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on Small Business Management |
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Issue of 2018‒02‒05
eleven papers chosen by João Carlos Correia Leitão Universidade da Beira Interior |
| By: | Caroline Mothe (IREGE - Institut de Recherche en Gestion et en Economie - USMB [Université de Savoie] [Université de Chambéry] - Université Savoie Mont Blanc); Thuc Uyen Nguyen-Thi (CEPS/INSTEAD - Centre d'Etudes de Populations, de Pauvreté et de Politiques Socio-Economiques / International Networks for Studies in Technology, Environment, Alternatives, Development - Centre d'Etudes de Populations, de Pauvreté et de Politiques Socio-Economiques / International Networks for Studies in Technology, Environment, Alternatives, Development) |
| Abstract: | The antecedents of environmental innovation and the impact of openness on technological innovation have been well studied, yet the role of external knowledge search remains largely unknown. This study explores whether six dimensions of open search (external R&D, acquisition, R&D cooperation, and three types of external information sourcing) enhance firms' radical and incremental innovation with environmental effects (EI) when used either sporadically or persistently. It shows that the temporal dimension of openness matters. Persistent open knowledge search efforts are associated with a firm's propensity to introduce EI, more so than sporadic search. Furthermore, the different types of knowledge search have heterogeneous effects on different types of EI. It also shows that persistent innovation is more relevant in the case of radical EI. |
| Keywords: | Search,Environmental innovation, Incremental/radical, Openness,Persistence |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-01609129&r=sbm |
| By: | Wim Naudé (Maastricht University, Maastricht School of Management and UNU-MERIT/MGSoG, Maastricht, The Netherlands and IZA-Institute of Labor Economics, Bonn, Germany); Paula Nagler (Erasmus Research & Business Support, Erasmus University Rotterdam and UNU-MERIT/MGSoG, Maastricht, The Netherlands.) |
| Abstract: | Entrepreneurship in Germany has been stagnating. As a result, the effectiveness of technological innovation to improve labor productivity weakened, which has been implicated in rising income inequality and poverty. In this paper we provide an overview of technological innovation and labor productivity growth from 1871. From this we show that over the past three decades the economy has found it increasingly difficult to transform technological innovation into labor productivity growth: in glaring contrast to earlier periods. Despite higher spending on R&D and more personnel than ever working in research labs, labor productivity growth continues to decline. Two interrelated reasons are offered for this phenomenon. The first is that the national innovation system itself has certain weaknesses. The second is entrepreneurial stagnation. We discuss the weaknesses of the innovation system and the nature and causes of entrepreneurial stagnation. We call for policies that will improve the innovation system, educational and managerial capabilities, venture capital investments, and the contestability of markets. Strengthening social protection and raising real wages are important supportive measures. |
| Keywords: | Entrepreneurship, Germany, Innovation, Social Protection, Industrial Policy |
| JEL: | D31 L26 O33 O38 O52 |
| Date: | 2018–01 |
| URL: | http://d.repec.org/n?u=RePEc:sru:ssewps:2018-02&r=sbm |
| By: | Hans K. Hvide; Paul Oyer |
| Abstract: | We document three new facts about entrepreneurship. First, a majority of male entrepreneurs start a firm in the same or a closely related industry as their fathers’ industry of employment. Second, this tendency is correlated with intelligence: higher-IQ entrepreneurs are less likely to follow their fathers. Third, an entrepreneur that starts a firm in the same 5-digit industry as where his father was employed tends to outperform entrepreneurs in the same industry whose fathers did not work in that industry. We consider various explanations for these facts and conclude that “dinner table human capital”, where children obtain industry knowledge through their parents, is an important factor behind what type of firm is started and how well it performs. |
| JEL: | G3 J24 L26 |
| Date: | 2018–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24198&r=sbm |
| By: | Trushin, Eshref; Ugur, Mehmet |
| Abstract: | Firm age or size diversity in an industry is taken for granted but its implications for industry evolution and firm survival have remained below the radars of empirical research. We address this knowledge gap by drawing on an interdisciplinary theoretical framework informed by theoretical biology, organizational ecology and industrial organisation. We hypothesize that firms in more diverse industries are more likely to exit as a result of rugged fitness distributions where a global fitness optimum is less likely to emerge. We also hypothesize that investment in research and development (R&D) may counterbalance the adverse effect of diversity on survival by enabling the firm to engage in active learning about its market and technology niches. Evidence from discrete-time hazard estimators and an unbalanced panel dataset of 35,136 R&D-active UK firms lend support to these hypotheses. The findings remain robust to: (i) a battery of sensitivity checks, including step-wise estimations, different diversity measures and various firm cohorts; (ii) control for frailty and for a wide range of firm, industry, and macroeconomic factors considered in the survival literature; and (iii) taking account of direct effects of age, size and R&D intensity. |
