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on Small Business Management |
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Issue of 2025–03–03
twenty papers chosen by João Carlos Correia Leitão, Universidade da Beira Interior |
| By: | Altunay, Paul-Christoph; Vetter, Oliver A. |
| Abstract: | The rapid advancement of artificial intelligence (AI) has ushered in a surge of AI startups. AI startups have been hypothesized to be organized in and benefit from ecosystems, with concrete research to substantiate this claim remaining scarce. We aim to bridge this gap by providing a first step towards a scientific understanding of AI startup ecosystems, focusing on investor-related ecosystem effects. We employ a network theory approach to examine the relationship between investor-related ecosystems and AI startup success. We provide an overview of how investor-related ecosystems influence the success of AI startups and how investor types affect their success differently. Findings suggest that AI startups disproportionately benefit from investor-related ecosystem effects and that they differ by investor type, suggesting a new pecking order for choosing investors. In light of these results, practitioners and scholars are prompted to reassess established norms of entrepreneurial finance and startup success factors concerning AI startups. |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:dar:wpaper:152916 |
| By: | Lahouari Said (UMBB - Université M'Hamed Bougara Boumerdes) |
| Abstract: | This study investigates the impact of entrepreneurship education on students' entrepreneurial intentions. Data collected via a structured questionnaire from students at University assess the relationship between entrepreneurship educations, entrepreneurial self-efficacy and entrepreneurial intentions. We used the Methodology Structural Modeling Partial Least Squares Equations (SEM-PLS) using Smart PLS (version 4). Findings confirm the direct and indirect positive relationship between entrepreneurship education (EE) and entrepreneurial intention. |
| Keywords: | Entrepreneurship education Entrepreneurial intention Self-efcacy University students entrepreneurial pedagogy JEL Classification Codes : L26, C31, I23, Entrepreneurship education, Entrepreneurial intention, Self-efcacy, University students, entrepreneurial pedagogy JEL Classification Codes : L26 |
| Date: | 2023–12–30 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:halshs-04521381 |
| By: | Salomé Baslandze; Leo Liu; Elvira Sojli; Wing Wah Tham |
| Abstract: | This paper studies the interaction between process and product innovations and their distinct role in firm growth dynamics. We differentiate empirically and theoretically two types of process innovations: foundational processes that advance production technology and cost-reducing processes that enhance existing production efficiency. We develop an innovation model of product varieties with quality heterogeneity to illustrate how these innovations affect firm growth differently and highlight how process innovation induces product innovation. By analyzing millions of patent texts from 1900 to 2020, we classify innovations into product, cost-reducing process, and foundational process innovations. We find that foundational processes lead to sustained firm growth, especially through their effect on subsequent product creation. R&D-intensive firms focused on “deep-tech” innovations have an advantage in creating foundational processes, resulting in superior product quality. Using patents linked to FDA-approved drugs, we show that firms with a comparative advantage in creating foundational processes, due to greater knowledge and technological stock, tend to produce higher-value products. |
| Keywords: | foundational process innovation; process innovation; product innovation; process-driven products; firm growth; technological possibility frontier |
| JEL: | O3 O4 |
| Date: | 2025–02–19 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedawp:99586 |
| By: | Meziane Amina (UMBB - Université M'Hamed Bougara Boumerdes) |
| Abstract: | The aim of this study is to identify the presence of entrepreneurial intention among Algerian researchers for creating academic spin-offs. We relied on a questionnaire administered to 88 researchers from the University of Boumerdes. The findings led to the conclusion that researchers show limited interest in starting a business. Furthermore, desirability and feasibility are the primary factors influencing this inclination. To facilitate the establishment of such enterprises, a comprehensive framework enveloping legislative, cultural, and financing elements is essential to improve the capacity of universities in forming spin-off companies. |
| Keywords: | entrepreneurial intention researchers universities business creation (Spin-Off) scientific research commercialization (valorization). JEL Classification Codes: M13 O3, entrepreneurial intention, researchers, universities, business creation (Spin-Off), scientific research, commercialization (valorization). JEL Classification Codes: M13, O3 |
| Date: | 2023–12–30 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:halshs-04521401 |
| By: | Venkat Ram Reddy Ganuthula |
