nep-sbm New Economics Papers
on Small Business Management
Issue of 2017‒04‒02
seventeen papers chosen by
João Carlos Correia Leitão
Universidade da Beira Interior

  1. PUBLIC R&D SUPPORT IN ITALY. EVIDENCE FROM A NEW FIRM-LEVEL PATENT DATA SET By Francesco Aiello; Giuseppe Albanese; Paolo Piselli
  2. Współpraca badawczo-rozwojowa przedsiębiorstw: przegląd prac empirycznych By Karbowski, Adam
  3. The Effect of Hiring Top Workers on Productivity: What is the Role of Absorptive Capacity? By Lodefalk, Magnus; Tang, Aili
  4. Agglomeration economies in Vietnam : a firm-level analysis By Gokan, Toshitaka; Kuroiwa, Ikuo; Nakajima, Kentaro
  5. Product versus Process: Innovation Strategies of Multi-Product Firms By Flach, Lisandra; Irlacher, Michael
  6. Effects of Main Bank Switch on Small Business Bankruptcy By OGANE Yuta
  7. R&D cooperation within Italian technological districts: A microeconometric analysis By Otello Ardovino; Maria Rosaria Carillo; Luca Pennacchio
  8. Firm Growth Dynamics and Financial Constraints: Evidence from Serbian Firms By Milos Markovic; Michael Stemmer
  9. Entrepreneurial Ecosystems By F.C. Stam; Ben Spigel
  10. Is innovation destroying jobs? Firm-level evidence from the EU By Piva, Mariacristina; Vivarelli, Marco
  11. Going Entrepreneurial? IPOs and New Firm Creation By Tania Babina; Paige P. Ouimet; Rebecca Zarutskie
  12. Accounting for Heterogeneity in Network Formation Behavior: An application to Vietnamese SMEs By HOSHINO Tadao; SHIMAMOTO Daichi; TODO Yasuyuki
  13. Measuring the Systemic Risk in Interfirm Transaction Networks By Hazama, Makoto; Uesugi, Iichiro
  14. Les économies « à épithète » et les business models associés By Yvon Pesqueux
  15. Novelty, Knowledge Spillovers and Innovation: Evidence from Nobel Laureates By Ham, John C.; Weinberg, Bruce A.
  16. Monitoring the knowledge transfer performance of universities: An international comparison of models and indicators By Matthew Ainurul Rosli; Federica Rossi
  17. Entrepreneurs’ Overoptimism During The Early Life Course Of The Firm By Z.V. Kambourova; F.C. Stam

  1. By: Francesco Aiello; Giuseppe Albanese; Paolo Piselli (Dipartimento di Economia, Statistica e Finanza "Giovanni Anania" - DESF, Università della Calabria)
    Abstract: This paper evaluates the impact of R&D public support on the innovation activities of a sample of Italian SMEs. Unlike most of the literature, the analysis focuses more deeply on the innovation output than on the innovation input. The innovation output is measured through patent data. By using a new data set obtained by combining information from EPO records and the Capitalia data set on Italian corporations, we find that publicly supported firms have similar patenting activity to other R&D performers, regardless of the type of policy tool used to foster innovation. However, as far as patenting is concerned, supported SMEs face higher R&D spending than others.
    Keywords: Patents, R&D policy support, SMEs
    JEL: O31 O38 L1 C21
    Date: 2017–03
  2. By: Karbowski, Adam
    Abstract: In this work empirical studies (published in the time period 2001-2015) on R&D cooperation of firms are reviewed. In the empirical literature on R&D cooperation of firms the following research strands can be distinguished: (1) research on impact of R&D cooperation of firms on enterprise innovation, (2) research on characteristics of firms and markets conducive to formation of R&D cooperation in industry, (3) research on impact of knowledge spillovers on R&D cooperation of firms, and (4) research on impact of R&D cooperation on enterprise profitability. Empirical studies revealed a positive relationship between R&D cooperation and enterprise innovation, though the existence and strength of the indicated relationship depend heavily on the enterprise innovation measure selected by the authors of the research. The impact of (i) firm’s size, (ii) degree of market concentration, (iii) R&D intensity, and (iv) type of research performed by the enterprise on the probability of forming R&D cooperation is ambiguous. The analysis of relevant empirical studies indicates that knowledge spillovers incentivize firms to form R&D cooperation in the industry. The empirical literature further suggests that firms cooperating in R&D attain on average lower profit margins than firms competing in R&D.
