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on Entrepreneurship |
| By: | Harju, Jarkko; Juuti, Toni; Matikka, Tuomas |
| Abstract: | Using full-population data from Finland, we show that individuals at the top of the income distribution are significantly more likely to start new incorporated businesses compared to others. There is no similar selection based on parental income, but more than half of new entrepreneurs have entrepreneurial parents. Individual income gains from entrepreneurship are similar across different background characteristics, but parental entrepreneurship and personal income are positively linked to key firm-level outcomes such as productivity and job creation. This highlights the importance of the intergenerational transmission of entrepreneurial skills and suggests that businesses established by high-income individuals generate largest positive spillovers. |
| Keywords: | entrepreneurship, income mobility, inequality, productivity, Social security, taxation and inequality, Business taxation and regulation, L26, J24, J3, fi=Tulonjako ja eriarvoisuus|sv=Inkomstfördelning och ojämlikhet|en=Income distribution and inequality|, |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:fer:wpaper:168 |
| By: | Astebro, Thomas B. (HEC Paris); Fossen, Frank M. (University of Nevada, Reno); Gutierrez, Cédric (Bocconi University) |
| Abstract: | Entrepreneurship scholars are interested in understanding and describing how entrepreneurs make decisions under uncertainty, where the probabilities of outcomes are not known but perceived, resulting in ambiguous probabilities. In this context, ambiguity refers to the lack of precise and objective probability assessments and the presence of subjective judgments regarding potential outcomes. In this chapter, we discuss the development of thought on how entrepreneurs perceive and react to uncertainty from Frank Knight (1921) to the present day. Recognizing that entrepreneurs face uncertainty rather than risk and are unlikely to have estimates of all probabilities for all potential outcomes, it becomes difficult to accept Expected Utility Theory (EUT), developed by Savage (1951) and von Neumann and Morgenstern (1953), as a relevant model for entrepreneurial decision-making. We examine a range of decision theories, ranking them in an order starting from EUT and proceeding to the most structure-free models of entrepreneurial choice, allowing for comparisons and contrasts of the main components and underlying concepts as they apply to entrepreneurial decision making. |
| Keywords: | entrepreneurship, uncertainty, ambiguity, decision theory, Bayesian Entrepreneurship |
| JEL: | L26 J24 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17231 |
| By: | D’Alessandro, Francesco (Università Cattolica del Sacro Cuore); Santarelli, Enrico (University of Bologna); Vivarelli, Marco (Università Cattolica del Sacro Cuore) |
| Abstract: | In this paper we integrate the insights of the Knowledge Spillover Theory of Entrepreneurship and Innovation (KSTE+I) with Schumpeter's idea that innovative entrepreneurs creatively apply available local knowledge, possibly mediated by Marshallian, Jacobian and Porter spillovers. In more detail, in this study we assess the degree of pervasiveness and the level of opportunities brought about by AI technologies by testing the possible correlation between the regional AI knowledge stock and the number of new innovative ventures (that is startups patenting in any technological field in the year of their foundation). Empirically, by focusing on 287 Nuts-2 European regions, we test whether the local AI stock of knowledge exerts an enabling role in fostering innovative entry within AI-related local industries (AI technologies as focused enablers) and within non AI-related local industries, as well (AI technologies as generalised enablers). Results from Negative Binomial fixed-effect and Poisson fixed-effect regressions (controlled for a variety of concurrent drivers of entrepreneurship) reveal that the local AI knowledge stock does promote the spread of innovative startups, so supporting both the KSTE+I approach and the enabling role of AI technologies; however, this relationship is confirmed only with regard to the sole high-tech/AI-related industries. |
| Keywords: | KSTE+I, Artificial Intelligence, innovative entry, enabling technologies |
| JEL: | O33 L26 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17206 |
| By: | April Burrage; Nilanjana Dasgupta; Ina Ganguli |
