nep-sbm New Economics Papers
on Small Business Management
Issue of 2023‒01‒16
25 papers chosen by
João Carlos Correia Leitão
Universidade da Beira Interior

  1. The relationship between firms that start operating as unregistered and firms’ innovation: the moderating effect of access to finance By Sam Njinyah; Simplice A. Asongu
  2. The Impact Of Family Ties And Founder Involvement On Innovation In High-Tech Firms By Anastasia N. Stepanova; Polina A. Khmeleva
  3. Air Pollution and Firm-Level Human Capital, Knowledge and Innovation By Cavalcanti, T.; Mohaddes, K.; Nian, H.; Yin, H.
  4. Government Procurement and Access to Credit: Firm Dynamics and Aggregate Implications By Julian di Giovanni; Manuel García-Santana; Priit Jeenas; Enrique Moral-Benito; Josep Pijoan-Mas
  5. Theories of crowdfunding and token issues: a review By Miglo, Anton
  6. Learning A Bayesian Structure to Model Entrepreneurial Intentions and Attitudes Toward Business Creation among Emirati Students By Linda Smail; Mouawiya Alawad; Wasseem Abaza; Firuz Kamalov; Hamdah Alawadhi
  7. Patents that Match your Standards: Firm-level Evidence on Competition and Growth By Bergeaud Antonin; Schmidt Julia; Zago Riccardo
  8. Judge Bias in Labor Courts and Firm Performance By Pierre Cahuc; Stéphane Carcillo; Bérangère Patault; Flavien Moreau
  9. Management of Big data: An empirical investigation of the Too-Much-of-a-Good-Thing effect in medium and large firms By Claudio Vitari; Elisabetta Raguseo; Federico Pigni
  10. Research on College Students' Innovation and Entrepreneurship Education from The Perspective of Artificial Intelligence Knowledge-Based Crowdsourcing By Yufei Xie; Xiang Liu; Qizhong Yuan
  11. Impact of Covid-19 on Small- and Medium-Sized Enterprises in Iraq By Diego Martin; Erin Neale; Raffaele Bertini; Julia Smith Omomo; Olga Aymerich
  12. Survival Strategies Under Sanctions: Firm-Level Evidence from Iran By Iman Cheratian; Saleh Goltabar; Mohammad Reza Farzanegan
  13. Income Inequality and Entrepreneurship: Lessons from the 2020 COVID-19 Recession By Christoph Albert; Andrea Caggese; Beatriz González; Victor Martin-Sanchez
  14. Acquisition-induced kill zone By Christopher Teh; Dyuti Banerjee; Chengsi Wang
  15. Firm Dynamics in Times of COVID: Evidence from Egyptian Firms By Amirah El-Haddad; Chahir Zaki
  16. 디지털 플랫폼의 활용이 중소기업의 국제화에 미치는 영향과 정책 시사점(The Internationalization of SMEs via Digital Platforms: Findings and Policy Implications) By Koo, Kyong Hyun; Kang, Gusang; Moon, Ji Young; Park, Hyeri; Na, Seung Kwon; Kim, Jegook
  17. Firm Entry and Exit during Recessions By Ayres, JoaÞo; Raveendranathan, Gajendran
  18. Globalization of Finance and Fintech in The MENA Region By Franklin Allen
  19. Business transactions and ownership ties between firms By László Lõrincz; Sándor Juhász; Rebeka O. Szabó
  20. Carl Menger on time and entrepreneurship By Gilles Campagnolo
  21. Funding Female Entrepreneurs in MENA Countries (2019): Self-Selection and Discrimination By Imène Berguiga; Philippe Adair
  22. Resource Productivity and Eco-Innovation Convergence in the Service of Sustainability. Evidence from the EU-28 By Nikos Chatzistamoulou; Phoebe Koundouri
  23. Innovation de rupture By Jean-Francois Duroch; Pascal Le Masson; Armand Hatchuel; Benoit Weil; Dominique Laousse; François Déliac; Michel Grosbost
  24. Financing Constraints and Risk Management: Evidence From Micro-Level Insurance Data By Bustos, Emil; Engist, Oliver; Martinsson, Gustav; Thomann, Christian
  25. Firm Closures and Performance in A Time of Pandemic By Amirah El-Haddad; Chahir Zaki

  1. By: Sam Njinyah (Manchester Metropolitan University, UK); Simplice A. Asongu (Yaoundé, Cameroon)
    Abstract: The purpose of this paper is to examine the relationship between a firm starting operation informally and its future innovation and whether this relation is moderated by institutional support (having access to finance from financial institutions to run their business). Data from the World Bank Enterprise Survey on 30 Eastern European and South-East Asian countries were analysed using probit regression analysis. The findings show that there is a positive significant relationship between firms that start operations informally and the firms’ innovation and that such effect persists over time. We found that this relationship is stronger if the firms can gain access to finance to expand their business activities. Finally, our result shows that such a relationship is based on the type of innovation being pursued by the firm. By examining the moderation effect of access to finance on starting a business informally, we provide an alternative explanation to policymakers on how to deal with informal firms to benefit from their contribution to growth.
