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on Entrepreneurship |
| By: | Michael Fritsch (Friedrich Schiller University, School of Economics and Business Administration); Stefan Krabel (Max Planck Institute of Economics, Entrepreneurship, Growth and Public Policy Group, Jena) |
| Abstract: | In this study we investigate the factors that shape the attitudes of scientists toward starting their own business or working in a private sector firm. The analysis is based on data collected from scientists working in the German Max Planck Society, a research institution devoted to basic science. We find that the scientists' evaluations of the attractiveness of working in a private sector firm or of starting their own business differ considerably according to their academic discipline and the perceived commercial potential of their research. The ability to take risks, prior work experience in private firms, and personal experience with industry cooperation lead to a positive attitude towards switching to private sector employment or entrepreneurship. Strong willingness to freely distribute research findings are related to a low appeal of private sector work. |
| Keywords: | Knowledge transfer, science, entrepreneurship, innovation, commercialization |
| JEL: | O31 O33 L26 L32 |
| Date: | 2009–08–06 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2009-063&r=ent |
| By: | Yu, Li; Artz, Georgeanne M. |
| Abstract: | This paper investigates entrepreneurship of migrants and their location choice in attempt to draw connections between migration and economic development, especially the role of business formation in rural development. Rural entrepreneurship is firstly attempted to be better understood form perspectives of individual people’s migration, human capital, social capital and family background. The study uses a recent survey on alumni of Iowa State University. We find that social capital and social networks established in one’s home region are shown to be a strong factor in location choice of entrepreneurs. Entrepreneurs from rural origins tend to choose to start their businesses in rural areas in general and half of entrepreneurs migrate back to their home in particular to take local comparative advantages. Rural entrepreneurs are also more likely to obtain financial support from family members, friends and local banks to start a business. |
| Date: | 2009–07–27 |
| URL: | http://d.repec.org/n?u=RePEc:isu:genres:13095&r=ent |
| By: | David M. Hart (School of Public Policy, George Mason University); Zoltan J. Acs (School of Public Policy, George Mason University and Max Planck Institute of Economics, Jena); Spencer Tracy (Corporate Research Board) |
| Abstract: | In this study, we quantify the role of foreign-born founders in high-tech entrepreneurship in a nationally representative sample of rapidly growing "high-impact" companies. This class of companies drives job creation and aggregate growth in the U.S. We find that, while most previous studies have overstated this role, it is nonetheless very important. For instance, about 16% of the companies in our sample had at least one foreign-born person among their founding teams, and these high-tech companies display better performance in some respects than high-tech companies in our sample whose founders were all native-born. We also provide a profile of high-tech immigrant entrepreneurs. The vast majority are strongly rooted in the U.S., highlighting the need to build a coherent pathway to permanent status for highly-skilled immigrants. |
| Keywords: | Immigrant entrepreneurs, High Tech, High Impact Firms, Entrepreneurship |
| JEL: | L26 O3 F2 |
| Date: | 2009–08–06 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2009-061&r=ent |
| By: | Gabriele Pellegrino (Universita Cattolica del Sacro Cuore, Piacenza and Milano); Mariacristina Piva (Universita Cattolica del Sacro Cuore, Piacenza and Milano); Marco Vivarelli (Universita Cattolica del Sacro Cuore, Piacenza and Milano; IZA, Bonn; Max Planck Institute of Economics, Jena) |
| Abstract: | This paper discusses the determinants of product innovation in young innovative companies (YICs) by looking at in-house and external R&D and at the acquisition of external technology in embodied and disembodied components. These input-output relationships are tested on a sample of innovative Italian firms. A sample-selection approach is applied. Results show that in-house R&D is linked to the propensity to introduce product innovation both in mature firms and YICs; however, innovation intensity in the YICs is mainly dependent on embodied technical change from external sources, while -in contrast with the incumbent firms- in-house R&D does not play a significant role. |
| Keywords: | R&D, product innovation, embodied technical change, CIS 3, sample selection. |
| JEL: | O31 |
| Date: | 2009–08–06 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2009-055&r=ent |
