Session 234

Institutional, Industry and Firm Specific Impacts on Nascent Firms

Track K

Date: Tuesday, September 23, 2014


Time: 17:15 – 18:30

Common Ground

Room: Budapest


  • Julio de Castro, IE Business School

Title: Business Model Innovation in Early Entrepreneurial Stages: Evidence from New Spanish Firms During Expansionary and Recessionary Periods


  • Henar Alcalde, University of Deusto
  • Maribel Guerrero, Newcastle Business School

Abstract: This proposal examines the effect of business model innovation on the performance of young firms during expansionary and recessionary periods. The idea is founded on previous studies regarding innovation, entrepreneurial life cycles, and business innovation models. In general, open innovation developed by young firms would increase their innovation performance independently of economic periods. Specifically, we propose the analysis of different types of open business model innovation (science-based collaborations, commercial partnerships, and diverse cooperation) adopted during the firms’ early stages (start-up and early growth) and by economic periods (expansionary and recessionary periods). We propose to test this theoretical proposition using a firm level data from the Spanish Technological Innovation Panel (PITEC) identifying start-ups in 2005 (expansionary period) that remained active in 2011 (recessionary period).

Title: Does Government Assistance Promote Entrepreneurship?


  • Luisa Delgado-Márquez, IE Business School
  • Julio de Castro, IE Business School
  • Guillermo Vanderlinde, Pontifical Catholic University Madre y Maestra
  • Rosa Ruiz, Pontifical Catholic University Madre y Maestra

Abstract: For decades, poverty alleviation has topped the international development agenda. This paper aims to analyze how government assistance, both for new venture creation and for basic needs, microcredit programs, and individuals incomes and education levels influence the likelihood of new venture creation at BOP. Data were obtained from the Survey Social Protection Evaluation in 2010 in Dominican Republic. We provide a model and analyze data from 17003 individuals and 8985 Households. Initial analyses indicate that basic assistance and education do affect the likelihood of new venture creation. The proposed methodology consists of a hierarchical moderated and mediated multiple linear regression analysis. Basic assistance is taken as a mediating variable between total incomes and microcredits and entrepreneurship to study which is the role of basic assistance in the relationship.

Title: Enforcing Covenants Not to Compete: The Life-Cycle Impact on New Firms


  • Evan Starr, University of Maryland
  • Natarajan Balasubramanian, Syracuse University
  • Mariko Sakakibara, University of California-Los Angeles

Abstract: We examine the impact of enforcing non-compete covenants (CNC) on the formation and performance of new firms using matched employer-employee data on 30 US states. We exploit the variation in the enforcement of CNC by state along with the fact that courts do not enforce CNC to law firms in any state. Using a difference-in-difference-in-difference specification with law firms and new firms that are not within-industry spinouts as the baseline, we find states with stricter enforcement of CNC tend to have fewer, but larger, and faster-growing within-industry spinouts. These results are consistent with the view that CNC enforcement has a selection effect: while CNC reduces the rate of within-industry spinout formation, the spinout founders who have higher-quality idea choose to overcome the barrier of CNC.

Title: Export Intensity of Small Business: Institutional Determinants in Emerging Economies


  • Tatyana Tsukanova, St. Petersburg State University

Abstract: Why are small and medium-sized enterprises (SMEs) from emerging economies not characterized by high export intensity? SMEs are considered as a source of economic growth and job creation but their involvement in international operations is rather low. There are multiple reasons. One of them is the existence of impediments in the national institutional environment that should be identified in time if we are interested in creating favorable conditions for small business development and in facilitating the expansion of these firms abroad. The purpose of this paper is to highlight the national institutional determinants of small business internationalization and to examine the impact of institutions at different levels in emerging economies on the export intensity of SMEs focusing on the example of Russian companies.

Title: From Events to Institutions: Manufacturing Consent After a Disaster to Create New Institutions


  • Ken Chung, California State University-East Bay
  • Shahzad Ansari, University of Cambridge

Abstract: The study of institutional entrepreneurship has focused on various conditions in which institutions are created or changed. We study the condition that occurs when there is considerable difference in power among institutional entrepreneurs. Powerful state actors typically become involved in the change effort when disasters occur. We find that powerful state actors, when present after a disaster, can influence the understanding of the problem offered by less powerful actors; but no change occurs when the powerful deem the disaster irrelevant to their interests. This interaction among entrepreneurs is a process and mechanism through which entrepreneurs interests are shaped and shape the shared meanings that are created in a new institution. The findings affect stakeholder management, corporate strategy and organizational theory in general.

Title: Super Partes? Assessing the Effect of Judicial Independence on Creative Destruction in a Quasi-Experimental Context


  • Raffaele Conti, Catholic University of Portugal
  • Giovanni Valentini, IESE Business School

Abstract: In this paper, we study whether judicial independence –i.e. the extent to which judges are insulated from pressures by interest groups – promotes the Schumpeterian process of creative destruction and ultimately economic growth. We argue that more judicial independence, by ensuring that courts do not favor politically powerful or connected parties in disputes, induces greater entry of novel firms (as they face a lower risk of expropriation by powerful incumbents), more exit by established and less efficient firms, and, as a result, enhances the overall economy productivity. In order to identify the effect of the judicial independence on the outcomes of interest we rely on a quasi-experimental context and exploit (presumably) exogenous longitudinal variations in U.S. states between 1981 and 2010.

All Sessions in Track K...

Sun: 08:00 – 09:15
Session 386: Entrepreneurial Corporate Governance
Sun: 09:30 – 10:45
Session 387: Social Capital in Emerging Markets: Local, Glocal or Global?
Sun: 11:15 – 12:30
Session 462: Crowdfunding: State of the Art and Directions for Future Research
Sun: 15:45 – 17:00
Session 235: Cognitive and Behaviorial Perspectives of Entrepreneurial Decision Making
Session 380: Small, Young and Entrepreneurial Firms: A Unique Perspective in Globalization
Sun: 17:15 – 18:30
Session 607: Entrepreneurship and Strategy IG Business Meeting
Mon: 08:00 – 09:15
Session 227: Entrepreneurial Orientation, capabilities and firm performance
Session 445: Adaptation issues for Entrepreneurial Firms
Mon: 11:00 – 12:15
Session 232: Theory Building in the Field of Entrepreneurship
Session 440: Entrepreneurial Strategies in Emerging and International markets
Mon: 14:45 – 16:00
Session 231: Entrepreneurial Leadership: What it Takes to be a Successful Enterprise?
Session 457: Ownership and Funding Structures: Performance Implications for the entrepreneurial firms
Mon: 16:30 – 17:45
Session 226: Culture, Norms and Institutions: The contextual influences on Entrepreneurship
Session 229: Who Founds and how the Founding Team Impacts the Entrepreneurial Firm?
Tue: 08:00 – 09:15
Session 224: Funding an Entrepreneurial Venture: What Works and What Does Not?
Session 236: Universities, Academics and Incubators: The Role of Academic Institutions in Shaping Entrepreneurial Firm and Outcomes
Tue: 11:00 – 12:15
Session 230: TMTs as Firm Resources
Session 309: New Conversations on Business Models
Tue: 15:30 – 16:45
Session 225: Entrepreneurial Networks: Formation and Implications
Session 228: Dynamic Capabilities and Performance Implications for New Firms
Tue: 17:15 – 18:30
Session 234: Institutional, Industry and Firm Specific Impacts on Nascent Firms
Session 441: Funding Entrepreneurial Ventures: Sources and Successes

Strategic Management Society