nep-sbm New Economics Papers
on Small Business Management
Issue of 2022‒11‒07
thirty papers chosen by
João Carlos Correia Leitão
Universidade da Beira Interior

  1. Urban Agglomeration and Firm Innovation: Evidence from Developing Asia By Chen,Liming; Hasan,Rana; Jiang,Yi
  2. Structural change within versus across firms: evidence from the United States By Xiang Ding; Teresa C. Fort; Stephen J. Redding; Peter K. Schott
  3. The Returns to Innovation in East Asia : The Role of the Business Environment and Firms' Characteristics By De Nicola,Francesca; Chen,Pinyi
  4. Managerial input and firm performance. Evidence from a policy experiment By Francesco Manaresi; Alessandro Palma; Luca Salvatici; Vincenzo Scrutinio
  5. Financial Structure and Firm Innovation : Evidence from around the World By Mare,Davide Salvatore; De Nicola,Francesca; Miguel Liriano,Faruk
  6. Case studies towards Green Transition in EU regions: Smart Specialisation for transformative innovation By Claire Nauwelaers; Richard Harding; Inmaculada Perianez-Forte; Karel Haegeman; Eskarne Arregui
  7. The Impact of Internet Access on Innovation and Entrepreneurship in Africa By Houngbonon,Georges Vivien; Mensah,Justice Tei; Traore,Nouhoum-000531164
  8. Where the EU stands vis-à-vis the USA and China? Corporate R&D intensity gap and structural change By MONCADA PATERNO' CASTELLO Pietro; GRASSANO Nicola
  9. Productivity and Firm Exit during the COVID-19 Crisis : Cross-Country Evidence By Muzi,Silvia; Jolevski,Filip; Ueda,Kohei; Viganola,Domenico
  10. The effects of COVID-19 on businesses key versus non-key firms By Stemmler, Henry.
  11. Informal Firms in Mozambique : Status and Potential By Aga,Gemechu A.; Campos,Francisco Moraes Leitao; Conconi,Adriana; Davies,Elwyn Adriaan Robin; Geginat,Carolin
  12. Revisiting the moderation effect of network on the export barrier –export performance in the Cameroon context By Sam Z. Njinyah; Sally Jones; Simplice A. Asongu
  13. Does Competition from Informal Firms Impact R&D by Formal SMEs ? Evidence Using Firm-Level Survey Data By Amin,Mohammad
  14. The Impact of Corruption on SMEs’ Access to Finance : Evidence Using Firm-Level Survey Data fromDeveloping Countries By Amin,Mohammad; Motta,Vctor
  15. Climate Change, Gender Equality, and Firm-Level Innovation : Cross-Country Evidence By Abdulla, Eman; Lim, King Yoong; Morris, Diego; Saliba, Faten
  16. Firm Recovery during COVID-19 : Six Stylized Facts By Cirera,Xavier; Vargas Da Cruz,Marcio Jose; Grover,Arti Goswami; Iacovone,Leonardo; Medvedev,Denis; Pereira Lopez,Mariana De La Paz; Reyes,Santiago
  17. International Sourcing and Firm Learning : Evidence from Serbian Firms By Reasner,Mason Scott,Tan,Shawn Weiming
  18. Firm Resources, Strategies, and Survival and Growth during COVID-19: Evidence from Two-WaveGlobal Surveys By Fang,Sheng; Goh,Chorching; Li,Shaomin; Xu,L. Colin
  19. The research university, invention and industry: evidence from German history By Jeremiah Dittmar; Ralph R. Meisenzahl
  20. The effect of firm informality on sustainable and responsible innovation in developing countries: Evidence from Nigeria By Gasmi, Farid; Kouakou, Dorgyles; Sanni, Maruf
  21. El emprendimiento juvenil: Factores determinantes en Europa By Buil, Carlos
  22. The role of mobile money adoption in moderating the influence of access to finance in firm performance By Sam Njinyah; Simplice A. Asongu; Sally Jones
  23. The Impact of FDI on Domestic Firm Innovation : Evidence from Foreign Investment Deregulation in China By Liu,Yan-000529044; Wang,Xuan
  24. Heterogeneous Agglomeration Economies in the Developing Countries : The Roles of FirmCharacteristics, Sector Tradability, and Urban Mobility By Burger,Martijn; Ianchovichina,Elena; Akbar,Prottoy Aman
  25. The interaction effect of government non-financial support and firm’s regulatory compliance on firm innovativeness in Sub Saharan Africa By Sam Njinyah; Simplice A. Asongu; Ngozi B. Adeleye
  26. The impact of SMEs on employment creation in Makurdi metropolis of Benue state By Bridget Ngodoo Mile; Victor Ushahemba Ijirshar; Mlumun Queen Ijirshar
  27. Social push and the direction of innovation By Elias Einio; Josh Feng; Xavier Jaravel
  28. Childcare, COVID-19 and Female Firm Exit : Impact of COVID-19 School Closure Policies onGlobal Gender Gaps in Business Outcomes By Goldstein,Markus P.; Gonzalez Martinez,Paula Lorena; Papineni,Sreelakshmi; Wimpey,Joshua Seth
  30. The Impact of the COVID-19 Pandemic on Women-Led Businesses By Torres,Jesica; Maduko,Franklin Okechukwu; Gaddis,Isis; Iacovone,Leonardo; Beegle,Kathleen G.

