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on Small Business Management |
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Issue of 2020‒11‒09
sixteen papers chosen by João Carlos Correia Leitão Universidade da Beira Interior |
| By: | Michael Fritsch; Michael Wyrwich; ; ; |
| Abstract: | We investigate how initial conditions that existed in East Germany at the end of the socialist regime impact regional development during the turbulent shock transition to a market economic system. Our investigation spans a period of almost 30 years. Both the self-employment rate (an indication of the existence of a pre-socialist entrepreneurial tradition) and the share of the workforce with a tertiary degree have a strong positive effect on regional development. We conclude that knowledge and a tradition of entrepreneurship have long-run positive effects on development in regions that face disruptive shocks. Entrepreneurship and knowledge play a less important role for development across West German regions, where no significant shocks occurred. |
| Keywords: | Entrepreneurship, knowledge, economic development, history, transformation, East Germany |
| JEL: | L26 R11 N93 N94 |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:2050&r=all |
| By: | Ichiro Iwasaki; Evžen Kocenda; Yoshisada Shida |
| Abstract: | In this paper, we traced the survival status of 94,401 small businesses in 17 European emerging markets from 2007–2017 and empirically examined the determinants of their survival, focusing on institutional quality and financial development. We found that institutional quality and the level of financial development exhibit statistically significant and economically meaningful impacts on the survival probability of the SMEs being researched. The evidence holds even when we control for a set of firm-level characteristics such as ownership structure, financial performance, firm size, and age. The findings are also uniform across industries and country groups and robust beyond the difference in assumption of hazard distribution, firm size, region, and time period. |
| Keywords: | small business, institutions, financial development, survival analysis, European emerging markets |
| JEL: | C14 D02 D22 G33 M21 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8641&r=all |
| By: | Barinova Vera (Gaidar Institute for Economic Policy); Zemtsov Tsepan (Gaidar Institute for Economic Policy); Tsareva Yulia (Gaidar Institute for Economic Policy) |
| Abstract: | Government funding of the respective activities of small and medium-sized enterprises (SME) under the national project “Small and medium-sized entrepreneurship and support of entrepreneurial initiatives†increased in 2018-2020. However, in 2019, the number of SMEs subjects decreased by 118 thousand compared to 2018, and the number of people employed in the sector fell to 18.8 million, i.e. decreased by almost half a million people (the goal of the national project for 2024 is 25 million people). The share of the SME sector in GDP decreased to 20 percent in 2018 (the goal of the national project for 2024 is 32.5 percent). Generally, negative trends in the development of the sector, associated with an increase in the VAT rate, the introduction of online cash registers and almost zero growth in household incomes were observed in Russia in 2019. In 2020, near-zero economic growth and the coronavirus pandemic, which has already led to a significant drop in demand, especially in the restaurant business, tourism and entertainment, will negatively affect the development of the SME sector. A more significant reduction in performance of the sector’s activity is expected compared to 2019. However, the conditions for the development of entrepreneurship and, accordingly, the indicated trends vary significantly across Russia’s regions. |
| Keywords: | Russian economy, small businesses, medium-sized enterprises |
| JEL: | C53 E37 L21 L52 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:gai:ppaper:ppaper-2020-1052&r=all |
| By: | Elert, Niklas (Research Institute of Industrial Economics (IFN)); Stenkula, Mikael (Research Institute of Industrial Economics (IFN)) |
| Abstract: | Researchers increasingly recognize that entrepreneurial employees, intrapreneurs, play a critical role in innovation. As with regular entrepreneurship, however, the value of intrapreneurial activity depends on the firm-specific and societal reward structures that intrapreneurs face. Ideally, these rules of the game are such that they reward intrapreneurship that is beneficial for the firm and the economy. When this is not the case, intrapreneurship can be beneficial for the firm but not for society, damaging for the firm yet beneficial for society, or downright destructive. We offer a taxonomy describing how society’s rules and firm rules interact to produce different intrapreneurial outcomes. |
| Keywords: | Intrapreneurship; Entrepreneurship; Entrepreneurial behavior |
| JEL: | D02 J24 L26 M14 O17 O31 |
| Date: | 2020–10–26 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1367&r=all |
| By: | Leland Crane; Ryan Decker; Aaron Flaaen; Adrian Hamins-Puertolas; Christopher J. Kurz |