| Abstract: | This paper presents the AI Enabled Individual Entrepreneurship Theory (AIET), a theoretical framework explaining how artificial intelligence technologies transform individual entrepreneurial capability. The theory identifies two foundational premises: knowledge democratization and resource requirements evolution. Through three core mechanisms skill augmentation, capital structure transformation, and risk profile modification AIET explains how individuals can now undertake entrepreneurial activities at scales previously requiring significant organizational infrastructure. The theory presents five testable propositions addressing the changing relationship between organizational size and competitive advantage, the expansion of individual entrepreneurial capacity, the transformation of market entry barriers, the evolution of traditional firm advantages, and the modification of entrepreneurial risk profiles. Boundary conditions related to task characteristics and market conditions define the theory's scope and applicability. The framework suggests significant implications for entrepreneurship theory, organizational design, and market structure as AI capabilities continue to advance. This theory provides a foundation for understanding the evolving landscape of entrepreneurship in an AI-enabled world. |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2502.00009 |
| By: | John Bonney; Luigi Pistaferri; Alessandra Voena |
| Abstract: | Using multiple administrative data sources from Norway, we examine how firm performance changes after entrepreneurs become parents. Female-owned businesses experience a substantial decline in profits, steadily decreasing to 30% below baseline ten years post-childbirth. In contrast, male-owned businesses show no decline, often growing in revenues and costs after childbirth. The profit decline for female-owned firms is most pronounced among highly capable entrepreneurs, women who are majority owners, and those with working spouses. Entrepreneurial effort is key to performance, and our findings suggest that time demands from childbirth and childcare are a significant determinant of the decline in firm profits. |
| JEL: | J13 J16 L25 L26 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33448 |
| By: | Khellil Khaled (OEB - Université Larbi-Ben-Mhidi [Oum-El-Bouaghi]); Loucif Kamilia (OEB - Université Larbi-Ben-Mhidi [Oum-El-Bouaghi]) |
| Abstract: | This study aims to assess the development of small and medium-sized enterprises in Algeria from 2010 to 2022 and their contribution to economic diversification and reducing Algeria's reliance on oil revenues, using descriptive and analytical techniques plus the inductive approach to examine and analyze data collected, the study shows that Algeria's small and medium-sized enterprises are vulnerable and ineffective at contributing to the country's economic diversification, and their extensive orientation towards the services and construction sectors does not help create added value despite the significant growth in their count during the period of study. |
| Keywords: | Small and Medium-sized Enterprises Economic Diversification Algerian exports. JEL Classification Codes : Q32 Q37, Small and Medium-sized Enterprises, Economic Diversification, Algerian exports. JEL Classification Codes : Q32, Q37 |
| Date: | 2023–12–30 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:halshs-04521465 |
| By: | Oyun Erdene Adilbish; Mr. Diego A. Cerdeiro; Mr. Romain A Duval; Mr. Gee Hee Hong; Luca Mazzone; Lorenzo Rotunno; Hasan H Toprak; Maryam Vaziri |
| Abstract: | Europe faces a well-known productivity malaise, with a large and widening aggregate productivity gap relative to the U.S. In this paper, we provide a novel diagnosis of the firm-level roots of Europe’s productivity growth slowdown through an analysis of data covering the universe of firms in Europe and the U.S over their life cycles. Compared to their U.S. counterparts, we identify critical performance gaps among both Europe’s frontier firms and young high-growth firms. Our firm-level analyses reveal that smaller markets and limited market-based financing are key bottlenecks for frontier European firms, while skill shortages and insufficient risk capital, such as venture capital, hinder the formation and subsequent growth of young firms in Europe. These findings suggest that removing remaining intra-Europe barriers to accelerate factor and product markets integration, alongside national reforms to facilitate swifter resource reallocation and enhance human capital, could help revive Europe’s productivity growth. |
| Keywords: | Firm-level productivity; business dynamism. |
| Date: | 2025–02–14 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2025/040 |
| By: | Bruno Merlevede (-) |
