national co2 policy and externalities some general equilibrium results for switzerland abstract switzerland following the kyoto agreement plans to reduce co 2 emissions by 10 over the next decade with a tax on the use of fossil fuels this policy while having a marginal effect on global co 2 emission levels will have a positive effect on local environmental quality however since different sources of energy produce different local external effects a uniform co 2 tax is ill targeted this paper shows that a policy setting tax rates equal to the lower bounds of the estimated local marginal external effects would reduce the national co 2 level by 30 using a computable general equilibrium model of the swiss economy it also finds substantial efficiency gains of pigovian taxes as compared to a uniform co 2 tax

national technology gaps and trade an empirical study of the influence of globalisation abstract this paper examines the hypothesis that economic internationalisation is acting to reduce the importance of national technology gaps as determinants of trade patterns and performance the cross country analysis uses two approaches to assess the dynamic nature of the relationship between national investment in technological capability proxied by both r d activity and human capital and technology intensive ti trade performance natural resource endowment and the changing impact of physical capital formation are also investigated the study includes approximately 48 nations and is based on data from the mid 1970s to 1990 the empirical evidence from one approach undertaken does not support the globalisation hypothesis as national investment in technology and human capital is shown to have maintained its link to international trade success in ti manufactures over the study period however the findings of the alternative approach are ambiguous a positive association between technology investment catch up and ongoing ti manufacturing trade performance is evident for the newly industrialised economies nics but the results suggest that an inverse relationship may apply for many of the mature western economies

double dividend effectiveness of energy tax policies and the elasticity of substitution a cge appraisal there is a considerable body of literature that has studied whether or not an adequately designed tax swap whereby an ecotax is levied and some other tax is reduced while keeping government income constant may achieve a so called double dividend that is an increase in environmental quality and an increase in overall efficiency arguments in favor and against are abundant our position is that the issue should be empirically studied starting from an actual non optimal tax system structure and by way of checking the responsiveness of equilibria to revenue neutral tax regimes under alternate scenarios regarding technological substitution with the use of a cge model we find that the most critical elasticity for achieving a double dividend is the substitution elasticity between labor and capital whereas the elasticity that would generate the highest reduction in carbon dioxide emissions is the substitution elasticity among energy goods

measuring entrepreneurship over time abstract this article is a review of three measurement issues that impact the study of entrepreneurship over time 1 level of analysis difference between firms and individuals 2 differences between rate and stock measures and 3 the effects of choosing particular time frames on subsequent analytical results based on theory that views entrepreneurship as depending on ownership rights hawley 1907 this article develops a longitudinal measure of entrepreneurship in the united states the number of organizations per capita the problems and advantages of using a measure based on organizations per capita as an indicator of entrepreneurship is examined understanding how and what is being measured in studies of changes in entrepreneurship over time is an important issue for academic researchers and public policy makers measurement of changes in entrepreneurship over time can shed light on important research questions and public policy issues about entrepreneurship for example is entrepreneurship increasing in the united states if entrepreneurship is increasing is this trend comparable to any previous time periods or is the current increase in entrepreneurship a new or unique social phenomenon what influences changes in entrepreneurship over time the choice of certain measures of entrepreneurship is likely to influence the answers to these questions for example the measures used in an entrepreneurship study are an implicit specification of one s views of entrepreneurship e g entrepreneurship as self employment or firm creation and few measures of entrepreneurship reflect critical changes in important environmental influences e g technological change because of short measurement time frames therefore determining the contribution of entrepreneurship to the well being of an economy is dependent on understanding what measures of entrepreneurship are utilized for making these evaluations and the time frame used for these measures we review three measurement issues that impact the study of entrepreneurship over time 1 level of analysis differences between firms and individuals 2 differences between rate and stock measures and 3 the effects of choosing particular time frames on subsequent analytical results based on theory that views entrepreneurship as depending on ownership rights hawley 1907 this article develops a longitudinal measure of entrepreneurship in the united states the number of organizations per capita studies of entrepreneurship focus on either individual level activity e g self employment or on firm level activity e g new incorporations self employment research focuses on individuals who employ themselves that is individuals who report wages but not wages paid to them by other individuals or organizations in most studies of the self employed firm founders would therefore be classified as wage earners and not as entrepreneurs new firm research focuses on the rate of new firm entrants typically measured as new incorporations so such businesses as proprietorships or partnerships will not be counted a rate is a change from one state to another e g the number of people who become self employed for a specific year or the number of new firms created for a specific year whereas a stock specifies a particular level e g much like a stock of inventory such as the number of self employed or a particular number of firms for a specific time period it is important to recognize that entry into business does not necessarily guarantee remaining in business for example although the number of people who become self employed may increase for a specific year the number of people who remain self employed may actually decrease if more of the self employed fail to remain in business than those that enter the stock of the self employed can decrease if the outflow of self employed is greater than the inflow for those persons interested in whether entrepreneurial activity results in wealth creation either individually or societally the realization that entry into business may not lead to a sustainable business and therefore no creation of wealth should be a signal that measuring rates of business formation and rates of self employment may not be appropriate for this type of research the factors that drive changes in the rate of entrepreneurship are not likely to be manifest over short timeperiods changes in values attitudes technology government regulations and world economic and social changes have a significant influence on changes in entrepreneurship over time studies that have measured entrepreneurship over recent time periods are therefore likely to miss the influence of these variables we introduce a measure of entrepreneurship organizations per capita based on a theory of entrepreneurship as ownership this measure shows the stock of organizations in the u s economy over time from 1857 to 1992 the problems and advantages of using a measure based on organizations per capita as an indicator of entrepreneurship is examined we conclude with some suggestions for improving entrepreneurship research by recognizing the limitations of particular longitudinal entrepreneurship measures and by challenging the field to seek convergent validity among measures

