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on Small Business Management |
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Issue of 2023‒12‒11
eighteen papers chosen by João Carlos Correia Leitão, Universidade da Beira Interior |
| By: | Gianluca Biggi; Andrea Mina; Federico Tamagni |
| Abstract: | Using a firm-level dataset from the Spanish Technological Innovation Panel (2003-2016), this study explores the characteristics of environmentally innovative firms and quantifies the effects of pursuing different types of environmental innovation strategies (resource-saving, pollution-reducing, and regulation-driven innovations) on sales, employment, and productivity dynamics. The results indicate, first, that environmental innovations tend to be highly correlated with firms’ technological capabilities, although to varying degrees across types of environmental innovation, whereas structural characteristics are less significant. Second, we observe heterogeneous effects of different types of environmental innovation on performance outcomes. We find no evidence that any type of environmental innovation fosters sales growth while pollution-reducing and regulation-driven innovations boost employment growth. Moreover, both resource-saving and pollution-reducing innovations bring about productivity advantage. |
| Keywords: | Environmental Innovation; Green Investments, Resource-saving, Pollution-reduction, Envi- ronmental compliance; Firm performance. |
| Date: | 2023–11–20 |
| URL: | http://d.repec.org/n?u=RePEc:ssa:lemwps:2023/42&r=sbm |
| By: | Colin Wessendorf; Nils Grashof |
| Abstract: | This study analyses the influence of Key Enabling Technologies (KETs) on radical innovation at the firm-level in 27 EU countries. KETs are a group of six technologies that are considered to be promising for Europe’s industrial competitiveness and innovativeness because they are horizontal and widely combinable, representing properties of General Purpose Technologies. We test this by investigating whether KET knowledge promotes the emergence of radical innovation in firms and whether regional specialization in KETs can moderate this relationship. Based on a unique firm-level database, our results show that KETs generally facilitate the emegence of radical innovation and that firms lacking KET knowledge in particular can benefit from being located in regions specialised in KETs. However, when focusing on the six individual KETs, the results get markedly heterogeneous and point to differences in the influence of engineering-oriented and science-based KETs. Our results therefore call for tailored, KET-specific, approaches – both in research and policy. |
| Keywords: | Radical Innovation, Recombinant Novelty, Knowledge Creation, General Purpose Technologies, Key Enabling Technologies, Firm-Level |
| JEL: | L25 O31 O33 R10 |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:atv:wpaper:2303&r=sbm |
| By: | Akcigit, Ufuk; Alp, Harun; Diegmann, André; Serrano-Velarde, Nicolas |
| Abstract: | This paper investigates a unique policy designed to maintain employment during the privatization of East German firms after the fall of the Iron Curtain. The policy required new owners of the firms to commit to employment targets, with penalties for non-compliance. Using a dynamic model, we highlight three channels through which employment targets impact firms: distorted employment decisions, increased productivity, and higher exit rates. Our empirical analysis, using a novel dataset and instrumental variable approach, confirms these findings. We estimate a 22% points higher annual employment growth rate, a 14% points higher annual productivity growth, and a 3.6% points higher probability of exit for firms with binding employment targets. Our calibrated model further demonstrates that without these targets, aggregate employment would have been 15% lower after 10 years. Additionally, an alternative policy of productivity investment subsidies proved costly and less effective in the short term. |
| Keywords: | industrial policy, privatizations, productivity, size-dependent regulations |
| JEL: | D22 D24 J08 L25 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:279550&r=sbm |
| By: | Andreas Teichgraeber; John Van Reenen |
| Abstract: | What research and innovation (R&I) policies should Europe adopt? The world faces a challenge to rebuild after the pandemic, but also faces the same structural slowdown of productivity growth that occurred in the decades before the COVID crisis. We need to have a plan around innovation policy to address the challenge. We show that Europe is less innovative on many dimensions compared to other advanced regions, such as the US and parts of Asia. We review the econometric evidence on R&I policies and argue that there is good evidence for the efficacy of many of them. A mix of R&D subsidies, reinvigorated competition and a big push on expanding the quantity and quality of human capital is needed. These could be bound together around the need for green innovation in order to achieve the mission to radically reduce carbon emissions. |
