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on Entrepreneurship |
| By: | Veronique Schutjens; Niels Bosma; Jolanda Hessels; Mirjam Van Praag; Ingrid Verheul |
| Abstract: | The decision to become an entrepreneur is in essence an individual decision. But even when the endowments of inhabitants are taken into account, some regions have persistently higher entrepreneurship rates than others. Proposed explanations for this regional variation are numerous: market potential, unemployment rates, knowledge spillovers and agglomeration effects. Regional differences in entrepreneurship have also been linked to the availability of role models (Fornahl 2003; Sternberg 2009; Malecki 2009). It can be argued that in regions with high rates of entrepreneurship, entrepreneurial role models are abundant. These role models may serve as good examples of entrepreneurial activity and inspire individuals in the region to become entrepreneurs or attract other entrepreneurs to the region, thereby reinforcing the entrepreneurial process. We take a new approach by combining existing approaches, i.e., the geographical and individual-level studies of entrepreneurship in empirically exploring the importance of role models for early-stage entrepreneurship. We use a rich data set of over 300 owner-managers of young firms across four different sectors for three regions in the Netherlands. For each of the regions, a random sample was drawn from the registration data base of the Dutch Chamber of Commerce. Semi-structured interviews were held with entrepreneurs in Utrecht, Amsterdam and Rotterdam between March and October 2009. The first descriptive results suggest that role models are indeed an important phenomenon that deserves further attention. About 45% of the entrepreneurs indicated that the start-up decision was influenced by another entrepreneur, mostly by providing a positive example. Some 70% of these respondents have received tangible support from these exemplar entrepreneurs at start-up, whereas 40% indicate that they would not have started the business if they would not have had this example. So, according to the respondents, role models are important and our first analyses seem to support the idea that entrepreneur characteristics affect the value attached to specific types of role model. These results have implications for the organization, timing and target group of support initiatives, network meetings and the involvement of specific established (regional) exemplar entrepreneurs in the early-stage entrepreneurship arena. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p531&r=ent |
| By: | Apostolos Baltzopoulos; Anders Broström |
| Abstract: | The presence of universities in a region has been found to be an important factor for regional economic growth. In search for the specific explanations of this phenomenon, the connection between universities and locally based entrepreneurship has attracted considerable attention. We investigate how universities may affect regional entrepreneurship through the localisation decisions of entrepreneurial alumni. Empirically, we use data on the background of all 35 187 young individuals who founded start-up firms in Sweden in the period 2003-2005, a third of whom attended a university, to estimate whether the choice of where to pursue tertiary education studies had significant impact on the location of their firm. Our results suggest that even when controlling for the spatial history of the individual founder, individuals have an increased propensity to set up in the region where they studied. This effect is found to substitute for both urbanisation economies and localisation economies as drivers of regional-level entrepreneurship. Thus, our analysis provides evidence on how universities affect regional economic development that complements the strong focus on spin-off activities by university researchers in previous studies. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1519&r=ent |
| By: | Erik Stam |
| Abstract: | 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. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1267&r=ent |
| By: | Michael Fortunato; Diane McLaughlin; Theodore Alter |
| Abstract: | New perspectives in entrepreneurship are emerging that view the concept of opportunity as central in the domain of entrepreneurship research. However, a robust understanding of how entrepreneurs and local institutions perceive opportunity in the community is still nascent in the empirical literature. We wish to contribute to the debate by presenting a testable empirical framework that views entrepreneurship in the community primarily as embedded within individual entrepreneurs, local institutions, and perceptions about local opportunity. A better understanding of this complex relationship may clarify why many local entrepreneurship assistance programs are developed in the absence of entrepreneur input, why many local entrepreneurs have little or no interaction with institutions in their community intended to help small businesspeople, and who entrepreneurs and local institutional leaders believe should be responsible for identifying and exploiting opportunity. The objective of this work is to identify differences in how individuals and entrepreneurs think about opportunity, and to develop strategies to bolster collaboration and opportunity exploitation within and between these groups in order to enhance local economic development through entrepreneurship. This paper presents the preliminary findings of face-to-face interviews and written surveys with entrepreneurs and community institutional leaders in three American states (Maine, Pennsylvania, and Wisconsin) about their views on entrepreneurship, opportunity enhancement, and local economic development. Results regarding the process of entrepreneurship and individual-institutional interaction are compared in high- and low-entrepreneurship areas to identify opportunity-oriented strategies that seem to be working at the local level. Finally, strategies are developed to overcome barriers between individual entrepreneurs and their institutional environment to enhance opportunity identification and exploitation. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1504&r=ent |
| By: | Gianni Romani; Miguel Atienza; Ernesto Amorós |
| Abstract: | Funding is critical during new firms´ creation and the most sources of funding in the early stages of entrepreneurial ventures are informal investors (Family, Friends, the Founding entrepreneurs themselves, and the foolhardy strangers, also known as business angels). Entrepreneurs in the initial stages are the main users of informal financing, more specifically those denominated according to the GEM definition as nascent entrepreneurs; that is, those who are involved in establishing a business or those who have made the leap from the conception of the business to its actual gestation (Reynolds et al., 2005). Informal investment has come to the attention of researchers, mostly in the United States and Europe, and very scarcely in Latin America. Nevertheless, in recent years there has been a call to study entrepreneurship taking in consideration the perspective of gender (Brush, 1992; Bird and Brush, 2002). In Chile, studies of this nature are scarce. For this reason in order to find out more of how the nascent entrepreneurs fund theirs ventures, the main objective of this article is to explore the gender differences that could exist in the financing needs of nascent Chilean entrepreneurs with regard to: Amount needed to start the business; outside financing expectations, employment creations expectations, socio-demographic characteristics, perception related to entrepreneurship. The analysis is based on a representative sample of the Chilean adult population between 18 and 64 years of age, using data from the GEM from the years 2007 and 2008. Since this is an exploratory study, we propose separating the nascent entrepreneurs by gender and using descriptive statistics and Mann–Whitney U test (non-parametric test for two independent samples). The results show that there are significant gender differences among nascent entrepreneurs with respect to the amount needed to start a business, socio-demographic characteristics, and in some aspects related to entrepreneurship. These results provide a better understanding of the financial needs of nascent entrepreneurs and the existent differences between women and men. These results can contribute to a better design of public policies to support new venture creations taking into account a gender perspective. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1425&r=ent |
| By: | Claudio Mancilla; Yancy Vaillant; Esteban Lafuente |
| Abstract: | Usually, immigrants have been studied as employed work force. However, they often choose to become entrepreneurs. According to the relevant literature, there are evidences that immigrants are more entrepreneurially active than local inhabitants. However, results from the Global Entrepreneurship Monitor for Spain show that this is not consistent across the urban-rural divide. Explanation for variances in entrepreneurship in rural as compared to urban areas have been linked to specific socio-institutional traits that exert a differentiated impact on the entrepreneurial activity levels of specific segments of the population. The objective of this study is to verify how the entrepreneurial activity of rural immigrants responds to socio-institutional traits that have been identified as key explanatory factors of entrepreneurial behaviour. To carry out this research, the Spanish Global Entrepreneur Monitor (GEM) data set from 2008 was used. We conduct a comparative analysis between three population groups: immigrants as compared to non-immigrant, rural immigrant as compared to urban immigrant, and rural immigrants as compared to rural non-immigrants. To do this, a rare events logit regression model was applied. The results indicate that the probability to become an entrepreneur is greater for immigrants. The same is true for an individual residing in a rural area. However, contrary to Spaniards, rural immigrants are not more likely to become entrepreneurs. We find explanation for this in the econometric analysis of the selected socio-institutional traits. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1464&r=ent |
