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on Small Business Management |
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Issue of 2014‒04‒11
seventeen papers chosen by Joao Carlos Correia Leitao Universidade da Beira Interior and Universidade de Lisboa |
| By: | Ornella Wanda Maietta (DISES and CSEF, University of Naples Federico II.; CSEF, University of Naples) |
| Abstract: | The objective of the paper is to determine the role that R&D networking, through the collaboration of firms with universities, plays among the determinants of product and process innovation in the Italian food and drink industry and how geographical proximity to a university affects both R&D university-industry collaboration and innovation. The data are sourced from the 7th (1995-1997), 8th (1998-2000), 9th (2001-2003) and 10th (2004-2006) waves of Capitalia survey data. The approach is a triprobit analysis in which the dependent variables are R&D collaboration with a university, process and product innovation; the independent variables are firm, territorial and university characteristics. |
| Keywords: | product and process innovation, university-industry interaction, geographical distance, food and drink industries |
| JEL: | O31 D21 R1 |
| Date: | 2014–03–29 |
| URL: | http://d.repec.org/n?u=RePEc:sef:csefwp:358&r=sbm |
| By: | Wixe, Sofia (Centre for Entrepreneurship and Spatial Economics (CEnSE), Jönköping International Business School,) |
| Abstract: | This paper tests the importance of firm level knowledge and neighborhood diversity, as a source for localized knowledge spillovers, on firms propensity to innovate. Diversity is measured in terms of industries as well as employee education and occupation, of which the results show a positive neighborhood effect from diversity in education. In addition, an added positive effect from neighborhood diversity in education is found for firms with a larger share of highly educated employees, which points to the importance of absorptive capacity. However, firm characteristics, such as the knowledge of the own employees, provide to be the strongest determinants for the innovativeness of firms. |
| Keywords: | Knowledge; neighborhood diversity; education; skills; innovation |
| JEL: | J21 J24 O31 R32 |
| Date: | 2014–04–03 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0360&r=sbm |
| By: | Jinjarak, Yothin (Asian Development Bank Institute); Mutuc, Paulo Jose (Asian Development Bank Institute); Wignaraja, Ganeshan (Asian Development Bank Institute) |
| Abstract: | This paper studies factors associated with firm participation in export markets, focusing primarily on firm size and access to credit, based on a survey sample comprising observations of 8,080 small and medium enterprises (SMEs) (with fewer than 100 employees) and non-SME firms in developing East Asian countries across sectors. The main findings suggest the interdependent relationships between export participation, firm size, and access to credit. SMEs participating in export markets tend to gain more access to credit, while potential scale economies (firm sizes) of SMEs are positively associated with participation in export markets. The estimation results also point to the supportive influences of foreign ownership, worker education, and production certification on export participation, and the positive effects of financial certification, managerial experience, and collateral/loan value on access to credit for SMEs. |
| Keywords: | small and medium enterprises; sme; international trade; export markets |
| JEL: | D22 E44 F14 L16 O14 |
| Date: | 2014–03–31 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbiwp:0470&r=sbm |
| By: | Heshmati, Almas (Centre of Excellence for Science and Innovation Studies (CESIS), & Department of Economics, Sogang University); Lenz-Cesar, Flávio (Ministry of Communications, Esplanada dos Ministério) |
| Abstract: | This study utilizes results from an agent-based simulation model to conduct public policy simulation of firms’ networking and cooperation in innovation. The simulation game investigates the differences in sector responses to internal and external changes, including cross-sector spillovers, when applying three different policy strategies to promote cooperation in innovation. The public policy strategies include clustering to develop certain industries, incentives to encourage cooperative R&D and spin-off policies to foster entrepreneurship among R&D personnel. These policies are compared with the no-policy alternative evolving from the initial state serving as a benchmark to verify the gains (or loses) in the number of firms cooperating and networking. Firms’ behavior is defined according to empirical findings from analysis of determinants of firms’ participation in cooperation in innovation with other organizations using the Korean Innovation Survey. The analysis based on manufacturing sector data shows that firms’ decision to cooperate with partners is primarily affected positively by firm’s size and the share of employees involved in R&D activities. Then, each cooperative partnership is affected by a different set of determinants. The agent-based models are found to have a great potential to be used in decision support systems for policy makers. The findings indicate possible appropriate policy strategies to be applied depending on the target industries. We have applied few examples and showed how the results may be interpreted. Guidelines are provided on how to generalize the model to include a number of extensions that can serve as an optimal direction for future research in this area. |
| Keywords: | agent-based simulation; collaborative R&D; innovation networks; simulation game; policy strategy; |
| JEL: | C15 C71 D21 D85 L20 O31 |
| Date: | 2014–03–27 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0357&r=sbm |
