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on Small Business Management |
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Issue of 2018‒09‒03
thirteen papers chosen by João Carlos Correia Leitão Universidade da Beira Interior |
| By: | Audretsch, David (Indiana University); Link, Albert (University of North Carolina at Greensboro, Department of Economics) |
| Abstract: | A compelling body of research has found that investments in knowledge from other firms and universities spill over to enhance the performance of entrepreneurial firms. This literature has shown that firm performance is positively related to investments in new knowledge by other firms and research universities. This paper addresses a gap in the literature by positing that public sector knowledge is also conducive to enhancing performance by knowledge intensive entrepreneurial (KIE) firms. Our findings suggest that the public sector provides a fertile source of knowledge for enhancing KIE firm performance. |
| Keywords: | entrepreneurship; performance; knowledge spillovers; public sector |
| JEL: | H41 L26 |
| Date: | 2018–08–22 |
| URL: | http://d.repec.org/n?u=RePEc:ris:uncgec:2018_005&r=sbm |
| By: | Pellegrino, Gabriela (EPFL, Lausanne); Piva, Mariacristina (Università Cattolica del Sacro Cuore, Piacenza); Vivarelli, Marco (UNU-MERIT, and Universita’ Cattolica del Sacro Cuore, Milano) |
| Abstract: | In this work, we test the employment impact of distinct types of innovative investments using a representative sample of Spanish manufacturing firms over the period 2002-2013. Our GMM-SYS estimates generate various results, which are partially in contrast with the extant literature. Indeed, estimations carried out on the entire sample do not provide statistically significant evidence of the expected labour-friendly nature of innovation. More in detail, neither R&D nor investment in innovative machineries and equipment (the so-called embodied technological change, ETC) turn out to have any significant employment effect. However, the job-creation impact of R&D expenditures becomes highly significant when the focus is limited to the high-tech firms. On the other hand - and interestingly - ETC exhibits its labour-saving nature when SMEs are singled out. |
| Keywords: | Innovation, R&D, Embodied Technological Change, Employment, GMM-SYS |
| JEL: | O33 |
| Date: | 2018–06–11 |
| URL: | http://d.repec.org/n?u=RePEc:unm:unumer:2018024&r=sbm |
| By: | Calza, Elisa (UNU-MERIT); Goedhuys, Micheline (UNU-MERIT) |
| Abstract: | Using two waves of the Mirco, Small and Medium sized Enterprises (MSMEs) survey of Vietnamese manufacturing firms, this paper first explores what drives firms' decision to have a domestically recognized certificate, taking into account a rich number of factors related to the cost and expected benefits of certification as well as institutional factors. It further explores the presence of a positive and significant effect of domestic certificates on firm growth, these serving as signaling devices for desirable attributes under information asymmetry and thus leading to an increase in legitimacy and reputation. Evidence is indeed found for a signaling effect of certification, this being stronger for more recently adopted certificates, for advertising firms and for women entrepreneurs. |
| Keywords: | Certification, Firm growth, Transaction costs, Signaling Emerging economies, Viet Nam |
| JEL: | D22 D23 L25 O12 |
| Date: | 2018–06–21 |
| URL: | http://d.repec.org/n?u=RePEc:unm:unumer:2018026&r=sbm |
| By: | Brown, J. David (U.S. Census Bureau); Earle, John S. (George Mason University); Kim, Mee Jung (George Mason University); Lee, Kyung Min (George Mason University) |
| Abstract: | Analyzing data on all U.S. employers in a cohort of entering firms, we document a highly skewed size distribution, such that the largest 5% account for over half of cohort employment at firm birth and more than two-thirds at firm age 7. Little of the size variation is accounted for by industry or amount of finance, but relative size is strongly persistent over time: at age 7, the probability of 20+ employees is about 40 times larger for those entering with 20+ than for those entering with one. We link administrative and survey data to study the role of founder characteristics in high growth, defined as the largest 5% of the cohort at ages 0 and 7. Female-founded firms are 50% less likely to be in this ventile at both ages, and 34% less likely when controlling for detailed demographic and human capital variables. A similar initial gap for African-Americans, however, disappears by age 7. Founder age is positively associated with high growth at entry, but the profile flattens and turns negative as the firm ages. The education profile is initially concave, with graduate degree recipients no more likely than high school graduates to found high growth firms, but the former nearly catch up to those with bachelor's degrees by firm age 7, while the latter do not. Most other