nep-sbm New Economics Papers
on Small Business Management
Issue of 2017‒05‒07
twenty-two papers chosen by
João Carlos Correia Leitão
Universidade da Beira Interior

  1. Regional Innovation Systems and Global Flows of Knowledge By Martin, Roman; Wiig Aslesen, Heidi; Grillitsch, Markus; Herstad, Sverre
  2. Knowledge externalities and firm heterogeneity: Effects on high and low growth firms By Grillitsch, Markus; Nilsson, Magnus
  3. The impact of family ownership status on determinants of leveraga. Empirical evidence from South East Asia By Nhung LE
  4. Who wishes to be an entrepreneur and who prepares for that? : Evidence from statistical micro data in Japan over 30 years By OKAMURO, Hiroyuki; IKEUCHI, Kenta; MATSUDA, Naoko; TSUCHIYA, Ryuichiro
  5. What is a Patent Worth? Evidence from the U.S. Patent “Lottery” By Joan Farre-Mensa; Deepak Hegde; Alexander Ljungqvist
  6. JRC Insights - Social Policy Innovation Series - Innovating EU Social Protection Systems through ICTs. Findings from analysis of case studies in fourteen Member States By Gianluca Misuraca; Giulio Pasi; Fabienne Abadie
  7. The effects of minimum wage hikes on employment and wages in Viet Nam’s micro, small, and medium enterprises By Phan Kim Dung
  8. SME financing in the EU: Moving beyond one-size-fits-all By Demary, Markus; Hornik, Joanna; Watfe, Gibran
  9. The Creative Response and the Endogenous Dynamics of Pecuniary Knowledge Externalities: An Agent Based Simulation Model. By Antonelli, Cristiano; Ferraris, Gianluigi
  10. Innovation policy for economic resilience: The case of Sweden By Asheim, Bjørn; Moodysson, Jerker
  11. Exploring the role of ICT-Enabled Social Innovation to support the modernisation of EU Social Protection Systems: findings and insights from analysis of case studies in fourteen Member States By Gianluca Misuraca; Giulio Pasi; Fabienne Abadie; Csaba Kucsera; Marco Virginillo
  12. Why Did Korean Domestic Demand Slow Down after the Asian Financial Crisis? By Whang , Unjung; Moon , Seongman; Ahn , Taehyun; Kim , Su Bin; Kim , Junyup
  13. Firms’ financial fragility and credit allocation By Emilia Bonaccorsi di Patti; Paolo Finaldi Russo
  14. An innovation system framework for system innovation policy: the case of Strategic Innovation Programs (SIPs) in Sweden By Coenen, Lars; Grillitsch, Markus; Hansen, Teis; Moodysson, Jerker
  15. Suitable or non-suitable? An investigation of Eurozone SME access to market-based finance By Bongini, Paola; Ferrando, Annalisa; Rossi, Emanuele; Rossolini, Monica
  16. The impact of structural reforms on productivity: The role of the distance to the technological frontier By Ana Fontoura Gouveia; Sílvia Santos; Inês Gonçalves
  17. Firm Financing and Growth in the Arab Region By Soha Ismail; Juan Jose Cortina Lorente; Sergio L. Schmukler
  18. Price promotions and brand equity: the role of brand types By Kuntner, Tobias
  19. Can Italy Grow Out of Its NPL Overhang? A Panel Threshold Analysis By Mohaddes, Kamiar; Raissi, Mehdi; Weber, Anke
  20. The Internationalisation of Firms and Management Practices:A Survey of Firms in Viet Nam By Isao Kamata; Hitoshi Sato; Kiyoyasu Tanaka
  21. Firm growth in Europe: an overview based on the CompNet labour module By Fernandez, Cristina; García, Roberto; Lopez-Garcia, Paloma; Marzinotto, Benedicta; Serafini, Roberta; Vanhala, Juuso; Wintr, Ladislav
  22. Los agentes y la toma de decisiones en las PyMEs frente convergencia a NIIF: una observación en seis empresas de algunos sectores en el Valle del Cauca By Franco, Angélica María; Ordoñez-Castaño, Iván Andrés; Perdomo, Luis Enrique

  1. By: Martin, Roman (University of Gothenburg); Wiig Aslesen, Heidi (BI Norwegian Business School); Grillitsch, Markus (CIRCLE, Lund University); Herstad, Sverre (Inland Norway University of Applied Sciences)
    Abstract: The literature on regional innovation systems emphasizes the role of the region as locus for interactive learning and knowledge exchange, stressing the importance of (geographical) proximity for innovation (Asheim and Gertler 2005). Even though the importance of extra-regional knowledge is widely acknowledged (Trippl et al. 2015), there has been only little emphasis on the particular role and the nature of global knowledge flows. The aim of this chapter is to explore the differentiated nature of global knowledge flows in regional innovation systems. We provide an overview of the different ways firms can gain access to global knowledge sources. Identified knowledge sourcing channels include international R&D collaborations, foreign direct investments, personally embedded relationships, international mobility of skilled labour, virtual