| By: | Maksim Belitski; Julia Korosteleva |
| Abstract: | The importance of entrepreneurship as a driving force in the economic development has been widely recognised. Respectively, a growing number of empirical studies have focused on explaining variation in entrepreneurial activity at various spatial levels with the majority of them taking either a cross-country perspective or looking at the inter-regional differences. Given limited city-level data availability, scarce work has been undertaken so far on cross-city entrepreneurship within the spatially oriented entrepreneurship research. Furthermore, to our best knowledge, no empirical studies exist on entrepreneurship across European cities and our paper aims to bridge this gap. The object of the paper is to analyse the variation in entrepreneurial activity across European cities. More specifically, by harmonizing the city level data in 31 European countries, based on European Urban Audit Survey (Eurostat) data, we undertake a panel data study of how various demographic, socio-economic, ethnic and geographical characteristics of European cities and institutional country-level settings affect entrepreneurship in 377 European cities during the period of 1989-2006. We use the rate of self-employment as a measure of entrepreneurship. While controlling for various spatial effects across cities we find that the rate of self-employment is largely explained by city size, socio-economic characteristics, such as the level of education and city inhabitants' wellbeing, city ethnicity and size of a local government. Institutional quality, including a property right system and democratic institutions, and city location affect entrepreneurship. Our findings fail to support a hypothesis of the importance of capital city incubators, Euroregions and EU enlargement for entrepreneurial activity. Surprisingly, our city location results suggest that cities in the south of Europe are more entrepreneurial than in the north. Along with a positive effect of a lower education and insignificant effect of a city typology associated with high-tech entrepreneurship. Keywords: Entrepreneurship, Agglomeration, Labour market, Western Europe, Eastern Europe, Urban JEL Codes: L26 R10 R30 O31 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1646&r=ent |
| By: | Lutz Trettin; Friederike Welter; Uwe Neumann |
| Abstract: | In recent years entrepreneurship in urban neighbourhoods, has drawn a growing attention of the research community as well as of urban planning (Mollenhorst et al. 2009). Entrepreneurship research is increasingly focussing on the manifold and intertwined contexts of entrepreneurial activities, such as the background of the enterprising individual, social networks, particular socio-spatial contexts or the cultural context. This combined view on the multifaceted embeddedness of entrepreneurial activities very often discloses strong linkages with their immediate socio-spatial environment (Steyart/Katz 2004). In the field of urban development the decision-makers in politics, planning and administration have increasingly adopted entrepreneurship support as a central means to foster economic revival in deprived localities, such as urban neighbourhoods in old industrialized regions or an urban locality with unfavourable demographic and socio-economic structures located within an overall prosperous urban agglomerations. However, practical experience shows that the efforts to economic renewal of deprived urban neighbourhoods through fostering entrepreneurship deserves a long time and faces serious obstacles (Berg et al 2004). Entrepreneurship research should critically ask, whether and how the knowledge about mixed embeddednes of entrepreneurial activities is considered by decision-makers in planning, administration and politics. Therefore, this paper aims at reviewing policy approaches which were recently adopted in different 6 German cities. Theoretically the paper draws on the literature which addresses entrepreneurship in its contexts. Empirically the paper is based on two empirical studies on public programmes at the interface of urban restructuring and economic development. We discuss the consideration of intertwined contexts of entrepreneurship as a relevant success factor of support policies. Our central focus is, whether entrepreneurship is seen as a topic related to economic life or as a matter of everyday social activities. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p550&r=ent |
| By: | Adli Abouzeedan; Boo Edgar; Thomas Hedner |
| Abstract: | In contrast to the Entrepreneurial Recycling Model (EREC), the Entrepreneurial Remedy Model (EREM) demands an active role of innovation to create an environment where small and medium size companies (SMEs) are developed. The EREM may provide a conceptual platform which may explain why developed regions have succeeded in maintaining a healthy entrepreneurial environment, while the less developed have failed to do that. Further, the Open Innovation concept is brought into the discussion connecting innovation to entrepreneurial environment conditions. A question which remains to be solves has to do to with the impact of innovation on the extent of entrepreneurial activities at a regional level. In this paper we will analyze and discuss this issue and provide understanding of the impact of innovation using the EREM. As such, the EREM offers an analytical tool to examine how the macroeconomic conditions impact the creation of new firms within a region or a country. Keywords: Open innovation, Entrepreneurial Remedy Model, EREM, regional development, incubators, start-ups, Small and medium-sized enterprises, SMEs |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1277&r=ent |
| By: | Katalin Erdos; Attila Varga |
| Abstract: | Knowledge flows from universities to the regional economy can take different forms ranging from formal research collaborations to consultancy and informal personal connections. One of the knowledge communication channels drawing substantial interest of both researchers and regional policy makers is academic spin-off firm formation. According to the concept of the “academic entrepreneur” (Etzkowitz) university spin-off firm formation has grown naturally from the academic culture of the US where professors traditionally behave very much like entrepreneurs while setting up and maintaining research labs, hiring research assistants, “marketing” research results in conferences and publications or networking with colleagues and funding agencies. Spinning off a company is just a step forward from such entrepreneurial tasks of academics. Thus according to this concept academic motivations are main drivers in university spin-off firm formation in the US. Despite this challenging view the empirical literature pays relatively little attention to the particular “academic” features of university spin-offs and rarely considers the specificities of university entrepreneurship most notably the role of scientists as entrepreneurs. Empirical evidence suggests that Europe performs less successfully than the US in transferring knowledge from university labs to the regional economy via spin-off companies. One potential reason behind this difference is that institutions that determine the continental European research system hold back the emergence of academic entrepreneurs. Thus it is the main research question in our paper whether those specific “academic” drivers behind university spin-off firm formation are present at all in the continental European context. The related question is whether professional characteristics of the academics, their social capital, the norms of academia and the academic and business environment support or hinder these academic motivations? This paper is based on interviews carried out with university researchers who actively participate in firm formation in Hungary. Hungary is an excellent European case since the features of its university system are rooted in the continental (mainly German) tradition, but it also inherits some characteristics from the even more centralized socialist (soviet) tradition. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1451&r=ent |
| By: | Michael Fritsch; Alexandra Schroeter |
| Abstract: | This paper investigates the impact of new firms’ quality on the magnitude of their employment effects. Our results clearly show that the quality of start-ups, measured by their affiliation to sectors and innovative industries, strongly influences the direct and the overall employment contribution of new firms. In particular, start-ups in manufacturing industries generate larger direct and overall growth effects than those in services. Moreover, new businesses in innovative manufacturing and in knowledge-intensive service industries make a larger direct contribution to employment than start-ups affiliated to other industries. We also find a relatively strong overall effect of new business formation in knowledge-intensive service industries. The impact of start-ups in innovative manufacturing industries on overall regional employment growth is, however, not statistically significant what may be mainly a result of their rather small share in all start-ups and due to the fact that they impact more on firms in other regions than start-ups in non-innovative manufacturing. Finally, we discuss conclusions for entrepreneurship policy, which can be derived from our findings. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1400&r=ent |
