nep-sbm New Economics Papers
on Small Business Management
Issue of 2014‒06‒07
seven papers chosen by
Joao Carlos Correia Leitao
Universidade da Beira Interior and Universidade de Lisboa

  1. The Development of US Policies directed at stimulating Innovation and Entrepreneurship By David Audretsch; Taylor Aldridge
  2. Key Findings and Implications of the European ICT Poles of Excellence Project By Daniel Nepelski; Giuditta de Prato
  3. Does Innovation Affect Credit Access? New Empirical Evidence from Italian Small Business Lending By Andrea Bellucci; Ilario Favaretto; Germana Giombini
  4. Necessity Entrepreneurship and Competitive Strategy By Block, Jörn; Kohn, Karsten; Miller, Danny; Ullrich, Katrin
  5. Japanese SMEs and the Credit Guarantee System after the Global Financial Crisis By Nobuyoshi Yamori
  6. Regional Branching and Smart Specialisation Policy By Ron Boschma; Carlo Gianelle
  7. Collaboration networks in a French cluster: do partners really interact with each other? By Bastien Bernela; Rachel Levy

  1. By: David Audretsch (Indiana University); Taylor Aldridge (Indiana University)
    Abstract: This report explores how U.S. federal institutions fund and influence innovation in the knowledge economy context and if any agencies or particular policies could be replicated in other countries. Three key U.S. agencies are identified as having significantly contributed to innovation and growth: (1) the Small Business Innovative Research program (SBIR), (2) the Advanced Technology Program (ATP) and (3) the Defense Advanced Research Program Agency (DARPA). How these agencies have advanced US innovation is explained in detail. The beginning of the report offers a lens for understanding why and how research and development does not necessarily lead to innovation. The report explores how ideas must pass through a knowledge filter in order to become successful innovations. This filter, which may impede potential innovations, means that transfers from ideas to innovations are not linear, nor are they always successful even though conditions may be suitable. Therefore, U.S. agencies are needed to help firms pass through the Valley of Death from ideas to successful commercial innovations. The report identifies US policies which could conceivably be replicated in other countries. Most notably, the authors argue that spurring innovation from European universities, with the help of an SBIR-like institution, may offer considerable help in transforming European ideas into innovations. The report concludes that the SBIR offered significant aid to innovative firms in the US and its replication by Horizon 2020 could also offer significant advantages for commercialization of inventions and ideas. The report also points out potential problems in a adopting an SBIR-like program in other countries.
    Keywords: Innovation policies, SBIR, DARPA, ATP
    JEL: L2 L5 O3 O4
    Date: 2014–04
  2. By: Daniel Nepelski (European Commission – JRC - IPTS); Giuditta de Prato (European Commission – JRC - IPTS)
    Abstract: The European ICT Poles of Excellence project aims to identify ICT R&D&I-related activities which are geographically concentrated and which demonstrate high performance in ICT innovative activities: the European ICT Poles of Excellence. It also aims to help map the dynamics of ICT-related innovation and economic geography in Europe, pointing to the presence and possibly the emergence of agglomerated and globally performing ICT activities. This policy brief offers a synthesis of the major findings of the EIPE study. It also provides some insights into the policy implications these findings indicate. The study found significant evidence to show that Europe hosts a small number of highly ICT intensive regions, i.e. EIPEs. Together they participate in a networked ecosystem made up of very strong hubs in the global ICT innovation system and a multifaceted periphery with local and global links. Despite the highly specific nature of each of these regions, including the European ICT Poles of Excellence, whose characteristics vary considerably, their identification and analysis offer some strong implications for policy.
    Keywords: ICT; information and communication technologies; innovation, R&D, ICT industry; region; Europe; Poles of Excellence; clusters; indicators; methods
    JEL: O32 O52 R12 R28
    Date: 2014–03
  3. By: Andrea Bellucci; Ilario Favaretto; Germana Giombini
    Abstract: In this paper we analyze the access to credit of innovative firms on the price and non-price dimensions of bank lending. Using information from two datasets, we use a propensity score matching procedure to estimate the impact of the innovative nature of firms on: (a) loan interest rates; (b) the probability of having to post collateral; and (c) the probability of overdrawing. Our analysis reveals that banks trade off higher interest rates and lower collateral requirements for firms involved in innovative processes. Further, innovative firms have a lower probability of being credit rationed than their non-innovative peers.
    Keywords: innovative firms, interest rate, firm’s financing, relationship lending