communities and online platforms, and the participation in temporary clusters such as fairs, exhibitions, and conferences (Maskell et al. 2006, Aslesen and Sardo 2016). Depending on regional innovation system preconditions, firms use and combine different knowledge sourcing channels to access global knowledge. Firms in organisationally thick and diversified regional innovation systems have a geographical advantage in accessing knowledge globally, but even firms in peripheral areas can exchange knowledge worldwide, due to improved means of transport and communication at distance. Furthermore, not only multinational companies that are dominated by analytical or synthetic knowledge bases, but even small and medium sized enterprises in symbolic industries are often deeply involved in global knowledge sourcing activities. We illustrate our arguments with interview data collected among New Media firms in southern Sweden and in the Oslo Region in Norway.
    Keywords: regional innovation systems; globalisation of innovation; knowledge sourcing; new media
    JEL: L82 L86 O19 O33
    Date: 2017–04–27
  2. By: Grillitsch, Markus (CIRCLE, Lund University); Nilsson, Magnus (CIRCLE, Lund University)
    Abstract: Knowledge externalities affect high and low growth firms differently. The paper develops two theoretical arguments. The knowledge equilibrium argument postulates that knowledge externalities weaken high growth firms for the benefit of low growth firms until performance differences vanish. The knowledge competition argument claims that high growth firms are in a better position to identify, attract, and integrate knowledge, thereby benefiting more from knowledge externalities than low growth firms. Based on 188,936 observations of 32,736 Swedish firms from 2004 to 2011, it is analyzed whether knowledge centers enable high growth firms to surge ahead or low growth firms to catch up.
    Keywords: knowledge spillovers; externalities; firm growth; competitiveness; core-periphery
    JEL: O18 O30 P48 R10 R12
    Date: 2017–04–27
  3. By: Nhung LE (International University, Vietnam National University & LaRGE Research Center, Université de Strasbourg)
    Abstract: We investigate the impact of family ownership on determinants of leverage in South East Asia. We find that family firms use more debt than non-family firms and that family ownership strengthens the positive relationship between firm size and leverage. Family firms have a higher level of tangibility at a certain level of debt relative to non-family firms. On one hand, family firms with family CEOs use more debt to finance internal fund deficit relative to family firms with CEOs from outside or non-family firms. On the other hand, family firms with family CEOs have a lower level of debt corresponding to growth opportunities than others. Our results are robust to alternative estimation techniques and measurement of leverage. These findings contribute to understanding the determinants of leverage among family-controlled firms in South East Asia.
    Keywords: Family firms, capital structure, South East Asia.
    JEL: G30 G32
    Date: 2017
  4. By: OKAMURO, Hiroyuki; IKEUCHI, Kenta; MATSUDA, Naoko; TSUCHIYA, Ryuichiro
    Abstract: Entrepreneurial process has been attracting much attention thus far, but no detailed empirical studies have been conducted on the determinants of the willingness to and the preparation for business start-up with a representative large sample. Especially in Japan, where start-up ratio and the number of people who wish to start their own business have decreased for decades, empirical analyses from a long term perspective are essential to consider why entrepreneurship in Japan experiences such a long-run downturn. However, previous empirical studies use one-shot dataset, and lack such a long term perspective. This paper aims to fill this gap using statistical micro data from the Employment Status Survey in Japan in seven survey cohorts for 30 years. We estimate what types of individuals wish to start up own business and prepare for that considering age, generation, gender, family status, education, income, occupation and employment types, firm size, job tenure, and industry. We find that the determinants of the willingness to and the preparation for business start-up are partially different and that household head dummy has positive, while female dummy, firm size and job tenure have negative effects on both willingness to and preparation for self-employment in all survey cohorts. We also find that the age effect on entrepreneurial process changes over time, with the peak of the willingness to start-up shifting towards older generation.
