nep-sbm New Economics Papers
on Small Business Management
Issue of 2021‒09‒06
ten papers chosen by
João Carlos Correia Leitão
Universidade da Beira Interior

  1. Foreign entry timing, time since first entry, and internationalization speed of SMEs: when does manager domestic experience matter? By Yadav, Sandeep
  2. Young Firms, Old Capital By Song Ma; Justin Murfin; Ryan D. Pratt
  3. Home country institutional harshness and emerging market SMEs internationalization: a strategy tripod perspective By Yadav, Sandeep
  4. Know-how and Know-who: Effects of a Randomized Training on Network Changes Among Small Urban Entrepreneurs By Mattea Stein
  5. Opposing firm-level Responses to the China Shock: Horizontal Competition Versus Vertical Relationships? By Philippe Aghion; Antonin Bergeaud; Matthieu Lequien; Marc Melitz; Thomas Zuber
  6. The impact of digitalisation on productivity: Firm-level evidence from the Netherlands By Martin Borowiecki; Jon Pareliussen; Daniela Glocker; Eun Jung Kim; Michael Polder; Iryna Rud
  7. Practise What You Preach: Innovation Implementation on Campuses of Dutch Research Universities By Magorzata Rymarzak; Alexandra den Heijer; Monique Arkesteijn
  8. The Impacts of the COVID-19 Pandemic on Micro, Small, and Medium Enterprises in Asia and Their Digitalization Responses By Sonobe, Tetsushi; Takeda, Asami; Yoshida, Susumu; Truong, Hoa Thi
  9. Analysis of policies to support SMEs in confronting the COVID-19 pandemic in Latin America By Dini, Marco; Heredia Zurita, Andrea
  10. Anatomy of a techno-creative community – the role of brokers, places, and events in the emergence of projection mapping in Nantes By Etienne Capron; Dominique Sagot-Duvauroux; Raphaël Suire

  1. By: Yadav, Sandeep
    Abstract: This study explores the interrelatedness between the various temporal concept of internationalization. Using organizational learning perspective, this study explores the impact of foreign entry timing, time since first foreign entry on the speed of internationalization. The author tests the proposed hypotheses on a sample of 11291 Small and medium-sized enterprises (SMEs) from 118 countries based on World Bank Enterprise Survey (WBES) data. The results show that foreign entry timing reduces the speed of internationalization while time since first foreign entry increases the speed of internationalization. Further, the author finds that manager prior domestic industry experience reduce disadvantages associated with the late start of internationalization and increase speed of internationalization. In contrast, the author finds support for the negative moderating effect of manager domestic industry experience on the time since first foreign entry and internationalization speed relationship.
    Keywords: foreign entry timing; time since first foreign entry; time in internationalization; speed of internationalization; SMEs; organizational learning; manager experience; temporality; absorptive capacity
    JEL: F23 M12
    Date: 2021–07
  2. By: Song Ma; Justin Murfin; Ryan D. Pratt
    Abstract: Across a broad range of equipment types and industries, we document a pattern of local capital reallocation from older firms to younger firms. Start-ups purchase a disproportionate share of old physical capital previously owned by more mature firms. The evidence is consistent with financial constraints driving differential demand for vintage capital. The local supply of used capital influences start-up entry, job creation, investment choices, and growth, particularly when capital is immobile. Conversely, incumbents accelerate capital replacement in the presence of more young firms. The evidence suggests previously undocumented benefits to co-location between old and young firms.