| Abstract: | This study examines gender differences in the social impact and commercial motives for academic entrepreneurship using the National Science Foundation's Innovation Corps (NSF I-Corps) program. I-Corps provides experiential entrepreneurship training to faculty and graduate student researchers at local I-Corps university sites and through a nationwide program. Since the inception of I-Corps, only 20% of participants have been women. We first use survey data from one I-Corps university site to show that women participants had higher social entrepreneurial intentions compared to commercial entrepreneurial intentions, and these social entrepreneurial intentions were higher than men’s. We then extend and generalize this finding by analyzing 1, 267 publicly available project summaries from the National I-Corps Program from 2012-2019. We find that women PIs’ I-Corps project proposals emphasized social impact significantly more than men PIs, while projects for all PIs emphasized commercial impact to a similar degree. We next ran a field experiment to estimate the causal impact of social impact vs. commercial motives by experimentally manipulating the recruitment email messages inviting researchers to participate in the I-Corps training program. We find that women were more likely to show interest in a social impact version of a message compared to a commercial version, while men showed equal interest in both types of messages. Taken together, our results indicate that women are more interested in pursuing commercialization and entrepreneurship activities when they are tackling societal problems. They suggest that low-cost interventions that emphasize the social impact value of entrepreneurial opportunities may increase gender diversity in entrepreneurship activities. |
| JEL: | J16 L26 O31 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32885 |
| By: | Churchill, Sefa Awaworyi (RMIT University); Chang, Simon (University of Western Australia); Smyth, Russell (Monash University); Trinh, Trong-Anh (World Bank) |
| Abstract: | This paper extends prior theory linking present-day sex ratios to present-day propensity for entrepreneurship among men backward in time to explore the long-run gender origins of entrepreneurship. We argue that present-day propensity for entrepreneurship among men will be higher in neighbourhoods which had historically high sex ratios. We propose that high sex ratios generate attitudes and behaviours that imprint into cultural norms about gender roles and that vertical transmission within families create hysteresis in the evolution of these gender norms. To empirically test the theory, we employ the transport of convicts to the British colonies of New South Wales and Van Diemen's Land in the eighteenth and nineteenth centuries as a natural experiment to examine the long-run effect of gender norms on entrepreneurship in present-day Australia. We use a representative longitudinal dataset for the Australian population that provides information on the neighbourhood in which the participant lives, which we merge with data on the sex ratio in historical counties from the mid-nineteenth century. We find that men who live in neighbourhoods which had high historical sex ratios have a higher propensity for entrepreneurship. We present evidence consistent with the vertical transmission of gender norms within families being the likely mechanism. Arguments for policies to promote female entrepreneurship are typically couched in terms of gender norms representing a barrier to more women starting their own business. We present evidence consistent with gender norms contributing to gender differences in rates of entrepreneurship by being a spur for higher male entrepreneurship rather than a barrier to female entrepreneurship. |
| Keywords: | gender norms, sex ratios, entrepreneurship, Australia |
| JEL: | I31 J21 J22 N37 O10 Z13 Z18 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17170 |
| By: | Marianne Sytchkov (NIMEC - Normandie Innovation Marché Entreprise Consommation - UNICAEN - Université de Caen Normandie - NU - Normandie Université - ULH - Université Le Havre Normandie - NU - Normandie Université - UNIROUEN - Université de Rouen Normandie - NU - Normandie Université - IRIHS - Institut de Recherche Interdisciplinaire Homme et Société - UNIROUEN - Université de Rouen Normandie - NU - Normandie Université); Charles-Edouard Houllier-Guibert (NIMEC - Normandie Innovation Marché Entreprise Consommation - UNICAEN - Université de Caen Normandie - NU - Normandie Université - ULH - Université Le Havre Normandie - NU - Normandie Université - UNIROUEN - Université de Rouen Normandie - NU - Normandie Université - IRIHS - Institut de Recherche Interdisciplinaire Homme et Société - UNIROUEN - Université de Rouen Normandie - NU - Normandie Université) |