| By: | Mircea Epure; Diego Prior; Christian Serarols |
| Abstract: | Literature highlights the importance of university spin-offs and their assistance mechanisms. However, there is little evidence on how to select and operationalize the appropriate variables for assessing this type of firms. This paper provides tools to estimate and interpret the efficiency of spinoffs embedded in university-based support mechanisms. We thus contribute to the literature in at least two ways. First, we identify the specific inputs and outputs that are required by both the organisational and regional development perspectives. Second, an application considers a unique sample of spin-offs created at Catalan universities within a regional support programme. Main descriptive results indicate that many efficient spin-offs have formal technology transfer agreements and emerge from universities with more technological background. Second stage analyses show that higher levels of innovation and specific academic knowledge or experience related with the university of origin are associated with higher efficiency. |
| Keywords: | university spin-off, regional development, efficiency, entrepreneurship, technology transfer, innovation |
| JEL: | M1 R1 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:1330&r=ent |
| By: | Emilia V√°zquez; Sofia Gomes; Elvira Vieira |
| Abstract: | The theory of economic growth covers institutional market and company internal factors that explain the disparities in well-being among countries, in a given period. It also questions welfare growth dynamics that leads to convergence or divergence of per capita wealth levels. (Solow, 1956-1957; Grilliches, 1979; Romer, 1986, 1990; Lucas, 1988; Barro, 1999; Barro e Sala-i-Martin, 1991 e 1992; Rebelo, 1991, Mankiw, Romer e Weil, 1992). The economic study of entrepreneurship is concerned with identifying factors that influence the dynamics of business creation and the consequences of these dynamics on economic growth. (Acs e Armington, 2006; Audretsch e Keilbach, 2004; Audretsch, Keilbach, Lehmann, 2006; Carree e Thurik, 2006; Van Stel, 2006). There are several studies that establish a direct relationship between entrepreneurship and economic growth. Other empirical works address an indirect relationship through the establishment of an interaction between entrepreneurship and employment rate growth. With a similar approach to other works that relate entrepreneurial activity (Petrakis, 2004; Audretsch and Keilbach 2004; Wong, Ho e Autio, 2005; Acs e Varga, 2005; Stam, Suddle, Hessels e Van Stel, 2006; Van Stel, Storey e Thurik, 2009; Barros e Pereira 2008; Salas y Sánchez-Asín, 2008) this paper analyzes the effect of entrepreneurship on growth on Spanish and Portuguese regions |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1537&r=ent |
| By: | Karl Wennberg; Karin Hellerstedt |
| Abstract: | This paper investigates the contextual conditions affecting the entry, growth and exit of knowledge intensive firms. On the aggregate or regional level, entry and exit are often intimately related. We suggests that the entrepreneurial process by which individuals engage in the start, the growth, and the exit of a firm is strongly path-dependent. Second, based on the importance of initial conditions at the regional level, we present empirical analysis on how characteristics of the economic milieu of regions influence firm births. The data material provides information on all knowledge intensive start-ups across the 286 Swedish municipalities between 1994 and 2002. We present an empirical model that captures both supply- and demand-side factors, with a specific emphasis on the demand side. We address the imperative role of initial conditions during firm founding, as these are strongly emphasized by I/O economics, organizational ecology, and entrepreneurship research alike. We describe and explain the substantial variation in start-up rates across municipalities and over time. The paper advanced econometric analysis where we use a number of variables derived from our theoretical framework to formulate and test a model of regional start-up rates. The model is tested on separate samples of services firms and manufacturing firms, yielding interesting results that are in line with the theories of organizational ecology and economic geography, but with somewhat stronger results for start-ups in services. Analyses of firm growth an survival further shows that the factors present during founding are strongly path-dependent, but differ for medium-growth and high-growth firms, and for firms exiting by closure and firms exiting by merger. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1585&r=ent |
| By: | Navid Bazzazian; Thomas √Östebro |
| Abstract: | There has been an increased trend in the number of spin-offs generated by universities in the past thirty years. Past research reveals that the majority of these start-ups are located in the same region as the university from which they originated. In this paper, we investigate critically what universities do to encourage entrepreneurship to increase regional economic development. We will also discuss whether maximizing local entrepreneurship necessarily maximizes total welfare. Unfortunately, the scientific evidence reviewed in this paper indicates that policy changes at universities typically have very little impact on commercialization of research and the benefits to the universities are marginal. For example, current evidence indicates that creating incubators and science parks on university grounds have no discernable effects on local start-up rates. Further, from a theoretical perspective we have reviewed articles showing that introducing Technology Licensing Offices (TLOs), the most popular method to stimulate research commercialization, may likely introduce economic inefficiencies, hold-ups and decision biases that deviate from what is optimal. The median university among the top U.S. research-based institutions creates less than two academic spin-offs per year and so the relative effects on local economic conditions through TLO efforts and policies are bound to be marginal. Nevertheless the evidence also shows that the scientific stature of the faculty, the commercialization culture at the university, and the sheer number of science and engineering students graduated do have important positive effects on local start-up rates. Increasing expenditures on university staff and students causes increases in regional productivity growth and innovation and the marginal effects are much bigger in structurally weak regions. Evidence confirms that university spin-offs disproportionally favor local development. Maybe as much as 80 percent of all university spin-offs are and remain locally situated. However, universities that maximize local effects will not maximize their societal impact. Instead, it appears more efficient if universities simply try to maximize licensing revenues and not worry about the number of spin-offs and their locations. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p822&r=ent |
| By: | Geraldine Ryan; Bernadette Power; Noreen McCarthy; Paul Braidford |
| Abstract: | Objectives: Business transfers are posing a particular problem for several European countries as the age distribution of business owners rises and as the number of firms transferred within families’ declines. This paper explores firm, market, and regional differences in firms which are expected to be transferred in the British Isles against those that are expected to be disposed of. It also examines whether there are regional differences in the types of businesses which are expected to be transferred across the British Isles. Prior Work: Previous research in this area has primarily examined intergenerational succession in family businesses (Bennedsen et al. 2006), while the research into management-buyouts and trade-sales has focused on the entrepreneur’s mode of entry (Parker and Van Praag, 2006). Martin et al. (2002) finds evidence that spatial differentiation exists in the vulnerability of firms to age related business transfer failure. In this paper we examine whether businesses located in relatively more economically vibrant regions within the British Isles, whether due to urban economies (Gordon and McCann 2005) or agglomeration economies (Parr 2002) or the level of entrepreneurial talent (Markley, 2006) in the region, have a lower probability of a business transfer failure. Approach: Interview evidence on the expected end-game strategy of entrepreneurs facing the risk of age related transfer failure was obtained from firms in a number of regions in the British Isles, namely the Republic of Ireland, Northern Ireland, Scotland, Wales and England (800 cases). A model is developed which predicts how firm, market and regional characteristics influence whether a firm is expected to be transferred or not. Preliminary Results: Entrepreneurs who expect to dispose of the assets of the business on their retirement have a significantly lower probability of having a high level of entrepreneurial talent in the region and a higher probability of having a high level of GVA per head in the region than entrepreneurs who expect to transfer their businesses. A higher level of entrepreneurial talent (as measured by stock of businesses per resident) and a lower of GVA per head are more likely in rural regions. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1094&r=ent |
