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on Small Business Management |
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Issue of 2015‒02‒22
nineteen papers chosen by João Carlos Correia Leitão Universidade da Beira Interior |
| By: | Link, Albert (University of North Carolina at Greensboro, Department of Economics); Wright, Mike (Imperial College and University of Ghent) |
| Abstract: | There is an extensive literature on the success/failure of firm-funded R&D projects but growing policy interest focuses on publicly-funded R&D projects. Using data from 1,878 Phase II R&D projects funded through the U.S. Small Business Innovation Research (SBIR) program, of which 624 had been discontinued prior to technical completion, we provide for the first time findings on the success/failure of publicly-funded firm-performed R&D projects. We find that prior R&D experience with the technology being funded by SBIR projects, the amount of the SBIR award, and having a female PI, other factors held constant, is negatively related to the probability of project failure. In contrast, firm size is positively associated with project failure. We discuss the implications of these findings for practice, policy, and further research. |
| Keywords: | R&D; project failure; innovation; SBIR; public sector |
| JEL: | L26 O31 O32 O33 |
| Date: | 2015–02–16 |
| URL: | http://d.repec.org/n?u=RePEc:ris:uncgec:2015_003&r=sbm |
| By: | Giorgio Calacagnini (Department of Economics, Society & Politics, Università di Urbino "Carlo Bo"); Ilario Favaretto (Department of Economics, Society & Politics, Università di Urbino "Carlo Bo"); Germana Giombini (Department of Economics, Society & Politics, Università di Urbino "Carlo Bo"); Francesco Perugini (Department of Economics, Society & Politics, Università di Urbino "Carlo Bo"); Rosalba Rombaldoni (Department of Economics, Society & Politics, Università di Urbino "Carlo Bo") |
| Abstract: | Start-ups increasingly find the prospect of university-industry collaborations to be a powerful driver of innovation and entrepreneurship activity. Moreover, at the geographical level, they are attracted by teaching and research institutions, either public or private. This paper focuses on the role played by universities. Our hypothesis is that geographical proximity favors the transfer of knowledge and technology from universities to industries and, consequently, represents a positive factor for regional economic development. Results show that university spillovers are positively correlated with the creation of innovative start-ups. Furthermore, the presence of human capital (graduates) exerts a significant influence on the location decisions of start-ups, being a source for competitiveness for firms close to universities. Research quality, especially in the social sciences area, attracts innovative start-ups, while third-mission activities have a weak impact on locational choice. |
| Keywords: | CKnowledge transfer, Innovative start-up, University spillovers |
| JEL: | M13 L20 R30 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:urb:wpaper:14_09&r=sbm |
| By: | Jahn, Vera; Berlemann, Michael |
| Abstract: | Successful innovation is a precondition for economic prosperity. While various potential determinants of innovative activity have been considered, little empirical evidence is yet available for the influence of firm governance issues. This paper aims at filling this gap in the literature by studying whether the relative importance of owner-managed small and medium sized enterprises has an effect on regional innovative capacity. We therefore combine patent data with data from the firm database of Creditreform, containing information on the governance structure of regional operating enterprises. Using a cross section of German NUTS-3-regions, we identify a significantly positive relation between the relative importance of owner-managed SMEs and innovative capacity. This finding is highly robust when controlling for various sorts of spatial correlation. |
| JEL: | O31 C21 D23 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc14:100412&r=sbm |
| By: | Grillitsch, Markus (CIRCLE, Lund University); Martin, Roman (CIRCLE, Lund University); Srholec, Martin (CIRCLE, Lund University & CERGE-EI, Charles University and Economics Institute of the Academy of Sciences of the Czech Republic) |
| Abstract: | The literature on geography of innovation suggests that innovation outcomes depend on the type of knowledge base employed by firms. While knowledge bases are distinct categories with regards to the nature and the rational of knowledge creation, existing studies also stress that innovation usually involves more than one knowledge base. In fact, new ideas often occur when analytical, synthetic and symbolic knowledge intertwines. It remains unclear, though, which combinations of knowledge bases are most conducive to innovation at the level of the firm, and how this is influenced by the knowledge bases available in the regional milieu. Therefore the contribution of this paper is threefold: i) to measure knowledge bases of firms and their regional heterogeneity in a more comprehensive way than the existing empirical literature has been able to do so far, ii) to quantitatively assess the impact of combinations of knowledge bases on innovation output, iii) to analyze the interplay between firm- and region-level knowledge bases (and combinations thereof) in generating innovations. Empirically, the paper applies econometric analysis on firm- and region-level data from Sweden. The knowledge base of firms is captured using detailed occupational data derived from linked employer-employee datasets that is merged at the firm-level with information from Community Innovation Surveys. The empirical analysis reveals in a quantitative way the extent to which the knowledge base combinations affect innovativeness of firms. |
