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on Small Business Management |
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Issue of 2016‒06‒04
fifteen papers chosen by João Carlos Correia Leitão Universidade da Beira Interior |
| By: | Xi, Guoqian (University of Trier); Block, Jörn (University of Trier); Lasch, Frank (Montpellier Business School); Robert, Frank (Montpellier Business School); Thurik, Roy (Erasmus University Rotterdam) |
| Abstract: | Our paper investigates how the type of work experience gained from prior paid employment influences the path to entrepreneurship. We distinguish between two distinct entrepreneurship entry modes: business takeover and new venture start-up. Using a large and rich French data set, we find that small firm experience increases the likelihood for business takeover, whereas management and same sector experience both increase the likelihood for new ventures. Our findings are relevant for policymakers aiming to improve the business transfer process. |
| Keywords: | entrepreneurship entry mode, business takeover, new venture start-up, work experience |
| JEL: | L26 |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9949&r=sbm |
| By: | Riccardo Leoncini (University of Bologna (Italy); Freiburg Institute for Advanced Studies (FRIAS), University of Freiburg (Germany); IRCrES-CNR (Italy)); Alberto Marzucchi (Catholic University of Milan (Italy)); Sandro Montresor (Kore University of Enna (Italy)); Francesco Rentocchini (Southampton Business School, University of Southampton (UK)); Ugo Rizzo (University of Ferrara (Italy)) |
| Abstract: | This paper investigates the relationships between green/non-green technologies and firm growth. By combining the literature on eco-innovations with industrial organisation and entrepreneurial studies, this relationship is investigated by considering its dependence on the pace at which firms grow and the moderating role of age. Based on a sample of 5498 manufacturing firms in Italy for the period of 2000-2008, we estimate longitudinal fixed effects quantile models in which age is set to moderate the effects of green and non-green patents on employment growth. The results indicate a positive role of green technologies in growth greater than the effect of non-green technologies. This result is valid with the exception of struggling and rapidly growing firms: the relevance of moderately growing firms thus emerges in contrast to the more celebrated “elite of superstar” growing companies. Age plays a moderating role in the growth effects of green technologies. Not completely inconsistent with the extant literature, this moderation effect is positive, indicating the importance of firm experience in benefiting from green technologies in terms of growth, possibly relative to the complexity of their management. |
| Keywords: | green technology; firm growth; age; quantile fixed effects |
| JEL: | L26 O33 Q55 |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:srt:wpaper:0616&r=sbm |
| By: | Molina, Jose Alberto; Velilla, Jorge |
| Abstract: | This project analyzes specifically how innovation and technological aspects influence the entrepreneurial activity around the world and in Spain. Recent international microdata GEM Global Individual (2014) are applied using a novel econometric methodology based on the Machine Learning techniques for selecting variables based on their predictive ability. Our results, both for Spain and internationally, support the importance of innovation as a critical component of the enterprise, characterizing in this way an "entrepreneurship by innovative vocation" in the sense that the fundamental reason that motivates entrepreneurship is the desire to deliver new services, products or technologies. |
| Keywords: | Enprepreneurship, Innovation, Machine Learning, GEM Data |
| JEL: | D22 J21 |
| Date: | 2016–05–19 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:71471&r=sbm |
| By: | Milne, Alistair |
| Abstract: | Alistair Milne argues in this ECRI Commentary that ‘FinTech’ (newly emerging Financial Technologies) can play a crucial role in achieving European policy objectives in the area of financial markets. These notably include increasing access by smaller firms to trade credit and other forms of external finance and completing the banking and capital markets unions. He points out, however, that accomplishing these objectives will require a coordinated European policy response, focused especially on promoting common business processes and the adoption of shared technology and data standards. |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:eps:ecriwp:11104&r=sbm |
| By: | Hasan, Iftekhar; Kobeissi, Nada; Wang, Haizhi; Zhou, Mingming |
| Abstract: | This paper provides an empirical examination of the regional banking structures in China and their effects on entrepreneurial activity. Using a panel of 27 provinces and four directly controlled municipalities from 1997 through 2008, we find that the presence of large banking institutions negatively correlates with small business development in local markets and that this negative relation is driven mainly by participation of large banks in the short-term loan market. Rural banking institutions, in contrast, are found to promote regional entrepreneurial activity. Moreover, large state banks facilitate small business development in concentrated markets. When we interact measures of banking financing by state banks and rural banking institutions with a set of provincial level marketization indexes, we find that extensive marketization, factor market development, and sophistication of legal frameworks mitigate the negative effect of large state banks on small business development. In provinces with advanced market development, efficient factor markets, and favorable institutional settings, the positive effect of rural banking institutions on small business growth is even stronger. Finally, we present evidence that banks do a better job of promoting regional entrepreneurship when it occurs in conjunction with policies to foster innovation activity and assure protection of intellectual property rights. |