| Keywords: | innovation, R&D, human capital, Europe |
| Date: | 2022–02–25 |
| URL: | http://d.repec.org/n?u=RePEc:cep:poidwp:025&r=sbm |
| By: | Mary Amiti; Cedric Duprez; Jozef Konings; John Van Reenen |
| Abstract: | Using firm-to-firm transactions, we show that starting to supply a "superstar" firm (large domestic firms, exporters and multinationals) boosts productivity by 8% in the medium-run. Placebos on starting relationships with smaller firms and novel identification strategies support a causal interpretation of "superstar spillovers". Consistent with a model of technology transfer, we find falls in markups and bigger treatment effects from technology-intensive superstars. We also show that the increase in new buyers is particularly strong within the superstar firm's network, a "dating agency" effect. This suggests an important role for raising productivity through superstars' supply chains regardless of their multinational status. |
| Keywords: | productivity, FDI, spillovers |
| Date: | 2023–04–21 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1917&r=sbm |
| By: | Nils Grashof; Alexander Kopka |
| Abstract: | Artificial intelligence (AI) is seen as a key technology for economic growth. However, the impact of AI on firm productivity has been under researched – particularly through the lens of inequality and clusters. Based on a unique sample of German firms, filling at least one patent between 2013 and 2019, we find evidence for a positive influence of AI on firm productivity. Moreover, our analysis shows that while AI knowledge does not contribute to productivity divergences in general, it increases the productivity gap between laggard and all other firms. Nevertheless, this effect is reduced through the localisation in clusters. |
| Keywords: | Artificial intelligence, Inequality, Productivity, Clusters, Patents, Firm-level |
| JEL: | O18 O30 R10 |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:atv:wpaper:2304&r=sbm |
| By: | Darius Lambrecht; Jörn Block; Matthias Neuenkirch; Holger Steinmetz; Tom Willeke |
| Abstract: | Firms often struggle with the successful commercialization of innovations, and there is a need for reliable predictors. Prior research suggests that intellectual property (IP) rights play a key role in the commercialization of innovations. However, to what extent can IP rights be used to predict successful commercialization of innovations in the manufacturing industry? Our paper studies the role of patents and trademarks and their complementary and substitutive relationships to predict commercialization success as measured by sales. We also analyze potential reciprocal relationships between commercial success and IP rights. The relationships are explored in a panel dataset of 2, 617 German Mittelstand firms over a 10-year period. The results of a panel vector autoregressive model show a short-lived positive effect of patents on sales growth and vice versa. However, no significant effects are found between trademarks and sales growth. Finally, a positive and complementary relationship between patents and trademarks is documented. |
| Keywords: | Innovation, Commercialization, Patents, Trademarks, Panel Vector Autoregression |
| JEL: | O14 O30 O34 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:trr:wpaper:202310&r=sbm |
| By: | Francis OSEI-TUTU (Paris School of Business (PSB)); Laurent WEILL (LaRGE Research Center, Université de Strasbourg) |
| Abstract: | We examine the effect of regional favoritism on the access of firms to credit. Using firm-level data on a large sample of 29, 000 firms covering 47 countries, we investigate the hypothesis that firms in the birth regions of national political leaders have better access to credit. Our evidence suggests that firms located in birth regions of political leaders are less likely to be credit constrained. The effect takes place through the demand channel: firms in leader regions feel less discouraged in applying for loans. We find no evidence, however, of preferential lending from banks to firms in leader regions. Thus, regional favoritism affects access to credit through differences in perceptions of firm managers, not deliberate changes in the allocation of resources by political leaders. |
| Keywords: | regional favoritism, access to credit, borrower discouragement. |
| JEL: | D72 G21 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:lar:wpaper:2023-04&r=sbm |