    JEL: D82 E43 D40 G21
    Date: 2014–05
  4. By: Block, Jörn (University of Trier); Kohn, Karsten (KfW Bankengruppe); Miller, Danny (HEC Montreal); Ullrich, Katrin (KfW Bankengruppe)
    Abstract: Many start-ups chose to compete with incumbent firms using one of two generic strategies: cost leadership or differentiation. Our study demonstrates how this choice depends on whether the startup was founded out of necessity. Our results, based on a representative data set of 4,568 German start-ups, show that necessity entrepreneurs are more likely than other entrepreneurs to pursue a cost leadership strategy, and less likely to pursue a differentiation strategy. Decomposition analyses further show that up to half of the difference in choice of strategy can be attributed to distinct endowments of human capital, socio-economic attributes, and start-up project characteristics that correlate with necessity entrepreneurship.
    Keywords: cost leadership, competitive strategy, new venture strategy, necessity entrepreneurship, product differentiation, decomposition analysis
    JEL: L10 L26
    Date: 2014–05
  5. By: Nobuyoshi Yamori (Research Institute for Economics & Business Administration (RIEB), Kobe University, Japan)
    Abstract: This paper provides a brief explanation of the Japanese public credit guarantee system and analyzes what role it played during the global financial crisis. The author conducted a questionnaire survey of small and medium-sized enterprises (SMEs) in Aichi Prefecture, the prefecture most seriously hit by the crisis, in collaboration with the Aichi-ken Credit Guarantee Corporation. Using the survey, which provides valuable information about the usage of the credit guarantee program, this paper finds that the credit guarantee system was effective in protecting the economy from collapsing. The system was so generous that now all SMEs want it to remain unchanged. However, as the generous system brings heavy financial burdens on the government and, more seriously, discourages firms and banks from improving their efficiencies, the author insists that reforms, such as limiting the target and the guarantee coverage, are inevitable.
    Keywords: Credit Guarantee System, Japan; Financial Crisis, Questionnaire, Small and Medium-sized Enterprises
    JEL: G01 G21 G28
    Date: 2014–05
  6. By: Ron Boschma (CIRCLE - University of Lund); Carlo Gianelle (European Commission – JRC - IPTS)
    Abstract: This note studies the mechanisms through which regional economies diversify over time and formulates suggestions on how policy can influence such process. In particular, two closely related concepts will be defined, that is, technological relatedness and related variety. Regional diversification is a crucial process in order to develop new growth paths. It is understood as an emerging process through which new activities develop out of existing ones, but the scope and outcome of this process are fundamentally affected by technological and cognitive constraints. We discuss how technological relatedness may provide an input for effective policy making. In this respect, public policy should avoid picking winners that do not fit into the regional actual and potential industrial space and should prevent supporting declining industries that occupy a peripheral position in the industry space of a region. More in particular, we direct attention to various mechanisms through which new industries may be stimulated to connect to technologically related industries at the regional level. We also introduce the process of entrepreneurial discovery, in which entrepreneurs generate the key information guiding the selection of the domains of future regional specialization, and discuss its relationship with policy schemes based on related diversification.
    Keywords: European cohesion policy, Structural Funds, smart specialisation, related variety, regional branching, entrepreneurial discovery process
    Date: 2014–05
  7. By: Bastien Bernela (CRIEF - Centre de Recherche sur l'Intégration Economique et Financière - Université de Poitiers); Rachel Levy (LEREPS - Laboratoire d'Etude et de Recherche sur l'Economie, les Politiques et les Systèmes Sociaux - Université des Sciences Sociales - Toulouse I : EA4212 - École Nationale de Formation Agronomique - ENFA - Institut d'Études Politiques [IEP] - Toulouse - Université Toulouse le Mirail - Toulouse II)
    Abstract: We discuss the common hypothesis that, in collaborative projects, all partners interact with each other in homogeneous ways. More precisely, this research aims to determine the existence and frequency of Partner interactions in a collaborative project. From a survey of participants involved in innovation projects approved by a cluster, we collect information about 754 collaboration ties. We then test the impact of several determinants on the existence and frequency of their observed interactions.
    Keywords: Collaboration tie, interaction, inter-organizational networks, cluster, complete graph
    Date: 2014–05–05

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