comparing risks by acceptance and rejection stochastic dominance is a partial order on risky assets gambles that is based on the uniform preference of all decision makers in an appropriate class for one gamble over another we modify this requirement first by taking into account the status quo given by the current wealth and the possibility of rejecting gambles and second by comparing rejections that are substantive i e uniform over wealth levels or over utilities this yields two new stochastic orders wealth uniform dominance and utility uniform dominance unlike stochastic dominance these two orders are complete any two gambles can be compared moreover they are equivalent to the orders induced by respectively the aumann serrano index of riskiness and the foster hart measure of riskiness

trade offs in the investment decisons of european venture capitalists abstract previous studies of venture capital investment criteria which have tended to utilize traditional likert scaled survey methods have produced some general findings which indicate that the human factor is of utmost importance however virtually all of these studies have been undertaken with u s based venture capitalists in addition the studies have generally been exploratory and have assumed a single hierarchy of decision criteria in all cases and across all venture capitalists we do not accept that this is valid therefore our study tested this assumption by investigating the trade offs made by venture capitalists in europe thirty five investment criteria were identified from the literature and from experts in the field and a questionnaire was developed that required the venture capitalist to make 53 pairwise trade offs with multiple levels seventy three venture capitalists from across europe were interviewed and completed the questionnaire conjoint analysis was used to compute relative rankings and overall rankings were computed to provide some general insight into the overall importance of the various criteria after this cluster analysis was used to identify different decision groupings the trade offs were randomized in the questionnaire but for descriptive purposes fall into the following groupings financial product market strategic competitive fund management team management competence and deal all five management team criteria as opposed to management competence criteria were ranked among the first seven product market criteria appeared to be only moderately important and fund and deal criteria were at the bottom of the rankings overall we conclude that the venture capitalists interviewed would as a group prefer to select an opportunity that offers a good management team and reasonable financial and product market characteristics even if the opportunity does not meet the overall fund and deal requirements it appears quite logically that without the correct management team and a reasonable idea good financials are generally meaningless because they will never be achieved cluster analysis identified three groupings of venture capitalists those primarily concerned with investing nationally those who focus solely upon the deal and those mainstream investors who consistently and instinctively rank the five management team criteria at the top of their list however there was no evident country bias a conclusion that is sustained if the countries are grouped by physical proximity northern versus southern europe or by size of the local venture capital community a surrogate for experience moreover there was no relationship to the scale of the fund the typical round of financing or the apparent network the article concludes by outlining the implications of the study for venture capitalists entrepreneurs and the research community

science parks and the performance of new technology based firms a review of recent u k evidence and an agenda for future research science parks were established to stimulate the formation and development of new technology based firms ntbfs despite the potential importance of these institutions as a mechanism for generating technological spillovers and employment growth there has been little systematic analysis of their impact on ntbfs in this paper we review some recent evidence comparing the performance of firms located on and off u k science parks this preliminary evidence suggests that the returns to being located on a science park are negligible we conjecture that these results may be due to imprecise estimates of these returns and may also be masking important differences in the returns to different types of science parks in addition we outline an agenda for additional research on the effects of these institutions on ntbf performance

instant gratification temporal discounting and self employment differences in temporal discounting could separate self employed individuals from employees working for wages drawing on a sample of 13 198 individuals from the 2012 2013 cross sectional step skills measurement survey we find that higher temporal discounting is more positively associated with the likelihood of self employment we further find that younger individuals with higher temporal discounting are more likely to engage in self employment the association of lower socioeconomic status at a young age or those who experienced economic shocks at a young age with the likelihood of self employment is only significant when interaction effects of temporal discounting and age are present in the model risk seeking is not associated with the likelihood of engagement in self employment under higher discounting these findings have implications for the self employment literature as well as the literature on behavioral decision making

the fall and rise of the petty bourgeoisie changing patterns of self employment in the postwar united states this article explores the historical trajectory of the self employed segment of the labor force in the united states particularly since 1940 self employment declined in the united states almost steadily from the 19th century to the early 1970s since then it has risen every year explaining this reversal in the historical fortunes of the petty bourgeoisie is the central task of this article we reach four basic conclusions first the reversal in the decline of the self employed is statistically significant and robust across a range of definitions of self employment rates second this reversal is not a simple countercyclical response to the increase in unemployment since the middle 1970s third part of the resurgence of self employment result from the expansion of various postindustrial services that tend to have higher levels of self employment within them within postindustrial sectors however there has not generally been any increase in self employment fourth a significant part of the expansio

stigma and business failure implications for entrepreneurs career choices we use data from global entrepreneurship monitor to examine the act of entrepreneurial reentry by entrepreneurs who exit a failed business we study reentry by mode of entry and by form of organizing we find that in countries where the levels of stigma and regulatory conveyance of stigma markings were at their highest entrepreneurs who exited failed businesses were less likely to reenter into entrepreneurial activity our finding suggests that negative social and economic sanctions that are associated with stigma markings speak only to one side of the entrepreneurship phenomenon on the other side stigma can function as a stimulus for entrepreneurs to defy the illegitimacy of the failed business and to actively seek out and engage in innovative behaviors that contribute to the overall diversity of entrepreneurial activities in their country