    Keywords: Informality/unregistered firms, Innovation, Institutions, and Eastern European and South East Asia
    Date: 2022–01
  2. By: Anastasia N. Stepanova (National Research University Higher School of Economics); Polina A. Khmeleva (National Research University Higher School of Economics)
    Abstract: This paper investigates the impact of family participation and founder involvement in business on innovation in high-tech companies from the S&P500 index over the period 1999–2017. We demonstrate that the family firm paradox (family firms tend to invest less in innovation while remaining more efficient in innovation output) is not so obvious for technological companies. We conclude that founder involvement and CEO ownership leads to higher R&D expenditures and income margins in the pharma and IT sectors. However, consistent with previous studies of family participation, family ownership and holding the offices of CEO and chairman, has a negative impact on amounts spent on innovation.
    Keywords: Family firms, founder, risk-taking, behavioral finance, corporate governance
    JEL: G30 G39
    Date: 2022
  3. By: Cavalcanti, T.; Mohaddes, K.; Nian, H.; Yin, H.
    Abstract: This paper investigates the long-run effects of prolonged air pollution on firmlevel human capital, knowledge and innovation composition. Using a novel firm-level dataset covering almost all industrial firms engaged in science and technology activities in China, and employing a regression discontinuity design, we show that prolonged pollution significantly diminishes both the quantity and the quality of human capital at the firm level. More specifically, we show that air pollution affects firm-level human capital composition by reducing the share of employees with a PhD degree and master’s degree, but instead increasing the share of employees with bachelor’s degree. Moreover, the difference in the composition of human capital materially change the knowledge and innovation structure of the firms, with our estimates showing that pollution decreases innovations that demand a high level of creativity, such as publications and inventions, while increasing innovations with a relatively low level of creativity, such as design patents. Quantitatively, on the intensive margin, one μg/m 3 increase in the annual average PM 2.5 concentration leads to a 0.188 loss in the number of innovations per R&D employee. Overall, we show that air pollution has created a gap in human capital, knowledge, and innovation between firms in the north and south of China, highlighting the importance of environmental quality as a significant factor for productivity and welfare.
    Keywords: Pollution, human capital, knowledge, innovation, China
    JEL: O15 O30 O44 Q51 Q56
    Date: 2023–01–03
  4. By: Julian di Giovanni (Federal Reserve Bank of New York); Manuel García-Santana (Universitat Pompeu Fabra); Priit Jeenas (Universitat Pompeu Fabra); Enrique Moral-Benito (Bank of Spain); Josep Pijoan-Mas (CEMFI, Centro de Estudios Monetarios y Financieros)
    Abstract: We provide a framework to study how different allocation systems of public procurement contracts affect firm dynamics and long-run macroeconomic outcomes. We start by using a newly created panel dataset of administrative data that merges Spanish credit register loan data, quasicensus firm-level data, and public procurement projects to study firm selection into procurement and the effects of procurement on credit growth and firm growth. We show evidence consistent with the hypotheses that there is selection of large firms into procurement, that procurement contracts provide useful collateral for firms -more so than sales to the private sector- and that procurement contracts facilitate firm growth beyond the contract duration. We next build a model of firm dynamics with both asset-based and earnings-based borrowing constraints and a government that buys goods and services from private sector firms. We use the calibrated model to quantify the long-run macroeconomic consequences of alternative procurement allocation systems. We find that granting procurement contracts to small firms, either by directly targeting them or by slicing large contracts into smaller ones, helps these firms grow and overcome financial constraints in the long run. However, we also find that reducing the average size of contracts |or making it less likely for large firms to access them| removes saving incentives for large firms, whose negative effects on capital accumulation can overcome the expansionary consequences for small firms and hence generate a drop in aggregate output.