| By: | Andersson, Martin (CITR, Blekinge Inst of Technology); Gråsjö, Urban (University West); Karlsson, Charlie (CITR, Blekinge Inst of Technology) |
| Abstract: | Multinational firms (MNFs) have been shown to have a set of defining characteristics. Compared to domestic firms, they have a larger fraction of skilled workers, higher R&D to sales ratios and established networks to knowledge sources in several different countries. As illustrated by the so-called ‘anchor-tenant’ hypothesis, they can be described as “knowledge spillover agents”. MNF affiliates, as defined in this paper, are firms that are part of large domestic and foreign MNFs. In this paper we test whether the local presence of MNF affiliates generate spillover effects on the local industry. The empirical analysis focuses on assessing whether the productivity of the regional manufacturing industry of non-affiliated firms is higher in regions with a large fraction of MNF affiliates. The analysis uses data on Swedish firms and is conducted on regional level as well as on firm level. The regressions show that local presence of MNFs in a region has a positive effect on Gross Regional Product (GRP) from non-MNFs. The paper also shows that regions where the low-productive non-MNFs are located appear to benefit the most from local presence of MNFs. The MNFs have, on the other hand, no effect on non-MNF productivity in regions where the high-productive non-MNFs are located. |
| Keywords: | Multinational firms; affiliates; productivity; R&D; knowledge; spillovers; skilled workers; region |
| JEL: | F23 J24 O33 R11 |
| Date: | 2014–04–02 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:bthcsi:2014-004&r=sbm |
| By: | Kärt Rõigas; Marge Seppo; Urmas Varblane; Pierre Mohnen |
| Abstract: | This paper presents an econometric analysis of the characteristics of firm’s cooperating with universities using Community Innovation Survey (CIS) data for 14 European countries. Our model incorporates three groups of variables which could be related to the probability to cooperate with universities. The first group of variables is related to the size of a firm, the second group measures different innovation activities and the third group describes the internationalisation of firms. In addition, we test for the number of linkages, public financing and the sector of the firm. In order to provide a comparative view across the European countries we use the CIS for the period 2006–2008, where we have data for 14 countries. We use a standard logit model for firm level data, with a dependent variable indicating whether a firm used a university as a cooperation partner or not. We estimate two separate models for cooperating with home and with foreign universities. Our main findings reveal that despite the origin of the university, firms must have a certain level of capabilities to have universities as cooperation partners – conducting internal or external R&D is a significant factor characterising the cooperation with universities. Investments into machinery and equipment as one of the innovative activities are hindering the cooperation with universities. Significant differences between firms that cooperate with home universities, compared to those cooperating with foreign universities exist. Firms cooperating with foreign universities are characterised by a higher level of internationalisation, measured by an export and foreign ownership dummy. |
| Keywords: | university- industry cooperation, Europe, comparative view, national innovation system, competitiveness, technological change |
| JEL: | O32 O33 O57 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:mtk:febawb:93&r=sbm |
| By: | Maliranta, Mika; Määttänen, Niku |
| Abstract: | Radical innovations require risk-taking. However, it is hard to find an objective measure for innovation investments that would take riskiness into account. In this paper, we investigate how a simple measure of firms’ innovation investments, namely the employee share of managers and professionals, is associated with profit risk at the firm level. Using data that cover essentially all firms in the Finnish business sector, we first document that labor productivity dispersion is very high among firms with a high employment share of managers and professionals. We also find that the dispersion in the return to firms’ total capital is particularly high among young firms with a high employment share of managers and professionals. We then build a simple model where firms’ innovation activities and firm risk are interrelated. We use the model to analyze how the asymmetric tax treatment of profits and losses in corporate taxation influences firms’ innovation decision in market equilibrium and whether innovation subsidies can improve industry productivity by mitigating such a tax distortion. |
| Keywords: | productivity, R&D, innovation, corporate taxation |
| JEL: | E23 L16 O47 |
| Date: | 2014–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:rif:report:22&r=sbm |
| By: | Olivier N. Godart; Holger Görg; Aoife Hanley |
| Abstract: | We explore whether the introduction of trust based working hours is related to the subsequent innovation performance of firms. Employing a panel data set of over 5,000 German establishments, we implement a propensity score matching approach where we only consider firms that did not use trust based work contracts initially. Our results show that firms which adopt such contracts tend to be between 11 to 14 percent more likely to improve products. These results hold when we control for another form of flexible time work arrangements, namely working time accounts. Thus, the positive relationship between the adoption of trust based working hours and innovation seems to be driven by the degree of control and self-management over working days, rather than by merely allowing time flexibility |