    Keywords: willingness, preparation, start-up, entrepreneurship, micro data, Japan
    Date: 2017–04
  5. By: Joan Farre-Mensa; Deepak Hegde; Alexander Ljungqvist
    Abstract: We provide evidence on the value of patents to startups by leveraging the random assignment of applications to examiners with different propensities to grant patents. Using unique data on all first-time applications filed at the U.S. Patent Office since 2001, we find that startups that win the patent “lottery” by drawing lenient examiners have, on average, 55% higher employment growth and 80% higher sales growth five years later. Patent winners also pursue more, and higher quality, follow-on innovation. Winning a first patent boosts a startup’s subsequent growth and innovation by facilitating access to funding from VCs, banks, and public investors.
    JEL: D23 G24 L26 O34
    Date: 2017–03
  6. By: Gianluca Misuraca (European Commission – JRC); Giulio Pasi (European Commission – JRC); Fabienne Abadie (European Commission – JRC)
    Abstract: This issue presents results from the analysis of selected case studies on how ICT-enabled social innovations promoting social investment can contribute to the modernisation of social protection systems in the EU. The selected case studies are drawn from fourteen Member States and address diverse social services and policy domains. Findings from the research show that they have made a positive contribution to transforming existing social services models, with ICT-enabled social innovation playing a crucial role, either as an enabler or game changer. The analysis illustrates examples of how ICTs can provide solutions to those global societal challenges that are adding new complexities to the delivery of social services; in particular, ICTs can help building a ‘client pathway’ approach, with services centred on the needs of the beneficiaries. At a more operational level, the simplification and automation of procedures increases access to services and fosters a direct relationship between service providers and users. Innovative policies encouraging the development of ICT solutions for the management of social protection systems and the delivery of social services should thus be promoted; to this end, specific incentive schemes to guarantee development, sustainability and transferability of those initiatives that generate social value by leveraging on ICTs shall be identified and fostered across the EU. At the same time, high levels of digitalization in the services delivery system must be balanced with alternative channels, to ensure that the less technologically savvy are not excluded. For this purpose, it is crucial to involve citizens and relevant stakeholders right from the early stages of social policy programming, and the creation of Public-Private Partnerships (PPPs) and partnerships with third sector organisations should be encouraged.
    Keywords: Social investment, social policy innovation, SIP, Social Investment Package, social economy, social enterprise, ICT enabled social innovation, ICT, services, social protection, social welfare
    JEL: O33 O35 O38 H55 H75 H83 I31 I38
    Date: 2017–04
  7. By: Phan Kim Dung
    Abstract: Very little is known about the extent to which wage and employment offsetting behaviours change by firm size to mitigate the detrimental effects of minimum wage regulation. Do micro establishments react more aggressively to minimum wage shocks compared to small and medium establishments? To answer this question, this paper examines the impact of minimum wage hikes on employment and wages in Viet Nam’s micro enterprises, and small and medium enterprises (SMEs), respectively. In particular, I exploit the differences in the rates of increases in minimum wages across minimum wage regions to identify the effects of minimum wage changes. The findings indicate that minimum wage has greater employment effects on SMEs, but alters employment structure of micro firms.
    Date: 2017
  8. By: Demary, Markus; Hornik, Joanna; Watfe, Gibran
    Abstract: The proposal for a European Capital Markets Union (CMU) carries large potential economic benefits from enhancing the financing possibilities for Small and Medium-Sized Enterprises (SMEs). By deepening the capital markets and strengthening cross-border integration, the European Commission hopes to stimulate economic growth and boost employment. In this paper, we discuss to what extent these goals can be achieved, in light of the complex business environment of European SMEs. We outline the different types of SMEs in terms of their financing structures as well as the pervasive differences across the EU, concluding that any policy approach must take into account the diversity of the companies' financing needs and the market realities in the Member States. We argue that the CMU is likely to have a heterogeneous impact, with some types of SMEs and certain regions gaining more than others.