| By: | Franz Kronthaler; Katharina Becker; Kerstin Wagner |
| Abstract: | Start-up activities are considered to be important for regional economic development and vary considerably between regions. As entrepreneurial activity in a region is strongly influenced by its regional conditions, we analyse the role of the conditions and their impact on start-up activities. The main objective of the paper is to identify the variables which are relevant for a typology of regions in terms of their start-up activity and to have a closer look on their region specific characteristics. For the analysis we use the spatial level of Swiss mobilité spatiale regions (MS). MS regions are functional units based on economic interaction and commuting movements. At this level, data is available which provide information about the endogenous entrepreneurial potential of regions. Furthermore, it is possible to distinguish between peripheral, semi-peripheral, urban regions and agglomerations. Cluster analysis and regression analysis are used to examine the relationship between regional conditions as influencing factors and real start-up rates. The selection of the indicators is based on a review of results of the theoretical and empirical literature on entrepreneurship. Cluster Analysis serves to compare different regions according to their structural potential for start-up activities. The method is used to form several homogeneous groups of Swiss labour market regions according to their individual structural potential and for comparative purposes. With the help of regression analysis we analyze whether the different types of cluster really explain start-up activity and if obstacles for entrepreneurial activity can be found. Results indicate that most of the regions use their potential for entrepreneurial activity. However, we also identify certain outliers with regard to the relationship of regional conditions and start-up activity. On the one hand, we observe regions with good structural conditions and high potential for new firm formation but low start-up rates. On the other hand, there are regions with unfavorable characteristics but relatively high start-up rates. Based on this analysis, we identify case specific variables influencing start-up activities under specific circumstances. These regions are potentially interesting cases for constructing regional policies. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p562&r=ent |
| By: | Dimitrios Ierapetritis; Dimitrios Lagos |
| Abstract: | The development of business and innovation potential in the countryside depends on the availability of sufficient structures providing knowledge and skills on new technologies, while the most effective training process for farmers is an education based on the principles of experiential learning and adult education. The aim of this article is, based on the results of a nation-wide research addressed to farmers, instructors and head trainers, to explore and submit specific proposals for the reinforcement of entrepreneurship in the Greek countryside. More specifically, the aims sought through the results of this research, which was conducted among five hundred and ninety (590) trainee farmers, three hundred and twenty (320) instructors and fifty-eight (58) head trainers, are to bring forward the main attributes of farmers who wish to engage in entrepreneurial activities of the secondary and tertiary sector, to explore the aspects of the educational and administrative resources in the Greek countryside, to reveal their educational needs for successful business ventures and finally to put forward specific proposals both for promoting farmers’ education and for the support of farmers who wish to enter the business field. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1510&r=ent |
| By: | Michael Fortunato; Theodore Alter |
| Abstract: | Pennsylvania is a state whose rural cities and towns – once prosperous centers of manufacturing and agricultural production – have seen steady economic declines in these sectors due to macro-economic restructuring. Global economic forces have resulted in the loss or downgrade of many local jobs, population declines, the loss of educated youth to growing metropolitan areas, and the abandonment of small businesses from many small downtowns. Despite these trends, most small towns and cities still retain a substantial core of new business activity. These entrepreneurs hold the promise of reviving the lagging local economy by providing new jobs and critical products and services that are targeted to local tastes and needs. Understanding what led them to start a business in a declining area can lead to the development of new strategies to entice more entrepreneurs to locate a business in the area to stimulate local economic development. This report uses interviews with forty-two entrepreneurs in eight small towns across Pennsylvania to understand what specific factors motivated their decision to locate in areas traditionally marked by economic decline. The report reveals the surprising fact that most small town entrepreneurs are not natives, but were attracted to the area for other reasons. The report also explores which factors were more important to the location decision – personal, individualist factors or factors within the local social and physical environment. A conceptual framework of the location decision in Pennsylvania is developed, and real strategies for bolstering local entrepreneurship, especially in areas formerly engaged in manufacturing, are drawn from the findings. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1505&r=ent |
| By: | Michael Fritsch; Florian Noseleit |
| Abstract: | We investigate the effects that regional start-up activity has on employment in new and in incumbent businesses. The analysis is performed for West German regions over the 1987-2002 period. It shows that the effects of new businesses on employment in the incumbents are significantly positive and that this indirect effect on incumbent employment leads to more jobs than what is created by the newcomers. We find that the effect of new business formation on incumbents is exclusively driven by start-ups that survive a certain period of time. We draw conclusions for policy and for further research. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1102&r=ent |
| By: | de Mel, Suresh; McKenzie, David; Woodruff, Christopher |
| Abstract: | The authors conduct a randomized experiment among women in urban Sri Lanka to measure the impact of the most commonly used business training course in developing countries, the Start-and-Improve Your Business program. They work with two representative groups of women: a random sample of women operating subsistence enterprises and a random sample of women who are out of the labor force but interested in starting a business. They track the impacts of two treatments -- training only and training plus a cash grant -- over two years with four follow-up surveys and find that the short and medium-term impacts differ. For women already in business, training alone leads to some changes in business practices but has no impact on business profits, sales or capital stock. In contrast, the combination of training and a grant leads to large and significant improvements in business profitability in the first eight months, but this impact dissipates in the second year. For women interested in starting enterprises, business training speeds up entry but leads to no increase in net business ownership by the final survey round. Both profitability and business practices of the new entrants are increased by training, suggesting training may be more effective for new owners than for existing businesses. The study also finds that the two treatments have selection effects, leading to entrants being less analytically skilled and poorer. |
| Keywords: | Primary Education,Competitiveness and Competition Policy,Business in Development,Business Environment,Access&Equity in Basic Education |
| Date: | 2012–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6145&r=ent |
| By: | Esa Storhammar; Timo Tohmo |
| Abstract: | ABSTRACT The aim of this study is to clarify what factors affect the innovation activity of small and medium-sized enterprises (SMEs), and especially the effect of regional factors. Innovations are seen as central phenomena on both micro and macro levels in economy. However, we know little about the formation, development and diffusion of innovations in different milieus. The different types of branch and enterprise structure might be the essential factor that accounts for regional differences in innovation activities. Many studies show remarkable differences between branches. Additionally, the resources of firms give an unequal starting point for innovation activities. Our study observed that the differences between regions were smaller than anticipated. It also found the innovation profiles in different areas to be fairly convergent. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p240&r=ent |
| By: | Kingsley E. Haynes |