| Keywords: | Diversity; complexity; firm survival; R&D; ecosystem |
| JEL: | C4 L2 O32 O33 |
| Date: | 2018–01–25 |
| URL: | http://d.repec.org/n?u=RePEc:gpe:wpaper:19095&r=sbm |
| By: | Ugur, Mehmet |
| Abstract: | Direct and indirect public support (subsidies and tax relief) for business R&D in the UK is higher than most other OECD countries. Nevertheless, total business R&D expenditure as percentage of GDP in the UK (1.7%) is relatively low compared to OECD countries (2.43%). This policy brief summarizes the findings from an ESRC-funded research project on productivity and employment effects of R&D investment; and on whether direct public support has had additionality effects in terms of increasing the funded firms’ R&D investment. The findings suggest that the bot the effects of R&D on productivity and employment and the effect of subsidies on private R&D effort are heterogeneous and non-linear. Therefore, we call for well-targeted R&D subsidies, new conditionality clauses taking account of past performance, and industry-specific targets for R&D investment. |
| Keywords: | Innovation; R&D; Employment; Productivity; Public Policy |
| JEL: | D24 J23 O30 O32 O38 |
| Date: | 2018–01–25 |
| URL: | http://d.repec.org/n?u=RePEc:gpe:wpaper:19096&r=sbm |
| By: | Marc Fréchet (COACTIS - UL2 - Université Lumière - Lyon 2 - UJM - Université Jean Monnet [Saint-Étienne], CRM - Centre de Recherche en Management - UT1 - Université Toulouse 1 Capitole - CNRS - Centre National de la Recherche Scientifique); Hervé Goy (COACTIS - UL2 - Université Lumière - Lyon 2 - UJM - Université Jean Monnet [Saint-Étienne]) |
| Abstract: | Despite abundant research, the relationship between strategy formalization and innovation remains unclear. Some acknowledge a positive impact of strategy formalization on innovation while others consider it an impediment to novelty and creation. Going beyond the conflicting views over the influence of formalization, we combine open innovation and socio-material perspectives. This study aims to contribute to the debate by considering the possibility that formalization is a means of benefiting from openness with respect to innovation. Therefore, we predict that formalization might positively moderate the impact of openness on innovation. Relying on a unique sample of 555 SMEs, we investigate the effects of strategy formalization and openness—according to their various facets and interactions—on new product innovation. We find a positive influence of formalization (whether it is approached as a process or as a strategic tool) on product innovation. Our findings also support the idea that formalization increases the effectiveness of openness on innovation performance. Implications are discussed, and future research directions are outlined at the end. |
| Keywords: | innovation,open innovation,strategy formalization,SMEs |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-01623788&r=sbm |
| By: | Katarina Bacic (Knowledge Network Ltd.); Ivana Rasic Bakaric (The Institute of Economics, Zagreb); Suncana Slijepcevic (The Institute of Economics, Zagreb) |
| Abstract: | The paper analyses the effects of urbanization and localisation economies on manufacturing firms’ productivity across urban landscapes in post-transition South-East European (SEE) countries. Fixed-effects panel data estimations on a large sample of firms show that the factors accounting for productivity advantages of manufacturing firms in urban post-transition SEE are related to the firms and to the environment in which these firms operate. Firms located in diversified cities benefit from a productivity premium generated in this type of agglomeration, while no evidence was found that the relative specialization across industries has any effect on firm productivity levels. |
| Keywords: | city, manufacturing, total factor productivity, post-transition South-East Europe |
| JEL: | D24 R00 R12 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:iez:wpaper:1706&r=sbm |
| By: | Fairlie, Robert W. (University of California, Santa Cruz); Fossen, Frank M. (University of Nevada, Reno) |