    Date: 2016
  9. By: Antonelli, Cristiano; Ferraris, Gianluigi (University of Turin)
    Abstract: The paper elaborates an agent based simulation model (ABM) to explore the endogenous long-term dynamics of knowledge externalities. ABMs, as a form of artificial cliometrics, allow the analysis of the effects of the reactivity of firms caught in out-of-equilibrium conditions conditional on the levels of endogenous knowledge externalities stemming from the levels of knowledge connectivity of the system. The simulation results confirm the powerful effects of endogenous knowledge externalities. At the micro-level, the reactions of firms caught in out-ofequilibrium conditions yield successful effects in the form of productivity enhancing innovations, only in the presence of high levels of knowledge connectivity and strong pecuniary knowledge externalities. At the meso-level, the introduction of innovations changes the structural characteristics of the system in terms of knowledge connectivity that affect the availability of knowledge externalities. Endogenous centrifugal and centripetal forces continually reshape the structure of the system and its knowledge connectivity. At the macro system level, an out-of-equilibrium process leads to a step-wise increase in productivity combined with non-linear patterns of output growth characterized by significant oscillations typical of the long waves in Schumpeterian business cycles.
    Date: 2017–03
  10. By: Asheim, Bjørn (CIRCLE, Lund University); Moodysson, Jerker (Jönköping International Business School, Jönköping University)
    Abstract: This paper provides an overview of the Swedish innovation system and the main strategies for Swedish innovation policy, with specific focus on VINNOVA’s place-based support to specialised areas integrating competences from different sectors in society. The overview reveals a recent shift from place-based specialisation to thematic areas underpinned by a societal challenge driven logic to policy intervention. The analysis indicates that a strong focus on R&D and science-driven innovation serves as a barrier for successful transition, and that the recent shift implies a greater need for policy coordination across different fields and scales. This makes agencies like VINNOVA less autonomous with regard to design as well as implementation of innovation policy and points to the need for reaching a balance between demand-oriented and supply-led strategies in which place-specific context matters and innovation policy must be attuned to and embedded in the particularities of the regional and national economies it aims to target. Linking smart specialisation strategies (S3), EU’s overall industrial and innovation policy for regional diversification and restructuring, with VINNOVAs new system innovation policy approach would be one way of doing this.
    Keywords: Innovation system; innovation policy; Sweden
    JEL: O25 O31 O52
    Date: 2017–04–27
  11. By: Gianluca Misuraca (European Commission – JRC); Giulio Pasi (European Commission – JRC); Fabienne Abadie (European Commission – JRC); Csaba Kucsera (Independent Researcher, Budapest, Hungary); Marco Virginillo (KPMG Advisory Spa, Rome, Italy)
    Abstract: This report presents the results of the analysis of selected case studies on how ICT-enabled social innovations promoting social investment can contribute to the modernisation of social protection systems in the EU. The case studies are drawn from 14 different Member States and address diverse social services and policy domains. Evidence from the analysis points to the strong potential of using new approaches based on ICT-enabled social innovation to support public authorities, at various governance levels, in their efforts to improve the effectiveness and impact of social services delivery mechanisms and outreach. The analysis makes a first attempt to assess the relationship between different typologies of ICT-enabled social innovation and the broader social protection system in which they are embedded. However, more research is needed to better understand the potential impact these initiatives could have on enhancing the adequacy and sustainability of welfare systems in the EU.
