Entrepreneurship http://lists.repec.org/mailman/listinfo/nep-ent Entrepreneurship 2026-03-02 The hidden cost of venture capital https://d.repec.org/n?u=RePEc:zbw:cbscwp:336737&r=&r=ent Founders, employees, consumers, and even funders increasingly expect businesses to pursue social goals alongside financial performance. Yet even the most committed firms have found it difficult to maintain social performance over time. Scholars in economics, management, and law have put forth several explanations for this "mission drift, " including inappropriate governance, poor management, lack of genuine commitment, and threat of takeovers. Puzzlingly, research to date primarily focuses on later-stage firms, even though the events and decisions that take place in a firm's early stages can critically impact retention of its social performance. Drawing from over five years of qualitative field research at six firms, this Article argues that a company's early-stage financing can have lasting consequences for social performance. I find that the structure of VC - the most prestigious and coveted form of startup funding - shifts organizational focus toward prioritizing rapid growth and exit, implicitly crowding out firm social performance. I find this dynamic occurs even when VCs package themselves as "impact investors" committed to preserving social performance. This study underscores the need to reorient impact VC models and startup corporate governance to avoid losing sight of social aspirations. It also has implications for corporate law and finance more broadly, challenging whether the current legal system operates optimally to achieve efficiency, promote innovation, and serve societal goals. Aguirre, Emilie 2025 Study on barriers to the creation and growth of SMES and their participation in public procurement https://d.repec.org/n?u=RePEc:awo:epaper:e/cnmc/004/23_eng&r=&r=ent SMEs are a key element for the efficient and competitive functioning of the Spanish economy. This Study identifies problems that affect them in their process of creation, growth and participation in public procurement, and puts forward recommendations for improvement. First, it recommends promoting a more integrated and pro-competitive market, by coordinating regulations and encouraging the use of model ordinances. Second, it calls for facilitating business creation by strengthening the operation, efficiency and dissemination of CIRCE and the PAE network, and by promoting regulatory sandboxes. Third, it advocates for a regulatory framework that supports business growth by tailoring obligations for SMEs and avoiding threshold effects. Fourth, it recommends steering public policies toward competition and growth by applying the “once-only” principle and implementing pro-competitive support and aid schemes. Fifth, it calls for strengthening measures to combat late payments. With regard to public procurement, the Study recommends reinforcing a pro-competitive approach in the planning, preparation and design of tenders; facilitating the submission of bids; reducing burdens during contract execution; ensuring that contracting authorities are provided with sufficient resources; and reviewing and simplifying the regulatory framework. Finally, it recommends seeking advice from the CNMC. Comisión Nacional de los Mercados y la Competencia (CNMC) Regulation, Business creation, Business growth, Public procurement 2026-01-13 Subsidy for the First Hires and Firm Performance https://d.repec.org/n?u=RePEc:ces:ceswps:_12484&r=&r=ent This paper studies how employment subsidies for start-ups shape their performance. We exploit an unexpected policy reform in Belgium that permanently exempted start-ups hiring their first employee from payroll taxes for that employee. Using firm-level administrative data and a regression-discontinuity-in-time design, we find that subsidized post-reform startups employed fewer workers and generated lower output, value added, and profits compared to pre-reform start-ups. However, post-reform start-ups were more likely to survive as employers. These effects emerged within the first year after hiring and remained stable over a medium horizon of three years. Our findings indicate a compositional shift: the subsidy primarily induced low-productivity firms to enter the market. As most firms nowadays are nonemployers, our results meaningfully generalize the theoretical implications of standard neoclassical entrepreneurship models (employee–employer margin) and fill the important gap of the nonemployer–employer margin. Haotian Deng Sam Desiere Bart Cockx Gert Bijnens entrepreneurship, start-up, employment subsidy, tax reduction, labor demand; small firms 2026 Zombie Firms and Competition https://d.repec.org/n?u=RePEc:ahy:wpaper:wp65&r=&r=ent The phenomenon of zombie firms has been increasing through time in the last decades. Prior re search has extensively examined the role of zombie firms in credit misallocation and weak insolvency regimes However, limited attention is paid to how the competitive environment has influenced its surge. The study aims at linking the diffusion of zombie formation with the field of industrial dynam ics. The analysis focuses on whether the intensity of competition influences the diffusion of zombie f irms, by assessing competition forces such as firm entry and innovation intensity. We use micro aggregated data at the region-sector level to analyse the diffusion of zombie