| Keywords: | banking structure, marketization, small business development, China |
| JEL: | G21 O16 P23 P25 |
| Date: | 2015–03–27 |
| URL: | http://d.repec.org/n?u=RePEc:bof:bofitp:2015_011&r=sbm |
| By: | Rocha, Vera (Copenhagen Business School); van Praag, Mirjam C. (Copenhagen Business School); Folta, Timothy B. (University of Connecticut); Carneiro, Anabela (University of Porto) |
| Abstract: | The founder (team)'s human capital is a vital determinant of future firm performance. This is a stylized fact. Less is known about the effect of the human capital of the initial workforce hired by the founder(s). We study the performance consequences of a founder's choice of the initial workforce's human capital (quantity and quality), besides the human capital of the founder(s). The analysis is based on matched employer-employee data and covers about 5,300 startups in manufacturing industries founded by individuals coming from employment between 1992 and 2007. We acknowledge that initial hiring decisions are endogenous and correlated with the human capital of the founders and the ownership structure of startups (single founder versus team of founders). Given the stickiness of initial choices, human capital decisions at entry turn out to be a close to irreversible matter with significant implications for post-entry survival and growth of the firm. |
| Keywords: | human capital, entrepreneurship, startups, firm performance |
| JEL: | J24 L26 M13 |
| Date: | 2016–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9919&r=sbm |
| By: | Torres, Ariana; Marshall, Maria; Delgado, Michael |
| Abstract: | This project assesses the effect of social capital, defined as the clustering of Hispanics, on the probability of Hispanic business creation. A big issue in the social capital literature is identification. We use new econometric procedures to try to address this possible endogeneity and draw causal conclusions on the effect of social interactions on individual economic behavior. This essay provide robust empirical evidence on the role of social capital on Hispanic entrepreneurship. We also tackle the constructs of Hispanic heterogeneity and find a potential indicator for the Hispanic entrepreneurial environment. |
| Keywords: | Hispanic, entrepreneurship, social capital, clustering, endogeneity, instrumental variable, Latino, Community/Rural/Urban Development, Labor and Human Capital, |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea16:235523&r=sbm |
| By: | Castellani, Davide (University of Reading); Piva, Mariacristina (Università Cattolica del Sacro Cuore); Schubert, Torben (Lund University); Vivarelli, Marco (Università Cattolica del Sacro Cuore) |
| Abstract: | Using data on the US and EU top R&D spenders from 2004 until 2012, this paper investigates the sources of the US/EU productivity gap. We find robust evidence that US firms have a higher capacity to translate R&D into productivity gains (especially in the high-tech industries), and this contributes to explaining the higher productivity of US firms. Conversely, EU firms are more likely to achieve productivity gains through capital-embodied technological change at least in medium and low-tech sectors. Our results also show that the US/EU productivity gap has worsened during the crisis period, as the EU companies have been more affected by the economic crisis in their capacity to translate R&D investments into productivity. Based on these findings, we make a case for a learning-based and selective R&D funding, which – instead of purely aiming at stimulating higher R&D expenditures – works on improving the firms' capabilities to transform R&D into productivity gains. |
| Keywords: | R&D, productivity, economic crisis, US, EU |
| JEL: | O33 O51 O52 |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9937&r=sbm |
| By: | Izabella Szakálné Kanóa, Balázs Lengyel, Zoltán Elekes, Imre Lengyel; Balázs Lengyel; Zoltán Elekes; Imre Lengyel |
| Abstract: | We investigate the effect of related variety on the entry and exit patterns of domestic and foreign firms in Hungarian city regions from 1996-2012. In order to characterize the archetypes of interaction between domestic and foreign firms, we introduce three alternative models to calculate the related variety. The best fit is provided by the model, in which no interaction among foreign and domestic firms is presumed. Related variety in the foreign subset tends to accelerate firm entry and decelerate firm exit in a much earlier stage of economic transition than related variety across domestic firms. |
| Keywords: | related variety, firm entry and exit, foreign-owned firms, panel logistic regression, dual economy |
| JEL: | F43 F23 L16 |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:1612&r=sbm |
| By: | Sandra M. Leitner (The Vienna Institute for International Economic Studies, wiiw) |
| Abstract: | The paper focuses on Emerging Europe and sheds light on the effects of different types of financing constraints on firm growth – both in terms of sales and employment -, before and after the onset of the global financial crisis. It analyzes and compares a large group of emerging economies, on the one hand (comprising all NMS-10 economies plus Turkey) and the group of economically and financially lagging Western Balkan countries, on the other, and demonstrates that financing constraints significantly obstruct firm growth, with interesting differences across growth indicators, type of financing constraints and economic periods considered. Moreover, it shows that during the pre-crisis period only, financial constraints were more harmful to employment growth of establishments located in the Western Balkans than in the NMS-10. It also highlights that growth is determined by particular establishment characteristics with product innovators or exporters only growing faster while older or larger establishments, importers only or foreign-owned establishments grow more slowly. Finally, it demonstrates that the state of the economy and the particular institutional environment are essential for establishment growth. |
