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on Small Business Management |
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Issue of 2025–12–01
twelve papers chosen by João Carlos Correia Leitão, Universidade da Beira Interior |
| By: | Massimiliano Mazzanti (Università degli studi di Ferrara); Alessandro Montanaro (Università degli studi di Ferrara); Fabiola Onofrio (Università degli studi di Ferrara); Emy Zecca (Università degli studi di Ferrara) |
| Abstract: | This work investigates sustainability-oriented innovation among Italian small and medium-sized enterprises (SMEs) within the broader context of the European twin transition toward sustainability and digitalization. Based on survey data from 740 manufacturing firms, it analyses the diffusion of research and development activities, digital technologies, and circular economy practices across firm sizes and regions. The results reveal a persistent dualism: medium and large firms, mostly located in northern regions, show higher levels of innovation and digital adoption, while smaller firms remain limited by financial and structural constraints. Circular innovation largely focuses on efficiency measures, whereas advanced strategies such as eco-design remain rare. Digitalization acts as both a driver and an enabler of sustainable transformation but progresses unevenly across territories. |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:srt:wpaper:1225 |
| By: | Mahmut Zeki Akarsu (College of Economics and International Trade, Pusan National University, Busan, Korea); Cassidy Hruz (Department of Economics, College of Business Administration, University of Central Florida); Zeynep Yom (Department of Economics, Villanova School of Business, Villanova University) |
| Abstract: | This paper examines how firms adjust their innovative activities during recessions and whether they learn from past downturns. Using COMPUSTAT data linked with patent and citation information, we analyze U.S. firms across four major recessions and test whether R&D expansion in one recession predicts R&D investment in the next. Exploiting recessions as exogenous shocks to the economy for identification, we find that firms performing above the median during the 2001 recession invested substantially more in R&D during the Great Recession. These learning effects are stronger for small firms, firms with high bond ratings, and those in high-technology or high-opportunity sectors, and weaker in concentrated industries. Earlier recessions also have a persistent, though gradually diminishing, effect on later downturns. Instrumental-variables and propensity-score-matching analyses confirm that these patterns reflect a learning mechanism consistent with creative accumulation. |
| Keywords: | R&D, innovation, patents, business cycles, COMPUSTAT |
| JEL: | E32 G30 O32 |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:vil:papers:62 |
| By: | Paul Winter; Hilary Devine; John Janssen; Chris Thompson (The Treasury) |
| Abstract: | New Zealand has not seen the same growth in productivity as comparable countries. Increased capital intensity and higher levels of innovation are pathways to greater productivity growth that are closely connected. Investment in more technologically sophisticated capital could contribute to productivity improvements along both pathways at once. New Zealand has relatively low capital intensity, with the high cost of capital a contributing factor. Though New Zealand’s investment rate has tracked with other advanced economies, it has not kept pace with rising labour utilisation, leaving the country capital shallow. Innovation increases an economy’s productivity by allowing for a more efficient mix of capital and labour. Improved technology is one route to greater innovation. Technology can be created anew or adopted from elsewhere. Neither creation nor adoption is unambiguously preferable from a productivity perspective. The optimal combination of creation and adoption in supporting productivity depends on context. We set out a number of reasons why adoption through capital investment may be an important path to innovation in New Zealand. New Zealand creates technology at a lower rate than comparable economies, in part because its Research and Development (R&D) expenditure is lower. New Zealand also struggles to convert R&D activity into outputs and broader productivity benefits. Although some business R&D appears an exception to this rule, New Zealand-specific evidence is limited, which makes it difficult to be definitive about the productivity benefits of R&D. Adopting and adapting new technologies, including through capital investments, typically costs less than creating them. Adopting new technologies is shown to have strong positive effects on productivity, and could potentially benefit a large share (up to 95%) of New Zealand firms. Given New Zealand’s struggle to create technology, greater adoption from overseas could form a crucial part of the country’s optimal approach to innovation. At the same time, a dynamic and, to some extent, complementary relationship may exist between creation and adoption – suggesting stronger adoption of new technology may enhance domestic scientific activity. Despite adopting some general-purpose digital technologies at a pace similar to comparable countries, there are signs that technology diffusion (the aggregate economy-wide rate of firm-level technology adoption) is low and slowing. To better understand opportunities for increasing diffusion, we capture in a framework the key factors that affect diffusion and their links to capital investment. We organise the framework around three firm-level factors: exposure and access to new technology, incentives to adopt new technology, and capacity to adopt new technology. We find there are four common channels that directly affect technology diffusion and capital intensity: importing, foreign investment, input costs, and access to finance. New Zealand appears, based on initial assessment, to be weaker than the OECD average across all four channels. Improvements on these channels and across framework settings (such as, competition), could boost productivity growth by lifting both capital intensity and innovation. The fundamental implication is that policy focussing exclusively on technology creation may miss a key pathway to greater innovation: diffusion through new capital investment. Equally, policies exclusively focussed on capital intensity may miss the role of investment in increasing innovation and lifting the technological sophistication of the capital stock. |