| Keywords: | Knowledge bases; knowledge combination; regions; innovation performance; microdata; cross-level interaction; Sweden |
| JEL: | O30 O31 R10 |
| Date: | 2015–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lucirc:2015_006&r=sbm |
| By: | Herstad, Sverre J. (NIFU Nordic Institute for Studies in Innovation, Research and Education) |
| Abstract: | This paper explores how the innovation strategies of firms reflect the density, diversity and connectivity of their urban locations. Firms located outside the four large-city regions of Norway are generally more committed to development work than are their urban counterparts. Still, once engaged, firms in certain large-city locations exhibit unique preferences towards geographically dispersed collaboration that are most pronounced within the Western business district of the Capital. This shows that firm-level decisions along interconnected activity dimensions must be considered in order for different strategy choices, and the interdependencies between them that are an essential feature of urban economies, are to be revealed. The study provides new insights into the large-city region knowledge dynamics that are increasingly important to human capital formation, employment and growth. |
| Keywords: | urbanization; innovation; collaboration; knowledge dynamics; Norway |
| JEL: | O31 O33 R11 |
| Date: | 2015–02–15 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lucirc:2015_008&r=sbm |
| By: | Caliendo, Marco (University of Potsdam); Hogenacker, Jens (ConVista Consulting AG); Künn, Steffen (IZA); Wießner, Frank (Catholic University of Eichstätt) |
| Abstract: | Offering unemployed individuals a subsidy to become self-employed is a widespread active labor market policy strategy. Previous studies have illustrated its high effectiveness to help participants escaping unemployment and improving their labor market prospects compared to other unemployed individuals. However, the examination of start-up subsidies from a business perspective has only received little attention to date. Using a new dataset based on a survey allows us to compare subsidized start-ups out of unemployment with regular business founders, with respect to not only personal characteristics but also business outcomes. The results indicate that previously unemployed entrepreneurs face disadvantages in variables correlated with entrepreneurial ability and access to capital. 19 months after start-up, the subsidized businesses experience higher survival, but lag behind regular business founders in terms of income, business growth and innovation. Moreover, we show that expected deadweight losses related to start-up subsidies occur on a (much) lower scale than usually assumed. |
| Keywords: | innovation, deadweight effects, entrepreneurship, start-up subsidies, evaluation |
| JEL: | C14 L26 J68 |
| Date: | 2015–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp8817&r=sbm |
| By: | Marcel Fafchamps; Simon Quinn |
| Abstract: | We run a novel field experiment to link managers of African manufacturing firms. The experiment features exogenous link formation, exogenous seeding of information and exogenous assignment to treatment and placebo. We study the impact of the experiment on firm business practices outside of the lab. We find that the experiment successfully created new variation in social networks. We find some limited evidence of diffusion of management practices, particularly in terms of firm formalisation and innovation. Such diffusion appears to be a combination of diffusion of innovation and simple imitation. |
| JEL: | D22 L26 O33 |
| Date: | 2014–06–19 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:wps/2014-25&r=sbm |
| By: | Enrico Guzzini (Università degli Studi eCampus); Donato Iacobucci (Università Politecnica delle Marche) |
| Abstract: | Collaboration with firms and public research institutions (PRI) is expected to raise the innovative performance of firms. Collaboration is also likely to increase the cost of innovation because of leakages of strategic information, appropriability and coordination problems. When collaborating with PRI the latter problem is expected to be stronger thus raising the probability of project failure. The aim of this paper is to investigate if and to what extent collaboration in R&D projects raises the probability of failure: i.e. abandoning or delaying innovative projects. It also aims at verifying if and to what extent the collaboration with PRI increases the likelihood of failure. We use data from the fourth Italian Community Innovation Survey (CIS 4) which collected data for the three-year period 2002-2004. The empirical results support the hypothesis that collaboration significantly impacts the probability of abandoning or delaying innovative projects, thus raising the cost of innovation. Collaboration with PRI does not raise the likelihood of failure more than what observed for the collaboration with other partners. Moreover, delaying is influenced by cost factors (such as the lack of financial resources) and knowledge factors (such as the lack of qualified personnel); abandonment is significantly associated with market factors (such as uncertain demand). |
| Keywords: | R&D collaboration; project failure; public research institutions |