    Keywords: Social investment, social policy innovation, SIP, Social Investment Package, social economy, social enterprise, ICT enabled social innovation, ICT, services, social protection, social welfare
    JEL: O33 O35 O38 H55 H75 H83 I31 I38
    Date: 2017–04
  12. By: Whang , Unjung (Korea Institute for International Economic Policy); Moon , Seongman (Chonbuk National University); Ahn , Taehyun (Sogang University); Kim , Su Bin (Korea Institute for International Economic Policy); Kim , Junyup (Independent)
    Abstract: Economic growth in Korea has slowed down dramatically after the Asian financial crisis of 1997. The average growth rate of real GDP of Korea before the crisis (1981-1996) was 9.3%, while it was reduced to 3.7% during the period (2003-2014) after the credit card lending boom following the financial crisis. Coincidentally, the patterns of domestic demand growth before and after the crisis were similar to the GDP growth: the average growth rate of Korean real domestic demand was 8.8% and -0.3%, in the respective periods. This remarkable decline in both growth rates should not be attributed to the factors that are linked to the short-run economic fluctuations because these phenomena have lasted more then 10 years after the Asian financial crisis. Instead, structural factors related to the domestic market or exports are more likely to induce the significant declines in the growth of these two variables. In this study, we focus on identifying those structural factors that are responsible for the decline in the growth rate of domestic demand after the Asian financial crisis, which may result in the decrease in economic growth. Motivated by observing dramatic changes in the growth rates of the relevant variables such as GDP, domestic demand, investment, and exports, we consider two structural problems that the Korean economy faced after the Asian financial crisis: i) one is the dampened ripple effects of exports on domestic demand and thus on GDP; ii) the other is the decrease in the growth of household disposable income. First, exports can contribute to the economic growth via two channels. One is the direct contribution to the GDP. The other is the indirect contribution to the GDP through the domestic demand (that is, the ripple effect of exports on GDP). As firms export more, they tend to use more production inputs and thus are more likely to increase investment and employment, which results in the increase in domestic demand. In fact, the data reveal that about one third of GDP growth can be accounted for by exports directly in the period of 1981-1996. This implies that two third of GDP growth can be explained by the domestic demand. In contrast, the Korean economic growth after the Asian financial crisis is entirely driven by export growth, that is, the growth of export sector does not boost domestic demand after the crisis. In other words, the ripple effect of export sectors on GDP has significantly dampened after the Asian financial crisis. Furthermore, we found two potential reasons for the dampened ripple effect from the export sector. These reasons are closely related to changes in investment behaviors of large-sized Korean exporting firms before and after the Asian financial crisis: i) the large-sized exporting firms do not invest their earnings from exports any more to create new industries; ii) they tend to use more foreign value added contents for their exports and to increase outward FDI by participating in the Global Value Chains (GVCs). Second, another structural factor that affects the pattern of domestic demand before and after the Asian financial crisis is closely associated with the decrease in the growth of household real disposable income. Its growth rate was 10.3% in the former period (1981-1996), which is higher than the GDP growth rate. Its growth rate, in contrast, was 2.3% after the financial crisis, which is lower than the GDP growth rate. This remarkable decrease in the growth of household income may influence household consumption, and hence economic growth. In fact, the data reveal that the real consumption growth rate was 8.4% in the former period and 2.4% in the latter period, respectively. These patterns of consumption growth rates before and after the crisis were similar to the patterns of both the GDP and the income growth rate. In addition, the decrease in household disposable income is more likely to induce increase in household debts and thus an increase in the burden of debt service. This will further restrict consumption and domestic demand growth, which may result in an overall decline in economic growth. To be more specific, we pointed out three potential factors that are closely linked to the decrease in the growth of household disposable income. These reasons are related to the labor market reforms after the Asian financial crisis: i) a seizable number of necessity-driven entrepreneurs (i.e., self-employed households) whose income are relatively low, ii) a large proportion of temporary workers whose wages are about 70 to 80% of the regular workers, and iii) a relatively low wage in small and medium-sized enterprises (SMEs) which employ a large portion of total workforce. In the two subsequent chapters, we examined the two issues related to the structural problems of the Korean economy using the micro-level data: i) a link between temporary employment contract and firms’ productivity and ii) a difference in consumption behavior between wage workers and self-employed households. Motivated by concerns that an increase in the share of temporary workers in total employment can potentially harm firm productivity, we empirically investigated the relationship between temporary employment and firms’ productivity. The estimated results show that