| By: | Christian R. {\O}stergaard; Bram Timmermans |
| Abstract: | Over the last 10 years, there has been a growing interest in diversity in human capital. Fueled by the business case for diversity, there is an increasing interest in understanding how the combination of people with different backgrounds fosters the innovation performance of firms. Studies have measured diversity on a wide range of personal-level characteristics, at different levels of the organization, and in particular kinds of settings. Innovation performance has been measured using an arsenal of indicators, often drawing on a large range of databases. This paper takes stock of this research, identifying the current state of affairs and proposing future research trajectories in the field of diversity and innovation |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2311.05219&r=sbm |
| By: | Asani Sarkar |
| Abstract: | In this post, we follow up on the previous Liberty Street Economics post in this series by studying other impacts of extreme weather on the real sector. Data from the Federal Reserve’s Small Business Credit Survey (SBCS) shed light on how small businesses in the Second District are impacted by natural disasters (such as hurricanes, floods, wildfires, droughts, and winter storms). Among our findings are that increasing shares of small business firms in the region sustain losses from natural disasters, with minority-owned firms suffering losses at a disproportionately higher rate than white-owned firms. For many minority-owned firms, these losses make up a larger portion of their total revenues. In a companion post, we will explore the post-disaster recovery of small firms in the Second District: how long do they remain closed and what are their sources of disaster relief? |
| Keywords: | climate; racial disparities; inequality; Second District |
| JEL: | D63 Q54 R10 |
| Date: | 2023–11–15 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednls:97312&r=sbm |
| By: | Gutierrez-Lythgoe, Antonio |
| Abstract: | This study aims to analyse disparities in entrepreneurship across the United States, taking into account the diverse socioeconomic contexts of each county and emphasizing the role of social capital structures and their connections to nearby regions. To conduct this research, we utilize data on Non-farm Proprietorships (NFP) as an indicator of entrepreneurial activity, sourced from the US Bureau of Economic Analysis, in conjunction with socioeconomic and demographic variables from the US Census Bureau, and social network data from Facebook via the Social Capital Atlas project. Employing spatial econometric techniques, we examine spatial dependence patterns and reveal a statistically significant and positive spatial autocorrelation. Particularly, we identify statistically significant correlations between the proportion of connections among different socioeconomic groups and entrepreneurial activity, as well as negative correlations between the Social Cohesion Index and non-farm proprietorships. These findings corroborate the significance of "weak ties" in social networks, as theorised by Granovetter, and underscore how associations with individuals of higher socioeconomic status could invigorate entrepreneurial initiatives, carrying notable practical implications for entrepreneurship promotion and policy development. |
| Keywords: | Non-farm proprietorship; Social Capital; Facebook data; Spatial Econometrics |
| JEL: | C21 L26 R11 |
| Date: | 2023–11–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:119068&r=sbm |
| By: | Dabekoa Yarbonme (IAE Lille - Institut d'Administration des Entreprises - Lille - Université de Lille, Sciences et Technologies) |
| Abstract: | Today, the role of women has evolved in society, from housewives to entrepreneurs, in the same way as men, and contributes to economies in terms of job creation and economic growth (Kelley, Bosma and Amoros, 2010). However, we will focus on the place of women in entrepreneurship in Togo. The objective of this study is to explain the entrepreneurial success of Togolese women on the basis of the environmental dimension. Thus, the question that arises is to know: What are the key factors for the success of female entrepreneurship in Togo? In order to answer this question, we conducted a qualitative study with semi-structured interviews with 12 women entrepreneurs in Lomé working in the formal sectors. Through a content analysis, our results show that family support, support structures, government action, and sociocultural factors have a positive effect on the success of Togolese women entrepreneurs. However, financial resources are a key factor of success, but access remains difficult for Togolese women. |
