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on Entrepreneurship |
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Issue of 2005‒11‒19
eleven papers chosen by Marcus Dejardin Facultés Universitaires Notre-Dame de la Paix |
| By: | Silvia Gorenstein (UNSUR); Raul Dichiara (UNSUR); Gustavo Burachik (UNSUR); Andrea Castellano (UNSUR); Federico Castellano (UNSUR) |
| Abstract: | We study post entry performance of manufactuirng firms in 3 municipalities of Buenos Aires province, borned between 1990 and 1999. The aim of the paper is to identify main factors explaining firm growth. The focus is directed to endogenous determinants of firm performance, individual or local as well, taking into account the growing interest those elements are receiving in recent literature about local development. The results show that firm tradability grade is the key variable explaining performance. This factor is strongly influenced by entrepreneur´s profile but also by macroeconomic context. |
| Keywords: | local development, new firms, firm performance, tradability |
| JEL: | L |
| Date: | 2005–11–15 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpio:0511009&r=ent |
| By: | Amelie Constant (IZA Bonn); Yochanan Shachmurove (Department of Economics, University of Pennsylvania); Klaus F. Zimmermann (Bonn University, IZA and DIW Berlin) |
| Abstract: | This paper addresses a central issue to migration the role of immigrants in entrepreneurial activity. In particular, the paper focuses on the determinants of the decision to become an entrepreneur for Turks living in Germany. The paper provides some important benchmarks, including the self-employment behavior of natives. The paper utilizes a comprehensive and reliable data base, the German Socioeconomic Panel to undertake systematic econometric analyses using appropriate statistical methods. The findings are that observable characteristics play different roles in the self-employment choice of immigrants and natives, whereas age-earnings profiles are similar for native and immigrant entrepreneurs. |
| Keywords: | Entrepreneurship, Self-employment, Immigration, Guest-workers, Turkey, Germany, European Union, German Socioeconomic Panel Data, Binomial Logit, Treiman international occupational prestige scale. |
| JEL: | J0 C23 C25 F22 J23 J61 |
| Date: | 2005–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:pen:papers:05-029&r=ent |
| By: | Baeyens, K.; Vanacker, T.; Manigart, M. |
| Abstract: | The paper analyses venture capitalists’ selection process in biotechnology ventures. Biotech ventures operate in an extremely risky environment making this an interesting research setting. The majority of venture capitalists exclude certain biotech sectors ex-ante because of regulatory uncertainty, the long development process to a market ready product and the difficulty to understand the technology. The more thorough due diligence process focusses on financial, market and technology criteria. Management team capabilities are more important for later stage investors, whereas early stage investors expect to have an impact on the future recruiting of professional managers. Despite the higher risk of biotech investments, we find no evidence that VCs require higher hurdle rates or more complete contracts for these investments, compared to investments in other technology-based companies. The most important reason for not reaching an investment agreement is disagreement over valuation, due to large differences in risk perception between entrepeneurs and venture capitalists and the lack of a standard valuation tool for biotech projects. |
| Keywords: | venture capital; selection process; biotechnology |
| Date: | 2005–11–05 |
| URL: | http://d.repec.org/n?u=RePEc:vlg:vlgwps:2005-17&r=ent |
| By: | Luigi Benfratello (Università di Torino); Fabio Schiantarelli (Boston College); Alessandro Sembenelli (Università di Torino) |
| Abstract: | This paper contains a detailed empirical investigation of the effect of local banking development on firms' innovative activities, using a rich data set on innovation at the firm level for a large number of Italian firms over the 90's. There is evidence that banking development affects the probability of process innovation, particularly for small firms and for firms in high(er) tech sectors and in sectors more dependent upon external finance. There is also some evidence that banking development reduces the cash flow sensitivity of fixed investment spending, particularly for small firms, and that it increases the probability they will engage in R&D. |
| Keywords: | Banks, Financial Development, Innovation, R&D, Investment |
| JEL: | D24 G21 G38 |
| Date: | 2005–10–30 |
| URL: | http://d.repec.org/n?u=RePEc:boc:bocoec:631&r=ent |
| By: | Viego Valentina (UNSUR) |
| Abstract: | This paper offers a review of the main progress made in entrepreneurship analysis and institutional economics, discussing its possible integration to general theory of economic development, considering the increasing importance that these topics have gained in contemporary approaches of terriorial development. |
| Keywords: | entrepreneurship, institutions, local economic development |
| JEL: | R |
| Date: | 2005–11–15 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpur:0511007&r=ent |
| By: | Mair, Johanna (IESE Business School); Schoen, Oliver (IESE Business School) |
| Abstract: | Although social entrepreneurial organizations have begun to receive more scholarly attention, we still know relatively little about how they are able to create both social and economic value. This paper presents a comparative case analysis of three social entrepreneurial organizations, based in Bangladesh, Egypt and Spain, whose success has been widely recognized. Analysis of these organizations' business models reveals common patterns: in their use of strategic resources, in their value networks, and in their customer interface. The findings suggest that successful social entrepreneurial organizations pro-actively create their own value network of companies that share their social vision; develop resource strategies as an integral part of the business model; and integrate the target group into the social value network. Propositions are advanced regarding the business models of successful social entrepreneurial organizations. |
| Keywords: | social entrepreneurship; business model; developing countries; |
| Date: | 2005–10–07 |
| URL: | http://d.repec.org/n?u=RePEc:ebg:iesewp:d-0610&r=ent |
| By: | Seelos, Christian (IESE Business School); Mair, Johanna (IESE Business School) |