    Keywords: Government procurement, financial frictions, capital accumulation, aggregate productivity.
    JEL: E22 E23 E62 G32
    Date: 2022–02
  5. By: Miglo, Anton
    Abstract: Entrepreneurial, innovative and small- and medium-sized firms experience difficulties with raising funds using traditional debt and equity. Consequently, they are constantly looking for new strategies of financing. Latest inventions are crowdfunding and token issues. In contrast to traditional ways of raising funds these innovations: 1) use modern technology (on-line transactions, blockchain etc.) much more actively; 2) are usually quicker in reaching potential investors/funders; 3) use more actively network benefits such as, for example, a large number of interactions between investors/funders and between funders and firms. These changes are so significant that some experts list them among the top business inventions of 21st century. This article provides a review of the growing number of theoretical papers in the areas of crowdfunding and token issues, compare their findings with empirical evidence and discuss directions for future research. The research shows that a large gap exists between theoretical literature and empirical literature.
    Keywords: entrepreneurial finance, crowdfunding, token issues, initial coin offerings (ICO), initial exchange offerings (IEO), security token issues (STO)
    JEL: G32 L26 M13 M21
    Date: 2022
  6. By: Linda Smail (Zayed University); Mouawiya Alawad (Zayed University); Wasseem Abaza (Zayed University); Firuz Kamalov (Canadian University Dubai); Hamdah Alawadhi (Zayed University)
    Abstract: Economic growth in most advanced countries is driven by small and medium-sized enterprises (SMEs), and most countries prioritize entrepreneurship for economic growth and innovation. This is very apparent in the United Arab Emirates (UAE), where an average of around 39 percent of adults want to start a business in the next three years. As such, entrepreneurial intentions have been a major area of focus in research, but they have always been studied using generic models. We use Bayesian networks as a relatively new technique to model entrepreneurial intentions as it provides an advantage over classical methods. Using the theory of planned behavior as a foundation, we conduct a cross-sectional study among a random sample of 324 Emirati university students in the UAE. We implement unsupervised structural learning within BayesiaLab using the SopEQ unsupervised algorithm to minimize the “minimum description length” score. Our model provides confirmation of and more robust statistical support for existing theoretical frameworks. It helps us find relationships among the different entrepreneurial factors and assess the effects of changes in these variables on intentions. One of the strengths of our study is the inclusion of attitudes toward entrepreneurship and self-efficacy variables. Accordingly, the main conclusion that can be drawn from our model is that entrepreneurial intentions are highly affected by attitude, self-efficacy, subjective norms, and opportunity feasibility. The results can be used by professionals for proposing new policies for university opportunities and government support.
    Date: 2022–09–20
  7. By: Bergeaud Antonin; Schmidt Julia; Zago Riccardo
    Abstract: When a technology becomes the new standard, the firms that are leaders in producing this technology have a competitive advantage. Matching the semantic content of patents to standards and exploiting the exogenous timing of standardization, we show that firms closer to the new technological frontier increase their market share and sales. In addition, if they operate in a very competitive market, these firms also increase their R&D expenses and investment. Yet, these effects are temporary since standardization creates a common technological basis for everyone which allows followers to catch up and the economy to grow.