| Abstract: | This paper builds a large pan-European panel dataset of firm-level senior management gender composition. We focus the dataset on firms in the business economy that file unconsolidated accounts and report both total assets and strict positive employment throughout their existence. We have management information for 9 million firms for the period 2005-2020 resulting in 60 million firm-year observations. Overall 40% of observations concerns firms with at least one female manager and 60% are led only by male managers. For (predominantly micro) firms with a single manager that account for 53.5% of observations, we find that only 23% are female-managed. 59.5% of firms with two or more managers have at least one female manager. Across countries between 14% and 66% of observations refer to firms where at least half of the managers are female, across industries variation is more limited and ranges between 20% and 53%. We find that within tight countryindustry- year cells women-led SMEs are smaller and less productive and show lower leverage. Real performance differences are sustained in an event study analysis of switching firms, financial performance differences are not. Female-managed firms show lower short and medium-run growth rates. These effects are small and remain unchanged (also in magnitude) when controlling for leverage. Female-managed firms do not differ in terms of exporting behaviour and responses to import shocks. We find indications that female-managed firms show lower future growth in very uncertain environments, but higher growth in environments characterized by low uncertainty. |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:rug:rugwps:25/1110 |
| By: | Benjamin Cornejo Costas; Nicola Cortinovis; Andrea Morrison; |
| Abstract: | This paper investigates the relationship between migrant inventors, informal institutions and the development of green technologies in European regions. We argue that migrant inventors act as an unlocking mechanism that transfers external knowledge to host regions, and that informal institutions (i.e. social capital, migrant acceptance) mediate this effect. The work is based on an original dataset of migrant inventors covering 271 NUTS2 regions in the 27 EU countries, the UK, Switzerland, and Norway. The analysis shows that migrant inventors help their host regions to diversify into green technologies. The regions with the highest levels of both measures of social capital show a higher propensity of migrant inventors to act knowledge brokers. Conversely, regions with lower levels of migrant acceptance and social capital do not seem to contribute to this effect. |
| Keywords: | lock-in, international migration, green innovation, social capital, acceptance, regional diversification, EU regions |
| JEL: | F22 J61 O30 R12 Q55 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:egu:wpaper:2503 |
| By: | Carolina Castaldi |
| Abstract: | Mapping innovation in space is part and parcel of research on the geography of innovation. The maps we produce reflect both how we conceptualize innovation and the data and indicators we choose to measure it. They can shape research directions and policy strategies. As research on the geography of innovation expands, this paper asks the question: How do innovation maps reflect these evolving perspectives? |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:egu:wpaper:2505 |
| By: | Koch, Florian |
| Abstract: | Entrepreneurs in the cultural and creative industries face the unique challenge of merging artistic vision with commercial objectives. These individuals, who manage businesses in areas such as art, design, and media, must balance creative expression with the need for financial sustainability. Thus, conflicts arise from multiple institutional logics, as creative logics emphasize exploration and experimentation, while commercial logics focus on refinement and profitability. Managing these competing demands creates organizational tensions, particularly under resource constraints, and mirrors a dilemma observable across many sectors. The cultural and creative industries thus serve as a microcosm for all hybrid organizations facing conflicting institutional logics and paradoxical tensions. Paradox theory provides a valuable framework for understanding these dynamics, showing how contradictory yet interdependent elements can coexist within organizations. By addressing both sides of the paradox simultaneously—rather than making trade-offs—organizations can harness both creative and commercial poles, fostering resilience and innovation. This dissertation investigates how creative entrepreneurs navigate these paradoxical tensions between artistic and commercial demands. Through a multi-level analysis, it examines the influence of individual orientations, team dynamics, and organizational strategies on ambidexterity as a paradoxical construct, innovation and adaptation processes. More specifically, by focusing on three levels—individual, team, and organizational—this dissertation addresses the complex interplay between paradoxical constructs such as creativity and commercialization, and exploration and exploitation, which define the challenges of hybrid ventures. The first study adopts a quantitative approach to explore how founders’ creative and business orientations interact to influence innovation, providing insights into how early decisions shape a venture’s long-term trajectory. The second study uses qualitative methods to examine interpersonal dynamics within founding teams, focusing on how social interactions foster ambidexterity, enabling teams to balance creativity with commercialization. The third study offers a longitudinal qualitative analysis of how hybrid organizations adapt their business models to reconcile the competing demands of artistic and commercial logics. Collectively, these studies examine the navigation of paradoxical tensions from these interconnected perspectives and under which conditions it results in innovation. As such, this dissertation contributes to the literature on creative entrepreneurship, hybrid organizations, and paradox theory. In particular, this dissertation highlights the importance of individual orientations and team dynamics in fostering innovative outcomes and ambidextrous capabilities while demonstrating how continuous organizational adaptation is essential for long-term success. |