| Abstract: | Business support programs, represented by business incubators (BIs) and small business development centers (SBDCs), play an important role in assisting new or small firms, nurturing entrepreneurial culture, and fostering regional economic growth. For that reason, the location of these programs may interest regional planners or economic practitioners who have the incentive to create or attract these programs. Our previous studies have found that the presence of both types of business support programs is positively associated with the level of agglomeration and negatively associated with the level of business development. It is however unclear whether the local knowledge context may influence the local presence of BIs or SBDCs. This paper examines the role of knowledge in shaping the geography of BIs and SBDCs in the US using county-level data. Human capital, the university, and high technology are used as the proxies for knowledge. Their effects on the presence of BIs and SBDCs are investigated in binomial logistic regressions. We also control other county-specific characteristics by including three common factors derived via factor analysis from 27 demographic, social, and economic variables. This study highlights business support programs as the link between regional innovation systems and small or new firms. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1499&r=ent |
| By: | Jonatan Svanlund |
| Abstract: | Both national and regional studies of economic change are often depending on aggregated variables such as GDP levels, wages or population development. In this paper I will discuss how data concerning individual firms can be used in studying regional economic change. This material can also be used to shed light in differences regarding male and female entrepreneurship in a regional and historical perspective. The paper will focus on how different types of data and databases can be used and linked together in order to shed more light on the regional economic development. Therefore this paper will have a more explorative character rather then trying to answer any hypothesis. The point of departure will be how the Census of Enterprises can be used in studying regional economic change and how his material can be linked to other databases such as the Housing and population census. The Census of Enterprises was conducted in Sweden on three occasions in 1931, 1951 and 1972. From these studies one can analyse questions regarding firm size, capital intensity, differences regarding male and entrepreneurship and how this develops over time in different regions. Finally, a discussion will be in the paper on how the structure and changing composition of enterprises on a regional level can be linked to other variables such as regional population- and employment development and regional GDP development. By studying the micro-level, (firm level) and looking at questions concerning entrepreneurship, adaptation to technology and globalisation hopefully more can be said about the mechanism behind different development in different regions. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1644&r=ent |
| By: | Yvonne Schindele; Michael Fritsch; Florian Noseleit |
| Abstract: | Several empirical studies showed that it is not the level of entrepreneurial activity itself, but the (long-term) survival and growth of new firms that determine the direct and indirect contribution of new businesses to regional employment. To this end, the aim of this paper is to analyze the determinants of the survival of German manufacturing establishments devoting special interest to the multi-dimension approach, thus investigating business-, industry-, and region-specific survival determinants. By using a micro-panel data set of all German manufacturing establishments for the period 1992 to 2005, we employ both non-parametric and semi-parametric procedures that are specifically designed to analyze duration phenomena in order to ascertain survival determinants by explaining the time period between a firm’s start-up and its cessation of economic activity. The results enable us to give advice on how to improve the survival conditions of businesses in certain regions and industries and, thus, to enhance the number of establishments with the potential to contribute to regional employment. The main findings indicate that the probability of exit is higher for very young and rather old businesses and also for relatively small businesses. Besides the overall finding of a higher exit risk in agglomerated areas, an above-average level of highly qualified employees working in the establishments decreases the probability of exit. Accordingly, businesses in R&D intensive or high-tech industries enjoy better survival prospects than businesses in other industries. Moreover, we find evidence that that regional industry specialization is not beneficial for the survival of newcomers in a respective industry. This result adds some interesting points to the findings of Dumais, Ellison and Glaeser (2002) who discovered that closure is less likely in those regions that belong to the current geographic centers of an industry and tends to increase geographic concentration. Our results suggest that in German manufacturing industries not only a business’ entry but also its survival chances (in opposition to closure in general) are forces that reduce geographic concentration. Possible benefits from geographically bounded, within-industry spillovers seem to be of less importance than the counterforce of intensified local competition for survival. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p549&r=ent |
| By: | Antonio Della Malva; Martin Carree; Enrico Santarelli |
| Abstract: | The anecdotal evidence provided by the literature on high tech clusters has paved the way to systematic explorations of the localized effects of academic research on technological success and economic development. Prime drivers of such development are new entrants. New entrants are more likely to embark in the risky activity of developing new products and/or new processes, they often open up new markets, restructure existing ones, replace declining industries and reshape local markets. Studies on the relation between academic R&D and business entry have found modest effects of the former on the latter. Recent empirical findings in the field of technology transfer, however, suggest that quality of academic research and the entrepreneurial attitude by faculty be the main factors explaining economic relevance of academic R&D. In this study we test the hypothesis that knowledge spilling over departments conducting cutting-edge research generates higher entry in related technology-intensive sectors than lower standing departments. We thus explore the extent to which the quantity, quality and orientation of research carried on at universities stimulates differently market entry in high-tech and low-tech sectors and the consequences of entry (high and low tech) on economic growth. We use data on business entry in 103 Italian provinces (NUTS3) between 2001 and 2006; we relate entry to a battery of measures of university presence in the province: the number of students graduated in scientific disciplines in 2001, the scientific productivity of academics between 1985 and 1999 and the number of patents invented by academics between 1978 and 2000. We apply a three-equation recursive model where in the first place we estimate the contribution of universities to entry, both in high-tech and low tech sectors and secondly the effects of entry and universities on economic growth. Additionally, we include patents and trademarks to control for the existence of innovative activities from the private sector, the presence and relevance of industrial districts to account for industrial specialization, the quality of road infrastructures and the existence of business service providers to support the creation of new ventures. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p554&r=ent |
| By: | T√∫lio Cravo |
| Abstract: | An important issue facing policymakers is the degree to which fluctuations in economic activity affect employment in large and small businesses across sectors and regions. These issues are particularly relevant for developing countries, as they matter for the understanding of the labour market dynamics, and for devising regional, sectoral, and national labour policies. The unique data used in this paper was constructed using the CAGED database, which is a comprehensive administrative census dataset collected monthly by the Ministry of Labour in Brazil covering the formal sectors of the economy. Thus, monthly employment data for small and large establishments across regions and industries were constructed from 2000:1 to 2009:6 for each state and industry across the two-digit sectoral classification. This paper draws on the work of Moscarini and Postel-Vinay (2009) who analyse the correlations between measures of relative growth rate of employment by size class and business cycle conditions. As in their work, this paper uses detrended difference in employment growth rates between large and small firms as a measure of the relative performance of firms in different size bins. The evidence suggests that in Brazil small firms are more sensitive cycles, a result that contradicts Moscarini and Postel-Vinay (2009). The differential growth of employment between large and small establishments is negatively correlated with measures of business cycles, indicating that SMEs shed proportionally more jobs in recessions and gain more in booms. This pattern is also observed in most of the Brazilian States; however, there is a substantial variation in the manner the difference in employment growth rates correlates with business cycles at regional level. Besides, the sectoral analysis supports the evidence that formal small businesses are more sensitive than large ones in all sectors but in the commerce. This finding is important and might be related with the fact that the commerce sector relies heavily on informal workers that are the first ones to be hired or made redundant over the business cycles. Therefore, the evidence from this paper suggests that in a developing country context small establishments are more sensitive than large ones to business cycle conditions. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p507&r=ent |