relationships of high growth with founder characteristics are highly persistent over time. Prior business ownership is strongly positively associated, and veteran experience negatively associated, with high growth. A larger founding team raises the probability of high growth, while, controlling for team size, diversity (by gender, age, race/ethnicity, or nativity) either lowers the probability or has little effect. Controlling for start-up capital raises the high-growth probability of firms founded by women, minorities, immigrants, veterans, smaller founding teams, and novice, younger, and less educated entrepreneurs. Perhaps surprisingly, female, minority, and less-educated entrepreneurs tend to choose high-growth industries, but fewer of them achieve high growth relative to their industry peers. |
| Keywords: | entrepreneurship, business entry, firm growth, firm dynamics, founder, employment, firm size distribution, firm performance |
| JEL: | D22 J24 L25 L26 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11662&r=sbm |
| By: | Angelo Bonomi (CNR-IRCRES, National Research Council, Research Institute on Sustainable Economic Growth, via Real Collegio 30, Moncalieri (TO) – Italy) |
| Abstract: | This paper concerns a study on the next production revolution called Industry 4.0 based on confluence of various technologies, mainly digital, with far reaching consequences especially for productivity and employment. This study considers the implementation of Industry 4.0 in SMEs and industrial districts that represent a great part of Italian industry. The latter represents certainly a major challenge to such implementation because of the existence of various obstacles constituted by availability of investment capitals, small scale productions and tendency to develop and to adopt only incremental innovations rather than radical ones typical of Industry 4.0. In this work we study the technologies involved in Industry 4.0, taking account of existence of specific technologies, called enabling technologies, whose confluence in the manufacturing industry determines the implementation of Industry 4.0. Such enabling technologies originate from the major fields of R&D activities such as nanotechnologies, biotechnologies, digital technologies and artificial intelligence (AI). In this paper we study the dynamic and possible evolution characterizing the formation of the various enabling technologies in a sort of ramification process, using specific models of technology, technology innovation and R&D, and their relation with manufacturing in SMEs and industrial districts. The results of the study underlines the importance of AI in determining possibilities and limits to Industry 4.0, the necessity to disrupt the tendency of SMEs in adopting only incremental innovations, the existence of “intranality effects” raising difficulties from the supply chain, and the importance of technology consulting firms in the integration of ICT in operating technologies of a manufacturing activity. |
| Keywords: | Industry 4.0, SMEs, industrial districts, technology innovation |
| JEL: | O14 O25 O33 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:csc:ircrwp:201804&r=sbm |
| By: | Vladasel, Theodor (Swedish Institute for Social Research, Stockholm University) |
| Abstract: | Family background matters for entrepreneurship. The focus on factors making siblings similar rather than different, however, may understate the total importance of families for occupational choice by hiding important sources of within-family heterogeneity. I assess the differential effects of birth order, family size, and sibling sex composition on unincorporated and incorporated entrepreneurship in a set of causal exercises using Swedish register data. These factors appear to have a negligible impact. First, while later born men are more likely to become unincorporated entrepreneurs, this effect is largely explained by their lower education and poorer labor market prospects, pointing towards the subsistence nature of this type of entrepreneurship. Second, I find limited evidence of causal family size effects in linear and non-linear instrumental variable approaches, using instruments based on multiple births and sibling gender. Third, while I find no pure sibling sex composition effect, there is a small negative effect of having a brother on the father-daughter association in unincorporated entrepreneurship. Fourth, neither source of within-family heterogeneity exhibits a clear relationship with incorporated entrepreneurship, although children with more than four siblings are less likely to become incorporated business owners. Finally, accounting for within-family differences increases previously estimated sibling correlations by little. The results are consistent with the absence of adult sibling peer effects in entrepreneurship and confirm the role of families in generating sibling similarities, rather than differences in occupational choice. The importance of family background for entrepreneurship is therefore only marginally understated. |
