Abstract This paper introduces narratives in entrepreneurial ecosystems as drivers of effectuation vs. causation. Drawing on 43 interviews with successful players in Silicon Valley, Munich, and Singapore, we found ecosystem-specific narratives indicate what is common, appropriate, and successful in each ecosystem, and these narratives encourage either effectuation or causation. Our findings indicate

During the economic slowdown caused by the financial crisis in 2008, grants for entrepreneurs were made available to support economic development. Whether such a policy instrument is effective for business development is a highly relevant question in the aftermath of the COVID-19. We evaluate the causal effects of small business development matching grants using a quasi-experimental approach. The grants

Abstract Comparing one hyper-growth venture with one moderate growth venture, we show that growth paths critically depend on the founders’ capability to leverage BAs’ and VCs’ financial and cognitive resources in an ongoing process of interaction. Dynamically matching specific entrepreneurs’ and investors’ decision-making styles is critical for shaping heterogeneous growth paths, as investors and entrepreneurs

Abstract Little is known about self-employment as a career choice for women who marry a high-income spouse. Using rich Swedish register data, we show that Swedish women who are married to a high-income spouse are, on average, highly educated and more likely to pursue self-employment than those married to a spouse in the middle of the income distribution. Our results indicate that the likelihood of

Ethnicity not only shapes pathways to entry into entrepreneurship but also plays an important role in the organizing structure of the business. Previous research on ethnic entrepreneurs has focused on niche markets, their coethnic labor supply, and the spatial concentration of businesses (i.e., enclaves), overlooking the role that ethnicity plays in business strategies more broadly. I draw on 65 in-depth

We study immigrant-native differences in long-term self-employment in Sweden combining population-wide register data and a unique survey targeting a large representative sample of the total population of long-term self-employment. Using the registers, we analyze the evolution of labor and capital incomes during the first 10 years following self-employment entry. We find that immigrant-native differences

COVID-19 placed a special role on fiscal policy in rescuing companies short of liquidity from insolvency. In the first months of the crisis, SMEs as the backbone of Germany’s economy benefited from large and mainly indiscriminate aid measures. Avoiding business failures in a whatever-it-takes fashion contrasts, however, with the cleansing mechanism of economic crises: a mechanism which forces unviable

AbstractSection Abstract We assess the role of race in loans made through the Paycheck Protection Program (PPP). The PPP program, created by the U.S. government as a response to the Covid-19 pandemic, provides loans to small businesses so they can keep employees on their payroll. We argue that the historical record and PPP program design choices made it likely that many Black-owned businesses received

This paper reviews the scholarly contributions of Zoltan J. Acs, who served as a Co-Founder and Co-Editor in Chief since the inception of Small Business Economics. His scholarship serves as one of the foundations and cornerstones of the field of entrepreneurship. His contributions range from innovation to philanthropy and national systems of entrepreneurship.

Women are consistently underrepresented among graduate entrepreneurs. This is especially true among the entrepreneurs who graduate in STEM fields. Here, we aim at identifying factors that reduce/enlarge the gender imbalance in entrepreneurship among STEM graduates. In particular, we explore the underinvestigated association between university education in STEM fields and entrepreneurial entry of recent

Entrepreneurial universities contribute directly and indirectly to supporting all stages of entrepreneurship. The challenge for entrepreneurial universities is how they can best support academic entrepreneurs through these stages of entrepreneurship. This has led to the creation of different and often ad hoc organizational units within an entrepreneurial university. The organizational challenge for

This study distinguishes entrepreneurs’ cognitive financial constraints from financial supply constraints and assesses their relative importance to small business growth. Drawing from the literature on cognitive styles and institutional theory, we argue that small businesses’ financial constraints derive not only from financial market failures but also from the cognitive factors of entrepreneurs. Analysing

Abstract The COVID-19 crisis presents manifest threats for entrepreneurs since their business survival is often directly at stake given the alarming economic downturn. This existential threat, together with their crucial role in the economy, is the reason for the plethora of public financial support schemes being implemented throughout the entire world. However, support schemes for mental health are

Publishing entrepreneurship research is not just important but challenging. Longstanding experts in the field can provide helpful advice. As borders between academic fields blur, research fields are increasingly global in their perspective, knowledge, and findings, thus enabling robust participation in research fields at a scale previously unimaginable. Drawing on the experience, insights, and perspectives

This study examines the influence of organizational psychological capital on the performance of small and medium-sized companies (SMEs) during crises. We argue that SMEs use their intangible resources to cope with difficult situations such as the COVID-19 pandemic. Therefore, we investigate how organizational psychological capital impacts performance and creative innovation through such intangible