| Abstract: | On constate aujourd'hui que le rôle de la femme a évolué dans la société, passant de femme au foyer à femme entreprenante au même titre que l'homme. L'entrepreneuriat féminin contribue aux économies en termes de création d'emplois et de croissance économique (Kelley, Bosma et Amoros, 2010). Dans ce travail, nous nous intéresserons à la place de la femme dans l'entrepreneuriat au Togo. L'objectif de cette étude est d'expliquer la réussite entrepreneuriale des femmes togolaises sur la base de la dimension environnementale. Ainsi, la question qui se pose est de savoir : Quels sont les facteurs clés du succès de l'entrepreneuriat féminin au Togo ? Afin de répondre à cette question, nous avons réalisé une étude qualitative avec des interviews semi-directives auprès de 12 femmes entrepreneures de Lomé exerçant dans les secteurs formels. À travers une analyse de contenu, notre résultat montre que le soutien de la famille, les structures d'accompagnements, l'action du gouvernement, les facteurs socioculturels ont un effet positif sur le succès des femmes entrepreneures togolaises. Cependant, le facteur clé reste celui des ressources financières alors que l'accès à ces ressources reste difficile pour les femmes togolaises. |
| Keywords: | Femmes entrepreneures, Facteur de succès, Togo. |
| Date: | 2023–10–25 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04263232&r=sbm |
| By: | Iorio, Roberto (CELPE - CEnter for Labor and Political Economics, University of Salerno, Italy); Segnana, Maria Luigia (Department of Economics and Management - University of Trento, Italy) |
| Abstract: | This paper originates from the endless question about whether corruption “greases or sands the wheels” of growth. Focusing on innovation at the firm level, the question becomes whether corruption hampers or enhances innovation. To explore this link we use a panel data obtained merging two BEEPS surveys (2012-2014 and 2018-2019) with 3916 units located in 24 countries in Eastern Europe and Central Asia. We suggest that, to deeply understand the nexus between corruption and innovation, it is needed to go beyond the average effect. In fact, the intensity as well as the direction of this link is clearly affected by two factors: the institutional context, particularly the country’s level of control of corruption, and the market context or the degree of market competition that firms face. The empirical analysis leads to the following conclusions: • the link between corruption and innovation is reinforced by the poor quality of the institutions; • the link between corruption and innovation is non linearly connected with the degree of competition. Its intensity is particularly strong when firms face a high competitive pressure, coming from a multitude of even informal firms. This implies that in some scenarios, characterized by low control of corruption and high competitive pressure, corruption is a way to “grease the wheels” of the innovation; in other contexts, with high control of corruption and moderate competitiveness, the link becomes weak if not negative, resembling the “sanding the wheels” hypothesis. From a policy point of view, as in the countries under inspection the impact of corruption on innovation differs over different competitive markets and institutional characteristics, it follows that uniform restrictions are not appropriate. |
| Keywords: | innovation; corruption; bribery; market competition |
| JEL: | O12 O31 P27 P51 |
| Date: | 2023–11–24 |
| URL: | http://d.repec.org/n?u=RePEc:sal:celpdp:0165&r=sbm |
| By: | Cátia Cerqueira (NIPE/Center for Research in Economics and Management, University of Minho, Portugal); Fernando Alexandre (NIPE/Center for Research in Economics and Management, University of Minho, Portugal); Miguel Portela (NIPE/Center for Research in Economics and Management, University of Minho, Portugal; and IZA, Bonn) |
| Abstract: | This paper examines firms’ characteristics and the impact on firm performance of being a first mover in the adoption of cloud computing and big data digital technologies, relative to followers and non-adopters. Our results show that firms with higher levels of education both for managers and workers, and shorter managerial tenure are more likely to be digital adopters. First movers in the adoption of big data show distinct characteristics from followers, namely they are younger and have a larger share of higher education workers. Regarding the impact on firm performance, we find that first movers in cloud computing experience significant performance gains, namely in gross value added and productivity, compared to non-adopters, but no gains relative to followers. Interestingly, first movers in big data exhibit a productivity edge over followers and non-adopters. Furthermore, we find that higher levels of education and shorter managerial tenure amplify the positive effects of big data adoption on firm performance. |