| Abstract: | This paper demonstrates that entrepreneurs who have created innovative organizations and service provision models are contributing to sustainable development. The processes, structures and outcomes of their initiatives are contrasted with more traditional efforts. World leaders have recently renewed the momentum for 'buying' sustainable development through massive allocation of development funds. The authors argue that such traditional approaches have repeatedly failed in the past and are unlikely to overcome the more fundamental hurdles to create development. Building on the findings of a three-year research project, the paper presents case studies which demonstrate how so-called 'social entrepreneurs' succeed in creating social and economic development in a poor country context. The process of discovery and creation from the ground up, in contrast to traditional design-driven development processes and strategies, is illustrated. The cases show how social entrepreneurs cater to various levels of needs: the basic needs of individuals, the institutional needs of communities, and the needs of future generations. The impact of social entrepreneurial activity on sustainable development measures such as the Millennium Development Goals is demonstrated. The findings suggest that social innovation may change the very structures and systems that recreate the circumstances for poverty and that development processes need to consider the link between social and economic development. |
| Keywords: | social entrepreneurship; sustainable development; |
| Date: | 2005–10–19 |
| URL: | http://d.repec.org/n?u=RePEc:ebg:iesewp:d-0611&r=ent |
| By: | Andy Cosh; Xiaolan Fu; Alan Hughes |
| Abstract: | This paper explores the impact of management characteristics and patterns of collaboration on a firmÕs innovation performance in transforming innovation resources into commercially successful outputs. These questions are investigated using a recent firm level survey database for 465 innovative British small and medium enterprises (SMEs) over the years 1998-2001. Both Data Envelopment Analysis (DEA) and Stochastic Frontier Analysis (SFA) are employed to benchmark a firmÕs innovative efficiency against best practice. Quality and the variety of innovations are taken into account by combining Principal Component Analysis (PCA) with DEA. We find evidence suggesting that the innovative efficiency of SMEs is significantly affected by their management characteristics and collaboration behaviour. Collaboration, organisational flexibility, formality in management systems and incentive schemes are found to contribute significantly to a firmÕs innovative efficiency. Managerial share-ownership also shows some positive effect. The importance of these effects, however, varies across different sectors. WE find that innovative efficiency in high-tech SMEs is significantly enhanced by collaboration, formal management structure and training; and that in medium- and low-tech SMEs is significantly associated with managerial ownership, incentive schemes and organisational flexibility. |
| Keywords: | management characteristics, collaboration, innovative efficiency |
| JEL: | D24 O30 O32 L20 M11 |
| URL: | http://d.repec.org/n?u=RePEc:cbr:cbrwps:wp311&r=ent |
| By: | Maria Jesus Nieto; Lluis Santamaría |
| Abstract: | In the current competitive scenario, firms are driven to introduce products with a higher degree of novelty. Consequently, there is a growing need to understand the critical success factors behind radical innovation. Specifically, this work empirically and theoretically analyses the role of different types of collaborative networks in achieving product innovation and, more precisely, the degree of novelty. Using a longitudinal data of Spanish manufacturing firms, our results show that the continuity on the co-operative strategy, the type of partner and the diversity of collaborative networks are critical factors in achieving a higher degree of novelty in product innovation. |
| URL: | http://d.repec.org/n?u=RePEc:cte:wbrepe:wb056516&r=ent |
| By: | Willi Semmler; Mika Kato (Department of Economics Howard University) |
| Abstract: | Recent literature in Industrial Organization has shown that the threat of entry limits the price setting power of dominant firms and stimulates the incumbents to increase innovations ---both leading to welfare improvements. On the other hand dominant firms as incumbents strive to build up entry preventing capital. In such an environment of heterogeneous firms, we study the dynamics of competition as suggested in an earlier paper by Brock (1983). When dominant firms face a threat of the competitive fringe’s entry in the industry they, therefore, will have an incentive to prevent it. Investing into barriers to entry capital through engaging in production activities with increasing returns and high adjustment cost of investment as well as through advertising, lobbying and patents the dominant firm can create thresholds above which fringe firms cannot induce price competition and stimulate innovations. The dominant firms thus face two types of investment: Entry-deterring investment and investment in physical capital for production activities. Depending on how the competitive fringe responds to the first type of investment, complex dynamics, multiple steady states and thresholds, separating different domains of attraction, may emerge. Since the effectiveness of entry-deterring investment depends in part on regulatory rules set and enforced by antitrust institutions, we show how an antitrust and competition policy can be designed that may prevent the build up of entry preventing capital strengthening incentives for price competition and innovations |
| Keywords: | entry-deterring investment |
| JEL: | L1 L4 |
| Date: | 2005–11–11 |
| URL: | http://d.repec.org/n?u=RePEc:sce:scecf5:194&r=ent |
| By: | basab dasgupta (economics university of connecticut) |
| Abstract: | Credit markets with asymmetric information often prefer credit rationing as a profit maximizing device. This paper asks whether the presence of informal credit markets reduces the cost of credit rationing, that is, whether it can alleviate the impact of asymmetric information based on the available information. We used a dynamic general equilibrium model with heterogenous agents to assess this. Using Indian credit market data our study shows that the presence of informal credit market can reduce the cost of credit rationing by separating high risk firms from the low risk firms in the informal market. But even after this improvement, the steady state capital accumulation is still much lower as compared to incentive based market clearing rates. Through self revelation of each firm's type, based on the incentive mechanism, banks can diversify their risk by achieving a separating equilibrium in the loan market. Incentive mechanism helps banks to increase capital accumulation in the long run by charging lower rates and lending relatively higher amount to the less risky firms. Another important finding of this study is that self revelation leads to very significant welfare improvement, as measured by consumption equivalence |
| Keywords: | informal credit and capital accumulation |
| JEL: | O16 O17 |
| Date: | 2005–11–11 |
| URL: | http://d.repec.org/n?u=RePEc:sce:scecf5:366&r=ent |