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on Small Business Management |
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Issue of 2013‒08‒31
fourteen papers chosen by Joao Carlos Correia Leitao University of Beira Interior and Technical University of Lisbon |
| By: | Toft-Kehler, Rasmus (Copenhagen Business School, Symbion Entrepreneurial Learning Lab); Wennberg, Karl (Ratio and Stockholm School of Economics); Kim, Phillip (Wisconsin School of Business) |
| Abstract: | This study tackles the puzzle of why increasing entrepreneurial experience does not always lead to improved financial performance of new ventures. We propose an alternate framework demonstrating how experience translates into expertise by arguing that the positive experience-performance relationship only appears to expert entrepreneurs, while novice entrepreneurs may actually perform increasingly worse because of their inability to generalize their experiential knowledge accurately into new ventures. These negative performance implications can be alleviated if the level of contextual similarity between prior and current ventures is high. Using matched employee-employer data of an entire population of Swedish founder-managers between 1990 and 2007, we find a non-linear relationship between entrepreneurial experience and financial performance consistent with our framework. Moreover, the level of industry, geographic, and temporal similarities between prior and current ventures positively moderates this relationship. Our work provides both theoretical and practical implications for entrepreneurial experience—people can learn entrepreneurship and pursue it with greater success as long as they have multiple opportunities to gain experience, overcome barriers to learning, and build an entrepreneurial-experience curve. |
| Keywords: | Serial Entrepreneurship; Learning Curves; Experience; Similarity; Performance |
| JEL: | L26 M13 |
| Date: | 2013–07–17 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0210&r=sbm |
| By: | Albahari, Alberto; Pérez-Canto, Salvador; Barge-Gil, Andrés; Modrego, Aurelia |
| Abstract: | Although the notion of Science and Technology Parks (STPs) has become fairly widespread, however, the level of university involvement in these parks differs hugely. At the extremes, there are parks that are owned and managed by universities, and parks with no formal links of any kind with a university. We use data from the Community Innovation Survey (CIS) for Spain and a survey of STP park managers to analyse how the level of involvement of a university in the STP affects the innovation outputs of its tenants and their links with universities. We find that higher involvement of a university in the STP negatively affects tenant’s innovation sales and positively affects the number of patent applications. We find no robust evidence of the involvement of a university in the propensity for park firms to cooperate with a university or to purchase external R&D services from the university. |
| Keywords: | Science Parks, Technology Parks, Innovation Policy, Academia-Industry links |
| JEL: | L2 O25 O3 R11 |
| Date: | 2013–08–21 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:49227&r=sbm |
| By: | KWON Hyeog Ug; Jungsoo PARK |
| Abstract: | This study empirically investigates the effect of foreign ownership on research and development (R&D) investment based on firm-level panel dataset for the period 2000-2008 taken from the <i>Basic Survey of Japanese Business Structure and Activities</i>. The results reveal the following. First, the "integration effect" on R&D is negative for domestic or foreign majority ownership. Second, although the "foreign ownership effect" controlling for integration effect is insignificant, it becomes positive only when the parent firm is located in a non-G7 country. Third, the negative integration effect is stronger for vertical integration than it is for horizontal integration. These findings have an important implication in that the globalization and integration of firms not only may affect the pattern of production process and the global supply chain, but also have important influence on the level of domestic R&D activities. |
| Date: | 2013–08 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:13071&r=sbm |
| By: | Holger Görg; Adnan Seric |
| Abstract: | This paper uses firm level data for 19 African countries to look at the link between domestic firms’ business relationship with multinationals and their performance in terms of innovation and productivity. Quite uniquely, we also evaluate the importance of support received by the domestic firm, either from the government or the multinational business partner, for this link. Overall, our data analysis shows that for the average domestic firm, supplying to a foreign multinational in the country (the backward linkage) is positively associated with product innovation. Buying from a multinational (the forward linkage) is positively associated with labor productivity. These results are independent of any type of support from the government or multinationals. We also find that domestic firms’ process innovation activity is only positively associated with supplying a multinational if the firm also receives assistance from the government or multinational. Furthermore, we find that supplying a multinational is only positively associated with domestic firms’ productivity if the firm received technology transfer from the multinational customers |
| Keywords: | multinationals, technology transfer |
| JEL: | F23 |
| Date: | 2013–08 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1867&r=sbm |
| By: | DeTienne, Dawn (Colorado State University); Wennberg, Karl (Ratio and Stockholm School of Economics) |