    Keywords: Standardization, Patents, Competition, Innovation, Text Mining
    JEL: L15 O31 O33
    Date: 2022
  8. By: Pierre Cahuc (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique, IZA - Forschungsinstitut zur Zukunft der Arbeit - Institute of Labor Economics, CEPR - Center for Economic Policy Research - CEPR); Stéphane Carcillo (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique, IZA - Forschungsinstitut zur Zukunft der Arbeit - Institute of Labor Economics); Bérangère Patault (UvA - University of Amsterdam [Amsterdam]); Flavien Moreau (IMF - "Research Department International Monetary Fund (IMF)" - International Monetary Fund (IMF))
    Abstract: Does judge subjectivity in labor courts influence firm performance? We study the economic consequences of judge decisions by collecting information on Appeal court rulings, combined with administrative firm-level records covering the whole universe of French firms. The quasi-random assignment of judges to cases reveals that judge bias, defined as judge-specific differences on granting compensation for wrongful dismissal, has statistically significant effects on the survival and employment of small firms, especially among very small and low-performing ones. When compensation for wrongful dismissal is instrumented by judge bias, an increase in compensation of 1 percent of the payroll reduces employment growth by 5 percentage points after 3 years for those firms.
    Keywords: Dismissal compensation, Judge bias, Firm survival, Employment
    Date: 2022–03
  9. By: Claudio Vitari (AMU - Aix Marseille Université, CERGAM - Centre d'Études et de Recherche en Gestion d'Aix-Marseille - AMU - Aix Marseille Université - UTLN - Université de Toulon); Elisabetta Raguseo (Polito - Politecnico di Torino = Polytechnic of Turin); Federico Pigni (EESC-GEM Grenoble Ecole de Management)
    Abstract: Firms adopt Big data solutions, but a body of evidence suggests that Big data in some cases may create more problems than benefits. We hypothesize that the problem may not be Big data in itself but rather too much of it. These kinds of effects echo the Too-Much-of-a-Good-Thing (TMGT) effect in the field of management. This theory also seems meaningful and applicable in management information systems. We contribute to assessments of the TMGT effect related to Big data by providing an answer to the following question: When does the extension of Big data lead to value erosion? We collected data from a sample of medium and large firms and established a set of regression models to test the relationship between Big data and value creation, considering firm size as a moderator. The data confirm the existence of both an inverted U-shaped curve and firm size moderation. These results extend the applicability of the TMGT effect theory and are useful for firms exploring investments in Big data.
    Keywords: Too-Much-of-a-Good-Thing effect,inverted U-shaped curve,Big data,business value,medium and large firms
    Date: 2022
  10. By: Yufei Xie; Xiang Liu; Qizhong Yuan
    Abstract: Based on the practical process of innovation and entrepreneurship education for college students in the author's university, this study analyzes and deconstructs the key concepts of AI knowledge-based crowdsourcing on the basis of literature research, and analyzes the objective fitting needs of combining AI knowledge-based crowdsourcing with college students' innovation and entrepreneurship education practice through a survey and research of a random sample of college students, and verifies that college students' knowledge and application of AI knowledge-based crowdsourcing in the learning and practice of innovation and entrepreneurship The study also verifies the awareness and application of AI knowledge-based crowdsourcing knowledge by university students in the learning and practice of innovation and entrepreneurship.
    Date: 2022–12
  11. By: Diego Martin; Erin Neale; Raffaele Bertini (Regional Office of IOM for Middle East and North Africa); Julia Smith Omomo; Olga Aymerich
    Abstract: Among the main socio-economic effects of the COVID-19 pandemic in Middle Eastern countries, its impact on small- and medium-sized enterprises (SMEs) is one of the most relevant, especially in post-conflict and fragile countries and contexts. To analyze this, the United Nations’ International Organization for Migration (IOM) in Iraq, the Food and Agriculture Organization (FAO), and the International Trade Centre (ITC) jointly conducted a panel study tracking the pandemic’s impact on SMEs in Iraq. The survey was disseminated among more than 700 SMEs across the country covering 16 economic sectors. Four rounds of data were collected at four points in time between June 2020 and June 2021 (June/July 2020, September 2020, November/December 2020, and June 2021) from businesses registered in the IOM’s database, located in both urban and rural areas. Findings from four rounds of data collection show that COVID-19 negatively affected production, revenue, and employment and, notably, the gender gap in the labor force at the beginning of the pandemic (February to June 2020) and COVID-19-related movement restrictions. This study concludes with related policy recommendations for Iraq and the Middle Eastern countries.