    JEL: G3 L2 R1 R4
    Date: 2021–08
  3. By: Yadav, Sandeep
    Abstract: Purpose - What is the role of the home country institutional environment in emerging market small and medium firms (SMEs) internationalization? Drawing from strategy tripod perspective, this study tests the proposed theoretical model on the impact of institutional harshness on SMEs internationalization. This study also demonstrates the moderating role of firm resources and industry informal competition on the relationship between home country institutional harshness and SMEs internationalization. Design/methodology/approach – This study tests the proposed theoretical model on a survey sample of 5129 Indian and Chinese SMEs from World Bank Enterprise Surveys (WBES). This study uses the Tobit regression model and Logit regression model as estimation techniques. Findings - Based on the institution-based view, the author finds that institutional harshness in the home country increases SMEs internationalization as escape to home country institutional challenges. The findings show that SMEs international quality certificate possession and informal industry competition strengthen the institutional harshness and internationalization relationship. The findings also support the negative moderating effect of SMEs global linkages on institutional harshness and internationalization relationship. Originality/value – This study contributes to institutional theory and international business literature by showing emerging market SMEs international expansion as a response to owner/manager perception of high institutional harshness. The study extends the boundaries of the home country institution escape-based internationalization argument by examining the heterogeneous impact of institutional harshness on SMEs internationalization based on firm resources and industry context.
    Keywords: Emerging market, Internationalization, Institutional harshness, SMEs, Exporting, Institutional theory, Industry context, Firm resources
    JEL: F2 L1
    Date: 2021–03
  4. By: Mattea Stein (Università di Napoli Federico II and CSEF)
    Abstract: Micro-enterprise owners in developing country industrial clusters interact through networks of horizontal business collaboration, information-sharing, and friendship links, despite the potential for close competition inherent in this setting. This paper explores how such business links change, and specifically whether they can be endogenous to a public policy intervention that provides training to some network members but not others. Using a randomized training for micro-entrepreneurs in Kampala, Uganda, together with novel panel network data, I find a positive effect on linking likelihoods, driven by untreated entrepreneurs to whom links with treated entrepreneurs become more desirable. As predicted by a bilateral network formation framework, it is the relatively lower-status treated who attract new connections with relatively higher-status untreated. Furthermore, links within clusters of treated enterprises are strengthened, which is not due to a strategic replacement of untreated with treated partners out of a competition motive but seems to be an effect of jointly attending the training. Together, my findings show that public policy interventions can cause networks to re-wire, with important implications both for research and policy.
    Keywords: network formation, network change, social networks, firms, micro-enterprises
    Date: 2021–09–02
  5. By: Philippe Aghion; Antonin Bergeaud; Matthieu Lequien; Marc Melitz; Thomas Zuber
    Abstract: We decompose the “China shock” into two components that induce different adjustments for firms exposed to Chinese exports: a horizontal shock affecting firms selling goods that compete with similar imported Chinese goods, and a vertical shock affecting firms using inputs similar to the imported Chinese goods. Combining French accounting, customs, and patent information at the firm-level, we show that the horizontal shock is detrimental to firms’ sales, employment, and innovation. Moreover, this negative impact is concentrated on low-productivity firms. By contrast, we find a positive effect - although often not significant - of the vertical shock on firms’ sales, employment, and innovation.
    JEL: F14 F16 F6 O31
    Date: 2021–08
  6. By: Martin Borowiecki; Jon Pareliussen; Daniela Glocker; Eun Jung Kim; Michael Polder; Iryna Rud
    Abstract: This paper analyses the role of intangibles and digital adoption for firm-level productivity in the Netherlands drawing on a newly constructed panel data set of Dutch enterprises. It provides robust evidence on productivity effects of intangibles and digital adoption using firms’ exposure to sector-wide advances in intangible intensity and digital adoption as an instrument. Results show that intangibles as measured by levels of digital skill intensity have a positive and statistically significant impact on firm-level productivity growth in the service sector and for younger firms. Productivity benefits from software investment are strong for low productivity firms. Together, these findings highlight the potential of intangibles to support the productivity catch-up of laggard enterprises. The evidence also suggests that productivity benefits from ICT hardware investment and the uptake of high-speed broadband are positive and sizeable.