| Abstract: | Given lags in official data releases, economists have studied "alternative data" measures of business exit resulting from the COVID-19 pandemic. Such measures are difficult to understand without historical context, so we review official data on business exit in recent decades. Business exit is common in the U.S., with about 7.5 percent of firms exiting annually in recent years, and is countercyclical (particularly recently). Both the high level and the cyclicality of exit are driven by very small firms. We explore a range of alternative measures and indicators of business exit, including novel measures based on payroll events and phone-tracking data, and find tentative evidence that exit has been elevated during 2020. Evidence is somewhat mixed, however, and exiting businesses do not appear to represent a large share of U.S. employment. |
| Keywords: | Business cycles; Business exit; Firm dynamics; Job destruction; Nontraditional data |
| JEL: | E32 C55 C81 D22 |
| Date: | 2020–10–22 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2020-89&r=all |
| By: | Kathrin Wernsdorf; Markus Nagler; Martin Watzinger |
| Abstract: | Does access to information and communication technologies (ICT) increase innovation? We examine this question by exploiting the staggered adoption of BITNET across U.S. universities in the 1980s. BITNET, an early version of the Internet, enabled e-mail-based knowledge exchange and collaboration among academics. After the adoption of BITNET, university-connected inventors increase patenting substantially. The effects are driven by collaborative patents by new inventor teams. The patents induced by ICT are exclusively science-related and stem from fields where knowledge can be codified easily. In contrast, we neither find an effect on patents not building on science nor on inventors unconnected to universities. |
| Keywords: | ICT, communication, knowledge diffusion, science-based innovation, university-patenting |
| JEL: | H54 L23 L86 O30 O32 O33 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8646&r=all |
| By: | Alexander Moerchel; Frank Tietze; Leonidas Aristodemou; Pratheeba Vimalnath |
| Abstract: | The Covid-19 pandemic exposed firms, organisations and their respective supply chains which are directly involved in the manufacturing of products that are critical to alleviating the effects of the health crisis, collectively referred to as the Crisis-Critical Sector,to unprecedented challenges. Firms from other sectors, such as automotive, luxury and home appliances, have rushed into the Crisis-Critical Sector in order to support the effort to upscale incumbent manufacturing capacities, thereby introducing Intellectual Property (IP)related dynamics and challenges. We apply an innovation ecosystem perspective on the Crisis-Critical Sector and adopt a novel visual mapping approach to identify IP associated challenges and IP specific dynamic developments during and potentially beyond the crisis.In this paper, we add methodologically by devising and testing a visual approach to capturing IP related dynamics in evolving innovation ecosystems and contribute to literature on IP management in the open innovation context by proposing paraground IP as a novel IP type.Finally, we also deduce managerial implications for IP management practitioners at both incumbent firms and new entrants for navigating innovation ecosystems subject to crisis-induced dynamic shifts. |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2010.10086&r=all |
| By: | Wicaksono, Hendro |
| Abstract: | This presentation introduces the concept of innovation and innovation management. It also explains the different open innovation models based on the triple helix and the implementation of triple helix model 3 in Germany. Finally, it gives examples of best practices to manage an open innovation project. |
| Date: | 2020–10–14 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:qm7hb&r=all |
| By: | Luisa Alamá-Sabater (Department of Economics and IIDL, Universitat Jaume I, Castellón, Spain); Miguel A. Márquez (Department of Economics, Universidad de Extremadura, Spain); Emili Tortosa-Ausina (IVIE, Valencia and Department of Economics, Universitat Jaume I, Castellón, Spain) |
| Abstract: | Grounded in the general equilibrium framework of regional adjustment models, this paper studies how the spatial distribution of sectoral employment can affect the intra-regional spatial location of population, and so affect territorial development. Although spatial interactions, spatial heterogeneity and sectoral heterogeneity have been introduced in these models, no empirical studies can be found that reveal how spatio-sectoral heterogeneity affects the intra-regional distribution of population and jobs. This paper explores this effect through a complex set of interdependencies among the regional population, the employment in the regional economic sectors and their respective regional neighbours within the different regional typologies (urban, semi-urban and rural areas), as suggested by the concept of proximity developed by (58). We use a system of simultaneous equations to focus on the phenomenon of rural depopulation for the 542 municipalities of the Valencian region (Spain). The results provide evidence for the relevance of spatio-sectoral dynamics, suggesting that reversing depopulation in rural areas depends strongly on the services sector. |