  1. By: Chen,Liming; Hasan,Rana; Jiang,Yi
    Abstract: This paper examines the relationship between urban agglomeration and firm innovation using a recently developed dataset that consistently measures city boundaries across Asia together with geo-referenced firm-level data. It finds that the spatial distribution of innovation by firms is highly concentrated within countries. Further, firms in larger cities have substantially higher propensities to introduce product and process innovations and undertake R&D activities, a result that holds for subgroups of countries and even when the largest cities are excluded from the analysis. Finally, the presence of high quality universities and highly ranked engineering departments in cities is positively associated with firm innovation, lending support to the idea that the accumulation of human capital locally is a key channel through which urban agglomeration affects innovation.
    Keywords: Innovation,Urban Governance and Management,Municipal Management and Reform,Common Carriers Industry,Food & Beverage Industry,General Manufacturing,Textiles, Apparel & Leather Industry,Pulp & Paper Industry,Construction Industry,Business Cycles and Stabilization Policies,Plastics & Rubber Industry,Skills Development and Labor Force Training,Railways Transport
    Date: 2021–11–24
  2. By: Xiang Ding; Teresa C. Fort; Stephen J. Redding; Peter K. Schott
    Abstract: We document the role of intangible capital in manufacturing firms' substantial contribution to non-manufacturing employment growth from 1977-2019. Exploiting data on firms' "auxiliary" establishments, we develop a novel measure of proprietary in-house knowledge and show that it is associated with increased growth and industry switching. We rationalize this reallocation in a model where firms combine physical and knowledge inputs as complements, and where producing the latter in-house confers a sector-neutral productivity advantage facilitating within-firm structural transformation. Consistent with the model, manufacturing firms with auxiliary employment pivot towards services in response to a plausibly exogenous decline in their physical input prices.
    Keywords: structural transformation, professional services, intangible knowledge, economic growth
    Date: 2022–06–01
  3. By: De Nicola,Francesca; Chen,Pinyi
    Abstract: The paper studies the relationship between innovation efforts, innovation outputs, andproductivity, using firm-level data from six East Asian countries. Firms are more likely to invest in innovationwhen they use technology licensed by a foreign company, are part of a large group, and have a more educated workforce.Investment in research and development can significantly boost both product and process innovation. Product innovation yields significant productivity gains. However,productivity gains from process innovation are not detectable in the sample.
    Keywords: Innovation,Educational Sciences,Labor Markets,Construction Industry,Plastics & Rubber Industry,General Manufacturing,Common Carriers Industry,Pulp & Paper Industry,Business Cycles and Stabilization Policies,Food & Beverage Industry,Textiles, Apparel & Leather Industry,Business Environment
    Date: 2022–02–01
  4. By: Francesco Manaresi; Alessandro Palma; Luca Salvatici; Vincenzo Scrutinio
    Abstract: We study the effects of a subsidy program designed to boost small and medium enterprises' export capabilities through a Temporary Export Manager (TEM), hired for at least 6 months to provide consulting on how to reach foreign markets. Firms applied online for the subsidy and vouchers to hire TEMs were allocated on a first-come, first-served basis. We use a difference-in-differences design to compare the performances of firms that nearly got the subsidy with those that barely did not. Eligible firms experienced a large increase in revenues, return on equity, profits and value added per employee, accompanied by a significant growth in export in extra-EU markets four years after receiving the subsidy. The gains were larger for the least productive and smaller firms and effects were heterogeneous across TEM providers. TEMs were also effective in stimulating 'good' labor demand: besides intensifying exports, firms increased their workforce by nearly 13%, mainly in full-time and permanent employees. Results of a survey conducted on TEM providers confirm our econometric results and revealed that the benefits of voucher extended beyond the initial subsidized service.
    Keywords: SMEs, export subsidy, labor demand, natural experiment, click-day
    Date: 2022–10–05
  5. By: Mare,Davide Salvatore; De Nicola,Francesca; Miguel Liriano,Faruk
    Abstract: This paper analyzes the relationship between financial structure and innovation. Analysis of cross-country micro data over 2009–18 shows that a firm’s financial sources matter for the choice to innovate and the extent to which a firm innovates. The relationship is stronger for firms relying on non-bank financial intermediaries and for firms in low-technology sectors. Moreover, the use of external sources of finance is associated with improved prospects of innovation, especially in more financially developed countries. These findings suggest that developing the financial sector can bring benefits in terms of innovation.