| Keywords: | entrepreneurship; incorporation; self-employment; family background; birth order; family size; sibling sex composition |
| JEL: | D13 J62 L26 |
| Date: | 2018–08–23 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sofiwp:2018_008&r=sbm |
| By: | Joonkyu Choi (University of Maryland) |
| Abstract: | Despite the importance of high-growth young firms for economic growth, determinants of their growth and survival dynamics are not well understood. In this study, I develop a dynamic occupational choice model that identifies a key predictor of the early growth trajectory of young firms: the outside options of the business founders. I show that entrepreneurs with higher outside options as paid workers tend to take larger business risks, and thus exhibit a more up-or-out type of firm dynamics. I find empirical support for the model's predictions using a large founder-firm matched data set built from administrative databases of the U.S. Census Bureau. I find that controlling for past business performance, young firms operated by entrepreneurs with higher outside options exhibit (i) higher firm exit rates, (ii) more growth dispersion, and (iii) faster growth conditioning on survival. With the calibrated model, I find that deterioration in the outside options of entrepreneurs can have a sizable negative impact on aggregate output and productivity via lower risk-taking by young firms and slower growth in their life cycle. These findings indicate that the expected post-failure outcomes of entrepreneurs are an important factor that governs young firm growth as well as aggregate output and productivity. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed018:1018&r=sbm |
| By: | valter di Giacinto (Bank of Italy); Giacinto Micucci (Bank of Italy); Alessandro Tosoni (Bank of Italy) |
| Abstract: | We analyse the geographic localization and the productivity of knowledge-intensive business services (KIBS) in Italy, using both census data and balance-sheet data at the firm level. We find that KIBS are generally agglomerated in urban areas where they attain significantly higher labour productivity levels. Urban productivity advantages are found to be strongly associated with the local availability of human capital and to standard proxies of Marshall-Arrow-Romer and Jacobs agglomeration economies. Forward demand linkages and some factors impacting on the thickness of the local labour market also appear to be relevant. On the whole, the set of explanatory factors considered could explain the entire urban productivity premium estimated for Italian KIBS firms. |
| Keywords: | knowledge-intensive business services (KIBS); urban areas; agglomeration economies. |
| JEL: | J24 L84 R30 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:opques:qef_443_18&r=sbm |
| By: | Faisal Sohail (Washington University in St. Louis) |
| Abstract: | Most new firms are founded by former employees of existing firms - spinouts. This paper studies the relationship between employer size and spinout entry, size, and growth. Using data from Mexico, we document that employees from small firms are more likely to form spinouts than those from large firms. Second, spinouts from large employers start at a larger scale and grow faster than spinouts from small employers. Although a qualitatively similar relationship is observed in data from the U.S., there are large quantitative differences in the levels of spinout formation. To understand the impact of these differences on aggregate outcomes, we build a model of occupational choice and firm dynamics in which workers can learn from and adopt the productivity of their employers to form their own firms. In this framework, differences in the rates of spinout formation between Mexico and the U.S. are driven by differences in the efficiency with which employees learn from their employers. We interpret this efficiency as representing a form of managerial quality. The model, calibrated to match spinout entry rates across the two countries, can account for 13 and 19% of the cross-country variation in output per worker and firm growth respectively. These findings highlight the relevance of spinouts for aggregate outcomes, and the potential for managerial quality to not only impact incumbent firms but also future entrants. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed018:274&r=sbm |
| By: | Loren Brandt (University of Toronto); Gueorgui Kambourov (University of Toronto); Kjetil Storesletten (University of Oslo) |