    Date: 2022–06–20
  12. By: Iman Cheratian (Tarbiat Modares University); Saleh Goltabar (Tarbiat Modares University); Mohammad Reza Farzanegan (Philipps-Universität Marburg)
    Abstract: Given the importance of firm strategic management in time of crises, this study investigates Micro, Small, and Medium Enterprises (MSMEs) survival strategies during the international sanctions against Iran. Using data from a questionnaire of 486 firms between December 2019 to September 2020, we found that firm strategies in reducing research and development (R&D) expenditures, marketing costs, and fixed/overhead costs and investing in information technology (IT) are positively related to their survivability. Conversely, managerial decisions to “reduce production” and “staff pay cut/freeze” have negative and significant impacts on a firm’s ability to survive during sanctions. Moreover, micro firms are more resilient than their small and medium counterparts. The findings also confirm that age has a significant and positive impact on firm survival. Finally, the results show that having a business plan, access to finance and technology, owner education, export orientation, business networking and consulting services are the key drivers of withstanding the pressure from sanctions.
    Date: 2022–08–20
  13. By: Christoph Albert; Andrea Caggese; Beatriz González; Victor Martin-Sanchez
    Abstract: We study entry into entrepreneurship during the COVID-19 recession of 2020 using new data from an extensive survey of more than 24,000 Spanish households, conducted between June and November 2020. We find that while the overall decline in the startup rate in 2020 was large, and of a similar magnitude as that during the Great Recession, the differential impact depending on ex ante income was starkly different. During 2020, the drop in firm entry was entirely concentrated among low -and medium- income households. We show that the entrepreneurship gap between these households and their high-income counterparts is not directly explained by social distancing, since it is mostly driven by the sectors not directly affected by lockdown measures, and it is larger among households that did not suffer a negative income shock during the pandemic. We instead find evidence indicating that high-income households performed relatively better during the COVID-19 recession because they had the means to exploit new business opportunities, thanks to their larger wealth and better access to external finance.
    Keywords: recessions, financial crisis, entrepreneurship, firm dynamics, coronavirus, COVID-19
    JEL: E20 E32 D22 J23 M13
    Date: 2022–11
  14. By: Christopher Teh (UNSW Sydney); Dyuti Banerjee (Department of Economics, Monash University); Chengsi Wang (Department of Economics, Monash University)
    Abstract: We study the impact of a dominant incumbent’s acquisition on entry and R&D incentives in a model with multiple start-ups. The incumbent’s acquisition directly suppresses entry and can distort the non-target start-up’s R&D incentives by creating a kill zone. The reduced threat of entry can also cause the incumbent to shelve the acquired technology. Despite these negative effects, acquisitions generally affect consumer welfare ambiguously due to synergy benefits. We study the design of merger policies aimed at minimizing acquisition-related harms. We also show that entry-for-buyout may not be a valid defense for start-up acquisitions when accounting for non-target start-ups.
    Keywords: Acquisitions, Innovation, Start-ups, Merger Policy, Remedies
    JEL: G34 L12 L41 O31
    Date: 2022–12
  15. By: Amirah El-Haddad (German Development Institute); Chahir Zaki (Cairo University)
    Abstract: The COVID-19 outbreak has had severe economic consequences across the globe. The crisis emanating from the pandemic has caused demand and supply side shocks, which are more far reaching than any crisis in living memory. We use a new data set from the 2020/21 Egyptian Industrial Firm Behavior Survey (EIFBS) to examine determinants of firms’ resilience during the COVID-19 pandemic. Crisis present the opportunity for what Schumpeter (1934) called creative destruction. Have manufacturing firms been all hit by the crisis equally, or were less efficient firms more likely to exit or downsize their activities thereby ‘cleansing’ the market? Two sets of factors affect firm dynamics and survival: 1) firms’ innate characteristics, such as formality and export status, sector, ownership, age, size and location and; 2) firm behavior which captures the extent to which good managerial practices, innovation, the adoption of advanced technologies and worker training have provided an opportunity for firms to adapt their business models and show greater resilience in coping with the crisis. Our main findings illustrate the vulnerability of private, smaller, informal firms and those that are not located in industrial zones. Also, as expected, preCOVID behavioural characteristics matter for firm dynamics. The food sector and sectors identified as ‘COVID sectors’ show more resilience. More nuanced results show that the effect of some behavioral traits vary by sector and are more influential depending on firm size.