| By: | Silvia Fernandes |
| Abstract: | This paper intends to contribute to an on-going change of perspective in territorial policies, more focused on a place-based integrative development strategy, which can be enhanced by social capital. This includes organizational and institutional learning for knowledge and skills’ transfer and governance coordination of the layers involved. Several concepts and indicators can be combined to support a conceptual framework for governance redefinition and sustainable growth. A comparison with related quantitative and qualitative indicators across countries highlights an approach for building a common culture that could facilitate governance and growth sustainability. It is less the size or the level of economic development that explains the different performances across countries/regions, than their levels of capital endowment (social, institutional, cultural) and the ability to properly exploit it. The most intangible aspects (entrepreneurship, participation, cohesiveness) are key elements in making the difference through the creation, valuation and maintenance of distinctive places and communities. Key-words: governance, social capital, institutional learning, sustainable growth, indicators, cluster analysis, discriminant analysis |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1431&r=ent |
| By: | Mozhdeh Taheri; Marina Van Geenhuizen |
| Abstract: | Abstract-The importance of new knowledge in innovative activities of firms and the impact of these activities on economic development of regions have been acknowledged in many studies. In particular, universities and firms that are established on university knowledge, spin-off firms, function as nodes and channels through which new knowledge is diffused into the wider (regional) economy. New knowledge is a strategic resource of competitive advantage for young high-tech firms. Of course, many of these firms are based on new technical knowledge but they may lack market and managerial knowledge and skills. An important way of learning on these different aspects is through social networks and business networks, with a local (national) and/or international coverage. Many studies have attempted to understand the characteristics of networks of young high-tech firms, but a detailed picture and understanding of the time and space dimension of models of learning relationships are rare. What may be true is that a well-developed local learning network performs as an important condition for establishing international learning relationships, indicating a stepwise model. The theory of ëborn globalsà indicates, however, international learning from the start of the firm. This paper explores the learning models of university spin-off firms, including some aspects of absorptive capacity, with a focus on various combinations of local and global knowledge networks and changes in these combinations by age of the firms. The analysis draws on a sample of 100 spin-offs from two universities: TU Delft University in the Netherlands and Norwegian University of Science and Technology (NTNU) in Trondheim in Norway. Resource based views and organizational learning theory will be applied to design an analytical model of young high-tech firmsà shaping of learning connections and improving of innovation performance. The empirical part of the paper will include descriptive and explanatory results, the latter derived from correlation analysis. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1661&r=ent |
| By: | Heike Delfmann; Sierdjan Koster |
| Abstract: | Knowledge transfer has been widely recognized as a key element of innovation that drives competitive advantage and regional development in knowledge-driven economies. In this respect the role of institutes of higher education is essential, as they generate knowledge. The vast majority of research on the topic of transferring knowledge focuses on universities. In the case of the Netherlands however, because of their binary system, colleges of higher education make up a great deal of the complete higher education system. We argue that these colleges of higher education are better suited to address the needs of small businesses than universities. Colleges have a more practical educational approach, they are closer related to the industry, which enhances their accessibility and approachability for small firms. This paper explains the difference in knowledge transfer between the two types of higher education institutes. The main goal of this research is to provide a classification of SMEs who take part in the knowledge transfer process of specifically colleges of higher education compared to universities. This paper presents the results of a recent study using a survey among small organisations in the area of Groningen, the Netherlands. Using Groningen as a case study we were able to collect data from a region with one university and one college of higher education of similar size. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p553&r=ent |
| By: | Lutz Trettin; Uwe Neumann; Guido Zakrzewski |
| Abstract: | The city of Essen is located at the centre of the Ruhr area, one of the largest urban and industrial agglomerations in Europe. Like many places in the German federal state of North Rhine-Westphalia Essen had to deal with tremendous structural changes due to the downturn of coal mining and the steel industry since the 1960s. Nevertheless, in the meanwhile the city succeeded in creating a comparatively favourable starting position as an important centre for services, culture and new forms of tourism. Traditionally the headquarters of some of the largest German public companies are located here. Furthermore, the city has become an internationally renowned place of commercial fairs, conferences, and has a university. Essen hosts internationally acknowledged cultural institutions. And recently the building complex of the coal mine “Zollverein” became enlisted by the UNESCO as a World Heritage Memorial. In May 2006 the Ruhr area with Essen as its leading city was finally nominated as European Capital of Culture 2010. Taking all these factors together, a boost of the local tourism sector can be expected. In this context we discuss how the cities economy can gain from this development in the long run. We are interested in the related approaches of the tourism policy and the role of small firms and entrepreneurs in the process of developing a sustainable tourism infrastructure. It is of particular interest how public initiatives of tourism promotion and entrepreneurship support will be combined with the aim to use “industrial heritage tourism” and “cultural tourism” as a mode to economically revive the old industrialized Ruhr area. Thus, central questions of the papers are: Which policy strategies and support measures are appropriate in order to compete with success as an old industrialized area in the field of city and cultural tourism? Who tends to govern the newly establishing value chains? What position remains factual for local young firms therein? What role can public institutions play in order to ensure a high degree of value addition by local economic actors? |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p357&r=ent |
| By: | Hans Westlund; Kent Eliasson |
| Abstract: | Policies aiming at promoting entrepreneurship are in general formed on national levels, without any consideration to differences between urban and rural areas. Usually cities are provided with better and more modern infrastructure; cities have better supply of physical, financial and human capital and connected services, and cities have a more modern industrial structure in the sense that their shares of growing industry are higher. These circumstances indicate that policies for entrepreneurship, which in general are designed for urban areas, might not work as intended when they are implemented in rural areas. A first step to improving the efficiency of these policies could be to investigate the differences between cities and countryside regarding frequencies and types entrepreneurship. Based on a database containing socio-economic information on all residents in Sweden this paper examines a) The scope and structure of enterprise propensity in urban and rural areas respectively in Sweden. b) The importance of a number of attributes that may have an impact on individuals’ propensity to start an enterprise in the two area types. Besides total (active) populations of urban and rural areas, divisions are made in men and women, in age groups and in different manufacturing and service sectors. Variables on individual level being investigated are education, incomes and combination of incomes from various income sources. Variables on regional level being tested are population size and density, centers’ population density, average commuting distance, local employment level and demographics and relative density of firms. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1486&r=ent |
| By: | Hoogendoorn, Sander M. (University of Amsterdam); van Praag, Mirjam (University of Amsterdam) |