| Keywords: | cloud computing, big data, management, digitalization, productivity, ICT |
| JEL: | D24 M10 E22 E23 J24 O33 L20 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:nip:nipewp:11/2023&r=sbm |
| By: | Sari Kerr; William Kerr |
| Abstract: | We generated a standardized sample of recently founded, non-public employer firms to evaluate the data consistency of key owner characteristics between the Survey of Business Owners (2007, 2012), Annual Survey of Entrepreneurs (2014-2016), and Annual Business Survey (2017-2019). We also contrast the trends found in this analysis to some of the Census Bureau press releases pertaining to a broader population of firms and owners, to the ACS IPUMS data on self-employed individuals in incorporated businesses, as well as our own previous disclosures using the LEHD first year top-3 earners of the founding team. We find some data consistency issues across the three surveys (SBO, ASE, ABS) that sometimes happen around changes in the way certain questions are posed. Other patterns suggest that there may have been differences in the type of respondents reached by the three surveys. We also provide some suggestions aimed at making the restricted access micro data and the public use data products more accessible to a wider range of researchers and other potential users. |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:cen:tnotes:23-20&r=sbm |
| By: | Amoroso, Sara (DIW Berlin); Herrmann, Benedikt (European Commission); Kritikos, Alexander S. (DIW Berlin) |
| Abstract: | High growth firms (HGFs) are important for job creation and considered to be precursors of economic growth. We investigate how product- and labor-market regulations, as well as the quality of regional governments that implement these regulations, affect HGF development across European regions. Using data from Eurostat, OECD, WEF, and Gothenburg University, we show that both regulatory stringency and the quality of the regional government influence the regional shares of HGFs. Additionally, we find that the effect of labor- and product-market regulations ultimately depends on the quality of regional governments. The institutional quality has a moderating role in dening the effect of regulations on the regional shares of HGFs. Our findings contribute to the debate on the effects of regulations by showing that regulations are not, per se, "good, bad, and ugly", rather their impact depends on the efficiency of regional governments. Our paper offers important building blocks to develop tailored policy measures that may influence the development of HGFs in a region. |
| Keywords: | high growth firms, regulation, quality of governments, regional development |
| JEL: | H11 L25 L50 R11 R50 |
| Date: | 2023–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16563&r=sbm |
| By: | OECD |
| Abstract: | This document provides an integrated view on income-based tax incentives for R&D and innovation. It brings together the latest evidence on the adoption, design, generosity, cost and take-up of income-based tax incentives, and gives new insights into both the long-term and short-term trends in the take-up of income-based tax incentives by business and their cost to governments, including role of policy design changes. Furthermore, the report explores the scope for developing indicators that provide a more complete picture of the value of expenditure- and income-based tax relief for R&D and innovation in the OECD area and beyond. |
| Keywords: | innovation, Research and development, tax incentives |
| JEL: | H25 O38 O34 |
| Date: | 2023–11–24 |
| URL: | http://d.repec.org/n?u=RePEc:oec:stiaac:161-en&r=sbm |
| By: | Hussinger, Katrin; Issah, Wunnam |
| Abstract: | This paper shows that the American Inventor's Protection Act, which introduced the disclosure of patent applications after 18 months, i.e. before a grant decision is taken and, hence, before it is known whether the respective technology receives legal protection, is associated with a reduction of family firms' research and development (R&D) investment. This suggests that early disclosure of patent applications is perceived as a threat to family firms' innovation activity and discourages their R&D investment. This finding deserves our attention because family firms account for a large share of the U.S. economy and a reduction of their R&D investment can have long-term consequences. |
| Keywords: | R&D investments, AIPA, Family firms, Socio-emotional wealth (SEW) |
| JEL: | O32 M14 O34 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:279811&r=sbm |