Creative destruction and productivity: entrepreneurship by type, sector and sequence
Martin Andersson,
Pontus Braunerhjelm and
Per Thulin (per.thulin@indek.kth.se)
Journal of Entrepreneurship and Public Policy, 2012, vol. 1, issue 2, 125-146
Abstract:
Purpose - Schumpeter claimed the entrepreneur to be instrumental for creative destruction and industrial dynamics. Entrepreneurial entry serves to transform and revitalize industries, thereby enhancing their competitiveness. The purpose of this paper is to investigate if entry of new firms influences productivity amongst incumbent firms, and the extent to which altered productivity can be attributed sector and time specific effects. Design/methodology/approach - Implementing a unique dataset the paper estimates a firm‐level production function in which the productivity of incumbent firms is modeled as a function of firm attributes and regional entrepreneurship activity. Findings - The analysis finds support for positive productivity effects of entrepreneurship on incumbent firms, albeit the effect varies over time, what the authors refer to as a “delayed entry effect”. An immediate negative influence on productivity is followed by a positive effect several years after the initial entry. Moreover, the productivity of incumbent firms in services sectors appears to be more responsive to regional entrepreneurship, as compared to the productivity of manufacturing firms. Originality/value - The paper employs a firm‐level production function approach allowing for time lags of the effect of entrepreneurship. The unique data implemented allow the authors to identify genuinely new ventures as compared to those associated with reorganizations of existing businesses, thereby overcoming much of data deficiencies in previous studies. In addition, data are distributed on Swedish functional labor market regions.
Keywords: Entrepreneurship; Entry; Business turbulence; Incumbent firms; Productivity; Region; Business dynamics; Entrepreneurialism; Productivity rate; Sweden (search for similar items in EconPapers)
Date: 2012
References: Add references at CitEc
Citations: View citations in EconPapers (12)
Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers
Related works:
Working Paper: Creative Destruction and Productivity – entrepreneurship by type, sector and sequence (2011) ![Downloads](/downloads_econpapers.gif)
Working Paper: Creative Destruction and Productivity – Entrepreneurship by type, sector and sequence (2011) ![Downloads](/downloads_econpapers.gif)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:eme:jepppp:v:1:y:2012:i:2:p:125-146
DOI: 10.1108/20452101211261417
Access Statistics for this article
More articles in Journal of Entrepreneurship and Public Policy from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support (feeds@emerald.com).