the impact of entrepreneurial capacity experience and organizational support on academic entrepreneurship abstract although sources and determinants of academic entrepreneurship have begun to command the attention of policy makers and researchers there remain many unanswered questions about how individual and social factors shape the decisions of academics to engage in entrepreneurial activities using a large scale panel of academics from a variety of uk universities from 2001 to 2009 this paper examines how an academics level of entrepreneurial capacity in terms of opportunity recognition capacity and their prior entrepreneurial experience shape the likelihood of them being involved in starting up a new venture in addition we explore what role university technology transfer offices ttos play in stimulating venture creation the results show that individual level attributes and experience are the most important predictors of academic entrepreneurship we also find that the social environment surrounding the academic also plays an influential role but its role is much less pronounced than individual level factors finally we show that the activities of the tto play only a marginal indirect role in driving academics to start new ventures we explore the implications of this analysis for policy and organizational design for academic entrepreneurship

effects of carbon taxes in an economy with prior tax distortions an intertemporal general equilibrium analysis abstract this paper analyzes the costs of carbon taxes in a model that recognizes interactions between this tax and pre existing taxes first we examine the extent to which costs of a u s carbon tax are reduced when its revenues finance cuts in income taxes such use of revenues significantly reduces but does not eliminate the overall policy costs the positive overall costs reflect the carbon tax s focus on intermediate inputs and its relatively narrow base in comparison with income taxes we also examine the sensitivity of the carbon tax s costs to the level of pre existing taxes for any given use of revenues welfare costs rise significantly with pre existing tax rates indicating that models disregarding pre existing taxes may substantially understate the costs of new environmental tax initiatives

entrepreneurial exit as a critical component of the entrepreneurial process theoretical development abstract by demonstrating the importance of entrepreneurial exit to the entrepreneur the firm the industry and the economy i contend that our understanding of the entrepreneurial process is incomplete without the inclusion of entrepreneurial exit i define entrepreneurial exit and demonstrate how this conceptualization provides concepts that are unique from those addressed by researchers in other domains thus outlining a space for it within the literature in each phase of the entrepreneurial process i explore the development of an exit strategy reasons for exit and options for exit

a typology of new manufacturing firm founders in wales performance measures and public policy implications abstract a typology of new manufacturing firm founders in wales is presented factors associated with the parental entrepreneurial background employment history and the characteristics of the founder s previous employer prior to start up are explored through the adoption of principal components analysis and cluster analysis a typology of new firm founders is detailed on the basis of 14 characteristics the six founder types are shown to have different abilities to generate new jobs create new wealth and export their manufactured products public policy should not solely be concerned with the number of new firms and the rate of new firm foundation different founder types have established new firms of variable quality in terms of potential for job generation wealth creation and ability to export on a competitive basis there is no shortage of potential new firm founders in wales and public policy should aim to discourage those individuals who are clearly unsuitable for entrepreneur ship if the objective of policy is geographical welfare there is the case for extra assistance to be directed to those regions associated with deep seated factors that make them less conducive to successful entrepreneurial formation and development assistance could vary according to local need in the cause of regional equity policy measures and schemes could be restricted to those areas with the lowest levels of entrepreneurial potential government in this way could minimize its financial commitment to new firms policy while maximizing its effectiveness finally it is suggested that public policy should be targeted to those founder types in problem areas who have the greatest potential for establishing successful new ventures

habitual entrepreneurs in the making how labour market rigidity and employment affects entrepreneurial re entry we investigate the impact of country level labour market regulations on the re entry decision of experienced entrepreneurs whereby they become habitual entrepreneurs multilevel logit models on entry decisions among 15 709 individuals in 29 european countries show that labour market regulations have a positive influence on the decision to re enter into entrepreneurship this positive impact is stronger among individuals holding wage jobs at the time of re entry compared to those that do not our results indicate that novice and habitual entrepreneurs may respond very differently to labour market rigidity we discuss and provide tentative explanations for these differences and outline potential policy implications

consequences of cultural practices for entrepreneurial behaviors although national culture is an important regulator of entrepreneurship there is a dearth of studies that 1 explore the effects of national cultural practices on entrepreneurial behaviors by individuals 2 use appropriate multilevel research designs 3 consider the effects of culture on different entrepreneurial behaviors such as entry and post entry growth aspirations we combined global entrepreneurship monitor gem and global leadership and organizational behavior effectiveness globe data from 42 countries for 2005 2008 to address these gaps using a multilevel design we found societal institutional collectivism practices negatively associated with entrepreneurial entry but positively associated with entrepreneurial growth aspirations uncertainty avoidance practices were negatively associated with entry but not with growth aspirations and performance orientation practices were positively associated with entry our analysis highlights the differential effects of cultural practices on entrepreneurial entry and growth aspirations and demonstrates the value of multilevel techniques in analyzing the effect of culture on entrepreneurship

varieties of entrepreneurship exploring the institutional foundations of different entrepreneurship types through varieties of capitalism arguments while entrepreneurship researchers agree that institutions matter for entrepreneurship they also have a rather encompassing understanding of institutions as almost any external factor that influences entrepreneurship ultimately this literature thus comes up with a long list of institutional factors that may explain entrepreneurial differences between countries but which institutions are most influential how do these institutions relate to different types of entrepreneurship and to what extent are institutions complementary to each other in the way they sustain different entrepreneurship types the literature on varieties of capitalism voc offers a parsimonious theoretical framework to address these questions based on the voc literature we theoretically derive a consistent set of institutional indicators that can explain differences in entrepreneurship types between countries based on principal component and cluster analyses we illustrate how 21 western developed economies cluster around four distinct institutional settings furthermore we use simple ols regressions to show how these institutional constellations are related to different types of entrepreneurship we conclude that four different varieties of entrepreneurship can be identified across the western world the main implication of our findings is that a perfect institutional constellation equally facilitating different types of entrepreneurship does not exist policy makers seeking to stimulate entrepreneurship are thus faced with the trade off of targeting policy reforms to that entrepreneurship type they intend to promote at the expense of other types of entrepreneurship and the broader societal consequences such reforms will have