Abstract The DUI (learning by doing-using-interacting) mode offers a promising theoretical framework to explain why many small- and medium-sized enterprises (SMEs) are successful in innovation without research and development (R&D) efforts. In this context, we argue that—because of the informal, person-centered, and interactive nature of the DUI mode—small business owners should be in a key position

Abstract What makes a place desirable is the subject of much debate. We conduct a mixed methods analysis on two mid-sized US cities—Indianapolis and Kansas City. We use a migration analysis to understand the flow of the general population, creative workers, and entrepreneurs, followed by an exploratory qualitative analysis of impactful entrepreneurs. Our migration analysis shows that these cities are

This study investigates how venture capital (VC) investments flowing into an industry impact both the innovative opportunities and technological arbitrage opportunities presented in the industry. After examining 855 industry-year observations for 45 industries in the USA for 1997–2015, we found that VC investments moderate the effects of new venture entry rates on innovative opportunities and technological

We examine firms’ employment adjustments immediately after the imposition of stringent lockdown in March 2020. In doing so, we use monthly administrative data, and take value-added tax payment changes as a proxy for the demand shock. We merge data with COVID-19 tests, classified by economic activity, and employ a fixed effects instrumental variable regression. We find that all sized firms in the manufacturing

A correction to this paper has been published: https://doi.org/10.1007/s11187-021-00494-5

This work investigates the relationship between the characteristics and survival probabilities of firms, distinguishing between “involuntary” firm exit and exit by merger and acquisition (M&A). More in detail, we study how, and to what extent, innovation capabilities, as proxied by patents and trademarks, are able to shape, together with standard performance variables, the observed dynamics at the

We investigate the impact of COVID-19 on 42,401 UK SMEs and how government intervention affects their capability to survive the pandemic. The results show that, without governmental mitigation schemes, 59% of UK SMEs report negative earnings and that their residual life is reduced from 164 to 139 days. The analysis shows that government support scheme reduces the number of SMEs with negative earnings

We investigate the corpus of literature on firm exit by means of a systematic literature review (SLR) which yields a final sample of 142 journal articles for the period 1991–2020. The phenomenon of firm exit is explored from a variety of perspectives: business exit; exit at the individual entrepreneur level; exit from specific markets; exit from foreign markets; and the role of exit for industrial

The recent widespread interest of policy in entrepreneurial ecosystems has been complemented by a burgeoning academic research output. This research to date may be broadly categorized as focusing on place, actors, governance, and evolution. Of these groupings, evolutionary processes have been paid least attention despite their centrality to a dynamic ecosystem phenomenon that evolves from an origin

Scholars and practitioners continue to recognize the crucial role of entrepreneurial ecosystems (EEs) in creating a conducive environment for productive entrepreneurship. Although EEs are fundamentally interaction systems of hierarchically independent yet mutually dependent actors, few studies have investigated how interactions among ecosystem actors drive the entrepreneurial process. Seeking to address

Why do entrepreneurs prefer to seek one equity form of funding over another? To address this question, we develop a contingency-based model of perceived funding fit that delineates several factors that influence strategic fund-seeking decisions by entrepreneurs. In prior research, entrepreneur fund-seeking has largely been explained using models that rely on rule-based approaches (e.g., the pecking

Research on family firms provides mixed evidence of the effect of family ownership on firm performance and exit outcomes. Drawing on threshold theory and the socioemotional wealth perspective, we argue that family firms have lower performance thresholds than non-family firms, reducing the likelihood of firm exit. Using a longitudinal dataset of 1191 firms over the period 2008–2011, we find support

This paper analyzes the impact of the Italian Start Up Act which entered into force in October 2012. This public policy provides a unique bundle of benefits, such as tax incentives, public loan guarantees, and a more flexible labor law, for firms registered as “innovative startups” in Italy. This legislation has been implemented by the Italian government to increase innovativeness of small and young

Social distancing restrictions and health- and economic-driven demand shifts from COVID-19 shut down many small businesses with especially negative impacts on minority owners. Is there evidence that the unprecedented federal government response to help small businesses—the Paycheck Protection Program (PPP) and the related COVID-19 Economic Injury Disaster Loans (EIDL)—which had a stated goal of helping

This paper investigates the real effect of short-term financial constraints on small and medium-sized enterprises (SMEs). Under the working capital channel, cash credit constraints force entrepreneurs to forgo investment opportunities in order to finance their working capital needs. Building on survey data, I find that short-term credit constraints are as important as long-term ones in SMEs’ investment

Because entrepreneurship entails uncertainty, business failure is a common outcome for entrepreneurs. When entrepreneurs encounter business failure, they carry a financial, social, and emotional burden associated with the failure. However, the magnitude of this burden differs by institutions, influencing entrepreneurial decisions and behaviors. Although institutions governing the rules of business