    Keywords: Financial Sector Policy,Innovation,Textiles, Apparel&Leather Industry,Pulp&Paper Industry,Plastics&Rubber Industry,Food&Beverage Industry,Common Carriers Industry,Construction Industry,Business Cycles and Stabilization Policies,General Manufacturing,Labor Markets,Financial Economics,Finance and Development
    Date: 2021–05–24
  6. By: Claire Nauwelaers; Richard Harding; Inmaculada Perianez-Forte (European Commission - JRC); Karel Haegeman (European Commission - JRC); Eskarne Arregui
    Abstract: This report analyses five case study reports in-depth across five EU countries as part of a broader analytical and critical exercise. This analytical work seeks to contribute to the development of new models for regional and local authorities aiming to boost support for Green Transition of their economies through smarter innovation policies, using the smart specialisation (S3) approach. The work covered five regions from across the European Union representing a diversity of approaches to using S3 for Green Transition: the Basque Country in Spain, the Centro region in Portugal, the region of East and North Finland, the region of Western Macedonia in Greece and the region of West Netherlands. The case studies included in this report consists of three sections on (i) Profile of the region and key development challenges; (ii) Innovation strategies and policies for green transition: incorporating societal challenges; (iii) Understanding and monitoring innovation-led green transition. Drawing together the different elements presented, the conclusion provides a summary overview of the case and the authors’ opinion on it.
    Keywords: Green Transition, EU regions, Smart Specialisation, Transformative innovation
    Date: 2022–10
  7. By: Houngbonon,Georges Vivien; Mensah,Justice Tei; Traore,Nouhoum-000531164
    Abstract: This paper investigates the effects of access to high-speed internet on innovation andentrepreneurship in Africa. The identification strategy exploits the staggered arrival of submarine internet cablesto the coast of Africa and the subsequent rollout of terrestrial fiber network across the continent. The findingsshow a positive effect of access to high-speed internet on innovation at the firm level, with availability of digitalskills within the firm playing a key role in the internet-innovation nexus. The paper also finds evidence ofinternet-induced entrepreneurship: the probability that a household establishes a non-farm business increases whenconnected to the internet. However, the increase in entrepreneurial activities is largely concentrated in theservice sector.
    Keywords: Marketing,Private Sector Development Law,Private Sector Economics,Labor Markets,Common Carriers Industry,Food & Beverage Industry,General Manufacturing,Pulp & Paper Industry,Construction Industry,Business Cycles and Stabilization Policies,Textiles, Apparel & Leather Industry,Plastics & Rubber Industry,Telecommunications Infrastructure,Information Technology
    Date: 2022–02–23
  8. By: MONCADA PATERNO' CASTELLO Pietro (European Commission - JRC); GRASSANO Nicola (European Commission - JRC)
    Abstract: This Brief explores the longstanding deficit in the EU’s overall corporate R&D intensity compared with that of competing economies over the last decade. The main results indicate the following: The EU business sector is still leading in traditional medium-tech sectors, such as automobiles and parts. As for the US and China, they are much stronger in newer high-tech sectors, and have maintained and even increased their strength in the last decade. For the EU, this causes a lower overall share of net sales and of R&D investment in sectors of high R&D intensity, compared with the full sample (all sectors). Consequently, there is a lower impact on the aggregate (all sectors) result for EU R&D intensity. The EU has a small number of global players in key sectors of high R&D intensity, such as biotechnology and ICT. The sample of top EU R&D investing companies is ahead in the production of green patents related to climate change technologies, as compared with the US and China. Tailored policies should also foster the speed of structural (sectoral) change towards sectors that are more R&D intensive, including some emerging ones, for example artificial intelligence and renewable energies. This will help the creation and growth of more firms in such sectors.
    Keywords: EU vs China vs USA, Corporate R&D intensity gap, structural change
    Date: 2022–09
  9. By: Muzi,Silvia; Jolevski,Filip; Ueda,Kohei; Viganola,Domenico
    Abstract: This paper examines whether the economic crisis induced by the COVID-19 pandemic exhibits a Schumpeterian “cleansing” of less productive firms. Using firm-level data for 31 economies, the study finds that less productive firms have a higher probability of permanently closing during the crisis, suggesting that the process of cleansing out unproductive arrangements may be at work. The paper also uncovers a strong and negative relationship between firm exit and innovation and digital presence, especially for small firms, confirming the relevance of the ability to adapt to market conditions as a determinant of firm survival. Finally, the study finds evidence of a negative relationship between firm exit and a burdensome business environment, as well as between firm exit and age.
    Keywords: Labor Markets,Financial Sector Policy,Business Environment,Food&Beverage Industry,Plastics&Rubber Industry,Textiles, Apparel&Leather Industry,Pulp&Paper Industry,Common Carriers Industry,Construction Industry,Business Cycles and Stabilization Policies,General Manufacturing
    Date: 2021–05–24
  10. By: Stemmler, Henry.
    Abstract: During the COVID-19 pandemic, governments designated specific services as “essential,” which allowed firms operating in those sectors to remain (partially) open as well as being granted other preferential treatment. This paper analyses the effects of the key-status, by mapping the countries’ lists to the sectoral level, and matching these sectors with firm-level Covid-19 survey data from 27 countries. The findings reveal that, controlling for a rich set of firm-level and sectoral characteristics, firms deemed key less often reported declining sales and demand for their goods or services, and had a smaller number of furloughed workers. Nonetheless, non-key firms were more likely to employ online business activities and to change the main product or service they offered, reflecting the necessity to otherwise adjust to the economic downturn and changes in demand.