using temporary workers decreases firms’ productivity. Besides, we found some evidence that a higher conversion rate from temporary to permanent worker leads to the increase in firm’s productivity. Finally, we looked into the seriousness of the self-employed household debt that may negatively affect consumption, and thus the overall domestic demand. To do this, we examined the different patterns of consumption behavior between wage workers and self-employed households using the household-level panel survey data. The key finding is that the financial debt of self-employed households is negatively associated with consumption expenditure, while this relationship is positive for wage workers. That is, the self-employed households tend to make a loan (i.e., business loans) that is not directly related to consumption itself. Rather, they tend to reduce their consumption due to a heavy debt burden from business loans. To the extent that the dampened ripple effects from the export sectors after the Asian financial crisis are mainly due to the changed investment behaviors of large exporting firms, policy makers should develop policies which aim at providing a better environment where small and medium-sized firms can participate in global value chains more actively. Those firms are not likely to use more foreign value added contents or invest in foreign countries because of their small sizes and limited capabilities. Instead, they may participate in global value chains by attracting multinational firms. To do this, those firms should develop better technologies or produce high quality goods and/or services which can be differentiated from foreign small- and medium-sized firms so that they can have comparative advantages. And policies should be able to encourage small and medium-sized firms to develop those technologies and to produce those goods and services. Most importantly, polices should be aimed at attracting foreign multinational firms so that domestic firms benefit from the active participation in global value chains. To the extent that the decrease in the growth of household disposable income is due to the presence of significant share of necessity-driven entrepreneurs and non-regular workers, and their relatively low income, policy makers should reform labor markets to deal with these issues. In particular, policies should be aimed at reducing the use of temporary workers by raising the conversion rate from temporary to permanent employment. In addition, alternative job opportunities which may absorb those self-employed workers should be created. There is a large degree of human capital mismatch: retired workers, in general, are more likely better matches for new businesses such as food and beverage franchise and agency for selling mobile phones. If there exist jobs where they can take advantage of their human capital, they would have less incentive to open those businesses which contribute to decreasing labor productivity in the service sector.
    Keywords: Economy - Korea; Structure Problem; Ripple Effect; Domestic Demand; Employment; Household Debts
    Date: 2015–12–30
  13. By: Emilia Bonaccorsi di Patti (Bank of Italy); Paolo Finaldi Russo (Bank of Italy)
    Abstract: In 2015 bank lending to larger firms expanded whereas it continued to contract for smaller ones; this gap is also observed for companies belonging to the same sector of economic activity or with similar budgetary conditions. Econometric estimates confirm that, taking into account a large number of firms’ characteristics (profitability, liquidity, sales dynamics, capital expenditure, economic sector and geographical area), the contraction in lending was especially pronounced for micro-firms and for riskier companies. The greater financial fragility of micro-firms, particularly due to their higher indebtedness, accounts for more than 70 per cent of the difference in the annual growth rate of loans to large companies and about 40 of that to small and medium-sized enterprises. A non-negligible proportion of these gaps is not explained by the firms’ characteristics considered in the analysis; it may instead reflect supply factors associated with a lower propensity on the part of some banks to finance small firms.
    Keywords: credit risk, credit allocation, flight to quality, evergreening
    JEL: G21 G32
    Date: 2017–02
  14. By: Coenen, Lars (CIRCLE, Lund University); Grillitsch, Markus (CIRCLE, Lund University); Hansen, Teis (CIRCLE, Lund University); Moodysson, Jerker (Jönköping Business School)
    Abstract: This orientation towards grand societal challenges can be seen as a new wave or paradigm for innovation policy. Such policy is geared to the achievement of systems wide transformations and often referred to as system innovation policy. Even if policies start to be aimed at system innovation, it is unclear how to implement such policies. While insights from transition studies have provided novel and useful rationales for system innovation policy, these studies provide less guidance as to which policy instruments are effective in addressing system innovation. To translate and concretize the challenges of system innovation towards scope for policy action, we relate these challenges to three generic dimensions of innovation systems, i.e. (1) interests and capabilities of actors, (2) networks and network dynamics and (3) institutions and institutional change. These dimensions will allow us to analyze whether and how innovation policy instruments can be used to foster and expedite system innovation. We illustrate its use to identify and assess system innovation policy in practice focusing on the Strategic Innovation Program, a recent policy initiative by Vinnova, Sweden’s Innovation Agency, targeting system innovation.