| Abstract: | Le parti-pris du dispositif inédit d'accompagnement par le récit vrai conté est d'intervenir au moment du renoncement des entrepreneurs à leur projet entrepreneurial et ainsi apporter un soutien à un stade inattendu du parcours : la fin. En tant que déclinaison méthodologique de l'approche conceptuelle d'étude de l'action entrepreneuriale au moyen de l'accès au réel expérimenté par les entrepreneurs, cet accompagnement non-invasif et dédramatisant se retrouve pourtant confronté à la difficulté pour les entrepreneurs de faire acte de narration lorsqu'ils sont en train de renoncer. |
| Keywords: | Accompagnement entrepreneurial conte renoncement méthodologie réel expérimenté, Accompagnement entrepreneurial, conte, renoncement, méthodologie, réel expérimenté |
| Date: | 2024–06–03 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04667541 |
| By: | Felipe A. Csaszar; Harsh Ketkar; Hyunjin Kim |
| Abstract: | This paper explores how artificial intelligence (AI) may impact the strategic decision-making (SDM) process in firms. We illustrate how AI could augment existing SDM tools and provide empirical evidence from a leading accelerator program and a startup competition that current Large Language Models (LLMs) can generate and evaluate strategies at a level comparable to entrepreneurs and investors. We then examine implications for key cognitive processes underlying SDM -- search, representation, and aggregation. Our analysis suggests AI has the potential to enhance the speed, quality, and scale of strategic analysis, while also enabling new approaches like virtual strategy simulations. However, the ultimate impact on firm performance will depend on competitive dynamics as AI capabilities progress. We propose a framework connecting AI use in SDM to firm outcomes and discuss how AI may reshape sources of competitive advantage. We conclude by considering how AI could both support and challenge core tenets of the theory-based view of strategy. Overall, our work maps out an emerging research frontier at the intersection of AI and strategy. |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2408.08811 |
| By: | KOUAKOU, Dorgyles C.M. |
| Abstract: | Using firm-level data from the World Bank Enterprise Surveys, covering 159 countries from 2006 to 2023, we examine whether past informality affects the credit constraints of registered firms. Estimations, based on the entropy balancing method, indicate that registered firms that began operations informally are more likely to be credit-constrained than those that started in the formal sector. This finding is extremely robust to a variety of robustness tests, including instrumental variables, propensity score matching, potential omitted variables, restricted samples, alternative measures of credit constraints, and different specifications such as Linear Probability, Logit, and Probit models. Heterogeneity analysis reveals that the detrimental impact of past informality lessens with firm size, firm age, and better structural factors like regulatory quality, trade openness, entrepreneurial dynamism, and public spending. Productivity, competition from the informal sector, and the quality of financial statements are key channels through which past informality increases credit constraints for registered firms. |
| Keywords: | Past informality status; Credit constraints; Entropy balancing |
| JEL: | G20 O12 O16 O17 |
| Date: | 2024–08–19 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:121766 |
| By: | Dirk Czarnitzki; Malte Prüfer |
| Abstract: | This paper investigates the impact of Public Procurement of Innovation (PPI) and Research and Development (R&D) grants on firms' R&D investment using data from Belgian R&D-active firms over the past decade. Our empirical analysis robustly reveals a non-negligible crowding-out effect between the two instruments, suggesting a substitutive relationship. While each policy individually positively influences R&D investment, their combined implementation diminishes their effectiveness. These results challenge prevailing evidence and emphasize the need for a careful policy implementation, raising policymakers’ awareness against a blanket increase in innovation policies without considering potential interactions. |
| Keywords: | Public procurement of innovation, Research and Development, Econometric policy evaluation, Crowding-out |
