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on Entrepreneurship |
| By: | Acemoglu, Daron; Akcigit, Ufuk; Alp, Harun; Bloom, Nicholas; Kerr, William R. |
| Abstract: | We build a model of firm-level innovation, productivity growth and reallocation featuring endogenous entry and exit. A new and central economic force is the selection between high- and low-type firms, which differ in terms of their innovative capacity. We estimate the parameters of the model using US Census micro data on firm-level output, R&D and patenting. The model provides a good fit to the dynamics of firm entry and exit, output and R&D. Taxing the continued operation of incumbents can lead to sizable gains (of the order of 1.4% improvement in welfare) by encouraging exit of less productive firms and freeing up skilled labor to be used for R&D by high-type incumbents. Subsidies to the R&D of incumbents do not achieve this objective because they encourage the survival and expansion of low-type firms. |
| Keywords: | Entry; growth; industrial policy; Innovation; R&D; reallocation; selection |
| JEL: | E2 L1 O31 O32 O33 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:12449&r=ent |
| By: | Aghion, Philippe; Akcigit, Ufuk; Lequien, Matthieu; Stantcheva, Stefanie |
| Abstract: | We study how strongly individuals respond to tax simplicity and how they learn about the complexities of the tax system. We focus on the self-employed, who can more easily adjust to tax incentives and whose responses directly stem from their own understanding of the tax system. We use new French tax returns data from 1994 to 2012. France serves as a good quasi-laboratory: it has three fiscal regimes -- or modes of taxation-- for the self-employed, which differ in their monetary tax incentives and in their tax simplicity. Two key features are that, first, these regimes are subject to eligibility thresholds; we find large excess masses (bunching) right below the latter. Second, the regimes impact different agents heterogeneously and have changed extensively over time. Taken together, these two key elements give us measures of tax responses (the bunching) as well as the variation needed to jointly estimate a value of tax simplicity and taxable income elasticities. They also give us an opportunity to study how individuals learn about and respond over time to changing policy parameters. We estimate a large value for tax simplicity of up to 650 euros per year per individual depending on the regime and activity. We also find sizable costs of tax complexity; agents are not immediately able to understand what the right regime choice is, leave significant money on the table, and learn over time. The cost of complexity is ``regressive'' in that it affects mostly the uneducated, low income, and low skill agents. Agents who can be viewed as more informed and knowledgable (e.g., the more educated or high-skilled) are more likely to make the correct regime choice and to learn faster. |
| Keywords: | Complexity; entrepreneurship; learning; Self-employment; taxation |
| JEL: | H21 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:12471&r=ent |
| By: | Grimpe, Christoph; Murmann, Martin (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Sofka, Wolfgang |
| Abstract: | "We investigate whether appointing a middle management level affects startups' innovation performance. Additional hierarchical levels are often suspected to restrict innovative activities. However, founders' capacities for information processing and resource allocation are usually strongly limited while, at the same time, R&D decisions are among the most consequential choices of startups. We argue that middle management is positively related to introducing product innovations because it improves the success rates from recombining existing knowledge as well as managing R&D personnel. In addition, we suggest that the effectiveness of these mechanisms depends on the riskiness of a startup's business opportunity. Based on a sample of German high-tech startups, we find support for our conjectures." (Author's abstract, IAB-Doku) ((en)) |
| JEL: | L26 M13 M12 M51 L22 L23 J21 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:201801&r=ent |
| By: | Xi, Guoqian (University of Trier); Block, Jörn (University of Trier); Lasch, Frank (Montpellier Business School); Robert, Frank (Montpellier Business School); Thurik, Roy (Erasmus University Rotterdam) |
| Abstract: | Focusing on entrepreneurship entry modes, we investigate two research questions regarding firm survival: how does the survival probability differ between business takeovers and new venture start-ups? And how do the determinants of survival differ between the two entry modes? Using a large French dataset, we find that business takeovers have a higher survival chance than new venture start-ups. Yet, the differences between two entry modes partially disappear when controlling for differences in founder and firm characteristics. Moreover, we identify differences in the determinants of survival between the two groups, highlighting the distinction between the two forms of entrepreneurship. |
| Keywords: | new venture start-up, business takeover, firm survival |
| JEL: | L26 M13 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11155&r=ent |
| By: | GOTO Yasuo; Scott WILBUR |