no news is bad news sensegiving activities media attention and venture capital funding of new technology organizations a significant body of research has examined how new organizations gain legitimacy and how gaining it affects their subsequent access to resources less attention has been given to the problem of how new organizations attract collective attention although related to legitimation the problem of attracting attention is distinct as attention and evaluation are distinct cognitive processes in this study we examine the allocation of collective attention to new organizations in a system of relationships within which new organizations seek to attract attention through their sensegiving activities the information properties of their sensegiving activities affect the level of attention they receive from different types of media and media attention in turn increases their perceived value potential in the eyes of venture capital investors vcs we examine these relationships in a sample of 398 information technology start ups that have obtained different levels of venture capital funding our results show that new organizations that engage in more intense and diverse sensegiving activities attract higher levels of industry media attention and that these effects are enhanced by the human capital of their founders and leaders diverse sensegiving activities are also associated with higher levels of attention from the general media but only the attention of specialized industry media is positively associated with the level of vc funding obtained these findings extend current research on information intermediation and institutional legitimation by demonstrating that media attention early in the life of new organizations affects how they are valued by a well informed expert audience such as vcs they also contribute to entrepreneurship research on the effects of new organizations strategies on their ability to secure resources and to research on vc funding decisions

norwegian climate policy reforms in the presence of an international quota market abstract this study shows that the second best optimal difference between tax rates on goods that generate greenhouse gas emissions and non polluting goods is equal to the quota price plus a ramsey tax on the quota price when emission quotas are traded between governments and the price elasticity of these goods is identical this tax difference exceeds the second best optimal difference between tax rates on goods that generate a negative externality equivalent to the quota price and non polluting goods model simulations show that a unilateral increase in emission tax to above the international quota price generates a welfare gain for norway model simulations also show that an international tax quota price increase generates a welfare gain loss for norway if norwegian imports of oil become substantial marginal in the long run

a socio economic model of stigma and related social problems abstract recent years have seen a rapid expansion of economic literature on stigma a notion that had been widely studied in sociology in relation to social deviance yet the economic literature overlooks the original sociological intuition that certain consequences of stigmatization could be socially inefficient this paper formalizes this intuition by developing a model of community behavior which mimics a classic sociological setting concerning the rehabilitation of a former criminal offender the conditions under which a socially inefficient equilibrium arises are derived some of those conditions are shown to be consistent with the findings from micro labor studies on crime

the welfare effects of environmental taxation recent literature has investigated whether the welfare gains from environmental taxation are larger or smaller in a second best setting than in a first best setting this question has mainly been addressed indirectly by asking whether the second best optimal environmental tax is higher or lower than the first best pigouvian rate even this indirect question has itself been approached indirectly comparing the second best optimal environmental tax to a proxy for its first best value marginal social damage msd on closer examination however msd becomes ambiguously defined and variable in a second best setting making it an unreliable proxy for the pigouvian rate given these observations the current analysis reevaluates these welfare questions and finds that when compared directly to its first best value the second best optimal environmental tax generally rises with increased revenue requirements even in cases where the second best environmental tax is lower than its first best value the welfare gains may be greater than in a first best setting these results suggest that the marginal fiscal benefit revenue recycling effect exceeds the marginal fiscal cost tax base effect over a range of environmental tax rates that for benchmark models extends above the first best pigouvian rate these findings reinforce the intuition that environmental policy complements rather than competes with the provision of other public goods

combining bottom up and top down abstract we motivate the formulation of market equilibrium as a mixed complementarity problem which explicitly represents weak inequalities and complementarity between decision variables and equilibrium conditions the complementarity format permits an energy economy model to combine technological detail of a bottom up energy system with a second best characterization of the over all economy our primary objective is pedagogic we first lay out the complementarity features of economic equilibrium and demonstrate how we can integrate bottom up activity analysis into a top down representation of the broader economy we then provide a stylized numerical example of an integrated model within both static and dynamic settings finally we present illustrative applications to three themes figuring prominently on the energy policy agenda of many industrialized countries nuclear phase out green quotas and environmental tax reforms

who become serial and portfolio entrepreneurs serial entrepreneurs run multiple businesses in sequence while portfolio entrepreneurs run multiple businesses in parallel they differ from novice entrepreneurs who have so far operated only one venture the present paper is the first to model occupational choices between all three entrepreneurial types it goes on to discuss its theoretical predictions in the light of independent evidence about serial and portfolio entrepreneurship from the extant literature

running to keep in the same place consumer choice as a game of status if individuals care about their status defined as their rank in the distribution of consumption of one positional good then the consumer s problem is strategic as her utility depends on the consumption choices of others in the symmetric nash equilibrium each individual spends an inefficiently high amount on the status good using techniques from auction theory we analyze the effects of exogenous changes in the distribution of income in a richer society almost all individuals spend more on conspicuous consumption and individual utility is lower at each income level in a more equal society the poor are worse off