| JEL: | O32 L14 |
| Date: | 2014–12 |
| URL: | http://d.repec.org/n?u=RePEc:cme:wpaper:1405&r=sbm |
| By: | Tetsugen Haruyama (Graduate School of Economics, Kobe University) |
| Abstract: | The paper constructs a general equilibrium model model where the rate of technical progress and the distribution of R&D expenditure by heterogeneous research firms are simultaneously determined. Using the model, we explore the effects of the following policy measures on those two endogenous variables: (i) subsidies to flow variable R&D costs, (ii) subsidies to flow fixed R&D costs, (iii) an increase in entrant firms into a series of patent races, and (iv) an increase in the supply of human capital as inputs to R&D. Contrasting results are demonstrated. For example, subsidies to flow variable R&D costs promote technical progress and induce the exit of R&D firms with low R&D productivity. That is, the policy accelerates technological progress through R&D by "elite" firms. On the other hand, the opposite result holds if subsidies are applied to flow fixed R&D costs. |
| Keywords: | R&D, Patent race, technical progress, heterogeneous firms, firm distribution |
| Date: | 2015–01 |
| URL: | http://d.repec.org/n?u=RePEc:koe:wpaper:1504&r=sbm |
| By: | Idota, Hiroki; Bunno, Teruyuki; Tsuji, Masatsugu |
| Abstract: | Social media such as SNS, Twitter, and the blogs has been spreading all over the world, and a large number of firms recognize social media as new communication tools for obtaining information on consumer needs and market for developing new goods and services and promoting marketing. In spite of increasing its use in the reality, academic research on whether or how social media contributes to promoting product innovation is not enough yet. This study thus attempts to analyze empirically how social media use enhances product innovation based on the survey data to Japanese firms using statistical method such as ordered probit analysis. This study finds that consumers' cooperation via social media is indispensable for effective social media use of firms. All of three managerial orientations such as prototyping, corporate initiatives, and cooperation with consumers are effective to using social media for innovation. Firms use social media effectively for communicating tools not only outside but also inside the firm. Social media is found to support firms to obtain the market trend, and consumer needs and reputation of existing products, and to promote product innovation. |
| Keywords: | social media,product Innovation,ordered probit analysis,factor analysis,R&D orientation |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:itsb14:106867&r=sbm |
| By: | Herstad , Sverre J. (NIFU Nordic Institute for Studies in Innovation, Research and Education, Oslo); Sandven , Tore (NIFU Nordic Institute for Studies in Innovation, Research and Education, Oslo) |
| Abstract: | Using Norwegian Community Innovation Survey (CIS) data linked to public employment registers covering the years 2004 - 2010, this paper investigates the relationship between employment growth prior to the event of innovation, innovation output, and growth performance after the event. Positive growth ex ante generally strengthens growth ex post. Moreover, it increases the likelihood that innovations are introduced during the intermediate period that strengthen employment performances further. This effect is present for all levels of growth only when new products, production processes and support functions are introduced in tandem. Standalone improvements of products, by contrast, influence only the probability of survival, whereas standalone improvements of production processes and support functions support ex post growth specifically in the upper tail of the distribution. Our findings challenge the common view that product innovations are more important to growth than process innovations, and reveal interdependencies between multi-faceted organizational capabilities, innovation output and employment performance. |
| Keywords: | Capabilities; innovation; employment growth; Norway |
| JEL: | J23 J24 O15 O33 |
| Date: | 2015–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lucirc:2015_003&r=sbm |
| By: | Matthew Crail Johnson (Big Innovation Centre) |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:img:wpaper:22&r=sbm |
| By: | Natarajan Balasubramanian; Mariko Sakakibara |
| Abstract: | This study examines how the human capital of spinout founders and the performance of parent firms affect the success of spinouts by using a matched employer-employee dataset of new ventures covering 7 SIC 1-digit sectors in the United States. Our data cover 29,100 spinouts and 379,800 new ventures formed by lone entrepreneurs in 23 states between 1992 and 2005. We evaluate several components of human capital: outcomes of human capital investments vs. human capital investments, task-related human capital vs. non-task-related human capital, and individual human capital vs. group capital, and examine whether these types of human capital affect spinout performance differently. We find that spinout founder’s earnings (an outcome of human capital investment) and industry experience (task-related human capital) prior to spinout formation have strong positive correlations with spinout performance, as measured by size, wage and growth rate. We also find that group experience of spinout founders prior to spinout formation has a positive correlation with spinout performance, though this effect is slightly weaker and smaller than those of spinout founder’s earnings and industry experience. The effects of these three measures of human capital are mostly present after controlling for parent firm establishment fixed effects. We find some evidence that the size of parent firm establishments has a positive correlation with spinout performance, but this effect does not hold after controlling for parent firm fixed effects. Finally, we find that founder’s earnings, industry experience, group experience and parent firm size are more important during the early stage of spinout formation. |