| JEL: | D24 E22 O3 O4 O56 O57 |
| Date: | 2025–10–31 |
| URL: | https://d.repec.org/n?u=RePEc:nzt:nztans:an25/12 |
| By: | Woolford Jayne (European Commission - JRC); Haegeman Karel (European Commission - JRC); Hazelkorn Ellen; Cavicchi Alessio; Kroll Henning |
| Abstract: | "Debates upon the place-based dynamics of transformative innovation insist upon directionality across regional, national and EU innovation policies and ecosystems, and multi-actor, -funding and -sector synergies. The potential role and contribution of higher education to boost Europe’s competitiveness is reflected across numerous EU policy initiatives that seek to strengthen their entrepreneurial and innovative capacity and their integration into transformative territorial innovation, recognising the interaction between innovation and education policies, both locally and transnationally, as key in maximising capabilities.The engagement of education actors and the nature of skills and human capital requirements will be context-specific or place-based, varying depending not only on the specific territorial challenge and reality, but also the capacity, experience, culture, governance and incentives of different higher education systems and individual institutions. An understanding of the ecosystem and its various constituent parts and their inter-connections, including that of the entire education and innovation system within the broader organisational and policy context, is vital in ensuring directionality and alignment of multiple actors and functions. Frameworks for reflection and pathways for action for higher education within place-based transformative innovation have therefore been proposed, to support higher education and other territorial actors to re-think their activities and portfolio in relation to the changing educational and innovation paradigms and to support and drive systemic transformation." |
| Date: | 2025–10 |
| URL: | https://d.repec.org/n?u=RePEc:ipt:trater:202502 |
| By: | Owen Gabourys; Farrukh Suvankulov; Mathieu Utting |
| Abstract: | This paper replicates and extends the work of Altig et al. (2022) on firms’ subjective sales growth expectations using Canadian survey data from the Bank of Canada’s Business Leaders’ Pulse. We examine the formation, uncertainty and predictive validity of firm-level sales growth forecasts using subjective probability distributions from business leaders at a one-year-ahead horizon. The replication work performed here confirms several findings from Altig et al. (2022), including that expected sales growth predicts realized sales growth, subjective uncertainty predicts forecast errors and firms frequently revise their expectations, usually by small amounts. We also find that subjective uncertainty predicts the magnitude of forecast revisions and follows a V-shaped relationship with past sales growth. We extend the original analysis by further demonstrating that firms with weaker recent performance assign greater weight to future weak growth scenarios, and subsequently that these firms are more likely to underperform, suggesting expectations are grounded in real conditions. The results presented in this paper reinforce the value of firm-level survey data for macroeconomic forecasting and policy analysis and help validate the Business Leaders’ Pulse as a reliable source of firm-level expectations data. |
| Keywords: | Firm dynamics Monetary policy and uncertainty |
| JEL: | C8 C83 D D2 D22 |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:bca:bocadp:25-15 |
| By: | Hilary Devine; Finn Smith (The Treasury) |
| Abstract: | New Zealand has experienced a significant and persistent slowdown in productivity growth over the last decade. While many advanced economies have experienced this slowdown, New Zealand has been more adversely affected due to consistently lower than OECD-average labour productivity. Treasury (2024) looked at the drivers of New Zealand’s productivity slowdown, but did not examine the industry sources of our slowing productivity growth. This paper fills a gap by quantifying the productivity slowdown through shift-share decomposition to examine the sources by industry. The analysis captures the shift of firm productivity within each industry, the shift of labour between low and high labour productivity industries, and the shift of labour between low and high labour productivity growth industries. This type of analysis has not been published in New Zealand for over a decade (see Meehan, 2014). The updated analysis includes a more up-to-date data set which captures the effect of two significant shocks – the Global Financial Crisis (GFC) and COVID-19 pandemic. We find that New Zealand’s labour productivity slowdown is broad based across industries. Overall our results are similar to Meehan (2014), showing that New Zealand’s slowing labour productivity growth is primarily due to low within-industry labour productivity growth, where the distribution of firm productivity plays a significant role in explaining within-industry effects (Syverson, 2011). The across industry effect is small and has mixed effects, but shows on average stronger reallocation towards low labour productivity industries over the period, resulting in a drag on overall labour productivity