    Keywords: enterprise, productivity, business strategy, COVID-19
    Date: 2022
  11. By: Aga,Gemechu A.; Campos,Francisco Moraes Leitao; Conconi,Adriana; Davies,Elwyn Adriaan Robin; Geginat,Carolin
    Abstract: In most countries in Africa, the informal sector is large and exhibits low levels of productivity compared to the formal economy: informal firms are typically small, inefficient, and run by entrepreneurs with low levels of education. This paper presents novel representative firm-level data collected on informal firms in the three largest cities of Mozambique, as well as data of microenterprises, formally registered businesses with less than 5 employees, the segment of the private sector that compares best to informal firms. Compared to formal microenterprises, informal firms sell about 14 times less, make 17 times lower profits and are 2–3 times less productive. Almost two-thirds (61 percent) of these performance gaps can be explained by differences in firm characteristics: informal firms are smaller and have limited skills, adapt fewer good business practices, use less capital and production inputs and are less likely to have access to finance. The rest of the productivity gap is explained by differential returns. Despite this “duality” between formality and informality, there is nevertheless a small but significant group of informal enterprises (7.6 percent of informal firms, representing 10.6 percent of employment in the informal sector) that in their characteristics and productivity levels are similar to formal microenterprises. Policies should take this heterogeneity into account.
    Keywords: Financial Sector Policy,Business in Development,Labor Markets,Common Carriers Industry,Plastics&Rubber Industry,Construction Industry,General Manufacturing,Textiles, Apparel&Leather Industry,Pulp&Paper Industry,Business Cycles and Stabilization Policies,Food&Beverage Industry
    Date: 2021–06–24
  12. By: Sam Z. Njinyah (Manchester Metropolitan University, UK); Sally Jones (Manchester Metropolitan University, UK); Simplice A. Asongu (Yaoundé, Cameroon)
    Abstract: The performance of small and medium size enterprises (SMEs) is an important determinant of economic development, especially in developing countries like Cameroon. However, due to financial constraints, SMEs in Cameroon do face significant challenges to exporting, which affect their export performance. Many SMEs develop relationships with financial institutions to benefit from loans to overcome export barriers. However, there is no evidence as to whether such benefits help them overcome the limitations of their financial constraints to improve their export performance. Using data from the World Bank Enterprise Survey 2016 in Cameroon, we examine the moderation effect of loans as a benefit of networks on the relationship between financial constraints and export performance for SMEs in Cameroon using regression analysis. Our results show that financial constraints negatively affect export performance. The moderation effect was significant but negative which means the benefit of network (loans) was not enough to offset the negative effect of financial constraints on export performance. Studies on export barriers and export performance for SMEs in Cameroon are scarce and our research provides some policy and managerial implications to help SME exporting in Cameroon.
    Keywords: Export barriers, Lack of finance, Network, Export performance, and Cameroon
    Date: 2022–01
  13. By: Amin,Mohammad
    Abstract: The informal sector is an important source of livelihoods and jobs for a vast majority of peoplein developing countries. However, there is concern that it may undermine growth and development of the formal sector.For instance, the growth literature indicates that research and development activity and innovation are a key driver oflong-term growth. How does the competition that formal sector firms face from informal sector firms affect researchand development activity by the formal firms The present paper attempts to answer this question using firm-levelsurvey data for small and medium-size enterprises in a large cross-section of mostly developing countries. The resultsshow that higher informal competition leads to greater a likelihood of spending on research and development by formalfirms. For the most conservative baseline specification, a one standard deviation increase in informal competitionleads to an increase of 5.2 percentage points in the likelihood of spending on research and development by formalfirms. This is a large increase given that less than 18 percent of the firms in the sample engage in research anddevelopment activity. Further, consistent with the “parasite” view of informality, the positive impact ofinformal competition on research and development activity is magnified when the business environment is less conducive tooperating in the formal sector compared with informal sector due to factors such as higher corruption, weaker rule oflaw, more burdensome business regulations, and a higher tax rate on profits. As expected, there is no impact of informalcompetition on research and development activity among large firms. The main findings are robust to several controls,alternative specifications, and endogeneity checks.
    Keywords: Labor Markets,Business Environment,Financial Sector Policy,Legal Products,Judicial System Reform,Regulatory Regimes,Legal Reform,Legislation,Social Policy
    Date: 2021–11–30
  14. By: Amin,Mohammad; Motta,Vctor
    Abstract: The present paper estimates the impact of bureaucratic corruption on access to finance ofsmall and medium-size enterprises in 114 developing countries. Corruption can hurt small and medium-sizeenterprises’ access to finance by lowering profits, increasing credit demand, increasing bankruptcy chances,creating uncertainty about the firm’s future profit, and exacerbating the asymmetric information problem betweenborrowers and lenders. Consistent with this view, the findings show a large adverse effect of higher corruption onsmall and medium-size enterprises’ access to finance. An increase in corruption from its smallest to highest valueincreases the likelihood of small and medium-size enterprises being financially constrained from 6.9 to 10.9percentage points. The analysis uncovers several heterogeneities in the corruption-finance relationship. Forinstance, the adverse effect of corruption on access to finance is much less in countries where financialinstitutions protect the rights of borrowers and lenders are stronger, laws provide for better credit information, andcredit bureaus exist. The paper argues that these heterogeneities derive from the specific ways in whichcorruption impacts access to finance. Thus, they help to raise confidence against endogeneity concerns about the mainresults. Other heterogeneities uncovered suggest that corruption is more harmful to firms more that, absentcorruption, are known to enjoy better access to finance, such as male versus female owned firms, relatively largefirms, and better performing firms. The results have important policy implications for the growth of small andmedium-size enterprises in the developing world.