| Abstract: | The non-state manufacturing sector has been the engine of China's economic transformation. Up through the mid-1990s, the sector exhibited large regional differences; subsequently we observe rapid convergence in terms of new firm start-up rates, productivity, and wages. To analyze the drivers of this behavior, we construct a Melitz (2003) model that incorporates location-specific capital wedges, output wedges, and a novel entry barrier. Using Chinese Industry Census data for 1995, 2004, and 2008, we estimate these wedges and examine their role in explaining differences in performance across prefectures and over time. Entry barriers turn out to be the salient friction for explaining performance differences. We investigate the empirical covariates of these entry barriers and find that barriers are causally related to the size of the state sector. Thus, the downsizing of the state sector after 1997 may be important in explaining the rapid manufacturing growth over the 1995-2008 period. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed018:954&r=sbm |
| By: | Erhardt, Eva Christine |
| Abstract: | Do high-growth firms continue to create jobs after the high-growth period or is high-growth a one-time event? Does the answer to this question depend on the definition of high growth? This paper analyzes data from Amadeus on Bulgarian firms for three consecutive 3-year periods (2001-2004, 2004-2007, and 2007-2010). Previously, high growth has been defined in terms of relative growth or composite measures such as recommended by Eurostat-OECD. We additionally apply an absolute measure of growth, i. e. the actual change in headcount. Using a two-part model with separate equations for sur-vival and growth, we moreover specifically account for the impact of firm exits on aggregate effects. We find that definitions are central for outcomes. In terms of relative and Eurostat-OECD high growth our results for Bulgarian firms largely confirm what has been found for high-income countries: surviv-ing relative high-growth firms are characterized by negative future growth rates. High growth firms defined according to Eurostat-OECD continue to grow positively after high growth. If growth is meas-ured in absolute terms, then high growth firms only continue to create more jobs than non-high growth firms as far as surviving firms are concerned. Taking firm exits into account, absolute high-growth firms are outperformed by average firms due to the job losses of large exiting high-growth firms – with one notable exception: absolute high-growth firms of initially small size (10-49 employees) continue to grow faster than other firms even if exits are accounted for and indeed seem a worthwhile target for policies promoting high-growth entrepreneurship. |
| Keywords: | high-growth firms, growth measures, employment, persistence, entrepreneurship policy |
| JEL: | C18 D22 J23 L26 P23 |
| Date: | 2018–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:88077&r=sbm |
| By: | Jose Asturias (Georgetown University in Qatar); Kim Ruhl (Pennsylvania State University); Sewon Hur (University of Pittsburgh); Timothy Kehoe (University of Minnesota) |
| Abstract: | Applying the Foster, Haltiwanger, and Krizan (FHK) (2001) decomposition to plant-level manufacturing data from Chile and Korea, we find that a larger fraction of aggregate productivity growth is due to entry and exit during periods of fast GDP growth. Studies of other countries confirm this empirical relationship. To analyze this relationship, we develop a simple model of firm entry and exit based on Hopenhayn (1992) in which there are analytical expressions for the FHK decomposition. When we introduce reforms that reduce entry costs or reduce barriers to technology adoption into a calibrated model, we find that the entry and exit terms in the FHK decomposition become more important as GDP grows rapidly, just as in the data from Chile and Korea. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed018:1139&r=sbm |
| By: | Anna Gerke (Audencia Recherche - Audencia Business School); Yan Dalla Pria (CeRSM - Centre de Recherche sur le Sport et le Mouvement - UPN - Université Paris Nanterre) |
| Abstract: | Sport clusters can be defined as geographical concentrations of private, public, and non-profitorganizations in a denominated area with a shared interest in one or similar sports. This paper addresses the following question: how does socioeconomic proximity – linkages between organizations or individuals which go beyond spatial proximity – influence the development and properties of sport clusters? This qualitative study investigates four sport clusters in surfing and sailing. The findings indicate that there are two types of sport clusters based on different forms of socioeconomic proximity. The surfing clusters are characterized by cognitive proximity based on convergent perceptions and managerial practices. The sailing clusters are characterzed by organizational proximity based on complementarity. This article (1) discusses the resilience properties of these two types of clusters and (2) proposes a two-step model of cluster development. This research has implications for policy makers and cluster members by showing that clusters should be considered to be social constructions that go through different stages. |
| Keywords: | sport cluster,socioeconomic proximity,resilience |
| Date: | 2017–06–21 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-01852222&r=sbm |