| Date: | 2025–02–12 |
| URL: | https://d.repec.org/n?u=RePEc:dar:wpaper:153012 |
| By: | Roberta V. Gatti; Asif M Islam; Maue, Casey; Esha Dilip Zaveri |
| Abstract: | Using global data from the World Bank’s Enterprise Surveys that includes the precise geo-location of surveyed firms, this paper examines how dry spells and precipitation shocks influence firm performance. The study finds that firms in areas that experience dry spells have lower performance in terms of sales. This is particularly true for smaller firms and those in developing economies. A higher number of extreme dry days also increases the chances that a firm will exit the market. The main channels are largely through labor productivity and infrastructure service disruptions such as water and power outages. There is also some evidence of limited access to finance due to negative precipitation shocks. Governance may be an exacerbating factor, with negative precipitation shocks increasing exposure to corruption. Yet, there is also some indication that digitally connected and innovative firms are more resilient to negative precipitation shocks. Process innovation, website ownership, and use of technology licensed from foreign firms mediate the effects of negative precipitation shocks on firm performance. However, there is little evidence of adaptation. Negative precipitation shocks have no effect on the presence of green management practices or green investments for a subset of firms for which such data is available. |
| Date: | 2024–09–23 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wbrwps:10923 |
| By: | Antonin Bergeaud (CEPR - Center for Economic Policy Research, Centre de recherche de la Banque de France - Banque de France); Arthur Guillouzouic (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, IPP - Institut des politiques publiques, Sciences Po - Sciences Po) |
| Abstract: | Following Bergeaud et al. (2022), we construct a new measure of proximity between industrial sectors and public research laboratories. Using this measure, we explore the underlying network of knowledge linkages between scientific fields and industrial sectors in France. We show empirically that there exists a significant negative correlation between the geographical distance between firms and laboratories and their scientific proximity, suggesting strongly localized spillovers. Moreover, we uncover some important differences by field, stronger than when using standard patent-based measures of proximity. |
| Keywords: | Knowledge Spillovers, Technological Distance, Public Laboratories |
| Date: | 2024–03 |
| URL: | https://d.repec.org/n?u=RePEc:hal:ipppap:hal-04938250 |
| By: | Bruno Merlevede; Annelies Van Maele (-) |
| Abstract: | This paper documents how the composition of value added per worker in Europe is distributed over manufacturing, services, and other industries based on a large panel of firmlevel data. We show that a non-negligible part of value added is accounted for by services industries. We then explore how micro-data at the firm level can be used to analyse this important component of aggregate productivity growth. We further discuss and explore using our data whether semi-parametric estimators of total factor productivity that are commonly found in the literature and typically tailored towards manufacturing are fit for analysing firms services sectors. |
| Keywords: | Productivity slowdown, firm-level data, services industries |
| JEL: | E24 J24 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:rug:rugwps:25/1109 |
| By: | Andrés Alonso-Robisco (BANCO DE ESPAÑA); José Manuel Carbó (BANCO DE ESPAÑA); Pedro Jesús Cuadros-Solas (CUNEF UNIVERSIDAD AND FUNCAS); Jara Quintanero (BANCO DE ESPAÑA) |
| Abstract: | Open banking initiatives, which aim to increase competition and innovation in the financial sector by enabling the customer-authorised sharing of financial data among banks, regulated third-party providers and other financial stakeholders, are becoming widespread around the world. This paper investigates the impact of open banking on the development of the fintech sector, focusing particularly on payment-related financial services. We utilise the implementation of the Second Payment Services Directive (PSD2) in Europe as a natural experiment and employ a difference-in-differences methodology to analyse a unique microdata set of 406 Spanish fintech firms from 2014 to 2022, sourced from the Banco de España Central Balance Sheet Data Office and Fintech Radar. Our findings reveal that following PSD2, fintech firms specialising in payment services (Paytech) improved their performance compared with non-payment fintechs (control), with this improvement driven primarily by revenue growth rather than cost reduction. Additionally, treated fintech firms exhibited a significant reduction in long-term bank debt reliance, securing more stable market-equity funding. We also find that Paytech firms increased their liquidity holdings, reduced their labor intensity while increasing their labor costs and enhanced their productivity. Our results contribute to the literature on open banking by providing empirical evidence of its benefits for fintech firms, particularly in the payment sector, and underscore the importance of regulatory frameworks in fostering innovation and competition. These insights are valuable for policymakers aiming to enhance financial sector dynamics through data-driven regulations. |