    Keywords: Financial Sector Policy,Access to Finance,Legal Institutions of the Market Economy,Business Environment,Electric Power
    Date: 2021–10–19
  15. By: Abdulla, Eman (Department of Economics, University of Warwick); Lim, King Yoong (International Business School Suzhou, Xian Jiaotong-Liverpool University); Morris, Diego (Nottingham Business School, Nottingham Trent University); Saliba, Faten (International Monetary Fund)
    Abstract: This paper examines the nexus between gender equality, climate change, and innovation at the firm level. Based on three hypotheses derived from a novel theoretical framework linking climate change and gender equality to within-firm innovation activities, we use a cross-section dataset of 87, 996 firms across 36 industries in 103 countries, surveyed across different waves during the 2010-2020 periods to implement an instrumental variable strategy and show that environmental policies unambiguously induce firm-level process and product innovation, through its influence on the endogenous bargaining power of women in society and firms. We document that female productivity has both a direct effect on innovation (0.1-1.3% increase in the likelihood of innovation) and an indirect effect (serving as the intermediation for the environment-innovation nexus). Contrarily, greenhouse gas emissions by themselves have an ambiguous effect on innovation. The type of greenhouse gas emissions and the measure of innovation both contribute to this ambiguity. Overall, our results show that it is not the physics of climate change that induces innovation but rather the countervailing human responses to policies that mitigate climate change that stimulate innovation.
    Keywords: Climate change ; firm-level analysis ; gender equality ; innovation. JEL Codes: D24 ; J16 ; L25 ; O32 ; Q58
    Date: 2022
  16. By: Cirera,Xavier; Vargas Da Cruz,Marcio Jose; Grover,Arti Goswami; Iacovone,Leonardo; Medvedev,Denis; Pereira Lopez,Mariana De La Paz; Reyes,Santiago
    Abstract: Building on prior work that documented the impact of COVID-19 on firms in developingcountries using the first wave of Business Pulse Surveys, this paper presents a new set of stylized facts on firmrecovery, covering 65,000 observations in 38 countries. This paper suggests that: One, since the outset of the pandemic,some aspects of business performance such as sales show signs of partial recovery. Two, other aspects remainchallenging, including persistently high uncertainty andfinancial fragility. Three, recovery is heterogeneous across firms and more sensitive to firm-level attributes such assize, sector, and initial productivity than to country-level differences in the severity of the initial shock. Inparticular, larger and more productive firms are recovering faster, with implications for competition policy andallocative efficiency. Four, the decline in jobs has been steeper during the initial shock than the expansion inemployment during recovery, raising the risk of a "jobless" recovery pattern. Five, the diffusion ofdigital technology and product innovation accelerated during the pandemic but did so unevenly, further widening gapsbetween small and large firms. Six, businesses now have more access to policy support, but poorer countries continue tolag behind and appropriate targeting of firms remains a challenge.
    Keywords: Labor Markets,Food & Beverage Industry,Plastics & Rubber Industry,Textiles, Apparel & Leather Industry,Pulp & Paper Industry,Common Carriers Industry,Construction Industry,Business Cycles and Stabilization Policies,General Manufacturing,Financial Sector Policy
    Date: 2021–10–18
  17. By: Reasner,Mason Scott,Tan,Shawn Weiming
    Abstract: This paper uses merged customs and administrative data from Serbian firms to quantify the impact of neighboring firms’ importing experience on the decision to start sourcing inputs from new markets. The analysis finds that firms are more likely to start importing from a new market if neighboring firms in the same industry and location have experience importing from that market and if those firms are increasing their imports over time. Further, the results support a distinction between imports and exports for the decision to enter foreign markets; unlike exports, import sourcing choices are not independent across countries. The analysis finds that imports across origins are substitutes, not complements. The paper also investigates origin-country and firm heterogeneity. The results indicate that the impact of neighboring firms’ importing experience is greater for source countries in the European Union market and for firms that are high productivity, foreign owned, and previous importers. Together, these findings suggest that a firm’s spatial connections are an important contributor to its access to global markets as sources for inputs.