    Keywords: R&D cooperation of firms, empirical studies
    JEL: O3 O31 O32
    Date: 2016–12
  3. By: Lodefalk, Magnus (Örebro University School of Business); Tang, Aili (Örebro University School of Business)
    Abstract: We examine heterogeneous productivity effects of hiring top workers on small and medium-sized enterprises, using longitudinal employer-employee data. We find the productivity effect to be stronger for firms with higher absorptive capacity in terms of having a well-educated workforce, being in a knowledge-intensive industry or performing R&D. Technological laggards within an industry benefit more strongly from hiring top workers if their workforce is more well-educated.
    Keywords: recruitment; knowledge spillover; firm growth; productivity; SME; absorptive capacity
    JEL: D22 D24 D83 J24 J62
    Date: 2017–03–24
  4. By: Gokan, Toshitaka; Kuroiwa, Ikuo; Nakajima, Kentaro
    Abstract: This paper examines the effects of agglomeration economies on firm†level productivity in Vietnam. By using Vietnamese firm†level data and the cluster detection method proposed by Mori and Smith (2013), we estimate the agglomeration economies for firm†level productivity. Specifically, we consider the different effects of agglomeration economies for localization and urbanization, as well as across types of firms; state†owned, private, and foreign†owned firms. Furthermore, we decompose the agglomeration economies into the three sources of the effect; inter†industry transaction relationships, knowledge spillovers, and labor pooling. We find the following results. First, localization economies actually improve firm†level productivity in Vietnam, with firms in the clustered areas having higher productivities. However, the localization economies do not improve the productivity of the state†owned firms. Second, urbanization economies improve productivity only for foreign†owned firms. State†owned and private firms do not benefit from urbanization economies. From the decomposition of agglomeration economies, we find that agglomeration economies formed through transactions work only for private firms. On the other hand, agglomeration economies formed through knowledge spillovers and labor pooling work for foreign†owned firms.
    Keywords: Local economy, Economic conditions, Economic geography, Productivity, Agglomeration Economies, Economic Geography
    JEL: R12
    Date: 2017–03
  5. By: Flach, Lisandra; Irlacher, Michael
    Abstract: We investigate the effects of better access to foreign markets on innovation strategies of multi-product firms in industries with different scope for product differentiation. Industry-specific demand and cost linkages induce a distinction between the returns to innovation. In differentiated industries, cannibalization is lower and firms invest more in product innovation. In homogeneous industries, firms internalize intra-firm spillovers and invest more in process innovation. Using firm-level data and large exchange rate devaluations, we show that better access to foreign markets increases the incentive to innovate. However, we exploit differential effects across industries and show that the innovation strategies depend on the scope of differentiation.
    Keywords: Cannibalization Effect; innovation; Market Size Effect.; multi-product firms; product differentiation; Spillovers
    JEL: F12 F14 L25
    Date: 2017–03
  6. By: OGANE Yuta
    Abstract: This paper examines the effects of main bank switching on the probability of small business bankruptcy by employing a propensity score matching estimation approach. We use a unique firm-level data set of more than 1,000 small and medium-sized enterprises (SMEs) incorporated in Japan; the firms are young and unlisted SMEs just after incorporation. We find that main bank switching increases the probability of firm bankruptcy. In addition, the result suggests that switching increases the probability of bankruptcy when firms switch to financial institutions with which they have not previously transacted. This result may be because such switching worsens the financial conditions of client firms. We also find that the result holds only when the ex-post main banks are not descendants of their ex-ante main banks.
    Date: 2017–03
  7. By: Otello Ardovino; Maria Rosaria Carillo; Luca Pennacchio (-)
    Abstract: The purpose of this paper is to investigate the determinants of inter-firm R&D collaborations in a particular type of innovation network, the technological districts created in Italy under a specific public policy to foster innovation and economic development at the local level. Using an original database containing information on the collaborative research projects activated by the districts, we find that the structural characteristics of the individual districts play an important role upon firms’ collaboration choices: the probability of cooperating is higher in districts in which universities have a major weight and in districts with governance more oriented towards market logic. As regards the governance, the estimates also reveal a strong moderating effect on other important determinants of R&D cooperation, such as geographical proximity and absorptive capacity.