private firms and corporate governance an integrated economic and management perspective this article provides a definition of corporate governance and highlights the challenges in adapting understanding of governance to the privately held firm we emphasize the need to develop the scope of governance in privately held firms beyond the traditional agency theory focus in the financial economics literature relating to large publicly listed corporations there is a need to draw on and integrate an array of theoretical perspectives from both economics and other social science disciplines as well we present a schematic model of corporate governance which places the contributions presented in the special issue in context and which serves as a guide to highlighting gaps in the research base we review the principal issues relating to corporate governance in privately held firms which relate to governance in different organizational contexts institutional context the industrial sector within which the firm finds itself the ownership context of the firm and the stage within the firm s life cycle the scope of corporate governance and other internal governance mechanisms to be considered we identify areas for further research on corporate governance in privately held firms with respect to processes of governance organizational contexts assumptions about the owners executive remuneration financial reporting the nature of the dependent variable relating to the expected outcome of different approaches to governance and various methodological issues we suggest a need to develop governance codes for privately held firms that are flexible enough to take account of the different types of governance needs of firms at different stages in their life cycle

redefining business success distinguishing between closure and failure new firms are believed to have high closure rates and these closures are believed to be failures but two u s census bureau data sources illustrate that these assumptions may not be justified the business information tracking series bits showed that about half of new employer firms survive beyond four years and the characteristics of business owners cbo showed that about a third of closed businesses were successful at closure the cbo also made it possible to compare results of models of business survival and business success but because of non response bias logit models were used similar to previous studies firms having more resources that were larger with better financing and having employees were found to have better chances of survival factors that were characteristic of closure such as having no start up capital and having a relatively young owner were also common in businesses considered successful at closure hence few defining factors can be isolated leading to true failures the significant proportion of businesses that closed while successful calls into question the use of business closure as a meaningful measure of business outcome it appears that many owners may have executed a planned exit strategy closed a business without excess debt sold a viable business or retired from the work force it is also worth noting that such inborn factors as race and gender played negligible roles in determining survivability and success at closure

entropy and the value of information for investors consider any investor who fears ruin when facing any set of investments that satisfy no arbitrage before investing he can purchase information about the state of nature in the form of an information structure given his prior information structure alpha is more informative than information structure beta if whenever he is willing to buy beta at some price he is also willing to buy alpha at that price we show that this informativeness ordering is complete and is represented by the decrease in entropy of his beliefs regardless of his preferences initial wealth or investment problem we also show that no prior independent informativeness ordering based on similar premises exists

why europe and the west why not china in the history of technological development why didn t other regions keep up with europe this is an important question as one learns almost as much from failure as from success the one civilization that was in a position to match and even anticipate the european achievement was china china had two chances first to generate a continuing self sustaining process of scientific and technological advance on the basis of its indigenous traditions and achievements and second to learn from european science and technology once the foreign barbarians entered the chinese domain in the sixteenth century china failed both times what explains the first failure i stress the role of the market the fact that enterprise was free in europe while china lacked a free market and institutionalized property rights that in europe innovation worked and paid while the chinese state was always stepping in to interfere with private enterprise as for the second failure china s cultural triumphalism combined with petty downward tyranny made it a singularly bad learner

on capturing oil rents with a national excise tax this paper argues that since the supply of oil in the ground is inelastic the incidence of a sales tax on oil maintained forever at a fixed rate would fall entirely on the oil suppliers in the world economy however the elasticity of supply of oil to a single country depends on that country s imports as a share of world output and on the elasticity of demand for that country the paper calculates optimal tax rates for a country as a function of these variables and estimates optimal oil tax rates for the u s for some oecd countries separately and for the u s plus the oecd collectively current u s tax rates are shown to be far below optimal values

stability vs flexibility the effect of regulatory institutions on opportunity type how entrepreneurial opportunities are formed and exploited depends upon the institutional environment in which they are embedded the varying amounts of risk and uncertainty across and within heterogeneous institutional environments have important implications for the types of opportunity developed while the international business and entrepreneurship literatures consider the effect of environmental risk and uncertainty on firms risk and uncertainty are often treated as interchangeable or synonymous and rarely are both considered to be present together to address this we develop a new theoretical model based on institutional economics describing how institutional arrangements promoting stability thus supporting an entrepreneur s ability to assess risk will lead to more imitative opportunities while institutions promoting flexibility thus supporting an entrepreneur s ability to respond to uncertainty by iterating will foster more innovative opportunities we test this framework using cross national data across 40 countries from the gem survey finding that institutional arrangements that promote stability do lead to more imitation while institutions that promote flexibility foster more innovation by treating risk and uncertainty as distinct constructs our study makes theoretical contributions to research on institutional environments and opportunity types with implications for future research on subsidiary initiatives the evolution of mnes and born global firms

look before you leap market opportunity identification in emerging technology firms entrepreneurs play a fundamental role in bringing new technologies to market because technologies are often configurable to serve a variety of different markets it is possible for entrepreneurs to identify multiple market opportunities prior to the first market entry of their emerging firms and if they elect to do so to therefore have a choice of which market to enter first the empirical results presented in this paper offer three new insights regarding this important early stage choice in new firm creation first they reveal that serial entrepreneurs have learned through prior start up experience to generate a choice set of alternative market opportunities before deciding which one to pursue in their new firm creation second the analysis indicates that entrepreneurs who identify a choice set of market opportunities prior to first entry derive performance benefits by doing so third the positive relationship between the number of market opportunities identified prior to first entry and new firm performance is nonlinear and subject to decreasing marginal return the research literature has yet to acknowledge the notion of multiple opportunity identification prior to entry and the related idea of selecting the most favorable market opportunity for the creation of a new technology firm

does culture still matter the effects of individualism on national innovation rates abstract does a society s culture affect its rate of inventive activity this article analyzes several independent datasets of culture and innovation from 62 countries spanning more than two decades it finds that most measures of individualism have a strong significant and positive effect on innovation even when controlling for major policy variables however the data also suggest that a certain type of collectivism i e patriotism and nationalism can also foster innovation at the national level meanwhile other types of collectivism i e familism and localism not only harm innovation rates but may hurt progress in science worse than technology