| By: | Andreas Koch; Jochen Spaeth |
| Abstract: | The present contribution addresses the question whether and how qualitative aspects of employment---like weekly hours of work, wages or qualification---differ between new and established firms. Although a wide strand of literature in entrepreneurship research analyses the employment effects of start-ups vs. incumbent firms, our knowledge about differences in these qualitative aspects of employment is rather poor. Labour market research, on the other hand, has been thoroughly accounting for the consequences of technological and organisational change on the characteristics and turnover of jobs, but it rarely has been attempting to consider the relevance of firm entry. Based on the Establishment History Panel, a plant-level dataset constructed from employment information and comprising nearly the entire German economy, we find significant differences between new and incumbent firms with respect to employment quality. Surprisingly, the difference regarding the share of high-qualified labour is---though highly significant---not as high as commonly expected. |
| Keywords: | Start-ups, Employment, Quality of Employment, Germany, Entrepreneurship, Qualification, Wages, Part-Time, Marginal Employment |
| JEL: | J24 J31 J82 M13 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:iaw:iawdip:50&r=ent |
| By: | Utz Weitzel (Utrecht University); Diemo Urbig (Max Planck Institute of Economics); Sameeksha Desai (University of Missouri Kansas City); Zoltan Acs (George Mason University); Mark Sanders (Utrecht University) |
| Abstract: | Talent allocation models assume that entrepreneurial talent is selfish and thus allocates into unproductive or even destructive activities if these offer the highest private returns. This paper experimentally analyzes other-regarding preferences of entrepreneurial talent. We find that making a distinction between creative talent and business talent explains systematic differences in other-regarding behavior. Generally, business talent is less willing, and creative talent more willing, to forego private payoffs to avoid losses to others. A moderator analysis reveals that uncreative business talent is significantly less other-regarding than creative business talent, a finding applicable to both certain and risky payoffs with and without negative externalities. The paper makes a contribution to entrepreneurship research by qualifying the implications of talent allocation models and discovering the importance of distinguishing between the two types of entrepreneurial talent. We also add to the field of experimental economics by advancing research on social preferences under risk and with negative externalities. |
| Keywords: | Social preference, entrepreneurship, experiment |
| JEL: | C91 D62 D64 L26 |
| Date: | 2009–08–06 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2009-066&r=ent |
| By: | Erik Stam |
| Abstract: | Entrepreneurship is a fundamental driver of economic evolution. It is also a distinctly spatially uneven process, and thus an important explanation of the uneven economic development of regions and nations. Not surprisingly, entrepreneurship is a key element of evolutionary economics (Schumpeter 1934; Witt 1998; Grebel et al. 2003; Metcalfe 2004; Grebel 2007) and has been recognized as an important element in explaining (regional) economic development (Acs and Armington 2004; Audretsch et al. 2006; Fritsch 2008). This means that the explanation of regional variations in entrepreneurship has also become an important issue. Even more so because there are pronounced differences within and between nations in rates of entrepreneurship and in their determinants (Bosma and Schutjens 2008), and these differences tend to be persistent over time, reflecting path dependence in industry structure (Brenner and Fornahl 2008), institutions (Casper 2007) and culture (Saxenian 1994) that vary widely across regions and countries, but are relatively inert over time. Introducing entrepreneurship into evolutionary economic geography means that the traditional focus on firms is complemented with a focus on individuals. This paper is an inquiry into the role of entrepreneurship in evolutionary economic geography. The focus is on how and why entrepreneurship is a distinctly spatially uneven process. We will start with a discussion on the role of entrepreneurship in the theory of economic evolution. Next, we will review the empirical literature on the geography of entrepreneurship. The paper concludes with a discussion of a future agenda for the study of entrepreneurship within evolutionary economic geography. |
| Keywords: | Length 23 pages |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:esi:evopap:2009-07&r=ent |
| By: | Wenli Cheng |