    Keywords: : R&D cooperation, innovation networks, firm behaviour, dyadic regession model
    JEL: L14 O31 O32
    Date: 2016–09–05
  8. By: Milos Markovic (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique); Michael Stemmer (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Using a unique dataset of unlisted Serbian firms during the period between 2005 and 2012, we analyze the impact of internal financial constraints on firm growth with respect to several firm-level characteristics. We also assess potential effects created by the 2008-2009 Global Financial Crisis. To do so, we rely on panel data models, which estimate via GMM cash flow sensitivities of firm growth, following the dynamic specification of Guariglia et al. (2011). Controlling for investment opportunities, our results show that Serbian firms face high financial constraints and exhibit generally a high reliance on retained earnings for firm growth. We do not find evidence for a crisis effect, potentially due to ex ante accumulated internal funds. Conventional firm characteristics such as age, size or overall performance largely determine the dependency on cash for firm growth. Moreover, foreign-owned companies seem to escape the financing gap by tapping other resources. A comparison with Belgian firms contrasts our results with an advanced country setting.
    Keywords: Financial constraints,firm growth,transition countries,dynamic panel data,GMM
    Date: 2017–02
  9. By: F.C. Stam; Ben Spigel
    Abstract: This paper reviews and discusses the emergent entrepreneurial ecosystem approach. Entrepreneurial ecosystems are defined as a set of interdependent actors and factors coordinated in such a way that they enable productive entrepreneurship within a particular territory. The purpose of this paper is to critically investigate the emerging literature on entrepreneurial ecosystems. Current work on ecosystems is underdeveloped, focusing more on superficial generalizations based on successful case studies such as Silicon Valley or Boulder, Colorado rather than on rigorous social science research. The paper provides a review of the multiple definitions of ecosystems found within the literature, and discusses the relationships between ecosystems and allied concepts such as industrial districts, clusters, and innovation systems. The paper concludes by discussing an integrative model that connects the functional attributes of entrepreneurial ecosystems (including framework conditions and systemic conditions) with entrepreneurial outputs and welfare outcomes. The framework conditions consist of the social (informal and formal institutions) and physical conditions enabling or constraining human interaction. Systemic conditions are the heart of the ecosystem and include networks of entrepreneurs, leadership, finance, talent, knowledge, and support services.
    Date: 2016–11
  10. By: Piva, Mariacristina (Università Cattolica del Sacro Cuore, Milano); Vivarelli, Marco (UNU-MERIT, Università Cattolica del Sacro Cuore, Milano, and IZA, Bonn)
    Abstract: Using a unique firm-level database comprising the top European R&D investors over the period 2002-2013 and running LSDVC estimates, this study finds a significant labour-friendly impact of R&D expenditures. However, this positive employment effect appears limited in magnitude and entirely due to the medium-and high-tech sectors, while no effect can be detected in the low-tech industries. From a policy point of view, this outcome is supporting the EU2020 strategy, but - taking into account that most European economies are specialised in low-tech activities - is also worrying in terms of future perspectives of the European labour market.
    Keywords: Innovation, R&D, innovation, employment, firm-level analysis, EU
    JEL: E24 O14 O15 O33 O52
    Date: 2017–03–10
  11. By: Tania Babina; Paige P. Ouimet; Rebecca Zarutskie
    Abstract: Using matched employee-employer US Census data, we examine the effect of a successful initial public offering (IPO) on employee departures to startups. Accounting for the endogeneity of a firm’s choice to go public, we find strong evidence that going public induces employees to leave for start-ups. Moreover, we document that the increase in turnover following an IPO is driven by employees departing to start-ups; we find no change in the rate of employee departures for established firms. We present evidence that, following an IPO, many employees who received stock grants experience a positive shock to their wealth which allows them to better tolerate the risks associated with joining a startup or to obtain funding. Our results suggest that the recent declines in IPO activity and new firm creation in the US may be causally linked. The recent decline in IPOs means fewer workers may move to startups, decreasing overall new firm creation in the economy.