| Date: | 2015–01 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:15-06&r=sbm |
| By: | David, Alexandra; Terstriep, Judith; Welschhoff, Jessica |
| Abstract: | The improvement and sustainability of urban transport systems is a necessity for quality of life, wellbeing and safety of citizens. Germany, France, Norway, the UK, the Netherlands and Sweden are anticipated to be the top six European countries for Battery Electric Vehicles (BEVs) on the road in 2020. In total 4 regional and 24 national electromobility-related RTDI policy measures have been identified for Austria, Czech Republic, France, Hungary, Germany and Switzerland, comprising top-down and bottom-up initiatives. Research-driven clusters (RDCs) entail a high potential to stimulate electromobility-related RTDI activities at the regional level and increase the competitiveness of regional economies. Electromobility is expected to become a central topic in several regions. Hence, it is even more important for regions engaging in this field to specialise. "Smart Specialisation Strategies" (S3) can be viewed as promising approach for "specialised diversification" that exploits the economies derived from related variety. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iatfor:22015&r=sbm |
| By: | Johannes Meuer (Department of Business Administration, University of Zurich); Christian Rupietta (Department of Business Administration, University of Zurich); Uschi Backes-Gellner (Department of Business Administration, University of Zurich) |
| Abstract: | The innovation systems approach, which has taken a prominent position in the academic literature, has also influenced policy-makers around the globe. Most research analyses innovation systems taking a national, regional or sectoral perspective, following a 'technological imperative'. Yet changes in institutional conditions and the importance of non-technological innovation question the accuracy and the relevance of the existing boundaries of innovation systems. These developments ask for a better understanding of how innovation systems integrate within and across different levels. Drawing on a novel combination of configurational and econometric analysis, we analyse 384 Swiss firms and identify five co-existing innovation systems: two generic innovation systems, the autarkic and the knowledge-internalisation; one regional innovation system, the protected hierarchy; and two sectoral innovation systems, the public sciences and the organised learning. The generic innovation systems entail the 'Science, Technology and Innovation' (STI) and the 'Doing, Interacting and Using' (DUI) learning modes. These systems are structurally distinct and do not integrate. In contrast, all regional and sectoral innovation systems integrate the learning modes of the generic innovation systems and complement them with idiosyncratic elements. The perspective on co-existing innovation systems that we develop here indicates the existence of two layers of innovation systems: a 'central' layer that hosts generic innovation systems and that constitutes the foundation for a second 'surface' layer that hosts regional and sectoral innovation systems. We discuss the implications of layers of co-existing innovation systems for policy-makers and future research. |
| Keywords: | Innovation systems, technological and organisational innovation, firms' learning behaviour, institutional frameworks, fsQCA, SUR model |
| Date: | 2015–01 |
| URL: | http://d.repec.org/n?u=RePEc:iso:educat:0105&r=sbm |
| By: | Goh, Chorching; Li, Wei; Xu, Lixin Colin |
| Abstract: | This paper uses a new data set of 12,000 firms in China to estimate the returns to research and development investment and its spillover effects, and investigates how the returns to research and development depend on firm incentives. For the firms in the sample, the results show that on average firm output increases around 0.4 yuan for each additional 1 yuan spent on research and development in the previous year, and there is high research and development return regardless of whether the analysis deals with the endogeneity of research and development intensity. Interestingly, the marginal return to research and development is significantly higher in firms whose chief executive officers were not appointed by the government and lower when the chief executive officer's pay is directly related to annual performance. The return to research and development is higher in relatively poor regions and for firms with worse access to finance. There are also non-trivial research and development spillover effects. |
| Keywords: | E-Business,Agricultural Knowledge and Information Systems,Scientific Research&Science Parks,Science Education,Rural Development Knowledge&Information Systems |
| Date: | 2015–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:7191&r=sbm |
| By: | Knoll, Bodo; Baumann, Martina; Riedel, Nadine |
