Sowing the seeds: The impact of initial ties on growth and innovation among micro and small firms

Issam Laguir (), Matthijs Den besten (), Jamal Elbaz () and Rebecca Stekelorum ()
Additional contact information
Issam Laguir: Montpellier Business School and Montpellier Research in Management
Matthijs Den besten: Montpellier Business School and Montpellier Research in Management
Jamal Elbaz: Ecole Supérieure de Technologie (EST) d'Agadir, Ibn Zohr University
Rebecca Stekelorum: Université de Montpellier, Montpellier Research in Management

Economics Bulletin, 2017, vol. 37, issue 2, 1021-1032

Abstract: We investigate the influence of networking on micro and small enterprises (MSEs) innovation and growth. We claim that people whom the entrepreneur approaches for advice as well as the companies with which initial relationships are forged leave an imprint that is reflected in MSEs tendency to upgrade—that is, innovate and grow. Our analysis of a sample of forty-six thousand French MSEs shows that the likelihood that MSEs upgrade within the first five years of existence is affected by their initial partners. Specifically, we find that companies seeking professional advice early on have a higher likelihood to achieve growth through innovation than others whilst companies relying primarily on advice provided by family members and/or organizations specializing in entrepreneurship have a lower likelihood. Moreover, we find that initial cooperation with other companies as well as cooperation with suppliers and customers leave a positive imprint on the MSEs' propensity to innovate and grow. Thus, the paper provides unique insights on the importance of fostering opportunities for networking in the earliest stages of MSEs development.

JEL-codes: L2 M2 (search for similar items in EconPapers)
Date: 2017-05-05
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.accessecon.com/Pubs/EB/2017/Volume37/EB-17-V37-I2-P89.pdf (application/pdf)

Related works:
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:ebl:ecbull:eb-17-00358

Access Statistics for this article

More articles in Economics Bulletin from AccessEcon
Bibliographic data for series maintained by John P. Conley ().