| Abstract: | In this chapter we look at exit as a multidimensional and multidisciplinary phenomenon that may involve processes and outcomes operating at multiple levels of analysis. We do so because entrepreneurship research is often considered a phenomenondriven academic field (Shane, 2003; Sorenson and Stuart, 2008) and entrepreneurship is in itself a multidimensional concept: its definition depends on the focus of the research undertaken (Davidsson, Low, & Wright, 2001). In this field, it is surprising that exit has received much less attention than the phenomenon of entry, growth, or innovation among new firms; however, there has been renewed interest in this topic and this research crosses many disciplines and multiple theoretical perspectives. In this chapter, we provide an indepth review of that research which is applicable to small business. We review disciplinary approaches to research on exit, and then present a literature review of 28 empirical studies of entrepreneurial exit during the last 29 years. We summarize these studies under a number of topical areas and discuss the potential for further development in these areas. In doing so, we provide a framework and opportunities for future research. |
| Keywords: | Entrepreneurship; Exit |
| JEL: | L26 M13 |
| Date: | 2013–08–22 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0218&r=sbm |
| By: | Bird, Miriam (Stockholm School of Economics); Wennberg, Karl (Ratio and Stockholm School of Economics) |
| Abstract: | We integrate insights from family business and organizational ecology into the entrepreneurship field by constructing a theoretical framework that explains how the regional context impacts family and non-family start-ups in differing ways. Regional count data models based on a rich longitudinal dataset reveal that while economic factors such as population size and growth in regions are primarily associated with the number of non-family start-ups, factors related to regional embeddedness, such as pre-existing small family businesses as well as favorable community attitudes toward small businesses, are more strongly associated with the number of family start-ups. Our research provides support for the notion that ‘the regional context’ is an important yet under-theorized area for research on venture creation and family business. |
| Keywords: | Family Business; Start-up; Population Ecology; Regional Science |
| JEL: | L21 M13 R12 |
| Date: | 2013–08–19 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0212&r=sbm |
| By: | Halvarsson, Daniel (Ratio) |
| Abstract: | This paper investigates the role(s) of high-growth firms (HGFs) in the robust growth-rate distribution. HGFs are identified as firms for which the growth-rate distribution exhibits power-law decay. In contrast to the traditional means of identifying HGFs, a distributional approach eliminates the need to specify an arbitrary growth rate or percentage share. The latter approach is illustrated by the growth-rate distribution for Swedish data on incorporated firms at the aggregate level and at the 2-digit industry level. The empirical results indicate that a power law is sometimes present in the growth-rate distribution and suggest that HGFs are rarer than previously thought. |
| Keywords: | High-growth firms; Gazelles; Firm growth-rate distribution; Laplace distribution; Power law |
| JEL: | D22 L11 L25 |
| Date: | 2013–08–21 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0215&r=sbm |
| By: | Allegrezza , Serge; Ben Aoun-Peltier, Leila; Dubrocard, Anne; Larue, Solène |
| Abstract: | This paper analyses the availability of external funding for Luxembourgish independent small and medium-sized enterprises (SMEs) before and during the crisis. SMEs represent a large part of the private sector in Luxembourg. External finance is essential to enable firms to invest in order to increase their productivity, innovate and create employment. Data used come from the Access to Finance (ATF) survey conducted by STATEC in 2010 and coordinated by Eurostat. This paper provides some stylized facts on access to finance in Luxembourg. It presents results from a regression analysis on how the individual characteristics, the past behavior and the business environment perception affect the decision about whether or not to seek external finance. The results of estimations show that past behavior is the most important determinant of seeking finance. Particular emphasis is placed on assessing the consequences of the 2007-2010 recession by introducing variables related to changes in perception between 2007 and 2010 and growth constraints. |
| Keywords: | SMEs, Access to finance, Luxembourg, survey data |
| JEL: | D04 D22 M2 |
| Date: | 2013–07–18 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:49330&r=sbm |
| By: | A. Arrighetti; F. Landini; L. Caricati; N. Monacelli |
| Abstract: | This paper presents one of the first studies on the entrepreneurial orientation of Italian university students. For a large sample of students from the University of Parma (Italy), we estimate the sources of entrepreneurial intent, distinguishing between the propensity to start a new business and the perceived likelihood of becoming an entrepreneur. In line with previous research in other countries, entrepreneurial intent is explained by a wide set of variables, including psychological, social and contextual factors. For Italian university students, the current economic crisis and the consequent increase in uncertainty do not seem to significantly weaken the importance of psychological variables as factors shaping entrepreneurial intent, confirming that these variables maintain primary relevance regardless of the context and the economic situation. While the perception of a lack of economic opportunities does not significantly affect the propensity to start a new venture, it does have a negative impact on the perceived likelihood of becoming an entrepreneur. This, in turn, suggests that the ongoing economic recession may indeed have a negative impact on the future entrepreneurial supply through a discouragement effect. Finally, the impact of family and business associations on stimulating entrepreneurial intent turns out not to be statistically significant. The combination of these results significantly contributes to our general understanding of entrepreneurial intent among Italian university students. |