when can carbon abatement policies increase welfare the fundamental role of distorted factor markets abstract this paper employs analytical and numerical models to assess the welfare effects of a revenue neutral carbon tax and nonauctioned carbon emissions permits taking into account preexisting tax distortions in factor markets the presence of preexisting taxes significantly raises the general equilibrium costs of both policies this cost increase is much greater under emissions permits since this policy does not generate revenues to reduce distortionary taxes under our central estimates emissions permits cannot increase welfare unless environmental damages exceed about 18 per ton of carbon in contrast an appropriately scaled carbon tax is welfare improving so long as environmental damages are positive

entrepreneurship and the initial size of firms abstract it is clear that entrepreneurs and their firms can vary widely nevertheless most of the research to date on entrepreneurship has examined central tendencies with relatively little attention devoted to entrepreneurial diversity this study examines one of the most distinguishing characteristics of young firms initial size the focus is whether smaller start ups differ from larger ones in the backgrounds of the entrepreneurs their processes of starting or the subsequent patterns of development in this longitudinal study an initial sample of 1903 young firms was examined to determine differences in characteristics of the entrepreneurs and in their processes of starting one year later data were obtained from 742 of these firms permitting analysis of how initial firm size was related to subsequent difficulties encountered and changes made as well as to performance as expected along almost every dimension these starting larger firms had the backgrounds that would seem to be necessary for the assembly of substantial resources they tended to have more education more management experience and goals that were more managerial in nature they also were more likely to have partners women were associated more often with smaller ventures but for this sample there were no differences in the representation of minorities between the smaller and larger start ups those starting larger ventures tended to rely more upon external investors and to start ventures more closely linked to their previous jobs both groups of entrepreneurs sought information from a number of sources but those founding larger ventures utilized professional advisors more whereas those starting smaller ventures utilized informal sources in the year after the first questionnaire differences between the two groups were less marked than expected both groups of surviving firms reported low levels of serious problems with the smaller ventures somewhat surprisingly reporting serious problems less often there were not many differences in changes made except that smaller ventures were more likely to lose partners and larger ventures were more likely to add branches or locations both groups reported high rates of mean growth in sales the smaller ventures with their small initial bases showed larger percentage increases smaller ventures also showed higher percentage increases in employment and surprisingly a greater increase in the absolute number of employees somewhat more of the smaller ventures had discontinued both groups included many firms that grew substantially and others that scaled back demonstrating the fluidity and experimentation characteristic of young firms for entrepreneurs and their advisors for public policy makers and for researchers any progress in understanding entrepreneurial processes should in the long run enhance venture performance the patterns observed here indicate that firms of different initial size tend to be associated with particular entrepreneurial characteristics processes of formation and subsequent patterns of development this diversity should be recognized in the development of assistance programs and university courses as well as in the interpretation of previous research for public policy makers the growth of these firms both small and large indicates the potential of economic contributions from entrepreneur ship further the growth of the smaller start ups suggests that even those ventures that appear to have few resources and modest potential can in the aggregate contribute substantially to the economy

novice portfolio and serial founders are they different abstract there is growing interest in entrepreneurs who have been involved in more than one venture yet to date there has been relatively little theoretical development and systematic empirical examination of the topic in particular there has been little attention to the potential heterogeneity of habitual entrepreneurship this study aims to contribute to this emerging area in two ways first it outlines a conceptual typology of habitual entrepreneurs who have founded purchased or inherited businesses second the empirical part of the study focuses on owner managers providing an exploratory analysis of the characteristics and effects of independent business ownership by novice portfolio and serial founders novice founders are those that have no prior entrepreneurial experience as either a founder an inheritor or a purchaser of a business portfolio founders retain their original business and inherit establish and or purchase another business serial founders are those who sell their original business but at a later date inherit establish and or purchase another business the study derives propositions suggesting differences among the three types of founders at the individual founder level of analysis similarities as well as differences in the personal background work experiences reasons leading to the start up of businesses and personal attitudes to entrepreneurship of these three types of entrepreneurs are explored at the organizational level of analysis finance employment and performance differences among the businesses owned by the three types of entrepreneurs are presented the issues are examined using a sample of entrepreneurs who were the principal owner managers of independent businesses in great britain the sample included 389 novice founders 62 6 75 portfolio founders 12 1 and 157 serial founders 25 3 no statistically significant differences were found among the three groups of entrepreneurs with regard to the main industrial activity geographical location and the age of their businesses univariate and multivariate tests were used to examine potential differences between the groups the results of the study show significant differences between portfolio and serial founders with regard to their parental background work experience and their age when they started their first business differences were also found with respect to reasons leading to start up personal attitudes to entrepreneurship and sources of funds used during the launch period of the surveyed business these findings suggest that habitual entrepreneurs cannot be treated as a homogeneous group the analysis however failed to find any significant differences between the performance of the surveyed firms owned by habitual founders and novice founders and between the two types of habitual founders the findings of the study indicate for researchers that there is a need to carefully define the unit of analysis in any examination of entrepreneurs in particular there is a need to take note of the heterogeneity of types of entrepreneur and to consider the entrepreneur as the appropriate unit of analysis rather than simply the firm although this study focused on habitual founders of businesses the theoretical section of the study also identified other types of habitual entrepreneurs such as serial corporate entrepreneurs and serial management buy out and buy in cases these other types of habitual entrepreneurs would appear to warrant further analysis the findings of this study have a number of implications for practitioners especially venture capitalists the absence of significant performance differences between novice and habitual entrepreneurs which is consistent with the results from other studies emphasizes the need for venture capitalists screening potential investees not to rely solely on previous experience the study also has implications for policy makers especially with respect to decisions concerning the allocation of resources to assist nascent entrepreneurs novice entrepreneurs and habitual entrepreneurs the similarities in business performance among novice serial and portfolio entrepreneurs suggests that policy makers need to be careful in targeting scarce resources most notably targeting resources to encourage talented nascent entrepreneurs to become novice entrepreneurs may offer returns which are at least as good as targeting resources to more experienced entrepreneurs