    Keywords: Entrepreneurship ; Initial Public Offerings ; New Firms ; Wealth
    Date: 2017–02
  12. By: HOSHINO Tadao; SHIMAMOTO Daichi; TODO Yasuyuki
    Abstract: Network formation is often characterized by homophily—the tendency that agents connect with others who have similar attributes. However, while most agents are homophilous, others may be heterophilous, namely, aiming to create ties with dissimilar agents. This study finds evidence supporting this hypothesis for the first time in the literature by applying random coefficient models to information-sharing network data for Vietnamese small and medium-sized enterprises (SMEs). One possible interpretation for this heterophily is that firms can obtain more useful and performance-improving information from those dissimilar—as opposed to similar—to themselves, as suggested by certain social network studies.
    Date: 2017–03
  13. By: Hazama, Makoto; Uesugi, Iichiro
    Abstract: Using a unique and massive data set that contains information on interfirm transaction relationships, this study examines default propagation in trade credit networks and provides direct and systematic evidence of the existence and relevance of such default propagation. Not only do we implement simulations in order to detect prospective defaulters, we also estimate the probabilities of actual firm bankruptcies and compare the predicted defaults and actual defaults. We find, first, that an economically sizable number of firms are predicted to fail when their customers default on their trade debt. Second, these prospective defaulters are indeed more likely to go bankrupt than other firms. Third, firms that have abundant external sources of financing or whose transaction partners have such abundant sources are less likely to go bankrupt even when they are predicted to default. This provides evidence for the existence and relevance of firms – called “deep pockets” by Kiyotaki and Moore (1997) – that can act as shock absorbers.
    Keywords: interfirm networks, trade credit, default propagation
    JEL: E32 G21 G32 G33
    Date: 2017–02
  14. By: Yvon Pesqueux (LIRSA - Laboratoire Interdisciplinaire de Recherche en Sciences de l'Action - CNAM - Conservatoire National des Arts et Métiers [CNAM])
    Abstract: éco-conception, écologie industrielle, consommation collaborative, économie circulaire, économie contributive (ou économie de la contribution), économie coopérative, économie de la fonctionnalité, économie distributive, économie participative, économie positive, économie quaternaire, économie sociale et solidaire, économie symbiotique, économie verte, freeware, freemium, logiciel libre, matériel libre, FabLab, travail collaboratif, crowdfunding, innovation frugale, du modèle collaboratif comme business model, du business model circulaire, du business model symbiotique
    Keywords: formes d'organisation
    Date: 2016–12–15
  15. By: Ham, John C.; Weinberg, Bruce A.
    Abstract: Using a new identification strategy and unique, rich data on Nobel laureates, we show that being in new or multiple locations, as measures of exposure to novel combinations of ideas, and the number of other local important innovators, all increase the probability that eventual Nobel laureates begin their Nobel prize winning work. Strikingly, and consistent with our identifying assumptions, we find that none of these measures increase the probability of doing Nobel prize winning work. Our results strongly suggest that spillovers affect the generation of ideas, and help us understand the weak spillover effects previously estimated in the economics literature.
    Keywords: Knowledge spillovers,Innovation,Nobel Prize,Duration models
    Date: 2017
  16. By: Matthew Ainurul Rosli (University of Wolverhampton); Federica Rossi (Birkbeck, University of London)
    Date: 2015–07
  17. By: Z.V. Kambourova; F.C. Stam
    Abstract: Recent research on cognitive biases in decision making suggests that over-optimism critically influences entrepreneurs’ decisions to establish and sustain new firms. This paper looks at entrepreneurs’ over-optimism during the early life course of the firm, in order to uncover the dynamics and persistence of over-optimism. We use a representative sample of start-ups in the Netherlands, which we divide into solo self-employed and employer firms. We find that while there is a persistence of over-optimism for the solo self-employed, namely initial over-optimist are more likely to be overoptimistic in subsequent periods; this is not the case for the employer firms.
    Keywords: over-optimism, entrepreneurship, learning, risk-propensity, biases, early life course of the firm, firm growth
    Date: 2016–12

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