| Keywords: | Trust based work time, innovation, firm performance |
| JEL: | M1 M5 L2 |
| Date: | 2014–04 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1913&r=sbm |
| By: | Rosina Moreno (Faculty of Economics, University of Barcelona); Jordi Suriñach (Faculty of Economics, University of Barcelona) |
| Abstract: | The idea in this paper is to provide an empirical verification of the relationship between innovation adoption and productivity growth. After a brief revision of the literature about the concept and main determinants of innovation adoption/diffusion, the paper provides empirical evidence of the above-mentioned relationship through means of descriptive statistics and subsequently, we study the impact that innovation adoption may have on productivity growth through a regression analysis. The analysis is made with the statistical information provided by the Community Innovation Survey in its third and fourth waves, which concern innovative activities carried out between 1998 and 2000 and between 2002 and 2004 respectively. The countries covered are the 25 EU Member States plus Iceland and Norway as well as Turkey. |
| Keywords: | Innovation, Innovation adoption, Productivity, Europe, Community Innovation Survey. JEL classification: C8, J61, O31, O33, R0 |
| Date: | 2014–04 |
| URL: | http://d.repec.org/n?u=RePEc:ira:wpaper:201413&r=sbm |
| By: | Nathalie Lazaric (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université Nice Sophia Antipolis (UNS)); Alain Raybaut (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - Université Nice Sophia Antipolis (UNS) - CNRS : UMR6227) |
| Abstract: | In this article, we explore the potential tensions between the incentive systems of group of inventors and knowledge diversity in a high tech firm. |
| Keywords: | Work motivation, groups of inventors, knowledge diversity, Knowledge creation |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00930186&r=sbm |
| By: | Bruno Amable (Centre d'Economie de la Sorbonne & Institut Universitaire de France); Ivan Ledezma (Université Paris-Dauphine, LEDa & IRD); Stéphane Robin (PRISM Sorbonne - Université Paris 1) |
| Abstract: | Several recent policy and academic contributions consider that liberalising product markets would foster innovation and growth. This paper analyses the innovation-productivity relationship at the industry-level for a sample of OECD manufacturing industries. We pay particular attention to the vertically-induced influence of product market regulation (PMR) of key input sectors of the economy on the innovative process of manufacturing and its consequences on productivity. We test for a differentiated effect of this type of PMR depending on whether countries are technological leaders or laggards in a given industry and for a given time period. Contrary to the most widespread policy claims, the innovation-boosting effects of liberalisation policies at the leading edge are systematically not supported by the data. These findings question the relevance of a research and innovation policy based on liberalisation. |
| Keywords: | Product market regulation, innovation, productivity, growth. |
| JEL: | D24 O43 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:mse:cesdoc:14025&r=sbm |
| By: | Backman, Mikaela (Jönköping International Business School, & Centre of Excellence for Science and Innovation Studies (CESIS)); Gabe, Todd (University of Maine); Mellander, Charlotta (Jönköping International Business School, & Centre of Excellence for Science and Innovation Studies (CESIS)) |
| Abstract: | This paper examines the effects of human capital on the growth and survival of a large sample of Swedish businesses. Human capital is represented by conventional measures of the educational attainment and experience of an establishment’s workers, and skills-based measures of the types of occupations present in the company. Controlling for an establishment’s size and age, as well as its industry and region of location, we find that the human capital embodied in a company’s workers significantly affects its performance. The specific effects, however, depend on how human capital is measured and whether the analysis focuses on growth or survival. |
| Keywords: | Firm growth; firm survival; human capital; education; skills |
| JEL: | J21 J24 L25 |
| Date: | 2014–03–25 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0354&r=sbm |
| By: | Backman, Mikaela (Jönköping International Business School, & Centre of Excellence for Science and Innovation Studies (CESIS)) |
| Abstract: | It is natural to assume that the characteristics of the bank sector are important factors for new firm formation when external capital is needed for establishing new firms. The local bank sector acts as the main provider of financial funds in Sweden since other sources of external capital are limited. In addition, the banking services needed in the start-up process tend to be sensitive to distance and are mainly supplied locally. Thus, the structure of the local bank sector is an important factor that determines the conditions for start-ups. The finding in this paper supports the hypothesis that new firm formation is positively influenced by (1) the average size of the bank branches, (2) number of independent banks and bank branches per capita, and (3) the intensity of competition level. Access to independent banks and bank branches has a stronger influence on start-ups in more rural locations. |
| Keywords: | new firm formation; local bank sector; Sweden |
| JEL: | G21 L26 R11 |
| Date: | 2014–03–31 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0358&r=sbm |
| By: | Catarina Roseira (FEP-U.Porto); Carla Ramos (Insper - Investigação e Ensino); Francisco Maia (FEP-U.Porto) |