| Abstract: | One of the most salient and relevant dimensions of team heterogeneity is ethnicity. We measure the causal impact of ethnic diversity on the performance of business teams using a randomized field experiment. We follow 550 students who set up 45 real companies as part of their curriculum in an international business program in the Netherlands. We exploit the fact that companies are set up in realistic though similar circumstances and that we, as outside researchers, had the unique opportunity to exogenously vary the ethnic composition of otherwise randomly composed teams. The student population consists of 55% students with a non-Dutch ethnicity from 53 different countries of origin. We find that a moderate level of ethnic diversity has no effect on team performance in terms of business outcomes (sales, profits and profits per share). However, if at least the majority of team members is ethnically diverse, then more ethnic diversity has a positive impact on the performance of teams. In line with theoretical predictions, our data suggest that this positive effect could be related to the more diverse pool of relevant knowledge facilitating (mutual) learning within ethnically diverse teams. |
| Keywords: | ethnic diversity, team performance, field experiment, entrepreneurship, (mutual) learning |
| JEL: | J15 L25 C93 L26 M13 D83 |
| Date: | 2012–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6731&r=ent |
| By: | Bart Sleutjes |
| Abstract: | This paper looks at the factors that influence an entrepreneur’s decision to stay or move out of a neighbourhood. In general, new and relatively small firms tend to have a strong connection to their local environment and hardly ever move across large distances. In the Netherlands, 75% of all moving firms even stays within the same municipality, to business parks or to other neighbourhoods (RPB, 2007). Aspects of the building (e.g. size) are the most likely reason to move, but does the neighbourhood itself matter as well? We look to what extent neighbourhood aspects influence or have influenced the decision to stay or move, both on the push and the pull side. These aspects may be related to the local physical environment or the safety situation, but also to the local social community. There is recent evidence that localized firm support network contacts contribute positively to firm success (Sleutjes & Schutjens, 2009). Local personal and professional relationships may tie firms to their local environment. If certain neighbourhood characteristics or localized networks turn out to be pull or push factors for entrepreneurs, this might interest policy makers aiming at stimulating the neighbourhood economy by attracting and retaining entrepreneurs within certain urban neighbourhoods. Basically, three questions will be answered in this paper: 1. To what extent do social and physical neighbourhood characteristics play a role in a firm’s decision to stay or move? 2. How do localized firm support networks influence a firm’s decision to stay put within a certain neighbourhood or not? 3. To what extent do moving firms keep in touch with local network contacts from their former neighbourhood? We conducted in-depth semi-structured interviews among 40 entrepreneurs from five similar Dutch neighbourhoods. The sample is equally divided between firms that stayed and firms that recently moved out of the neighbourhood (20/20). The survey provides detailed information on the characteristics and the performance of firms, as well as network contacts, neighbourhood attachment, location choice, and the valuation of location aspects. We make use of qualitative methods in order to analyze our data. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p690&r=ent |
| By: | Sven-Olov Daunfeldt; Niklas Elert; Dan Johansson |
| Abstract: | Previous examinations of the literature suggests that high-growth firms (HGFs) exist in all or most industries, are not overrepresented in high-tech, and if anything appear to be slightly overrepresented in services. In an updated overview, we find that more recent studies, employing better statistical methods, show a clear link between technological sophistication and HGFs. In a tobit model we examine what factors explain the presence of HGFs across 5-digit-NACE-industries in Sweden 1997-2005. We find that technological sophistication is crucial for the prevalence of HGFs in an industry, particularly in services. These results are in line with both current research and previous research concerning Sweden. We conclude that innovation is crucial for firm growth. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1658&r=ent |
| By: | Dan Johansson; Sven-Olov Daunfeldt |
| Abstract: | Abstract: Previous examinations of the literature suggests that high-growth firms (HGFs) exist in all or most industries, are not overrepresented in high-tech, and if anything appear to be slightly overrepresented in services. In an updated overview, we find that more recent studies, employing better statistical methods, show a clear link between technological sophistication and HGFs. In a tobit model we examine what factors explain the presence of HGFs across 5-digit-NACE-industries in Sweden 1997-2005. We find that technological sophistication is crucial for the prevalence of HGFs in an industry, particularly in services. These results are in line with both current research and previous research concerning Sweden. We conclude that innovation is crucial for firm growth. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1500&r=ent |
| By: | Florian Noseleit |
| Abstract: | Several theoretical approaches to explaining economic growth focus on externalities arising from interactions between economic agents. A frequently discussed source of such externalities is regional diversity of the industry structure. A large number of empirical studies support the argument that regional diversity can be beneficial to regional employment, innovation, and economic stability. It is not particularly surprising that diversity in the industry structure can be assumed to depend, in part, on the activity of new businesses. To date, however, little is known about the roles and paths new businesses take in the diversification of the industry structure. The central questions that this paper attempts to answer are how the market selection process influences the diversity of entries and how start-up activity influences diversity in the region and beyond. For an analysis of diversity patterns, we use regional data for West Germany over a 27-year period that includes specifics about employment at the industry level and allows us to distinguish and follow entry cohorts over time. Compared with the large amount of literature analyzing whether diversity or specialization is conducive to regional development, the literature discussing trends of regional diversification is rather limited. The preliminary results of this study can be summarized as follows. On the whole, regional diversity moderately increased over the last decades. Regional diversity and region size are related via an inverse u-shape. Establishment scale is negatively related to diversity. In addition, evidence supports that regional diversity increases with the number of entries but decreases with the number of exits. Modest specialization is positively associated. Certain empirical regularities for the role of entries are: Employment diversity in entries is increasing over time at the national level, while diversity at the regional level is decreasing on average. This antipodal development of diversity can be explained by a market selection favoring a diverse set of specializations at the regional level. Despite the decrease in regional diversity in entry cohorts over time, these entries contribute to an increase in total regional diversity due to a selection within entry cohorts that substantially differs from the existing regional industry structure. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1117&r=ent |
| By: | Suvi Konsti-Laakso; Timo Pihkala; Saara Linna |
| Abstract: | Small and middle sized companies (SME) are important for local economies. Networking of SME is often considered to be a vital activity as well in production operations but also in innovation activities (Vesalainen 2006, Bessant and Tidd 2007.) From the perspective of small businesses the value networks (Vanhaverberke & Cloodt 2006) provide an interesting opportunity. Instead of mere value chain co-operation, the value networks open up new approaches to horizontal co-operation and opportunity to use the small businesses’ own core competencies in a wider context. While the access to traditional value chain networks has been dominantly difficult for the smallest businesses, in value networks the access is largely dependent on the entrepreneur’s personal contacts and social relationships. The purpose of this paper is to analyze the formation process of a SME value network focusing on the development of a small suburb. Through this analysis we seek to illustrate how regional Living Lab activities can promote SME networking. The theory section provides an insight about value network, user involvement in innovation and network evolution. The case example is from Lahti Living Lab, where a group of companies from living environment (products or services such as living area services, parks, street maintenance, planning, communication and outdoor products) participate in suburb development. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p773&r=ent |
| By: | Ana Claudia Arruda Laprovitera; Dinilson Pedroza Junior |