| Date: | 2024–08–14 |
| URL: | https://d.repec.org/n?u=RePEc:ete:msiper:746875 |
| By: | Lora Dufresne; Mark M. Spiegel |
| Abstract: | Using bank-level U.S. Call Report data, we examine the longer-term effects of the Paycheck Protection Program (PPP) and the PPP Liquidity Facility on small business (SME) lending. Our sample runs through the end of 2023H1, by which time almost all PPP loans were forgiven or repaid. To identify a causal impact of program participation, we instrument based on historical bank relationships with the Small Business Administration and the Federal Reserve discount window prior to the onset of the pandemic. Elevated bank participation in both programs was positively associated with a substantial cumulative increase in small business lending growth. However, we find a negative impact of both programs during the final year of our sample, suggesting that the increase may not prove permanent. Our results are driven by the small and medium-sized banks in our sample, which are not stress-tested and hence not included in Y-14 banking data, illustrating the importance of considering small and medium-sized banks in evaluating the performance of SME lending programs. |
| Keywords: | PPP; PPPLF; small business; bank lending; relationship lending |
| JEL: | E58 E63 G14 G18 G32 |
| Date: | 2024–08–07 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedfwp:98688 |
| By: | Schito, Marco; Klimavičiūtė, Luka; Pál, Rozália |
| Abstract: | Does increasing inflation affect firms' investment decisions? This article employs the European Investment Bank Investment Survey (EIBIS) dataset to explore the association between the increased inflation that the EU countries have experienced since 2021, and firms' investment decisions. We find evidence that very high rates of inflation (over 20%) are associated with higher probabilities of investment, likely driven by measures to improve energy efficiency (particularly for SMEs) and a desire to avoid the devaluation of cash reserves (for large firms). We further find a positive association between SMEs' ability to pass costs onto consumers (the so-called pass-through rate) and investment decision, suggesting a higher degree of reliance on the generation of continuous revenues for investment purposes compared with large firms. Inflation's by-products (increased interest rates, difficulties in accessing external financing, increasing uncertainty) are found to be important negative factors in investment decisions. (146 words) |
| Keywords: | EIBIS, inflation, investment, cost pass-through rate, financial tightening, SMEs |
| JEL: | D22 D25 E31 E43 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:eibwps:301874 |
| By: | Heng-fu Zou (The World Bank) |
| Abstract: | Deirdre McCloskey's argument in favor of what she calls humanomics emphasizes the role of novel ideas about liberty and dignity for ordinary people as the driving force behind what she terms "The Great Enrichment." This period of unprecedented economic growth, beginning in the 18th century and continuing into the present, was not primarily driven by capital accumulation or institutional frameworks, but by the widespread social acceptance of bourgeois values that encouraged innovation and entrepreneurship among the masses. |
| Date: | 2024–08–24 |
| URL: | https://d.repec.org/n?u=RePEc:cuf:wpaper:659 |
| By: | Inés Gabarret (LAREQUOI - Laboratoire de recherche en Management - UVSQ - Université de Versailles Saint-Quentin-en-Yvelines); Aude D’andria (UEVE - Université d'Évry-Val-d'Essonne); Annie Bartoli (LAREQUOI - Laboratoire de recherche en Management - UVSQ - Université de Versailles Saint-Quentin-en-Yvelines); Philippe Hermel (LAREQUOI - Laboratoire de recherche en Management - UVSQ - Université de Versailles Saint-Quentin-en-Yvelines); Alain Bouvier (LAREQUOI - Laboratoire de recherche en Management - UVSQ - Université de Versailles Saint-Quentin-en-Yvelines); Bérangère L. Szostak (LAREQUOI - Laboratoire de recherche en Management - UVSQ - Université de Versailles Saint-Quentin-en-Yvelines); Yasmine Boughzala (ISG - Institut Supérieur de Gestion de Tunis [Tunis] - Université de Tunis) |
| Keywords: | Female incubators entrepreneurship gender equality French incubators Design Thinking CSR Innovation Community Case Study. JEL Codes: O310 O320, Female incubators, entrepreneurship, French incubators Design Thinking, CSR, Innovation, Community, Case Study. JEL Codes: O310, O320, gender equality |
| Date: | 2023 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04648222 |