    Keywords: System innovation; transition theory; innovation systems; policy; strategic innovation porgrammes
    JEL: O30 O33 O38
    Date: 2017–04–27
  15. By: Bongini, Paola; Ferrando, Annalisa; Rossi, Emanuele; Rossolini, Monica
    Abstract: The present paper provides in-depth analysis of SME access to capital markets among Eurozone countries. First, we detect the factors - at the firm and country level - that are able to influence the likelihood of SME access to market-based finance. Second, we construct an index of what we call "market suitability",, i.e., a score that can be measured at the dimensional, sectoral and national level, which provides the percentage of firms potentially fit for market-based finance. Our results highlight that a few Eurozone countries seem to have deployed the "potential" for capital market financing, while there exists a large percentage of unexploited potential for firms fit for market-based finance. It should also be highlighted that overall business conditions - measured by GDP growth, the degree of development of domestic financial markets, and the quality of the legal and judicial enforcement system - greatly influence a firm's market suitability. In the period under consideration (2000-2014), macro factors tended to reduce the likelihood of SME access to market-based finance in most countries in our sample
    Keywords: Eurozone; market-based finance; SMEs
    JEL: G10 G32 L25 L26
    Date: 2017–04
  16. By: Ana Fontoura Gouveia (Ministry of Finance, Portugal); Sílvia Santos (Banco de Portugal); Inês Gonçalves (Instituto Nacional de Estatística)
    Abstract: In recent years, literature has linked structural reforms with productivity growth. Considering Portugal’s recent comprehensive reform agenda, this topic acquires particular relevance. Using data for Portuguese firms for the period 2006-2014, this paper assesses the impact of structural reforms on firms’ productivity. In line with existing literature, the analysis shows that most reforms entail long-term gains, despite, in some reform areas, the existence of short-term costs. In general, there are important differences across reform areas and across firms, namely when comparing firms with different productivity levels. The firms’ distance to the technological frontier mediates the impact of reforms, either by potentiating its effects or by curbing them, depending on the reform area.
    Keywords: Distance to frontier, Growth, Structural reforms, Total Factor Productivity
    JEL: D04 D22 D24 O33
    Date: 2017–05–09
  17. By: Soha Ismail (The World Bank); Juan Jose Cortina Lorente; Sergio L. Schmukler
    Abstract: This paper provides a first analysis of the extent to which firms in the Arab region use capital markets to obtain financing and grow. It addresses two questions: First, how many and which firms issue equity, bonds, and syndicated loans in the Arab region? Second, how do these firms perform relative to non-issuing firms? To tackle these questions, a uniquely matched dataset of firm-level issuances and balance sheet information of 1,462 firms in the Arab region is constructed. Two main findings emerge from the analysis. (1) Over the last two decades, the amounts raised in equity, bond, and syndicated loan markets have considerably increased and been associated with an increasing number of issuing firms. (2) The typical issuing firm is larger, grows faster, is more leveraged, and holds more long-term debt relative to the typical non-issuer. Moreover, issuers seem to be initially larger than non-issuers in terms of assets, turnover, and the number of employees, and even grow faster over time. The firm size distribution of issuers lies to the right and shifts more rightwards over time compared to the distribution of non-issuers, indicating a divergence in firm size among listed firms.
    Date: 2017–11–05
  18. By: Kuntner, Tobias
    Abstract: Purpose – This study investigates whether the influence of selected marketing-mix elements on brand equity differs for different types of brands. The main focus is on price promotions’ influence. In addition, the impact of discount-store distribution is explored. Design/methodology/approach – This study applies fixed-effects regression to analyze German panel data, which includes 126 national brands in four product categories across five years. Findings – The results reveal that frequent price promotions and intensive discount-store distribution have a negative influence on brand equity. However, this effect differs across brand types: the higher a brand’s initial equity level, the more harmful is the impact of these marketing activities on brand equity. Research implications – This study shows that brand types play an important role in moderating the influence of marketing activities on brand equity. Thus, further research endeavors may generate new insights by accounting for these brand-related differences in their investigations. Practical implications – Managers of high-equity brands should avoid frequent price promotions and intensive discount-store distribution. In contrast, managers of low-equity brands may use these instruments more widely because their detrimental effects are less severe. Originality/value – Current research mainly focuses on improving the conceptualization of brand equity or exploring different kinds of marketing-mix elements. Findings on potential effect moderators are scarce. Thus, this study substantiates and extends existing findings by emphasizing the importance of distinguishing different brand types when investigating the effect of marketing-mix elements on brand equity.