    Date: 2022–09–20
    Abstract: 디지털 플랫폼의 발전과 함께 글로벌 전자상거래 시장이 빠르게 성장하고 있다. 디지털 플랫폼을 활용한 국제화는 전통적인 방식에 비해 해외시장 진입 비용을 크게 낮추었는데, 이는 자본이나 인력 면에서 상대적으로 열세에 놓여 있는 중소기업에 새로운 기회를 제공할 것으로 기대된다. The global e-commerce market has been rapidly expanding due to the development of digital platforms. When compared to traditional methods, internationalization via digital platforms has significantly reduced the cost of entering overseas markets, which is expected to open up new opportunities for small- and medium-sized enterprises (SMEs) with limited capital or manpower. However, few studies have been conducted on domestic SMEs internationalization via digital platforms. Furthermore, little is known about the effects of relevant policies on SMEs’ use of digital platforms and internationalization. Aiming to fill this research gap, this study collects data on Korean SMEs’ online exports (i.e., exports via e-commerce), the most representative type of SMEs’ internationalization through digital platforms, establishes stylized facts, and investigates the effects of Korean SMEs’ online export support policies. Based on the findings, we also provide policy implications. In Chapter 2, we first conduct a survey on domestic SMEs’ online exports using a sample representing domestic SMEs registered as official e-commerce firms as of June 2021. Based on survey results, we document basic descriptive statistics on SMEs’ online exports behavior and investigate their main issues and policy demands. Chapter 3 outlines Korea’s online export support policies for SMEs and explores the effects of five major online export assistance programs on SMEs’ online exports. For the estimation of the effects, we combined the survey data from Chapter 2 with information on the firms participating in the programs, which are provided by the Ministry of SMEs and Startups and Korea Enterprise Data (KED). (the rest omitted)
    Keywords: 전자상거래; 무역정책; E -commerce; trade policy
    Date: 2021–12–30
  17. By: Ayres, JoaÞo; Raveendranathan, Gajendran
    Abstract: We analyze shocks to productivity, collateral constraint (credit shock), firm operation, and labor disutility in a model of firm dynamics with entry and exit. Shocks to firm operation and labor disutility capture COVID-19 lockdowns. Compared to the productivity shock, the credit and the lockdown shocks generate larger changes in firm entry and exit. The credit shock accounts for lower entry, higher exit, and concentration of exit among young firms during the Great Recession. The lockdown shocks predict a large fall in entry and rise in exit followed by a sharp rebound. In both recessions, changes in entry and exit account for 10-20 percent of the fall in output and hours. Finally, we discuss how the modeling of potential entrants matters for the quantitative results.
    Keywords: firm dynamics;general equilibrium model;COVID-19;recession;lockdown;COVID-19;COVID-19;COVID-19;COVID-19;Creditshock
    JEL: E24 E32 D22 D21
    Date: 2021–06
  18. By: Franklin Allen (Brevan Howard Centre at Imperial College)
    Abstract: Globalization, together with Fintech – in other words, the application of technology to finance – are in the process of revolutionizing the financial services industry. This paper looks at this process in the MENA region and focuses on two sets of countries. The first set comprises the high-income countries of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE. The second group consists of the middle-income countries of Algeria, Egypt, Iraq, Jordan, Lebanon, Morocco, and Tunisia. Countries can benefit from fintech to differing degrees in terms of the financial inclusion of both households and firms, especially small- and medium-sized enterprises (SMEs). Advances in credit scoring, digital banking, and peer-to-peer lending have the potential to transform banking if properly implemented. Distributed ledger, blockchain, and cryptocurrency technologies have enabled Initial Coin Offerings (ICOs). These can greatly improve the number of start-ups and their subsequent growth. They also enable Central Bank Digital Currencies (CBDCs) that may significantly improve central banks’ effectiveness of intervening in the financial system and economy. Finally, appropriate cybersecurity and financial regulation are needed to ensure that fintech can achieve these improvements. Policymakers should be accommodative towards fintech innovations to obtain their full potential benefit.