| Abstract: | A common finding in the entrepreneurship literature is that business creation increases in recessions. This counter-cyclical pattern is examined by separating business creation into two components: "opportunity" and "necessity" entrepreneurship. Although there is general agreement in the previous literature on the conceptual distinction between these two factors driving entrepreneurship, there are many challenges to creating a definition that is both objective and empirically feasible. We propose an operational definition of opportunity versus necessity entrepreneurship using readily available nationally representative data. We create a distinction between the two types of entrepreneurship based on the entrepreneur's prior work status that is consistent with the standard theoretical economic model of entrepreneurship. Using this definition we document that "opportunity" entrepreneurship is pro-cyclical and "necessity" entrepreneurship is counter-cyclical. We also find that "opportunity" vs. "necessity" entrepreneurship is associated with the creation of more growth-oriented businesses. The operational distinction proposed here may be useful for future research in entrepreneurship. |
| Keywords: | opportunity entrepreneurship, necessity entrepreneurship, business creation, business cycle |
| JEL: | J22 J23 L26 |
| Date: | 2018–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11258&r=sbm |
| By: | Cadar, Otilia; Badulescu, Daniel |
| Abstract: | The challenges of the economy and of the modern society based on knowledge are closely related to the success of firms, their ability to generate new, innovative products and services, in a steady pace and in a large, diverse structure in order to ensure performance and long-term welfare. In a global world where countries compete to produce and promote the market for quality and convenient products for the consumers, the innovation capacity of a country and the innovative capabilities of companies acquire a special importance. Numerous studies have analyzed the determinants of innovation of the innovative activities in companies, focusing in particular on organizational and technological capabilities and associated strategies required for successful innovation. There are different types of measuring innovation at the firm level, and in this paper we chose four main groups inspired by the typology promoted by OECD and Eurostat: product innovation, process innovation, organizational innovation, marketing innovation. To remain competitive in the long term, companies must consider all these areas, introduce new products to market, improve the quality of the existing products, upgrade or purchase new production technologies. Based on statistical reports of world and national organizations, our research highlights an extremely diverse and heterogeneous picture of the performance innovation indicators in Europe and the situation in Romania, by comparison both with the EU average, with countries in Central and Eastern Europe (CEE), but also with their own performance in prior periods. |
| Keywords: | innovation, innovative firms, performance, EU, Romania |
| JEL: | L25 M21 O31 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:82801&r=sbm |
| By: | Gomez-Loscos, Ana; Gadea, M. Dolores; Bandres, Eduardo |
| Abstract: | The aim of this paper is threefold. First, we analyze the comovements of the business cycles of European regions. Second, we date these business cycles, for the first time in the literature, and identify clusters of regions with similar business cycle behavior, using Finite Mixture Markov models. Third, we develop a new index to measure within-country homogeneity. We find that comovement among regions is, on average, quite low, although it increased during the convergence process prior to the euro cash changeover and after the onset of the Great Recession. We identify five different groups of European regions. We also find heterogeneity in the size of border effects. |
| Keywords: | Business cycle dating, comovements, clusters, regions, Finite Mixture Markov models. |
| JEL: | C32 E32 R11 |
| Date: | 2018–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:83964&r=sbm |
| By: | Mitze, Timo; Strotebeck, Falk |
| Abstract: | We use industry directory data as a novel source of information to model the strength of interregional research collaboration in German biotechnology. Specifically, we gather data on the number of research collaborations for biotech actors listed in the BIOCOM Year and Address book and aggregate this information to the level of German NUTS3 regions. This allows us to set up a modeling framework that treats individual regions as nodes of the biotech research network. We then specify the collaboration activity between regional nodes as a function of research and economic capacities at the regional level, the geographical proximity between regions, and policy variables. Our results show that the strength of interregional research collaboration can be related to both node properties and the relationship between nodes. As such, we find that modern locational factors are positively correlated with the extent of interregional research collaboration, while geographical distance is found to be an impediment to collaboration. The results further show that the pursuit of network and cluster policies in the biotech sector, particularly through collaborative R&D funding, is positively related to the strength of the interregional collaboration activity. |
| Keywords: | Biotechnology, research collaboration, cluster policy, social network analysis, count data |
| JEL: | C21 L65 O38 R38 |
| Date: | 2017–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:83392&r=sbm |