| Keywords: | entrepreneurial intent, university students, Italy, economic crisis |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:par:dipeco:2013-ep04&r=sbm |
| By: | Halvarsson, Daniel (Ratio) |
| Abstract: | This paper empirically examines industry determinants of the shape of Swedish firm size distributions at the 3-digit (NACE) industry level between 1999-2004 for surviving firms. Recent theoretical studies have begun to develop a better understanding of the causal mechanisms behind the shape of firm size distributions. At the same time there is a growing need for more systematic empirical research. This paper therefore presents a two-stage empirical model, in which the shape parameters of the size distribution are estimated in a first stage, with firm size measured as number of employees. In a second stage regression analysis, a number of hypotheses regarding economic variables that may determine the distributional shape are tested. The result from the first step are largely consistent with previous statistical findings confirming a power law. The main finding, however, is that increases in industry capital and financial constraint exert a considerable influence on the size distribution, shaping it over time towards thinner tails, and hence fewer large firms. |
| Keywords: | Firm size distribution; Zipf's law; Gibrat's law |
| JEL: | D22 L11 L25 |
| Date: | 2013–08–21 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ratioi:0214&r=sbm |
| By: | Dissanayake, Srinath |
| Abstract: | This small note on defining entrepreneurship is produced due to the apparent pursue of stereotyped knowledge among students in general. The author postulates to be an accountant or a finance manager should not be the prime concerns of students. There are other emerging areas as well. for an instant, Business Technology, Entrepreneurship, Value Based Marketing, Green Accounting, Personal Management etc. Given the unimportance of stereotyped knowledge, the author intends to define Entrepreneurship concisely to convince the students about the value of such a field. With some scholarly definitions on entrepreneurship, the author writes what entrepreneurship is and who is an entrepreneur. Most notably, in the definition of entrepreneur, the author adds the notion of Intrapreneurship allowing students to think out of the box. |
| Keywords: | Entrepreneurship, Intrapreneurship, Stereotyped Knowledge |
| JEL: | M00 |
| Date: | 2013–08–20 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:49255&r=sbm |
| By: | INOUE Hiroyasu; NAKAJIMA Kentaro; SAITO Yukiko |
| Abstract: | This study investigates the localization of knowledge exchange behavior by using data on inter-establishment collaborations in Japanese patent applications. Using distance-based methods, we obtain the following results. First, inter-establishment collaborations are significantly localized at the 5% level, with the range of localization at approximately 100km. Second, the extent of collaboration localization was stable during 1986-2005 despite the extensive developments in information and communications technology facilitating easy communication between remote researchers. Third, the extent of collaboration localization is much larger in inter-firm collaborations than in inside-firm collaborations. Furthermore, in inter-firm collaborations, the extent of localization is larger in collaborations with firms having only one research establishment. As a whole, inter-establishment collaborations are localized and stable, and localization occurs to complement firm-border effects, especially with regard to small firms. |
| Date: | 2013–08 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:13070&r=sbm |
| By: | J. Augusto Felicio (School of Economics and Management (ISEG), Technical University of Lisbon); Eduardo Couto (School of Economics and Management (ISEG), Technical University of Lisbon); Jorge Caiado (CEMAPRE, School of Economics and Management (ISEG), Technical University of Lisbon) |
| Abstract: | This research evaluates the human capital and social capital of managers and its influence on the performance of small and medium-sized Portuguese companies. We resorted to the structural modeling methodology approach applied to a sample of 192 small and medium companies aged between four and fifteen years from five different activity sectors. It was concluded that human capital affects social capital and the experience and cognitive ability influence personal relations and complicity. The organizational performance is strongly influenced by human capital through the cognitive ability of the manager. It's an important contribution to the management literature. |
| Keywords: | Human capital, Social capital, Organizational performance, Cognitive ability, Small and medium enterprises |
| Date: | 2013–08 |
| URL: | http://d.repec.org/n?u=RePEc:cma:wpaper:1302&r=sbm |
| By: | Brixiova, Zuzana (African Development Bank); Ncube, Mthuli (African Development Bank) |
| Abstract: | Since mid-2000s, Ethiopia has been one of the fastest growing countries in the world. However, productive entrepreneurship in high-value added activities has made limited contributions to this growth, in part because of a weak business environment. Moreover, the low-productive firms in the informal sector still account for a large share of employment. Reflecting these facts, this paper presents a model of costly entrepreneurial start-ups in an economy with a large informal sector and rigid business environment where an equilibrium outcome can be a low-skill, low-productivity trap. By fostering productive start-ups and skilled employment, creation of an enabling business environment could help move the Ethiopian economy into high-productivity equilibrium. |
| Keywords: | entrepreneurship, SME start-ups, low productivity trap, multiple equilibria, Africa |
| JEL: | L26 J24 J48 O17 |
| Date: | 2013–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7553&r=sbm |