    Date: 2021–09–20
  19. By: László Lõrincz (Centre for Economic and Regional Studies, Corvinus University of Budapest, Corvinus Institute for Advanced Studies); Sándor Juhász (Corvinus University of Budapest, Corvinus Institute for Advanced Studies, Centre for Economic and Regional Studies); Rebeka O. Szabó (Corvinus University of Budapest, Corvinus Institute for Advanced Studies)
    Abstract: In this study we investigate the creation and persistence of interfirm ties in a large-scale business transaction network. Transaction ties, firms buying or selling products or services can be the outcome of pure business motivations, but the social connections of owners or the geographical location of companies may also influence their development. We build the transaction and the ownership networks of firms in Hungary for 2016 and 2017 from two administrative datasets and identify multi-layer network motifs to predict the creation and persistence of business transactions. We show that direct or indirect relationships in this two-layered network contribute to both the creation and persistence of business transaction ties. We find a positive, but smaller impact of geographic proximity and industrial similarity of firms. For our estimations, we utilize loglinear models and emphasize their efficiency in predicting links in such large networks. We contribute to the literature by illustrating business connection patterns in a nationwide multilayer interfirm network.
    Keywords: transaction network, ownership network, multilayer network, network motifs, tie creation, tie persistence
    JEL: L14
    Date: 2022–06
  20. By: Gilles Campagnolo (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Carl Menger is remembered less for his analysis of entrepreneurship (which in the following analysis refers to his fundamental notions related to the nature of business practice) than for his views on matters like money, individualism or the nature of institutions (there are exceptions to this subdued interest, such as Kirzner 1978). However, these issues are related and a long-debated notion among Austrians, namely time, relates investment, entrepreneurship, uncertainty and Menger's tentative quasi-anthropology (kept in his notes). This paper conscientiously investigates those issues through Menger's views on the notion of time.
    Keywords: Böhm-Bawerk (Eugen von), entrepreneurship, innovation, Menger (Carl), time
    Date: 2022–09
  21. By: Imène Berguiga (University of Sousse, Tunisia); Philippe Adair (University Paris-Est Créteil)
    Abstract: Do female entrepreneurs in MENA countries face obstacles, either exogenous (discrimination) or endogenous (self-selection), in funding their businesses? Literature reviews provide controversial evidence thereof and, so far, very few papers tackled this funding issue for female entrepreneurs in MENA countries. A pooled sample of 6, 253 enterprises from the 2019/2020 World Bank Enterprise Surveys (WBES) including six MENA countries (Egypt, Morocco, Tunisia, Jordan, Lebanon, and Palestine) documents the financial behavior of both owners and managers according to gender. Two probit regression models address loan supply and loan demand with respect to discrimination versus self-selection. There is self-selection and discrimination against female owners but not discrimination against female managers. We provide a robustness test by estimating the models on a sub-sample of micro, small, and medium-sized enterprises. Sampling biases in the WBES, together with the characteristics of female clients of microfinance institutions, suggest that micro-entrepreneurs would have faced bank discrimination and self-selection obstacles. Hence, public authorities should support pooling loan guarantees in favor of female entrepreneurs (i.e., positive discrimination).
    Date: 2022–11–20
  22. By: Nikos Chatzistamoulou (AUEB); Phoebe Koundouri
    Abstract: The European Green Deal prioritizes green growth through resource efficiency and eco-innovation to achieve the transition in a sustainable and inclusive growth orbit. To monitor progress in such endeavor the EU Resource Efficiency Scoreboard was launched. Focusing on the resource productivity, which is the main sustainability development indicator and policy evaluation tool for Europe and the eco-innovation performance of the EU-28 over a twenty-year period, from 2000 though 2019, we explore convergence patterns and club formation. Descriptive analysis via growth rates of the resource productivity and eco-innovation indicates productivity differentials among the countries giving rise to heterogeneity groups. Econometric results using convergence algorithms advocate in favor of convergence for both variables. However, convergence clubs surface highlighting that there is heterogeneity to consider when designing policies to promote sustainability transition to ensure that no one is left behind serving the priority of inclusive and sustainable growth.