growth. We also look at the reallocation trends across the OECD to see if they reflect similar dynamics, particularly in light of large economic shocks (eg, GFC and COVID-19). Other OECD countries have seen a gradual increase in aggregate labour productivity growth since the GFC in contrast to New Zealand’s slowing growth over this period. Between 2012 and 2021, 18 of the 27 sample countries exhibit an increasing trend, including 6 of the 8 Small Advanced Economies (SAE’s). Much like New Zealand, the within-industry effect dominates for the OECD. However, the OECD average also has positive across-industry effects, which appear to be consistent among individual sample countries. Some caution is needed when interpreting these results due to data and comparability issues. Differences in structural reforms, their timing, and the extent of industry changes across countries complicate cross-economy comparisons. But the results suggests that overall, OECD countries are on average seeing a movement of labour into relatively higher labour productivity industries in contrast to New Zealand. Both New Zealand and the OECD average show evidence of the shift towards a services-based economy, with labour moving out of the Agriculture and Manufacturing industries, and into industries such as Professional, Scientific and Technical Services, Information Media and Telecommunications, and Healthcare. However there is considerable heterogeneity of labour productivity across industries in the service sector. Firm-level analysis would provide richer insights into the within-industry component, as it captures micro-level reallocations including firm entry and exit, labour reallocation between firms, and productivity changes. This approach would reflect reallocation dynamics at the firm level, offering a more granular perspective. Similar analysis in other countries has shown this heterogeneity at the firm level, particularly between frontier and laggard firms (ECB, 2021). Due to data availability, this paper is constrained to industry level insights. Better understanding of these industry and firm dynamics could enhance our knowledge of productivity drivers, particularly how reallocation within industries might align with firms that engage in exporting, innovation, and increased capital investment. The interplay between tradeable and non-tradeable sectors and our ongoing transition to services also deserves attention, as the propensity to export may differ for New Zealand compared with other OECD countries. These are all areas for further work. |
| JEL: | D22 L16 O4 O56 O57 |
| Date: | 2025–10–31 |
| URL: | https://d.repec.org/n?u=RePEc:nzt:nztans:an25/11 |
| By: | Juan S. Mora-Sanguinetti; Cristina Peñasco; Rok Spruk |
| Abstract: | This paper analyses the effect of “green regulations” i.e. those aimed at mitigating the effects of climate change and environmental externalities, on innovation, using a novel regulatory database covering the period 2008 – 2022 for Spain. The database identifies regulations at both the national and regional levels through textual analysis. Employing a panel data approach, we assess how different types of environmental regulations—particularly those related to renewable energy—affect firm-level innovation activities. Our findings indicate that national level green regulations have a positive effect on innovation, whereas regional level regulations show mixed or negligible impacts. Importantly, the interaction between national and regional regulations, measuring the simultaneous production of legal texts at both levels can foster innovation but at a reduced pace with respect to the sole production of regulation at the national level. Given the results for regional-level regulation, our results provide evidence in favour of the hypothesis that regulatory fragmentation due to unequal, overlapping, inconsistent or conflicting procedure across jurisdictions may diminish these benefits. |
| Keywords: | Green Regulation, Innovation, Porter Hypothesis, Renewable Energy, Business |
| JEL: | K32 Q5 O44 O13 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:bfr:banfra:1016 |
| By: | Murunga, Powel |
| Abstract: | he study examined the determinants of fertilizer adoption among small scale crop farmers across Sub-Saharan Africa's regions using a probit regression model and propensity score matching (PSM) technique to assess productivity impacts. Variables analyzed include land tenure, access to credit, access to fertilizer, gender, age, farm size, education, household size, expenditure, and other income sources. Data was obtained from households’ survey data for selected sub-Saharan countries. The countries were also categorized as arid, semi-arid, and non- arid regions. Findings indicated that access to fertilizer increases adoption across all zones, for example by 36.1% in arid areas at 95% confidence level. Access to credit is also significant at 95% confidence level in arid regions, boosting adoption by 6.2%. Land tenure positively affects adoption in semi-arid regions but is insignificant in arid and non-arid areas. Education levels and household expenditure show mixed effects; secondary education negatively affects adoption in arid zones, while higher household expenditure reduces adoption likelihood in semi-arid regions. The PSM analysis conducted showed that fertilizer adoption leads to increased productivity, with adopters experiencing yield increases between 195 kg/acre and 261 kg/acre compared to non- adopters. Policy recommendations to improve fertilizer adoption include enhancing supply chains for timely and affordable access, expanding financial services for smallholder farmers, securing land tenure, and providing targeted education and training programs. These strategies are expected to boost agricultural productivity and smallholder’s farmer livelihoods in arid and semi-arid regions. The study emphasizes on the critical role of fertilizer access in boosting productivity for smallholder farmers and provides actionable insights for policymakers to improve agricultural outcomes in challenging environments. |