firms in Italy for the years from 2014 to 2020, and identify a substantive role of reallocation forces in driving the shares of zombie firms. Competition in the form of entry and, albeit more weakly, innovation intensity reduces the diffusion of zombie firms, ultimately showing that a decrease in competition intensity is part of the phenomenon. This research contributes to understanding the relationship between zombie firms and sluggish economic activity, describing further factors that affect their formation and persistence. Francesco Androni Andrea Ascani Alberto Marzucchi Zombie firms; competition; firm entry; innovation; industrial dynamics 2026-02 Cross-Regional Venture Capital Flows in Europe https://d.repec.org/n?u=RePEc:bda:wpsmep:wp2025/46&r=&r=ent Using a newly constructed dataset, this paper investigates the determinants of cross-regional venture capital (VC) flows within Europe through a structural gravity model Asdrubali, Pierfederico Testa, Giuseppina venture capital; cross-regional investment; structural gravity model, PPML, European regions, fixed effects 2025-07 Debt financing gap for SMEs in Europe https://d.repec.org/n?u=RePEc:bda:wpsmep:wp2025/45&r=&r=ent This paper assesses the debt financing gap for SMEs, which undermines their competitiveness and leads to sub-optimal investments Raab, Georg 2025-09 The determinants of access to credit for Small and Medium Enterprises (SMEs): Evidence from Uzbekistan https://d.repec.org/n?u=RePEc:pra:mprapa:127588&r=&r=ent This study examines the determinants of access to bank financing for enterprises in Uzbekistan, addressing both the decision to apply for credit and the probability of approval conditional on applying. Using World Bank Enterprise Survey data (n=1, 008 enterprises), we employ a twostage analytical framework: binary logit regression models examine factors associated with having an existing loan, and Heckman probit selection models jointly estimate the loan application decision and approval probability, accounting for potential selection bias. The study reveals severe credit rationing in Uzbekistan, with only 13.3% of enterprises holding bank loans and 10.1% applying for new credit. The most striking finding is the dominant effect of existing banking relationships: enterprises with current loans achieve 87.0% approval rates compared to 41.7% for first-time applicants. The Heckman outcome equation confirms this relationship banking effect, representing approximately 30-35 percentage point higher approval probability. Medium-sized enterprises enjoy substantial advantages in both application propensity and approval probability. Export activity and checking account ownership significantly enhance credit access. Contrary to international evidence, female-managed enterprises show positive approval coefficients, though statistical significance is marginal. The highly significant selection parameter confirms substantial selection bias, validating the Heckman approach. Bobojanov, Shakhrukh Ilyosov, Imron SME financing, Credit access, Heckman selection model, Relationship banking, financial inclusion, Transition economies, Uzbekistan 2026-01 MSME Resilience in the Face of COVID-19 and Beyond: A Meta-Analysis of Factors that Influence MSME Resilience https://d.repec.org/n?u=RePEc:lpe:wpaper:202582&r=&r=ent This study investigates the resilience of Micro, Small, and Medium Enterprises (MSMEs) during the COVID-19 pandemic by analyzing firm characteristics and entrepreneurial competencies. Utilizing a meta-analysis approach, 60 literature studies and 425 empirical estimates were examined. The findings reveal that entrepreneurial competence, encompassing entrepreneurial orientation, networking and social capital, and human capital, significantly enhances MSME resilience more than firm characteristics such as firm size, business age, and financial capital. Additionally, technological utilization and cultural aspects (uncertainty avoidance, individualism, and motivation towards achievements and success) were assessed as moderating factors. The results indicate that robust ICT infrastructure, proficiency, and utilization, along with supportive policies, bolster MSME resilience. The study also underscores the negative impact of high uncertainty avoidance and individualism on resilience, whereas motivation towards achievement and success positively influences resilience. The analysis of Indonesian MSMEs, incorporating 26 literature studies and 91 empirical estimates, corroborates these findings, highlighting the greater impact of entrepreneurial competence. The study suggests the need for targeted policies and support programs to enhance MSME resilience through technological and cultural adaptation. Admiral Athallah Darmawan Jahen Fachrul Rezki MSME resilience — entrepreneurial competence — firm characteristics — meta-analysis 2025 Weathering the Storm: Examining the Resilience of Small and Micro Firms in Indonesia During the COVID-19 Pandemic https://d.repec.org/n?u=RePEc:lpe:wpaper:202585&r=&r=ent This paper examines the resilience of small and micro enterprises (SMEs) in Indonesia during the COVID-19 pandemic using panel data from the Micro and Small Industry Survey (VIMK) conducted by the Central Bureau of Statistics (BPS) in 2019, 2021, and 2022. By employing firm-level panel regressions based on 2-digit KBLI classifications and size categories, the study identifies key structural and behavioral factors