| Keywords: | depopulation, neighbours, population dynamics, sectoral employment, spatial effects, territorial development |
| JEL: | C3 O18 O21 R1 R23 R3 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:jau:wpaper:2020/24&r=all |
| By: | Lars Mewes; Tom Broekel; ; ; |
| Abstract: | One the one hand, complex technologies o↵er substantial economic benefits, and on the other, they are difficult to invent and to imitate, and they refuse a fast dissemination. This two-sidedness motivates the idea that regions’ competitive advantages and, in consequence, their economic growth, originate in their ability to produce and utilize complex technologies. However, the relationship between technological complexity and regional economic growth has rarely been empirically investigated. Here, we address this pressing issue by assessing the complexity of technological activities in 159 European NUTS 2 regions and relating it to their economic growth from 2000 to 2014. Our empirical results suggest that technological complexity is an important predictor of regional economic growth. A 10% increase in complexity is associated with a 0.45% GDP per capita growth. By showing that technological complexity is important for regional economic growth, our results fuel current policy debates about optimal regional policies such as the Smart Specialization strategy. |
| Keywords: | Knowledge Complexity, Technological Complexity, Regional Economic Growth, Patent Data |
| JEL: | O10 O33 R11 |
| Date: | 2020–09 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:2049&r=all |
| By: | Chu, Angus C. |
| Abstract: | This survey provides a selective review of the literature on patent policy, innovation and economic growth. The patent system is a useful policy tool for stimulating innovation given its importance on technological progress and economic growth. However, the patent system is a multi-dimensional system, which features multiple patent policy instruments. In this survey, we review some of the commonly discussed patent policy instruments, such as patent length, patent breadth and blocking patents, and also use a canonical Schumpeterian growth model to demonstrate their different effects on innovation and the macroeconomy. |
| Keywords: | patent policy, innovation, economic growth |
| JEL: | O3 O4 |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:103643&r=all |
| By: | Matt Marx; Aaron Fuegi |
| Abstract: | We curate and characterize a complete set of citations from patents to scientific articles, including nearly 16 million from the full text of USPTO and EPO patents. Combining heuristics and machine learning, we achieve 25% higher performance than machine learning alone. At 99.4% accuracy, coverage of 87.6% is achieved, and coverage above 90% with accuracy above 93%. Performance is evaluated with a set of 5,939 randomly-sampled, cross-verified “known good” citations, which the authors have never seen. We compare these “in-text” citations with the “official” citations on the front page of patents. In-text citations are more diverse temporally, geographically, and topically. They are less self-referential and less likely to be recycled from one patent to the next. That said, in-text citations have been overshadowed by front-page in the past few decades, dropping from 80% of all paper-to-patent citations to less than 40%. In replicating two published articles that use only citations on the front page of patents, we show that failing to capture those in the body text leads to understating the relationship between academic science and commercial invention. All patent-to-article citations, as well as the known-good test set, are available at http://relianceonscience.org. |
| JEL: | O31 O32 O33 O34 |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:27987&r=all |
| By: | Andreas Haufler; Dirk Schindler |
| Abstract: | Many countries have introduced patent box regimes in recent years, offering a reduced tax rate to businesses for their IP-related income. Patent boxes are supposed to increase innovative activity, but they are also suspected to aim at attracting inward profit shifting from multinational firms. In this paper, we analyze the effects of patent box regimes when countries can simultaneously use patent boxes and R&D subsidies to promote innovation. We show that when countries set their tax policies unilaterally, innovation is fostered, at the margin, only by the R&D subsidy. The patent box tax rate is instead targeted at attracting international profit shifting, and it is optimally set below the corporate tax rate. With cooperative tax setting, the optimal royalty tax rate is instead equal to, or even above, the statutory corporation tax. Hence, patent box regimes emerge in the decentralized policy equilibrium, but never under policy coordination. Enforcing a nexus principle, as proposed by the OECD, is helpful to mitigate harmful competition for paper profits, but it comes at the price of increased strategic competition in direct R&D subsidies to attract physical R&D units instead of intangible patents. |