after the exit acquisitions entrepreneurial recycling and regional economic development mason c m and harrison r t 2006 after the exit acquisitions entrepreneurial recycling and regional economic development regional studies 40 55 73 most studies of the impact of mergers and acquisitions suggest they have a detrimental impact on economic development in peripheral regions over the longer term however such assessments fail to consider the post acquisition behaviour of the cashed out entrepreneurs it is argued here that acquisition triggers a process of entrepreneurial recycling in which the entrepreneurs use their newly acquired wealth allied to the experience they have accumulated to engage in other entrepreneurial activities notably starting new business ventures and investing in other businesses as business angels or venture capitalists case studies of five scottish technology based firms that were acquired by non uk companies illustrate this process when entrepreneurial recycling is taken into account the overall impact of acquisition on regional economic development

the latent demand for bank debt characterizing discouraged borrowers concerns that small firms encounter credit constraints are well entrenched in the literature despite widespread empirical evidence that a relatively small proportion of small firms have their loan applications rejected however many firms may be discouraged from applying for fear of rejection these businesses are the focus of this paper based on responses to a large scale postal survey of uk small and medium sized enterprises smes we find that twice as many businesses were discouraged from applying for a bank loan than had their loan request denied more particularly we observe a number of distinguishing characteristics of discouraged borrowers relative to applicants these include strategy sector prior entrepreneurial experience and banking relationships the implications of our findings for policy and future research are briefly discussed

a penny for your quotes patent citations and the value of innovations the use ofpatents in economic research has been seriously hindered by the fact that patents vary enormously in their importance or value and hence simple patent counts cannot be informative about innovative output the purpose of this article is to put forward patent counts weighted by citations as indicators of the value of innovations thereby overcoming the limitations of simple counts the empirical analysis of a particular innovation computed tomography scanners indeed shows a close association between citation based patent indices and independent measures of the social value of innovations in that field moreover the weighting scheme appears to be nonlinear increasing in the number of citations implying that the informational content of citations rises at the margin as in previous studies simple patent counts are found to be highly correlated with contemporaneous rd however here the association is within afield over time rather than cross sectional

cultural influences on national rates of innovation abstract the purpose of this research was to examine the effect of the cultural values of individualism power distance uncertainty avoidance and masculinity on national rates of innovation in 33 countries in 1975 and 1980 the study found that rates of innovation are most closely associated with the cultural value of uncertainty acceptance but that lack of power distance and individualism also are related to high rates of innovation this research suggests that nations may differ in their rates of innovation because of the cultural values of their citizens these findings have important implications for managers and policy makers first culture matters countries may not be able to increase their rates of innovation simply by increasing the amount of money spent on research and development or industrial infrastructure they also may need to change the values of their citizens to those that encourage innovative activity this concept in turn suggests that national rates of innovation are driven by more fundamental forces than economic conditions and that societal change may be necessary to make less innovative societies more innovative second the values associated with high national rates of innovation are those that many scholars have long argued are important at the firm level an acceptance of uncertainty appears to be necessary probably because innovation requires a tolerance for risk and change individualism seems to be important perhaps because of its association with autonomy independence and freedom lack of power distance appears important perhaps reflecting the role that tolerance of change in the social order and distribution of power play in the innovation process third the study indicates that the strength of the relationship between innovation and two cultural values individualism and lack of power distance were stronger in 1975 than in 1980 suggesting perhaps that these values are becoming less important in spurring the innovation process this finding supports the anecdotal evidence that many collectivist and hierarchical asian nations are becoming more innovative fourth this study shows that per capita income is a more important economic variable than industrial structure in determining national rates of innovation this finding confirms previous work that has shown that as nations become wealthier they become more innovative the reason may be that wealthier countries have more demand for innovations both because innovations are often laborsaving and because wealthier nations have greater demand for new and differentiated consumer goods

state governance and technological innovation in emerging economies state owned enterprise restructuration and institutional logic dissonance in china s high speed train sector can state governance spur firm innovation in an emerging economy and transform state owned enterprises soes from dying dinosaurs to dynamic dynamos we seek an answer to this question by investigating the innovative performance of restructured soes in china s high speed train sector we expect that soe restructuration will improve firm innovation but that the degree of improvement will depend on how the state conducts firm governance building on institutional theory we distinguish state governance via equity ownership and administrative affiliation in an emerging economy with market hierarchy institutional conflicts under such conflicts restructured soes experience institutional logic dissonance which hinders organizational change for technological innovation we hypothesize that state ownership exacerbates institutional logic dissonance at a restructured soe thus limiting innovation improvement from restructuration in contrast state affiliation mitigates firm dissonance and hence augments such improvement we find empirical evidence for these hypotheses in a comprehensive panel of high speed train manufacturers in china between 1989 and 2015 this study contributes to the institution based theory of technological innovation in emerging economies on the practical front our findings suggest that emerging states may adopt arms length governance to spur soe innovation and unleash these dynamic dynamos to fuel sustainable economic growth