associated with firm performance during the crisis period. The results reveal that digital adoption—measured by the use of digital marketing and online sales—is a critical driver of resilience for small firms. The study contributes to the growing body of evidence on how digital strategies can buffer SMEs against external economic shocks and support their post-crisis recovery. Dhaniel Ilyas Small and Micro Enterprises (SMEs) — Resilience — COVID-19 — Digital Adoption 2025 Entrepreneurial Coaching and Migration Intentions: Evidence from a Randomized Controlled Trial in Senegal https://d.repec.org/n?u=RePEc:ces:ceswps:_12486&r=&r=ent This paper investigates the impact of a one-week entrepreneurial coaching program on overall and irregular migration intentions among young adults in the Dakar metropolitan area, Senegal. Using a randomized controlled trial implemented in partnership with an entrepreneurship training center in Dakar, we estimate treatment effects by comparing baseline and follow-up outcomes and address partial compliance using instrumental-variable methods. We find that participation in entrepreneurial coaching reduces emigration intentions by 12–20%, with effects concentrated among individuals connected to the labor market. The program indirectly reduces intended irregular migration by encouraging some individuals to remain in Senegal. We do not find that participation affected the migration mode of those who still intend to migrate. Overall, our findings provide experimental evidence from Senegal that entrepreneurship-based active labor market policies can shape migration aspirations by strengthening local economic attachment among working youth. Michel Beine Arnaud Bourgain Elisabeth Kempter Melissa Tornari migration intention, migration deterrence, randomized experiment, entrepreneurship, irregular migration, Sub-saharan Africa 2026 Redes de apoyo a las pymes locales y desempeño innovador: evidencia de una región en América Latina https://d.repec.org/n?u=RePEc:ulr:wpaper:dt-18-25&r=&r=ent This study aims to analyze the innovation processes of SMEs in the Canelones region, Uruguay, with a particular focus on the role of support organizations (SOs). The analysis draws on data from SME surveys conducted in 2023 and 2024, as well as a survey of SOs. A combination of econometric techniques, social network analysis, and qualitative data analysis from the surveys is employed to examine the factors associated with different forms of innovation among SMEs and the role of SOs. The findings reveal that innovation is not a widespread practice among SMEs, within a context of low inter-firm collaboration, significant challenges related to unfair competition, fixed and labor costs, and a predominant orientation toward local markets. Nevertheless, a dense and well-coordinated network of SOs is identified, actively working to support SME development. In fact, SME engagement with SOs emerges as one of the most significant factors in increasing the likelihood of innovation. The results also indicate an opportunity to strengthen SO actions in the context of the green transition (sustainability) and digitalization, in order to inform policies aimed at enhancing local innovation networks. Canelones could serve as a suitable region for implementing such policies and monitoring their outcomes, building on an already existing and well-integrated SO network. Pablo Galaso Sergio Palomeque Adrián Rodríguez Miranda innovation, SMEs, support organizations, cooperation networks, Uruguay, Latin America 2025-08 Resultados de la Encuesta de Actividad Empresarial del Departamento de Canelones 2024 (3era edición) https://d.repec.org/n?u=RePEc:ulr:wpaper:dt-17-25&r=&r=ent The purpose of this document is to present the methodology and analyze the findings of the 2024 Business Activity Survey of the Department of Canelones. The survey was carried out among micro, small, and medium-sized enterprises (MSMEs) in Canelones, as part of a project funded by the National Development Agency (Agencia Nacional de Desarrollo, ANDE) and a cooperation agreement between the Canary Business Chamber (Cámara Empresarial Canaria, CEC), the Government of Canelones through the Canary Center for Strategic Studies (Centro de Estudios Estratégicos Canario, CEEC), and the University of the Republic (Facultad de Ciencias Económicas y Administración, FCEA). This study builds on the work initiated with the previous edition of the survey, continuing the process of generating and analyzing data to enhance the understanding of business development dynamics in the department of Canelones and its territories. Reliable data are essential for the planning and design of departmental policies by both public and private stakeholders. The information presented includes, among other topics, the geographic distribution of clients and markets, the origin of suppliers and workers, cooperation networks for innovation, training activities, and the relationships between firms and support organizations. The study also identifies the main challenges facing business activity in the region, including digitalization and environmental concerns. The survey results offer novel insights that help to challenge prior assumptions and support more informed decision-making. Sergio Palomeque Martín Pérez Fernández Adrián Rodríguez Miranda Small and medium-sized enterprises (SME), Canelones, Uruguay, local development, regional economy 2025-07