| Keywords: | R&D investment, patent boxes, investment tax credits, profit shifting, tax competition |
| JEL: | H25 H87 F23 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8640&r=all |
| By: | Hoang, Ha |
| Abstract: | Industrial Revolution 4.0 is taking place strongly and has gained a lot of special attention from the public recently. For the financial world, this revolution has given birth to Fintech – a generation of start-up companies with advanced technology based on the Internet. Most Fintech companies start out with payment services, but in many other areas of the financial world, by their own strategies, Fintech is competing directly or indirectly with segments that are the monopoly of traditional financial services such as capital mobilization, lending, asset management, etc. The results show that Fintech has had a tremendous impact on the financial world and traditional financial institutions. However, the challenges and risks of this start-up generation should not be taken seriously and neglected their positive impacts such as promoting innovation, increasing competition, better serving customers. We also believe that Fintech will be a promising land for startups in Vietnam. As many studies in the world have shown, the government need to observe closely, but should not lay down rules too soon or too closely because it can extinguish a field that has many advantages for Vietnam in the 4.0 revolution. This is also an important citation for further research in this field in Vietnam. |
| Date: | 2020–10–16 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:n7vqg&r=all |
| By: | Vicinanza, Paul (Stanford U); Goldberg, Amir (Stanford U); Srivastava, Sameer B. (U of California, Berkeley) |
| Abstract: | Which groups are most likely to become visionaries that define the future of their field? Because vision is difficult to measure, prior work has reached conflicting conclusions: one perspective emphasizes the benefits of being large, established, and central, while another stresses the value of being small, upstart, and peripheral. We propose that this tension can be resolved by disentangling vision--the capacity to generate contextually novel ideas that foretell the future of a field--from the traces of vision that result in tangible innovation. Using Bidirectional Encoder Representations from Transformers (BERT), we develop a novel method to identify the visionaries in a field from conversational text data. Applying this method to a corpus of over 100,000 quarterly earnings calls conducted by 6,000 firms from 2011 to 2016, we develop a measure--prescience--that identifies novel ideas which later become commonplace. Prescience is predictive of firms’ stock market returns: A one standard deviation increase in prescience is associated with a 4% increase in annual returns, and firms exhibiting especially high levels of prescience (above the 95th percentile) reap especially high returns. Moreover, contrary to theories of incumbent advantage, we find that small firms are more likely to possess prescience than large firms. The method we develop can be readily extended to other domains to identify visionary individuals and groups based on the language they use rather than the artifacts they produce. |
| Date: | 2020–05 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:stabus:3869&r=all |
| By: | KALPAKA Anna (European Commission - JRC); SORVIK Jens; TASIGIORGOU Alexandra |
| Abstract: | Building upon the knowledge gained during the last two years on how Digital Innovation Hubs (DIHs) operate in different regional socioeconomic contexts, this practical handbook aims to provide national/regional policy makers and/or existing DIH managers useful and structured information on how to setup a new DIH or reinforce existing ones while benefiting from available funds with a special focus to the European Regional Development Fund (ERDF) 2021-2027. Given the urgent need of SMEs and public administrations to rapidly deploy advanced digital technologies to mitigate the negative consequences of the recent COVID19 crisis to their businesses, the role of DIHs is more important than ever. The Handbook introduces a step-by-step approach to provide support to policy makers that envisage strengthening DIHs in their regions/countries with a view to accelerate digital transformation of the economy and society. This approach allows to use the Handbook as a reference tool depending on the specific needs and level of implementation of DIHs. The practical character of the Handbook is enhanced with the inclusion of many examples that highlight good practices in the different steps of the proposed methodology. |
| Keywords: | Digital Innovation Hubs, DIH, digital transformation, digitalisation, SMEs, public sector, regional policy, regional development |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc121604&r=all |