| Abstract: | The "soft budget problem," by which banks loosen their lending stances toward long-term client firms despite worsening business conditions, has been widely discussed in the field of financial studies. In Japan, this problem has attracted attention particularly in connection to so-called "zombie firms," financially weak firms sustained by discounted interest rates and evergreen lending which have become a major research and political interest in recent years. In this paper, we focus on zombie firms among small and medium-sized enterprises (SMEs), a corporate category that has hitherto received less consideration in the discussion about Japan's zombie firms. We find that: (1) many zombie firms exist among SMEs; (2) some zombie firms eventually emerge from zombie status; (3) once a firm becomes a zombie, its probability of exit increases especially among SMEs; and (4) the economic performance of exiting zombie firms is worse than those of exiting non-zombie firms. |
| Date: | 2017–12 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:17123&r=ent |
| By: | Medalla, Erlinda M.; Mantaring, Melalyn C. |
| Abstract: | Small and medium enterprise (SME) development as a major domestic policy objective that is consistent and reinforced within APEC would not only engender inclusive growth but also enable SMEs to become drivers of growth for the domestic, as well as the regional economy. This paper provides a background on the local SME development policy environment and the existing APEC SME activities in the region. It also offers recommendations on how the APEC can further mainstream SMEs in the regional and global market. |
| Keywords: | APEC, inclusive growth, , SMEs, small and medium enterprises |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:phd:dpaper:dp_2017-49&r=ent |
| By: | Jakhongir Kakhkharov |
| Keywords: | Remittances, labour migration, investments, Uzbekistan |
| JEL: | O15 F24 E22 |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:gri:fpaper:finance:201703&r=ent |
| By: | Chen, Yu; Zhou, Haiwen |
| Abstract: | We study firm heterogeneity in economic development in an overlapping-generations general equilibrium model in which manufacturing firms engage in oligopolistic competition. Individuals differ in their productivities in the manufacturing sector and choose to become entrepreneurs or workers. The model is surprisingly tractable. In the steady state, an increase in the entry barrier in the manufacturing sector or an increase in the percentage of income spent on the agricultural good decreases the wage rate, but the level of output in the manufacturing sector does not necessarily decrease. An increase in the degree of patience of an individual increases the steady state wage rate and the capital stock. Even with increasing returns in manufacturing and constant returns in agriculture, neither the wage rate nor the output level in the manufacturing sector may increase with the size of the population. |
| Keywords: | Firm heterogeneity, overlapping-generations model, oligopolistic competition, career choice, economic development |
| JEL: | D43 L13 O10 |
| Date: | 2017–12–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:83206&r=ent |
| By: | Samuel Mongrut Montalván (EGADE, ITESM, Campus Queretaro, Mexico) |
| Abstract: | So far, the estimation of discount rates required by entrepreneurs has remained a mystery. Mongrut and Ramirez (2006) made a contribution to this area by deriving the lower bound discount rate for a non-diversified entrepreneur in an emerging market. However, they used a quadratic utility function, which does not have desirable assumptions. In this research one extends the previous work by deriving expressions of discount rates using a Hyperbolic Absolute Risk Aversion (HARA) utility function that includes the quadratic and the logarithmic forms as special cases. Furthermore, one also assumes the entrepreneur with the lowest risk-aversion that invests almost all his capital in his project or firm and whose level of wealth approaches to zero. One finds that both expressions depend upon entrepreneur's riskaversion and a measure of the project total risk. Maintaining constant the risk-free rate, we simulate the expressions of discount rate for the quadratic form and the logarithmic form. As expected, the entrepreneur’s required returns (discount rates) are highly sensitive in both specifications and all values were lower than 50% and most of them were lower than 25%, but higher than the assumed risk-free rate. |
| Keywords: | Seed Capital, discount rates, entrepreneurship |
| JEL: | L26 M13 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:pai:wpaper:16-01&r=ent |
| By: | Velilla, Jorge; Sánchez Gracia, Rebeca |
| Abstract: | En este trabajo se realiza una revisión de la literatura sobre emprendimiento, mediante la definición y la historia del término “emprendedor”, tanto cronológicamente como desde diferentes campos de estudio, intentando mostrar la importancia de los diferentes usos del término, y dando especial importancia a las características del individuo emprendedor sénior (mayor de 50 años). Posteriormente, usando los datos “Adult Population Survey” del Global Entrepreneurship Monitor para el año 2014, se analiza empíricamente el emprendimiento entre los individuos sénior de países de la OECD. Encontramos que España y Francia muestran los niveles más bajos de emprendimiento sénior, mientras que los más altos se dan en Chile y Méjico. Además, se encuentra que el emprendimiento por oportunidad prevalece sobre el emprendimiento por necesidad entre la población sénior, y también que los factores que impulsan la actividad emprendedora por uno u otro motivo son, en gran medida, diferentes. |
| Keywords: | Emprendimiento; Emprendimiento sénior; Datos GEM |
| JEL: | L26 |
| Date: | 2018–01–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:83567&r=ent |