| Abstract: | This paper presents a simple general equilibrium model of financial intermediation, entrepreneurship and economic growth. In this model, the role of financial intermediation is to pool savings and to lend the pooled funds to an entrepreneur, who in turn invests the funds in a new production technology. The adoption of the new production technology improves individual real income. Thus financial intermediation promotes economic growth through affecting individuals’ saving behaviour and enabling the adoption of a new production technology. |
| Keywords: | financial intermediation, entrepreneurship, economic growth |
| JEL: | G21 D90 O40 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:mos:moswps:2007-18&r=ent |
| By: | William R. Kerr (Harvard Business School, Entrepreneurial Management Unit); Ramana Nanda (Harvard Business School, Entrepreneurial Management Unit) |
| Abstract: | We examine the effect of US branch banking deregulations on the entry size of new firms using micro-data from the US Census Bureau. We find that the average entry size for startups did not change following the deregulations. However, this result masks the differences in entry size among startups that failed within three years of entry and those that survived for four years or more. Long-term entrants started at a 2% larger size relative to their size in their fourth year, while churning entrants were no larger. Our results suggest that the banking deregulations had two distinct effects on the product market. On the one hand, they allowed entrants to compete more effectively against incumbents by reducing financing constraints and facilitating their entry at larger firm sizes. On the other hand, the process of lowering financing constraints democratized entry and created a lot more churning among entrants, particularly at the low end of the size distribution. Our results highlight that this large-scale entry at the extensive margin can obscure the more subtle intensive margin effects of changes in financing constraints. |
| Keywords: | entrepreneurship, entry size, financial constraints, banking. |
| JEL: | E44 G21 L26 L43 M13 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:hbs:wpaper:10-010&r=ent |
| By: | John Schmitt; Nathan Lane |
| Abstract: | Contrary to popular perceptions, the United States has a much smaller small-business sector (as a share of total employment) than other countries at a comparable level of economic development, according to this new CEPR report. The authors observe that the undersized U.S. small business sector is consistent with the view that high health care costs discourage small business formation, since start-ups in other countries can tap into government-funded health care systems. |
| Keywords: | small business, employment, health care |
| JEL: | O O5 O51 O52 O57 E E2 E24 J J4 J49 L |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:epo:papers:2009-27&r=ent |
| By: | Kochanski, Tim |
| Abstract: | In this paper, I develop a hybrid model that contains elements of both agent based simulations (ABS) as well as analytic Cournot models, to study the effects of firm characteristics, market characteristics, and innovation on market concentration, as measured by a Herfindahl-Hirschman Index (HHI). The model accommodates the following components: multiple firms with heterogeneous marginal costs, market entry and exit, barriers to entry, low or high cost industries, changing demand, varying levels of marginal cost reducing returns-to-innovation, varying costs associated with innovation, increased returns to innovation from past experience innovating, and varying propensities to innovate within the market. The components mentioned above are commonly cited as determinants of market concentration. A sensitivity analysis which is robust to high degrees of model complexity demonstrates that the model provides results that are consistent with economic theories of markets. |
| Keywords: | agent based simulation; Cournot; game; innovation; oligopoly |
| JEL: | C79 D43 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16539&r=ent |
| By: | David M. Cutler (Harvard University); Robert S. Huckman (Harvard Business School, Technology and Operations Management Unit); Jonathan T. Kolstad (The Wharton School, University of Pennsylvania) |
| Abstract: | Prior studies suggest that, with elastically supplied inputs, free entry may lead to an inefficiently high number of firms in equilibrium. Under input scarcity, however, the welfare loss from free entry is reduced. Further, free entry may increase use of high-quality inputs, as oligopolistic firms underuse these inputs when entry is constrained. We assess these predictions by examining how the 1996 repeal of certificate-of-need (CON) legislation in Pennsylvania affected the market for cardiac surgery in the state. We show that entry led to a redistribution of surgeries to higher-quality surgeons and that this entry was approximately welfare neutral. |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:hbs:wpaper:10-011&r=ent |