    Keywords: International Trade and Trade Rules,Business in Development,Trade and Services,Financial Sector Policy,Transport Services
    Date: 2021–10–04
  18. By: Fang,Sheng; Goh,Chorching; Li,Shaomin; Xu,L. Colin
    Abstract: This study examines how firms have made strategic choices and performed during the COVID-19pandemic. Drawing on the organizational resources and strategic change literature, it uses World Bank EnterpriseSurveys and the COVID-19 Follow-up Enterprise Surveys to examine how different endowments in organizational resourcesaffected firm performance as measured by their survival status and sales growth, and how these resources interactwith and affect strategic responses in the supply of inputs, response to changing demand, liquidity management, andinnovation. The results indicate that larger firms, firms with foreign or state ownership, and subsidiary companiesperformed better during the pandemic by more effectively stabilizing supply, managing liquidity, and fostering newproduct development. Chief executive officers with longer tenure improved survival rates. Firms in richer countrieshave coped with the pandemic better and stringent government COVID-19 control policies have tended to hurt firms' performance.
    Date: 2022–04–05
  19. By: Jeremiah Dittmar; Ralph R. Meisenzahl
    Abstract: We examine the role of universities in knowledge production and industrial change using historical evidence. Political shocks led to a profound pro-science shift in German universities around 1800. To study the consequences, we construct novel microdata. We find that invention and manufacturing developed similarly in cities closer to and farther from universities in the 1700s and shifted towards universities and accelerated in the early 1800s. The shift in manufacturing was strongest in new and high knowledge industries. After 1800, the adoption of mechanized technology and the number and share of firms winning international awards for innovation were higher near universities.
    Keywords: industrialization, invention, universities, cities
    Date: 2022–06–30
  20. By: Gasmi, Farid; Kouakou, Dorgyles; Sanni, Maruf
    Abstract: At the turn of the millennium, developing countries face a twofold societal challenge. First, these countries need to understand the deep principles underpinning informality, which is by now recognized as a structuring phenomenon of their economies. Second, for reasons related to both intra- and inter-generational justice, these countries need to follow the sustainable development pathway. This paper highlights a micro-economic aspect of the relationship between these two goals by investigating how a firm being formal versus informal affects its sustainable and responsible innovation (S&RI) activity, a milestone for sustainable development. Using a propensity score matching methodological approach to analyze an original database extracted from the Nigerian Business Innovation Surveys for 2005-2007, we find that registered Nigerian firms have a higher propensity to introduce S&RIs than unregistered firms. This result is robust to alternative and widely used matching methods. Hence, in the prospect of sustainable development of Nigeria and developing countries in general, there should not be a hiatus between acknowledging and further understanding the importance of informality in the economy and promoting policies that give firms incentives to formalize.
    Keywords: Sustainable development; sustainable and responsible innovation; informality,; developing countries; Nigeria.
    JEL: O17 O35 O55 Q01 Q55
    Date: 2022–10–06
  21. By: Buil, Carlos
    Abstract: The main objective is to know the main theoretical concepts of entrepreneurship, in order to better understand the current entrepreneurial situation, and the main variables that influence the probability that a young person is involved in entrepreneurial activities. Entrepreneurship today is essential for development, both economically and socially, which is why young entrepreneurs must take the initiative to start a business. This project aims to encourage and develop entrepreneurship in young people, as it is important to promote their autonomy and improvement in life. From this, we talk about the types of entrepreneurship, the entrepreneurial situation in Spain and the rest of Europe, the advantages it has, the benefits, and the main variables that condition them to start a new business. Therefore, it will not only try to encourage young people, but also to understand the importance of entrepreneurship in education, as it is key for the new generations to keep in mind this concept, and be able to innovate, create and adapt to new changes.
    Keywords: Emprendimiento juvenil, factores determinantes, Europa.
    JEL: J23 J62
    Date: 2022–10–07
  22. By: Sam Njinyah (Manchester Metropolitan University, UK); Simplice A. Asongu (Yaoundé, Cameroon); Sally Jones (Manchester Metropolitan University, UK)
    Abstract: Africa is becoming the fastest-growing continent despite significant challenges to accessing finance and the use of technology. This research aims to examine the direct effect of mobile money adoption on firm performance and its indirect effect by examining how it moderates the effect of access to finance on firm performance. Quantitative data were obtained from the World Bank Enterprise Survey for Cameroon, Ivory Coast and Zimbabwe. A series of hierarchical regression analyses were done to test the hypotheses. The main findings show a negative significant relationship between mobile money adoption and firm performance while access to finance had a positive relationship. The moderation effect though positive was not significant. Research examining the effect of mobile money adoption in Africa on firm performance is limited and existing studies have focused on the determinants of mobile money usage.
    Keywords: Mobile money, Access to Finance, Firm Performance, Resource-based view, Sub Saharan Africa
    Date: 2022–01
  23. By: Liu,Yan-000529044; Wang,Xuan
    Abstract: This paper studies the impact of foreign direct investment on domestic firms’ innovation in China. It provides causal evidence by exploiting China’s foreign direct investment deregulation in 2002 and employs a difference-in-difference estimation strategy. Using a matched firm-patent data set from 1998 to 2007, the results show that the quantity and quality of domestic firms’ innovation benefit from foreign direct investment. Moreover, the paper emphasizes the importance of knowledge spillover from foreign direct investment in similar technology domains. The analysis examines the role of horizontal foreign direct investment and foreign direct investment in technologically close industries—industries that share similar technology domains. The findings show that foreign direct investment in technologically close industries generates much bigger positive spillovers than horizontal foreign direct investment. The paper also shows that knowledge spillover from foreign direct investment in similar technology domains is not driven by input-out linkages. Moreover, the spillover effect is stronger in cities with higher human capital stock and firms with higher absorptive capacity.