| Abstract: | Recent years have seen an unprecedented increase in the provision of R&D tax incentives. A growing empirical literature suggests that R&D tax incentives are instrumental in raising domestic R&D activity. In policy debates this fi nding is often interpreted to lend support to the notion that R&D tax incentives increase national welfare by internalizing knowledge spillovers to other agents in the economy and raising ineffi ciently low R&D levels. Our paper stresses that much of the observed increase in R&D activities in response to R&D tax incentives is in fact related to R&D activities that are attracted from abroad. Using unique panel data on R&D activities of European multinational fi rms, we test for a potential impact of both, R&D tax incentives in the affi liate's host country and R&D tax incentives at other locations of the multinational group. In line with theoretical predictions, we fi nd a positive impact of domestic R&D subsidies and a negative one for foreign subsidies provided at other group locations. Quantitatively, the fi ndings suggest that around 80% of the observed increase in R&D activities is related to relocations of R&D across country borders. |
| JEL: | H25 H71 D62 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc14:100347&r=sbm |
| By: | Christian Ketels |
| Abstract: | This paper develops policy recommendations on the use of cluster-based economic policies and the adoption of a new concept of competitiveness in the context of the new growth path that WWWforEurope aims to outline. A first section discusses summarizes key findings from the previous research papers on the role of clusters in the New Growth Path (MS47) and on a new concept of competitiveness that embeds beyond-GDP objectives (MS46). It then extends this work by deriving an initial set of policy implications from this research. For clusters, these implications address both general practices of cluster-based economic development and specific issues related to the use of cluster-based concepts in a transition to a New Growth path. For competitiveness, it specifically discusses the new concept of competitiveness proposed in MS46 and the notion of trade-offs among different dimensions of performance in this new concept. The second section of the paper explores the ways in which beyond-GDP objectives have been integrated into the current practice of cluster-based economic development efforts across Europe. It is based on interviews with policy makers and cluster initiatives as well as the review of relevant policy documents. For cluster programmes, i.e. the policy actions implemented by government, the paper organizes the existing efforts into three categories, differentiated by the extent to which beyond-GDP categories drive the activities supported. For cluster initiatives, i.e. the collaborative efforts by private-public groups focused on enhancing the competitiveness of a specific regional cluster, the existence of a market and the need for systemic changes are identified as key factors that drive the adoptation of beyond-GDP objectives. There is also a discussion of the relevant scope of the activities in beyond-GDP related efforts relative to existing cluster categories. The third section analysis the Europe 2020 Strategy, including its objectives, quantiative performance indicators, and the European Semester as a policy review process, from the perspective of the new definition of competitiveness proposed in MS46. After exploring whether the objectives of the strategy and the new definition of competitiveness are compatible it looks at their ability to drive an effective and transparent policy process towards policies consistend with a New Growth Path. The final section then develops five policy conclusions from the prior analysis. Three are focused on the use of cluster-based economic development tools as instruments to achieve beyond-GDP objectives. The recommendations deal both with the way cluster-based tools can be used and with how they should be structured. Two of the conclusions are focused on the Europe 2020 strategy process. They deal with the need for a shared, explicit definition of competitiveness, proposing the definition developed in MS46 as a candidate. And they deal with creating a more transparent policy process that more clearly separates political decisions from analytical evaluations. |
| Keywords: | Beyond GDP, Clusters, Competitiveness, Ecological innovation, Economic strategy, European economic policy, European governance, Industrial policy, Innovation policy |
| JEL: | D04 I31 O25 O44 O52 Q58 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:feu:wfewop:y:2015:m:2:d:0:i:84&r=sbm |
| By: | Annarosa Pesole (European Commission – JRC - IPTS) |
| Abstract: | During the past years, the role of ICT as key driver and enabler of innovation has been widely recognized. The advent and development of ICT transformed the economy and the society in an evident way. However, what and how ICT contributes to this value creation process and its full potential remains hard to detect. There is a need for continuous monitoring of ICT impacts in order to provide policy makers with appropriate tools to define the right policies to seize ICT benefits. In light of this, a final aim for policy makers is to develop methodologies and tools to measure the performance of ICT innovation in Europe. This report analyses the ICT component within the newly released Innovation output indicator and provide additional informative background on the role and relation between ICT and innovation output. |
| Keywords: | ICT, innovation, Innovation Output Indicator, composite indicator |
| Date: | 2015–01 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc94372&r=sbm |