| Keywords: | Consumer/Household Economics |
| Date: | 2024–08–07 |
| URL: | https://d.repec.org/n?u=RePEc:ags:iaae24:344322 |
| By: | Mahony, Michael (Central Bank of Ireland); Adhikari, Tamanna (Central Bank of Ireland) |
| Abstract: | Irish SMEs are expected to continue posting positive and stable profit margins under the central scenario for the domestic economy. In an adverse scenario which assumes a sharp deterioration in the global and domestic macro-financial environment driven by heightened geoeconomic tensions, SME profit margins fall sharply. Sectors with the greatest trade exposures suffer the largest drop in profitability. While the adverse scenario projects a large increase in the proportion of loss-making SMEs, the number of firms entering financial distress is more modest. This provides confidence in the resilience of Irish SMEs, even under stress conditions. |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:cbi:stafin:8/si/25 |
| By: | Stephen I Miran |
| Date: | 2025–11–19 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedgsq:102128 |
| By: | Magdalena Adamus (Masaryk University, Faculty of Economics and Administration); Martin Guzi (Masaryk University, Faculty of Economics and Administration); Eva Ballová Mikušková (Slovak Academy of Sciences) |
| Abstract: | The paper investigates gender biases and differential treatment of women and men in the business start-up phase. A sample of 498 entrepreneurs from Slovakia participated in an online experiment and evaluated three fictitious business plans in terms of the applicants’ competence, likeability, and business ability. The start-ups were positioned in three different sectors—cosmetics production, services provision, and software development—where men’s and women’s chances of success may be viewed differently. Following Goldberg’s paradigm, half of the evaluators received business plans presented as written by female and half by male applicants; otherwise the plans were identical. Results imply that female applicants are assessed similarly to male applicants, but more masculine evaluators assess women’s business plans and their potential in entrepreneurship more critically. The study advises caution in recommending more female evaluators in the business plan assessment. If women who become involved in entrepreneurship are excessively masculine and masculinity is associated with a less favourable evaluation of potential female entrepreneurs, such policies could backfire against women, putting them in a more disadvantaged position. |
| Keywords: | gender identity; masculinity; entrepreneurship; start-up; Goldberg paradigm; gender-role theory |
| JEL: | J16 M13 L26 |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:mub:wpaper:2025-07 |
| By: | Oliver, Miquel; López-Fernandez, Daniel |
| Abstract: | Generative AI (GenAI) has rapidly gained traction as a transformative technology, promising to revolutionize business processes across various sectors. However, the gap between theoretical potential and real-world implementation remains substantial, with many enterprises struggling to transition from experimental pilots to scalable applications. This study critically examines 31 GenAI projects from different industries evaluating the strategic, technical and operational factors that influence their success or stagnation. To ensure a methodologically rigorous and comparable analysis, we adopt a mixed-methods approach that integrates primary data—collected through direct project involvement and stakeholder feedback— with secondary data from project documentation, industry reports, and academic research. Our case selection is based on practical exposure to enterprise GenAI implementations, focusing on projects where organizations have actively engaged in experimentation and deployment efforts. Rather than applying rigid selection criteria, we leverage first-hand access to real-world implementations to extract patterns, challenges, and success factors across different organizational contexts. This approach allows us to identify both industry-specific challenges and broader cross-sectoral trends in GenAI adoption. Our findings indicate that most GenAI projects remain stalled at the PoC phase, with organizations facing significant obstacles in scalability, predictability, and enterprise-wide integration. The primary barriers include: (1) Unpredictability of AI outputs, limiting reliability in mission-critical applications; (2) Regulatory, ethical, and legal concerns, particularly in relation to data privacy, intellectual property, and compliance with evolving AI governance frameworks. (3) Fragmented AI strategies within enterprises, leading to siloed innovation efforts and a lack of alignment between technical development and business objectives. Despite these challenges, early indicators of business value are emerging, particularly in process automation, knowledge augmentation, and customer interaction enhancement. However, without robust governance structures, clear strategic alignment, and adaptive technical strategies, enterprises risk failing to realize the long-term benefits of GenAI. This research contributes to both academic and industry discourse by providing a nuanced, multi-sector examination of GenAI implementation. By identifying critical success factors and common failure points, we offer actionable insights for enterprises aiming to transition from experimentation to sustainable deployment. The study ultimately highlights the conditions under which GenAI can move beyond hype to deliver tangible enterprise value, emphasizing the importance of human-AI collaboration, regulatory foresight, and business-driven AI adoption strategies. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:itse25:331294 |