    Keywords: General Manufacturing,Textiles, Apparel&Leather Industry,Business Cycles and Stabilization Policies,Pulp&Paper Industry,Construction Industry,Plastics&Rubber Industry,Common Carriers Industry,Food&Beverage Industry,Intellectual Property Rights,Legal Products,Common Property Resource Development,Social Policy,Regulatory Regimes,Legal Reform,Judicial System Reform,Legislation,Real&Intellectual Property Law,Trade Law,Foreign Trade Promotion and Regulation,Investment and Investment Climate,International Trade and Trade Rules
    Date: 2021–05–24
  24. By: Burger,Martijn; Ianchovichina,Elena; Akbar,Prottoy Aman
    Abstract: Using geo-coded, firm-level data on more than 51,000 establishments in 649 metropolitan areas in98 developing economies, from the World Bank’s Enterprise Surveys and a new global database on city-level mobility andcongestion, this paper estimates the “pure” firm productivity gains of urban density, net of negativeexternalities associated with limited mobility, crime, and pollution. The results suggest that the average size ofagglomeration economies in the developing world is comparable to the one observed in advanced countries, butthe magnitude of the benefits of density on firm productivity substantially varies across firms. Returns tourban density are higher for firms operating in the tradables sector, exporters, foreign-owned firms, largerfirms, and more experienced firms. Agglomeration economies are lost through both limited uncongested mobility andcongestion, but the latter has a stronger negative effect on agglomeration economies and reduces relatively more theagglomeration benefits of firms in the non-tradables sector than those producing tradables.
    Keywords: Labor Markets,Common Carriers Industry,Food & Beverage Industry,Construction Industry,Business Cycles and Stabilization Policies,General Manufacturing,Plastics & Rubber Industry,Textiles, Apparel & Leather Industry,Pulp & Paper Industry,Intelligent Transport Systems,Transport Services,Crime and Society
    Date: 2022–03–07
  25. By: Sam Njinyah (Manchester Metropolitan University, UK); Simplice A. Asongu (Yaoundé, Cameroon); Ngozi B. Adeleye (Covenant University, Ogun State, Ota, Nigeria)
    Abstract: Firms' regulatory compliance with environmental and safety issues has been suggested as one of the reasons why firms innovate. Such compliance provides legitimacy, improves reputation and corporate image, and enhances customer loyalty and competitive advantages, which influences firm innovativeness. However, regulatory compliance is costly and with limited resources, the role of government support is crucialas a moderator, to help firms become more compliant and influence their innovativeness. The study uses data from the World Bank Enterprise Innovation Survey for seven countries in Sub Saharan Africa. Regulatory compliance has a positive and significant effect on firm innovativeness. Increased use of government non-financial support enhances the level of firm regulatory compliance and the effect of regulatory compliance on firm innovativeness. The study contributes to the literature on compliance and firm innovativeness in Africa by showing how the positive effect of regulatory compliance on firm innovativeness is stronger when firms benefit from government non-financial support.
    Keywords: Regulatory Compliance, Firm Innovativeness, government non-financial Support, and Sub Saharan Africa (SSA)
    Date: 2022–01
  26. By: Bridget Ngodoo Mile; Victor Ushahemba Ijirshar; Mlumun Queen Ijirshar
    Abstract: SMEs remain a veritable tool that generates employment opportunities. This study examined the impact of SMEs on employment creation in the Makurdi metropolis of Benue state. A sample size of 340 entrepreneurs was chosen from the population of entrepreneurs (SMEs) in the Makurdi metropolis. The study used logistic regression to analyse the impact of SME activities on employment creation or generation in the state and found that SMEs contribute significantly to employment creation in the state but are often faced with the challenges of lack of capital, absence of business planning, lack of confidence in the face of competition, unfavorable environment for the development of SMEs, high government taxes and inadequate technical knowledge. The study therefore recommended that the government should implement capital or credit enhancing programmes and an enabling environment for smooth running of the SMEs. Tax incentives should also be granted to infant enterprises, and tax administration should be monitored to avoid excessive tax rates imposed by tax collectors.
    Date: 2022–09
  27. By: Elias Einio; Josh Feng; Xavier Jaravel
    Abstract: Innovators are intrinsically-motivated individuals who use ideas to create new goods and services. This raises the possibility that their social backgrounds may affect the direction of their innovative activity. Consistent with this "social push" channel, we document that innovators create products that are more likely to be purchased by customers similar to them along observable dimensions including gender, age, and socioeconomic status, both across and within detailed industries. Next, we provide causal evidence that social experience affects the direction of a person's innovative activity. Specifically, being exposed to peers from a lower-income group increases an entrepreneur's propensity to create necessity products, without affecting her rates of entrepreneurship and entrepreneurial income. We incorporate this channel into a general equilibrium model to assess its implications for cost-of-living inequality and long-run growth when there is unequal access to the innovation system.