| Keywords: | financing constraints, establishment growth, NMS-10, Western Balkans, financial crisis |
| JEL: | L25 D22 D53 O16 O57 |
| Date: | 2015–10 |
| URL: | http://d.repec.org/n?u=RePEc:wii:bpaper:115&r=sbm |
| By: | Molina, Jose Alberto; Velilla, Jorge; Ortega, Raquel |
| Abstract: | This paper analyzes the role of innovation, and other socio-demographic variables, in the entrepreneurial activity in the OECD. We use the index from the GEM 2014 Global Individual Level database, which contains international micro-data for individuals. Our pooled and cross-country results show that young male individuals tend to entrepreneur more than their counterparts. Innovation is also positive strongly related to entrepreneurship. Furthermore, making use of unbiased estimates based on relatively novel and underused techniques we give strong robustness to this result. We find that family and well-being variables follow a mixed relationship with entrepreneurship. Skills, transmission by meeting and opportunities also play an important role. |
| Keywords: | Entrepreneurship, TEA, OECD. |
| JEL: | C21 L26 O31 |
| Date: | 2016–05–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:71592&r=sbm |
| By: | David Córcoles (University of Castilla-La Mancha); Carmen Díaz-Mora* (University of Castilla-La Mancha); Rosario Gandoy (University of Castilla-La Mancha) |
| Abstract: | The aim of this paper is to investigate the dynamics of the exporting activity of manufacturing firms that are involved in complex internationalization strategies. We consider complex internationalization to be when firms are simultaneously active in exporting, importing intermediates and international production, which are typically associated with participation in GVCs. Our descriptive data show that these triple mode internationalized firms belong to an elite group of firms that exhibit a higher level of labour productivity, are larger and show a higher likelihood of engaging in product innovation. On the basis of the estimation of a random-effects probit model with panel data, we find that once such firm characteristics are controlled for, internationalization complexity plays an important role in continuing to export. Additionally, the results from a dynamic panel data model show that being involved in more sophisticated internationalization modes positively influences the level of exports. Thus, it seems that firms active in a complex mix of internationalization strategies have an added advantage which enables them to confront the uncertainty of foreign markets in better conditions and translates to a lower likelihood of ceasing exporting and to higher export values. We go one step further and investigate whether the impact is different during the trade collapse in 2009 and the following recovery. |
| Keywords: | Export dynamics, firms' characteristics, complex internationalization, trade collapse and recovery |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:aee:wpaper:1605&r=sbm |
| By: | Canidio, Andrea; Legros, Patrick |
| Abstract: | The task assignment that maximizes present expected output is not necessarily the most informative about an agent's comparative advantage at different tasks. Entrepreneurs are free to choose their task assignment-workers in firms are not. When labor market frictions are low, any surplus generated by a more informative task as- signment is captured by the worker, and firms maximize present expected output in their task assignment. Hence, agents may choose entrepreneurship to learn their comparative advantage. The opposite holds when labor market frictions are large. The model establishes a causal relation between the degree of labor market frictions, the value of entrepreneurial failures, the level of entrepreneurial activity, the degree of firms' short-termism, and the rate of within-firm talent discovery. The theoretical correlations between these variables are consistent with the evidence available for the US and continental Europe. |
| Keywords: | career concerns.; entrepreneurial failures; entrepreneurship; learning; organizational choice; task allocation |
| JEL: | D83 J24 J62 L26 M13 |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11295&r=sbm |
| By: | Alberto Di Minin (Scuola Superiore Sant'Anna); Chiara Eleonora De Marco (Scuola Superiore Sant'Anna); Cristina Marullo (Scuola Superiore Sant'Anna); Andrea Piccaluga (Scuola Superiore Sant'Anna); Elena Casprini (Scuola Superiore Sant'Anna); Maral Mahdad (Scuola Superiore Sant'Anna); Andrea Paraboschi (Scuola Superiore Sant'Anna) |
| Abstract: | This report synthesizes the results of 13 case studies on innovative ICT and ICT-enabled companies across Europe. It aims to assess the impact of Open Innovation strategies (OISs) on their innovation processes and to highlight the role played by ICT. |
| Keywords: | Open Innovation, ICT, Innovation Ecosystem, SMEs, LE |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc100823&r=sbm |
| By: | Cui, Jingbo; Li, Xiaogang |
| Keywords: | Productivity, Backward Citations, Innovation, Knowledge Stock, Industrial Organization, Productivity Analysis, Research and Development/Tech Change/Emerging Technologies, d22, O31, |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea16:235603&r=sbm |