| Keywords: | open banking, fintech, payments, PSD2 |
| JEL: | L22 G23 C63 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:bde:wpaper:2514 |
| By: | Paulo Bastos; Katherine Stapleton; Daria Taglioni; Wei, Hannah Yi |
| Abstract: | This study examines the role of multinational firms and global value chain linkages in the cross-country diffusion of emerging technologies. The analysis combines detailed information on the near-universe of online job postings in 17 countries with data on multinational networks and firm-to-firm linkages from 2014 to 2022. Online job postings are utilized to investigate how jobs related to emerging technologies spread through firm networks. The findings show that emerging technology jobs are highly concentrated within multinational firms and their supply chains. Approximately one third of all emerging technology job postings during this period come from Fortune 500 firms, their affiliates, buyers, suppliers, or innovation partners. Although the locations where these technologies originate exhibit a higher prevalence of technology job openings, this advantage diminishes over time as diffusion accelerates in wealthier and geographically closer countries and regions. The study highlights the significant role of firm-to-firm linkages in technology diffusion, with some linkages proving more influential than others. Firms that were previously buyers or innovation partners of establishments in technology-originating locations experienced faster growth in jobs related to these technologies. Moreover, relationships outside corporate boundaries play a particularly critical role, and these connections are influential beyond the factor of geographical distance. |
| Date: | 2024–09–11 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wbrwps:10905 |
| By: | Koetter, Michael; Nguyen, Huyen; Uzonwanne, Sochima |
| Abstract: | This paper examines how firms' exposure to supply chain disruptions (SCD) affects firm outcomes in the European Union (EU). Exploiting heterogeneous responses to workplace closures imposed by sourcing countries during the pandemic as a shock to SCD, we provide empirical evidence that firms in industries relying more heavily on foreign inputs experience a significant decline in sales compared to other firms. We document that external finance, particularly bank financing, plays a critical role in mitigating the effects of SCD. Furthermore, we highlight the unique importance of bank loans for small and solvent firms. Our findings also indicate that highly diversified firms and those sourcing inputs from less distant partners are less vulnerable to SCD. |
| Keywords: | bank debt, external finance, firm sales, supply chains, supply chain disruptions |
| JEL: | D22 F14 G21 L14 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:iwhdps:311193 |
| By: | Guillermo Javier Vuletin; James Sampi; J.T. Araujo |
| Abstract: | This paper examines how the concentration of large firms influences the fiscal multiplier effects of public investment in transport infrastructure. Using data from 1, 891 Peruvian municipalities and firm-level information, the analysis exploits a quasi-experimental setting stemming from an exogenous change in the Municipality Compensation Fund in 2010, Peru's primary fiscal transfer mechanism from the central government to subnational authorities. The findings show that public investment generates a positive fiscal multiplier four years after implementation, with a temporary adjustment occurring two years earlier. The multiplier is significantly higher in municipalities with a greater concentration of large firms, highlighting the role of firm concentration in amplifying fiscal shocks. These results suggest that fiscal resources may be more effectively targeted to municipalities with a higher concentration of large firms, where the impact of public investment is stronger, and that policies promoting firm growth can enhance the effectiveness of fiscal policy by increasing the multiplier. |
| Date: | 2024–12–11 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wbrwps:10997 |
| By: | Francisco Moraes Leitao Campos; Frese, Michael; Leonardo Iacovone; Hillary C. Johnson; David McKenzie; Mensmann, Mona |
| Abstract: | A randomized experiment in Togo found that personal initiative training for small businesses resulted in large and significant impacts for both men and women after two years (Campos et al, 2017). This paper revisits these entrepreneurs after seven years, and finds long-lasting average impacts of personal initiative training of $91 higher profits per month, which is larger than the 2-year impacts. However, these long-term impacts are very different for men and women: the impact for men grows over time as they accumulate more capital and increase self-efficacy, whereas the impact for women dissipates, and capital build-up is much more limited. |
| Date: | 2024–10–01 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wbrwps:10938 |