    Keywords: digitalisation, intangibles, productivity, skills
    JEL: D24 E22 J24 O33
    Date: 2021–09–08
  7. By: Magorzata Rymarzak; Alexandra den Heijer; Monique Arkesteijn
    Abstract: In all advanced economies, there is a general tendency toward reforms of higher education institutions (HEIs) and education systems. In addition to their traditional educational role, and their second mission of conducting scientific research, they are expected to participate in various types of innovation initiatives as part of their third mission. With the transformation of the universities, the campus usage for innovation processes is also changing. From being the grounds where university buildings are providing settings for basic and applied research, it has become both the birthplace and test ground of innovations. Many universities want to practise what they preach on their own campuses: what is invented here is also applied here. On top of that, they want to set a good example of being innovative institutions, not only academically, but also in campus management and services. However, the scope and dynamics of the implementation of their own innovative ideas vary significantly. It is clear that universities need to develop their campus according to their own conditions/needs and features. But while some universities take the opportunity for wider adoption of on-campus innovations to support university performance, others are not as successful in the innovation implementation for many reasons. In this article both the drivers and the barriers that may hinder the implementation of campus innovations at Dutch research universities are studied.
    Keywords: Campus Management; Innovation; universities
    JEL: R3
    Date: 2021–01–01
  8. By: Sonobe, Tetsushi (Asian Development Bank Institute); Takeda, Asami (Asian Development Bank Institute); Yoshida, Susumu (Asian Development Bank Institute); Truong, Hoa Thi (Asian Development Bank Institute)
    Abstract: Soon after the outbreak of the COVID-19 pandemic, many governments began extending financial and other forms of support to micro, small, and medium-sized enterprises (MSMEs) and their workers because smaller firms are more vulnerable to negative shocks to their supply chain, labor supply, and final demand for goods and services than larger firms. Since MSMEs are diverse, however, the severity of the pandemic’s impact on them varies considerably depending on their characteristics. Using online survey data of MSMEs from eight developing economies in South, Southeast, and Northeast Asia, we attempt to deepen our understanding of the impact of the pandemic on MSMEs, especially their employment, sales revenue, and cash flow. We characterize those firms that began participating in online commerce and try to determine how their use of online commerce and their employment are related in this difficult time. We also examine the government support that MSMEs have received and the extent to which it has satisfied their support needs.
    Keywords: COVID-19; micro; small; and medium enterprises (MSMEs); layoffs; cash shortage; digitalization
    JEL: D22 J63 L25 O53
    Date: 2021–03–26
  9. By: Dini, Marco; Heredia Zurita, Andrea
    Abstract: The institutions that support micro-, small and medium-sized enterprises (MSMEs) in Latin America have demonstrated their capacity to react to the challenges posed by the coronavirus disease (COVID-19) pandemic, making unprecedented efforts to adapt support instruments and adjust their management modalities to new needs. This document summarizes the experiences of nine countries in the region (Argentina, Brazil, Chile, Colombia, Costa Rica, Ecuador, Mexico, Panama and Uruguay), highlighting good practices and methodological lessons learned that can be leveraged to improve the performance of the development system once the pandemic is over. There are three areas of particular importance for economic recovery: support for the incorporation of digital technologies, incentives for formalizing companies and biosafety protocols. There are also signs of a shift in the way policies are formulated, towards adaptive management models that focus on accountability and the strengthening of public institutions, the deepening of partnerships with the business sector and the consolidation of decentralization dynamics that provide space for participation by local and regional actors.
    Date: 2021–08–04
  10. By: Etienne Capron (MSH Ange-Guépin - Maison des Sciences de l'Homme Ange-Guépin - UN - Université de Nantes - UM - Le Mans Université - UA - Université d'Angers - CNRS - Centre National de la Recherche Scientifique, GRANEM - Groupe de Recherche Angevin en Economie et Management - UA - Université d'Angers - AGROCAMPUS OUEST - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - Institut National de l'Horticulture et du Paysage); Dominique Sagot-Duvauroux; Raphaël Suire
    Abstract: This article aims to study the role of brokers, places, and events in the structuring of a community of innovation whose practice is at the intersection of art and technology-projection mapping. Using an exploratory case study, we observe the relationships between the different actors who form a community, sharing a common interest in a techno-creative practice-but whose collective innovation dynamic is only in its beginnings and remains unstable. We document the critical role of places and events as intermediary platforms for these actors. This reveals preferential circulations-patterns of moves among a set of focal locations in the city for a community-and the crucial role of these locations in communities' emergence.
    Keywords: techno-creative innovation,community,network analysis,places,events,brokers
    Date: 2021–07

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