    Keywords: Price promotion,Brand equity,Brand type,Panel data
    Date: 2017
  19. By: Mohaddes, Kamiar (University of Cambridge); Raissi, Mehdi (International Monetary Fund); Weber, Anke (International Monetary Fund)
    Abstract: This paper examines whether a tipping point exists for real GDP growth in Italy above which the ratio of non-performing loans (NPLs) to total loans falls significantly. Estimating a heterogeneous dynamic panel-threshold model with data on 17 Italian regions over the period 1997-2014, we provide evidence for the presence of growth-threshold effects on the NPL ratio in Italy. More specifically, we find that real GDP growth above 1.2 percent, if sustained for a number of years, is associated with a significant decline in the NPLs ratio. Achieving such growth rates requires decisively tackling long-standing structural rigidities and improving the quality of fiscal policy. Given the modest potential growth outlook, however, under which banks are likely to struggle to grow out of their NPL overhang, further policy measures are needed to put the NPL ratio on a firm downward path over the medium term.
    JEL: C23 E44 G33
    Date: 2017–03–01
  20. By: Isao Kamata; Hitoshi Sato; Kiyoyasu Tanaka
    Abstract: This study examines the role of management practices in the internationalisation of domestic firms through directly exporting and/or supplying to local affiliates of multinationals. An original survey of manufacturing firms in Viet Nam was conducted, investigating their management practices such as human resource management and internationalisation status. The survey results shed light on similarities and dissimilarities among firms in several dimensions of management practices. Findings reveal that internationalised firms tended to be more enthusiastic about the formal training of production workers, the modernisation of production and operation, and product and process innovation. Differences in skills and experience requirements for newly employed managers were less recognizable, but internationalised firms tended to have managers who studied overseas. Furthermore, the use of public support to employee training, teamwork in production, and unionisation of employees did not show a significant difference between internationalised and non-internationalised firms.
    Keywords: Management practices, Firm heterogeneity, Global value chains
    JEL: F23 F61 M11 M50
    Date: 2017–05
  21. By: Fernandez, Cristina; García, Roberto; Lopez-Garcia, Paloma; Marzinotto, Benedicta; Serafini, Roberta; Vanhala, Juuso; Wintr, Ladislav
    Abstract: This paper illustrates the main features of the Labour Module of the CompNet dataset which provides indicators of firm growth over the period 1995-2012 across 17 EU (13 euro area) countries and 9 macro-sectors. It also includes information on a large set of micro-aggregated characteristics of firms growing at different speed such as their financial position and labour and total factor productivity. The paper shows that during the Great Recession the share of shrinking firms sharply increased in countries under stress, while firm growth slowed down in non-stressed countries. In the former, the construction sector suffered the most, while in the latter manufacturing and services related to transportation and storage were mainly affected, possibly as a result of the trade collapse. While we find that, all else equal, more productive firms had a higher probability of growing, the process of productivity-enhancing reallocation was muted during the Great Recession. JEL Classification: J23, L11, L25
    Keywords: cross-country analysis, firm growth, micro-aggregated data
    Date: 2017–04
  22. By: Franco, Angélica María; Ordoñez-Castaño, Iván Andrés; Perdomo, Luis Enrique
    Abstract: Este artículo indaga sobre cómo la convergencia a Normas Internacionales de Información Financiera (NIIF) podría producir una disminución en la asimetría de la información para los stakeholders. Para esto se analizaron seis PyMEs, asociadas a la producción de alimentos y agropecuaria, a la comercialización de artículos de ferretería y a la prestación de servicios de consultoría, seguros y salud. A cada una de las organizaciones se les elaboró el manual de políticas contables, ajuste a los sistemas de información, manual de revelaciones, procedimientos contables y conversión, lo que permitió la elaboración del estado financiero de apertura. Por medio de la comparación de la información financiera presentada bajo los Principios de Contabilidad Generalmente Aceptados (Decreto 2.649 de 1990) y la NIIF se deduce que las PyMEs en el corto y mediano plazo deberán realizar ajustes en su operación porque la convergencia impactará su capacidad de endeudamiento, la disminución en su patrimonio y alteraciones en el ciclo operativo.
    Keywords: Información Financiera; Toma de Decisiones; Pequeñas y Medianas Empresas;
    Date: 2017

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