    Keywords: innovators social background, social push
    Date: 2022–07–13
  28. By: Goldstein,Markus P.; Gonzalez Martinez,Paula Lorena; Papineni,Sreelakshmi; Wimpey,Joshua Seth
    Abstract: This paper estimates the impact of a large negative childcare shock on gender gaps inentrepreneurship using the shock created by national COVID-19 school closure policies. The paper leverages aunique data set of monthly enterprise data collected from a repeated cross-section of business owners across 50countries via Facebook throughout 2020 and in 2021. The paper shows that, globally, female-led firms were, onaverage, 4 percentage points more likely to close their business and experienced larger revenue declines thanmale-led firms during the COVID-19 pandemic in 2020 (male firms closed at a rate of 17 percent in 2020, and 12 percentin 2021). The gender gap in firm closures persisted into 2021. The closing of schools, a key part of the careinfrastructure, led to higher business closures, and women with children were more likely to close their business inresponse to a school closure policy than men with children. Female entrepreneurs were found to take on a greater shareof the increase in the domestic and care work burden than male entrepreneurs. Finally, the paper finds that womenentrepreneurs in societies with more conservative norms with respect to gender equality were significantly more likely toclose their business and increase the time spent on domestic and care responsibilities in response to a school closurepolicy, relative to women in more liberal societies. The paper provides global evidence of a motherhood penalty andchildcare constraint to help explain gender inequalities in an entrepreneurship context.
    Date: 2022–04–20
  29. By: Joseph Denis Njayou Oyong (VALLOREM - Val de Loire Recherche en Management - UO - Université d'Orléans - UT - Université de Tours)
    Abstract: Objectif: cet article de recherche vise à mettre en évidence les représentations qu'ont les investisseurs particuliers du marché de l'equity crowdfunding. Methodologie: Par une démarche exploratoire, nous avons mené 17 entretiens semi-directifs auprès d'investisseurs ayant participé à des campagnes de financement en ECF. Les données sont exploitées sur logiciel NVIVO 11 en utilisant des grilles d'analyse thématiques. Résultats: Nous montrons que les investisseurs particuliers se représentent le marché de l'ECF comme étant positif et utile au regard des projets qui s'y financent. Plusieurs raisons soutiennent les risques financiers pris par les investisseurs particuliers notamment l'accoutumance aux risques financiers, la prise en considération des difficultés des entrepreneurs, et le partage des risques avec les entrepreneurs et les plateformes. Enfin, il existe une relation d'influence et de confiance entre les plateformes d'ECF et les investisseurs particuliers qui poussent ces derniers à un comportement de suivisme. Practical implications: Nous notons que les décisions d'investissement des particuliers sont soutenues par facteurs subjectifs, des affinités personnelles et des erreurs cognitives qui sont de nature à biaiser leurs décisions d'investissement. Originalité: Notre recherche apporte une représentation post investissement du marché de l'ECF, en soulignant le ressenti et l'intérêt que portent les investisseurs particuliers pour ce mode de financement.
    Keywords: Equity crowdfunding (ECF),Crowdfunding (CF),Crowdfunders,retail investors,Financement participatif par capital
    Date: 2022–06–30
  30. By: Torres,Jesica; Maduko,Franklin Okechukwu; Gaddis,Isis; Iacovone,Leonardo; Beegle,Kathleen G.
    Abstract: The COVID-19 pandemic has struck businesses across the globe with unprecedented impacts. Theworld economy has been hit hard and firms have experienced a myriad of challenges, but these challenges have beenheterogeneous across firms. This paper examines one important dimension of this heterogeneity: the differentialeffect of the pandemic on women-led and men-led businesses. The paper exploits a unique sample of close to 40,000 mainlyformal businesses from 49 countries covering the months between April and September 2020. The findings show thatwomen-led micro-businesses, women-led businesses in the hospitality industry, and women-led businesses in countriesmore severely affected by the COVID-19 shock were disproportionately hit compared with businesses led by men.At the same time, women-led micro-firms were markedly more likely to report increasing the use of digital platforms,but less likely to invest in software, equipment, or digital solutions. Finally, the findings also show that women-ledbusinesses were less likely to have received some form of public support although they have been hit harder in somedomains. In a crisis of the magnitude of the COVID-19 pandemic, evidence tracing the impact of the shock in atimely fashion is desperately needed to help inform the design of policy interventions. This real-time glimpse intowomen-led businesses fills this need for robust and policy-relevant evidence, and due to the large countrycoverage of the data, it is possible to identify patterns that extend beyond any one country, region, or sector, butat the cost of some granularity for testing more complex economic theories.
    Keywords: Gender and Development,Inequality,Gender and Poverty,Gender and Economics,Economics and Gender,Technology Innovation,Technology Industry,Gender and Economic Policy,Textiles, Apparel & Leather Industry,Pulp & Paper Industry,Food & Beverage Industry,Common Carriers Industry,Construction Industry,Plastics & Rubber Industry,Business Cycles and Stabilization Policies,General Manufacturing
    Date: 2021–10–26

This nep-sbm issue is ©2022 by João Carlos Correia Leitão. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.