International Small Business Journal current issue

Entrepreneurship and Policy: Challenges and Directions for Future Research

Robson, P. J.A., Wijbenga, F., Parker, S. C. — 2009-09-22

Public Policy Support for the Informal Venture Capital Market in Europe: A Critical Review

Mason, C. M. — 2009-09-22

The ability of small firms to access finance is hindered by persistent market failure, which creates funding gaps for new businesses, particularly in technology sectors, seeking small amounts of finance. This has prompted various forms of public sector intervention to increase the supply of both debt and risk finance. For the past decade (longer in the UK) both the EU and its member states have increasingly focused on the informal venture capital market as a means of increasing the supply of early stage venture capital. This article describes the changing nature of the forms of intervention and provides a critical review of their effectiveness. The lack of data on angel investing means that there is very little evidence on the impact of these forms of intervention. The article advocates that governments should invest in appropriate methodologies which can accurately measure investment trends in the early stage venture capital market, and specifically angel investment activity, so that the need for public sector intervention can be demonstrated and the impact of such interventions can be measured.

Assessing the Effectiveness of Business Support Services in England: Evidence from a Theory-Based Evaluation

Mole, K. F., Hart, M., Roper, S., Saal, D. S. — 2009-09-22

In England, publicly supported advice to small firms is organized primarily through the Business Link (BL) network. Using the programme theory underlying this business support, we develop four propositions and test these empirically using data from a new survey of over 3000 English SMEs. We find strong support for the value to BL operators of a high profile to boost take-up. We find support for the BL’s market segmentation that targets intensive assistance to younger firms and those with limited liability. Allowing for sample selection, we find no significant effects on growth from ‘other’ assistance but find a significant employment boost from intensive assistance. This partially supports the programme theory assertion that BL improves business growth and strongly supports the proposition that there are differential outcomes from intensive and other assistance. This suggests an improvement in the BL network, compared with earlier studies, notably Roper et al. (2001), Roper and Hart (2005).

Is there Ethnic Discrimination in the UK Market for Small Business Credit?

Fraser, S. — 2009-09-22

A large-scale survey of UK small business finances is analysed for evidence of ethnic discrimination in the credit market. A summary analysis of credit outcomes (loan denials , loan interest rates and discouragement) reveals large differences across ethnic groups with Black and Bangladeshi businesses, in particular, experiencing poorer outcomes than White and Indian businesses. Econometric analysis indicates that ethnic differencs in denial rates and interest rates can be explained by variations in non-ethnic risk factors such as missed loan repayments and overdraft excesses. This suggests there is no ethnic discrimination in credit markets. However, ethnicity appears to influence whether business owners felt discouraged from applying for loans even after controlling for differences in loan application costs and risk. This suggests some ethnic groups may be affected by misperceptions of ethnic discrimination. The implications of these findings for UK policy are discussed.

Regional Opportunities and Policy Initiatives for New Venture Creation

Verheul, I., Carree, M., Santarelli, E. — 2009-09-22

This article investigates the determinants of new venture creation across industries and locations for 103 Italian provinces between 1997 and 2003. Allowing for differences in regional opportunities across industries, we investigate the impact of a range of factors, including policy initiatives, on new firm formation in manufacturing, retailing and wholesaling, hotels and restaurants. Our results show that regions with industrial districts are characterized by higher start-up rates in manufacturing and that wage costs deter entry in this industry. Firm entry in commercial sectors appears to be higher in large cities and areas with strong economic progress. For hotels and restaurants we find that tourism positively influences new firm formation. We do not find a significant effect of recently introduced regional laws promoting new firm formation in Italy.

Government Bureaucracy, Transactional Impediments, and Entrepreneurial Intentions

Griffiths, M. D., Kickul, J., Carsrud, A. L. — 2009-09-22

In environments where information asymmetries and changing market conditions are ever-present, discerning between different macro-level and contextual factors that stimulate or inhibit entrepreneurial activity still needs to be validated. Utilizing our own primary data ( N = 1473 across 10 countries) as well as secondary data (World Bank Economic Forum, Global Financial Data, and Transparency International), we investigate the role that several contextual indices (e.g. perceptions of an entrepreneurial culture) and macro-level indices (e.g. government corruption, GDP per capita, and ease of doing business indices) have on entrepreneurial intentions. Results reveal the impact government corruption and the concomitant transactional impediments have on the degree of entrepreneurial interest across countries.

Book Reviews: Prashantham Shameen, The Internationalization of Small Firms: A Strategic Entrepreneurship Perspective, Routledge Studies in Small Business. London and New York: Routledge, 2008. 163 pp. ISBN 978--0415--43177--4, {pound}70 (hbk)

Naldi, L. — 2009-09-22

Book Review: Peter Johnson ,The Economics of Small Firms: An Introduction. London and New York: Routledge, 2007. 176 pp. ISBN 978--0415--39338--6, {pound}25.99 (pbk), ISBN 978--0415--39337--9, {pound}85 (hbk)

Ashcroft, B. — 2009-09-22

Book Review: Ralf W. Seifert, Benoit F. Leleux and Christopher L. Tucci, Nurturing Science-Based Ventures: An International Case Perspective. 787 pp. London: Springer, 2008. ISBN 978--1846--28874--6, {pound}50 (hbk)

Iandoli, L. — 2009-09-22

Book Review: James O. Fiet, Prescriptive Entrepreneurship, Cheltenham and Northampton MA: Edward Elgar, 2008. 296 pp. ISBN 978--1847--20578--0, {pound}69.95 (hbk)

Baltrusaityte-Axelson, J. — 2009-09-22

Book Review: Alan Fayolle (ed.) Handbook of Research in Entrepreneurship Education, Volume 1: A General Perspective, Entrepreneurship. Cheltenham, UK and Northampton, MA: Edward Elgar, 2007. 320pp. ISBN 978-1-84542-106-9, {pound}115 (hbk)

Cooper, B. — 2009-09-22