effects,Peripheral rural regions,income distribution,Moderated mediation,Estimation,Branchenstruktur,Agglomerationseffekte,Landlich]periphere Regionen,Einkommensverteilung,Schatzung indirekter konditioneller Effekte
    JEL: R12 O14 O18 L16 C31
    Date: 2013
  5. By: Klein, Alexander (University of Kent); Leunig, Tim (London School of Economics)
    Abstract: This paper examines Gibrat’s law in England and Wales between 1801 and 1911using a unique data set covering the entire settlement size distribution.We find that Gibrat’s law broadly holds even in the face of population doubling every fifty years,an industrial and transportrevolution, and the absence of zoning laws to constrain growth. The result is strongest for the later period, and in counties most affected by the industrial revolution. The exception were villages in areas bypassed by the industrial revolution.We argue that agglomeration externalities balanced urban disamenities such as commuting costs and poor living conditions to ensure steady growth of many places, rather than exceptional growth of few.
    Keywords: Gibrat’s law, city-size distribution, industrial revolution
    Date: 2013

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