| Abstract: | Abstract Networking represents a cornerstone for entrepreneurial action, nurturing relationships that provide access to necessary resources. Previous research shows that such relationships can be fostered as part of incubation processes. However, there is a lack of understanding of the underlying networking process, particularly in settings aimed at promoting them such as Networked Incubators (NIs). Moreover, little is known about entrepreneurs’ expectations when joining a NI, or about entrepreneurs’ satisfaction regarding the fulfilment of those expectations. We address these issues by investigating the features of networking within NIs, and by positing new ways of measuring incubator performance: performance from the entrepreneurs’ perspective. The article focuses on the start-ups located in UPTEC - Science and Technology Park of the University of Porto, a NI. A combination of qualitative and quantitative methodological tools (including content and social network analysis) is used. Findings show how entrepreneurs hold relatively high expectations for the dimensions of Legitimacy/Credibility, Infrastructure, and Networking, and lower expectations regarding the Business Support provided by the incubator. However, the UPTEC network shows low levels of Networking, raising questions regarding effectiveness of NIs. The findings also reveal a number of factors that impact the value and effectiveness of the networking process within a NI. |
| Keywords: | University Incubators; Networked Incubators; Business Networks; Value; Entrepreneurship; Social Network Analysis. |
| JEL: | M13 L24 L29 |
| Date: | 2014–04 |
| URL: | http://d.repec.org/n?u=RePEc:por:fepwps:532&r=sbm |
| By: | Welter, Friederike; Brush, Candida; De Bruin, Anne |
| Abstract: | The paper builds on the understanding of context as suggested by Welter (2011) who introduced different dimensions of context along a continuum of where entrepreneurship takes place and when this happens. Where context has been studied in relation to gender and women, the focus has been on the influence of social contexts such as networks, family and household embeddedness of women entrepreneurs or the institutional environment for women's entrepreneurship. We contribute to the literature by identifying three further themes, based on a systematic literature review: how to conceptualise the spatial and institutional contexts for women's entrepreneurship and their intersections, as informed by entrepreneurship, gender and geography studies; the paradox of empowering women and the debate around mumpreneurship. Our analysis highlights the influence of spatial-institutional contexts on entrepreneurship: Entrepreneurial behaviour is gendered because of place which itself is gendered, reflecting local institutions such as accepted gender norms which may force women into specific industries or business sizes. We also highlight the agency of women entrepreneurs in influencing their spatial-institutional contexts. -- |
| Keywords: | entrepreneurship,women's entrepreneurship,gender,entrepreneurship context |
| JEL: | J16 L26 M13 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifmwps:0114&r=sbm |
| By: | Leandro D’Aurizio; Tommaso Oliviero (CSEF, University of Naples Federico II.; CSEF, University of Naples); Livio Romano (Confindustria) |
| Abstract: | This paper studies how access to bank lending differed between family and non-family firms in the 2007-2009 financial crisis. The theoretical prediction is that family block-holders’ incentive structure results in lower agency conflict in the borrower-lender relationship. Using highly detailed data on bank-firm relations, we exploit the reduction in bank lending in Italy following the crisis in October 2008. We find statistically and economically significant evidence that the contraction in credit for family firms was smaller than that for non-family firms. Results are robust to ex-ante observable differences between the two types of firms and to time-varying bank fixed effects. We further show that the difference in the amount of credit granted to family and non-family firms is related to an increased role for soft information in Italian banks’ operations, following the Lehman Brothers’ failure. Finally, by identifying a match between those banks and family firms, we can control for time-varying unobserved heterogeneity among the firms and validate the hypothesis that our results are supply driven. |
| Keywords: | Family firms, Financial crisis, Soft information, Bank lending |
| JEL: | C81 D22 E44 G21 G32 L26 |
| Date: | 2014–03–29 |
| URL: | http://d.repec.org/n?u=RePEc:sef:csefwp:357&r=sbm |
| By: | Vitor Gonçalves (Phd Student of Finance, FEP.UP); Francisco Vitorino Martins (Professor FEP.UP); Elísio Brandão (Professor of Finance, FEP.UP) |
| Abstract: | In this paper we investigate the behaviour of credit default in start-up companies. Using a logit regression technique on a panel data of 1430 start-ups and considering a tracking period of three years, we tested the impact on the probability of occurrence of the first credit event in financing agreements due to variables grouped into three categories: financial capital, human capital and industry dynamics. We concluded from a financial point of view, that the support provided by partners in the financing of the company’s activity, the intensity of use of assets under management and reduced debt pay-back periods, were decisive in mitigating risk of default. In addition we found that the occurrence of a credit event will only be as limited as higher the quality of human capital held by the promoter of the project in terms of educational background and management experience. |
| Keywords: | Credit Default; Start-Up; Financial Capital; Human Capital; Industry Dynamics |
| JEL: | G33 M13 |
| Date: | 2014–04 |
| URL: | http://d.repec.org/n?u=RePEc:por:fepwps:534&r=sbm |