deal or no deal decision making under risk in a large payoff game show we examine the risky choices of contestants in the popular tv game show deal or no deal and related classroom experiments contrary to the traditional view of expected utility theory the choices can be explained in large part by previous outcomes experienced during the game risk aversion decreases after earlier expectations have been shattered by unfavorable outcomes or surpassed by favorable outcomes our results point to reference dependent choice theories such as prospect theory and suggest that path dependence is relevant even when the choice problems are simple and well defined and when large real monetary amounts are at stake

growth diversification and business group formation in entrepreneurial firms recent empirical research has demonstrated that the growth process of entrepreneurial firms is frequently achieved through the formation of business groups i e a set of companies run by the same entrepreneur or entrepreneurial team this has been hypothesised as result of a growth process by diversification of the original activity this entrepreneurial growth process offers an alternative explanation for the formation of business groups than that arising from managerial efficiency and expediency the main aim of the article is to explore group formation through entrepreneurial diversification using a sample of high growth entrepreneurial firms the analysis demonstrates that the running of a group of companies by the same entrepreneur is not only induced by the geographical extension of their operation and by diversification but also by the differentiation policy aimed at serving different market segments within the same sector this seems to contrast with the diversification policy and organisational setting of large managerial firms

of free markets and a secular mind the value of economic decentralization and individual secular values in entrepreneurship building upon hayek s seminal work regarding the benefits of market decentralization in this study we examine the complementary role of an individual s secular values in further explaining the association between decentralization of economic affairs entrepreneurial activity and self employment we argue that studies on hayek s notion of decentralization may be incomplete in their conceptualization without a transition to individual morality based on more secular values we consider decentralization of economic affairs and secular values to explain why entrepreneurial activity differs across countries in study 1 we find that the decentralization of economic affairs increases the odds of being an entrepreneur in a startup but does not influence the likelihood of owning managing a business or perceptions related to the opportunity to start a business in study 2 we find evidence of mixed support for decentralization and self employment however with meaningful effect sizes but with marginal significance we find that an individual s secular values complement the association between decentralization of economic affairs and self employment the findings are robust to alternate specifications by demonstrating the role of secular values in strengthening decentralization we lay the foundation for melding economic perspectives with the freedom from religious ethos as an important consideration for entrepreneurial activity however the mixed effects of decentralization on different modes of entrepreneurship also call into question the value of decentralization in modern economies plain english summary higher levels of individual secular values even by a small amount enhance the benefits that economic decentralization can have on entrepreneurial activity in this paper we use a two study approach to examine how individual secular values might influence the effects of economic decentralization on entrepreneurial activity in study 1 we find that the decentralization of economic affairs increases the odds of being an entrepreneur in a startup but does not influence the likelihood of owning managing a business or individual perceptions related to existing opportunities to start a business in study 2 we find evidence of mixed support for the effects of economic decentralization on self employment however we find some evidence suggesting that an individual s secular values complement the association between decentralization of economic affairs and self employment thus the principal implication of this study is that policymakers should take into consideration the overall secular values present in society when making decisions regarding economic decentralization particularly with regard to understanding the potential effects that decentralization could have on entrepreneurial activity

moving forward balancing the financial and emotional costs of business failure why do owner managers delay business failure when it is financially costly to do so in this paper we acknowledge that delaying business failure can be financially costly to the owner manager and the more costly the delay the more difficult the recovery but we complement this financial perspective by introducing the notion of anticipatory grief as a mechanism for reducing the level of grief triggered by the failure event which reduces the emotional costs of business failure we propose that under some circumstances delaying business failure can help balance the financial and emotional costs of business failure to enhance an owner manager s overall recovery some persistence may be beneficial to recovery and promote subsequent entrepreneurial action

revenue raising vs other approaches to environmental protection the critical significance of pre existing tax distortions using analytical and numerical general equilibrium models we show that preexisting factor taxes produce a tax interaction effect that increases the costs of pollution taxes and quotas under policies that raise revenue and recycle it through cuts in marginal factor tax rates this effect is partially offset by a revenue recycling effect grandfathered pollution quotas such as those used under the 1990 clean air act amendments to regulate electric utilities so2 emissions do not benefit from this offset preexisting taxes raise this regulation s cost by over 70 more than half of this additional cost could be avoided by auctioning quotas and exploiting the revenue recycling effect

a theoretical analysis of optimal financing strategies for different types of capital constrained entrepreneurs in this paper we compare two alternative financing strategies that capital constrained entrepreneurs can adopt they can either wait until they raised enough money to complete their project the more conservative strategy or use limited resources to achieve some intermediate milestone before contacting large outside investors such as venture capitalists the more adventurous strategy we examine how the choice of financing strategy is affected by entrepreneurial types life style serial and pure profit maximizing entrepreneur we show that specific entrepreneurial characteristics may ultimately affect the shape of firms as they may pursue different strategies to achieve similar goals the paper generates a number of empirical predictions on security design the interplay between angel and venture capital finance and the professionalization of the venture capital market c 2006 elsevier inc all rights reserved

reassesing portfolio entrepreneurship portfolio entrepreneurship that is the simultaneous ownership of several businesses is becoming an important theme in the small business research literature to date however there have been few dedicated empirical investigations of the phenomenon this article analyses research on portfolio entrepreneurship that has been derived from a wide range of subject literatures including economic sociology cultural anthropology and agricultural economics the aim is to provide a deeper understanding of the motivations for portfolio entrepreneurship approaches and the processes associated with it

entropy and the value of information for investors the prior free implications abstract the partial order of prior independent investment dominance cabrales et al 2013 strictly extends blackwell s order over information structures i provide a complete characterization for the case of two states and two signals