| Abstract: | The objective of the article is to analyze the role of small (businesses) companies in regional economic development. The article analyzes the current structure of tax concession and financial incentives into improving regional development and how it can be modified and directed in promoting small companies, especially the small enterprises located in poor regions of Brazil. We discuss how the incentives for regional development can be used to foment small business environment in poor regions, more specifically, in the Northeast of Brazil. A small business environment is a set of social, economic and institutional spaces where such companies operate, considering its opportunities and threats. The small companies are understood - in the vision of the official institutions of Brazil - as units of production of goods and services of reduced scale. This concept considers the formal organizations (with legal register and tax contributions), excluding the informal sectors of the economy. The size of a company, its number of employees and its market share are criterias usually applied to the definition of small companies. We argue that tax and finances incentives to the small company in north-eastern of Brazil must consider the scenarios techniques, as anticipations of futures, conditioned of the determined hypotheses. The methodology of construction of scenarios constitutes a tool for anticipation of the events, delimiting its probabilities and organizing the uncertainty. It is assumed that the scenarios of small business environment are influenced by the national economic, political and institutional contexts. The work is based in social, economic and institutional sceneries available for Brazil adapted for the environment of the small companies of Brazilian northeast. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p50&r=ent |
| By: | Michaela Fuchs; Udo Brixy |
| Abstract: | Empirical research on agglomeration and regional economic growth puts high emphasis on the impact of specialization, diversity, and competition on regional employment dynamics (Glaeser et al. 1992, Henderson et al. 1995, Blien et al. 2006, Fuchs 2009). However, Beugelsdijk (2006) and Raspe/van Oort (2008) argue that this relationship should most profoundly hold at the micro or firm level. This paper centres on the labour demand of individual plants and assesses the influence of regional features in direct contrast to plant-specific characteristics as well as conventional labour-demand determinants. Hence, it contributes to the sparse literature on the importance of regional character-istics for firm performance and additionally integrates research from industrial as well as labour economics. The analysis is based on the IAB Establishment Panel, a comprehensive data set on German plants. For the years from 2004 to 2008 it encompasses observations on roughly 8,000 plants. The regional variables are added on the NUTS3-level. First econometric results confirm the basic hypotheses derived from labour-demand theory: wages exert a significantly negative and output a positive influence on the number of employees. Among the plant-specific characteristics, it is mainly plant size, exporting behaviour and R&D / innovation activities that foster employment. There are also distinctive differences regarding the single sectors. Last but not least, the regional environment plays a decisive role for plant-level labour demand. The size of the region the plant is located in, the degree of sectoral concentration as well as of competition within a sector have a positive and highly significant impact. By contrast, accessibility to highways, specialization, and diversity seem to be of minor relevance |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p243&r=ent |
| By: | Oguz Ozbek |
| Abstract: | The economic development in one region or locale can be associated with and explained by socio-cultural and socio-spatial factors. This premise is well-supported by an institutional and historical analysis. The increasing number of works on social embeddedness and formation of entrepreneurial culture highlight again a well-known phrase of institutional economics: history matters. Economic growth in one region can be closely associated with broad historical processes and initial advantages. The Turkish case offers a suitable context for this institutional analysis outlined above. The initial advantages that are most evident in the irreversible development trajectories of the commercial centres like Istanbul and Izmir are also expressive in the emerging regional and sub-regional growth centres like Anatolian Tigers. Anatolian Tigers refer a number of new growth centres that put up a good and consistent performance in manufacturing industry since the 1980s. Two Anatolian Tigers, Konya (well-known) and Karaman (less-known) locating in South-Central Anatolia constitute the geographical scope of this paper. The sub-region of Konya-Karaman is not only delineated by normative criteria but also defined historically and geographically. This makes the area a historical region of established commercial culture. Konya is an important regional centre of commercial, industrial, agricultural and service activities in Turkey especially with its nationally strategic industrial establishments and grain production. Since the 1980s, Konya has experienced an important development in the manufacturing industry. Karaman that is an important industrial and commercial centre of Central Anatolia at both provincial and urban levels is commonly not known or termed as an Anatolian Tiger but it displays a number of historical peculiarities (administrative, socio-economic and geographic) are crucial to comprehend the historical roots of recent commercial and industrial development of Tigers and other redeveloping centres in Anatolia. In the re-emergence of Konya and Karaman as regional growth centres, locational, social and political factors contributed positively to the perpetual socio-economic development in Anatolian Seljuk, Karamanogullari, Ottoman and Republican periods. In conclusion, from the perspective of institutional economics, this paper examines the role of historical-geographical factors in the formation of an entrepreneurial culture in the sub-region of Konya and Karaman. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1436&r=ent |
| By: | Megha Mukim |
| Abstract: | Innovation is crucial to regional economic competitiveness and to productivity growth. A salient feature of the Indian economy is the geographic concentration of both, economic activity and innovation, as measured by patent activity. Theoretical models argue that the clustering of economic activity within a geographic region results in knowledge spillovers, which in turn drives innovation. The literature also posits that the presence of human capital is critical to the generation of new knowledge. This paper studies how and why economic geography and factor endowments matter for innovative activity – in other words, what is the relationship between human capital and patent generation, and crucially, how is this affected by the spatial distribution of economic activity? The paper analyses patent activity, both applications and grants, between 1995 and 2004 across districts in India. By using an econometric model, it then relates innovation to measures of agglomeration, industry-type and the size distribution of firms, and to the distribution of human capital endowments. It also uses data on employment by industrial activity, productivity and FDI flows. Understanding the magnitude of the effects of economic geography and factor endowments is vital for policy formulation aimed at encouraging innovative activity. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p1356&r=ent |
| By: | Edward Bergman |
| Abstract: | Difficulty in extracting scientific and research findings from EU universities and placing such knowledge at the commercial disposal of innovation-dependent firms and industries is a cause for grave concern by the European Commission and many of its member states and regions, particularly when contrasted with the notable success enjoyed by U.S. universities. A review of literature from the perspective of EU knowledge-seeking firms and knowledge-generating universities reveals a striking asymmetry: firms presently seek mainly public science outputs, while universities pursue proprietary science opportunities more heavily in their dealings with business and industry. At the same time knowledge flows are being promoted far more aggressively, universities are being totally restructured, harmonised in many respects and decentralized regarding governance and accountability. Results from a web-survey of 1798 EU academics posted in Europe’s universities listed in the Shanghai TOP 500 reveal several important findings of interest. First, EU and U.S. respondents have quite similar views of what is considered reasonable with regard to public vs. private science. The exceptions reveal a generally stronger approval by EU academicians for their universities to be more proactive regarding commercialization, particularly university support of research-based start-up firms, with some differences based on respondents’ discipline [(1) biological sciences, 2) physics, 3) computer science, 4) chemical engineering, 5) economics and 6) history]. Further investigation shows those who have already undertaken or investigated commercialization opportunities tend to approve a battery of commercialization measures taken by their universities, and those who: a. have worked on externally-funded research projects with colleagues from industry, b. see regional business leaders influencing university commercialization policies, c. are heavily engaged in public service activities, and have collaborated with industry colleagues on research projects. (submitted to Uddevalla) |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwrsa:ersa10p363&r=ent |