    Keywords: Resource Productivity, Eco-Innovation, Sustainability, Convergence, Technological Heterogeneity, European Green Deal
    Date: 2022–12–15
  23. By: Jean-Francois Duroch; Pascal Le Masson (CGS i3 - Centre de Gestion Scientifique i3 - Mines Paris - PSL (École nationale supérieure des mines de Paris) - PSL - Université Paris sciences et lettres - CNRS - Centre National de la Recherche Scientifique); Armand Hatchuel (CGS i3 - Centre de Gestion Scientifique i3 - Mines Paris - PSL (École nationale supérieure des mines de Paris) - PSL - Université Paris sciences et lettres - CNRS - Centre National de la Recherche Scientifique); Benoit Weil (CGS i3 - Centre de Gestion Scientifique i3 - Mines Paris - PSL (École nationale supérieure des mines de Paris) - PSL - Université Paris sciences et lettres - CNRS - Centre National de la Recherche Scientifique); Dominique Laousse (SNCF Réseau [La Plaine st Denis]); François Déliac; Michel Grosbost
    Abstract: Innovation de rupture • L'enjeu de l'innovation de rupture aujourd'hui : gérer les inconnus des transitions et les gérer avec méthode ! • Comment faire de l'innovation de rupture avec la théorie C-K ?
    Date: 2022
  24. By: Bustos, Emil (Research Institute of Industrial Economics (IFN)); Engist, Oliver (Stockholm School of Economics); Martinsson, Gustav (Royal Institute of Technology); Thomann, Christian (Royal Institute of Technology)
    Abstract: We study the impact of financing constraints on corporate risk management. Using data on credit scores matched with unique information on firm level commercial insurance purchases, we find that financing constraints lead to higher insurance spending. We adopt a regression discontinuity design and show that financially constrained firms spend 5–14% more on insurance than otherwise similar unconstrained firms. Our findings add new insights to the longstanding empirical puzzle of whether financially constrained firms engage more in risk management. Furthermore, our results shed light on risk management in smaller, mostly private firms.
    Keywords: Financing Constraints; Risk Management; Insurance Demand; Credit Scores
    JEL: D22 D25 G22 G32
    Date: 2022–12–20
  25. By: Amirah El-Haddad (German Development Institute); Chahir Zaki (Cairo University, EMNES and ERF)
    Abstract: We use data from the 2020/21 Egyptian Industrial Firm Behavior Survey (EIFBS) to assess the effects of the COVID-19 crisis on firm dynamics, behavior and performance. The crisis emanating from the COVID-19 pandemic induced both demand and supply side shocks, which are more far reaching than any crisis in living memory. Our results show that the crisis has hit the entire Egyptian manufacturing sector. But, in line with Schumpeter’s (1934) creative destructive theory, the market shows signs of ‘self-cleansing’, whereby the less efficient are more likely to exit and downsize their activities. Our descriptive results show resilience of larger, public, formal, and export sector firms. Thus, revealing pre-existing fragilities of the private, informal and, more generally the lower productivity firms in the manufacturing sector. The counter cyclicality of the relation implies that contraction of the formal sector expands the informal as the only alternative way to earn a living. As a ‘survival sector’, the informal sector has provided 'helping hand employment'. Pre-crisis good managerial practices, innovation, the adoption of advanced technologies and training workers all provide an opportunity for firms to adapt their business model, as reflected by superior firm dynamics and post-crisis performance. Larger firms and mostly less vulnerable sectors such as fabricated metals and rubber have had more access to government support. It is likely that the government has chosen to support sectors with potentially better chances of survival rather than support the most vulnerable. Firms in pharmaceuticals were also recipients of support, which is sensible in a health crisis.
    Date: 2022–01–20

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