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What makes cities more entrepreneurial?


Economic Research Journal,Vol 53,No. 04

【Abstract】 Summary: The entrepreneurship-enhancing effect of urban agglomeration has attracted increasing attention in the economic literature over the last decade. Findings on this effect have been important motivations for the Chinese government’s new urbanization strategy. However, studies have focused on the U.S. and European countries. Theoretical and empirical analysis for cities in developing countries, including those in China, is lacking. This paper filled this gap by assessing the extent to which urban agglomeration affects entrepreneurship in China. We began our analysis by proposing a mechanism-based framework to study the precise channels through which urban agglomeration contributes to entrepreneurship. Our theoretical framework showed that different types of urban agglomeration affect entrepreneurship in different ways. Specialization externalities promote entrepreneurship through specialized labor market pooling, specialized production networks, and within-industry knowledge spillovers. Diversity externalities promote entrepreneurship through inter-industry labor sharing, input-output linkages, and inter-industry knowledge spillovers. As a transforming economy, the challenges currently facing China’s specialized industrial districts limit the entrepreneurship enhancing effect of specialization externalities, which makes diversity externalities rather than specialization externalities have a lasting effect on entrepreneurship in China. Based on this theoretical framework, we combined individual-level data from the Chinese Household Income Project (CHIP) with city-level data from the China Urban Statistical Yearbook to estimate the effect of urban agglomeration on entrepreneurship. The empirical analysis shows that diversity externalities have a positive effect on individual entrepreneurial choice, whereas specialization externalities have no impact on individual entrepreneurial choice. This finding holds true in a series of robustness checks. Our heterogeneity analysis showed that smaller and subsistence entrepreneurs benefit from both specialization externalities and diversity externalities, while bigger and transformational entrepreneurs only enjoy diversity externalities. The diversity externality estimates are generally significant for male entrepreneurs and service industries. Using Population Census micro-data and input-output table, we gauged the relative importance of different diversity externality mechanisms, showing that input-output linkages are the main mechanism through which diversity externalities promote entrepreneurship in China. Our paper contributes to the growing literature on urban agglomeration and entrepreneurship in three ways. First, theoretical analysis of the impact of urban agglomeration on entrepreneurship is in its infancy. This study constructs a mechanism-based framework to explore the ways in which specialization and diversity externalities influence entrepreneurship and conducts a dynamic analysis of the relationship between them based on the features of urban agglomeration economies in China. Second, the literature on urban agglomeration and entrepreneurship normally takes the firms’ perspective. Our paper examined the effects of urban agglomeration economies on individual entrepreneurial choice by combining individual-level data and city-level data, which provides a new perspective to study this very important phenomenon. Meanwhile, our paper also assessed the impacts of different types of urban agglomeration economies on different types of entrepreneurship, providing a better understanding of the entrepreneurship-enhancing effect of urban agglomeration economies. Third, the empirical evidence is scant on how urban agglomeration economies contribute to entrepreneurship. By constructing relevant indices, our empirical analysis on the mechanisms through which diversity externalities contribute to entrepreneurship fills a void in the literature.

Network embeddedness and frugal innovation of rural entrepreneurs: coordination and balance of dual opportunity development

RUI Zhengyun;FANG Conglong

Chinese Rural Economy,No. 07

【Abstract】 Frugal innovation emphasizes that enterprises provide better products and services with less resources. This concept can meet China’s demand for innovative entrepreneurship in the process of economic transformation. The embedded networks can effectively promote innovative entrepreneurship of rural entrepreneurs who tend to be ill-informed and fail to enjoy a complete industrial chain. This paper proposed a theoretical framework to reveal the impact of network embeddedness and opportunity exploitation modes (OEM) on frugal innovation, using survey data of rural entrepreneurs. The results showed that network embeddedness had significantly positive effects on the balanced OEM, innovative OEM and frugal innovation. Moreover, innovative and balanced OEMs both played a intermediary role between network embeddedness and frugal innovation, but they had different direct effects. Therefore, rural entrepreneurs need to pay more attention to coordinating and balancing the relationship between balanced OEM and innovative OEM. Finally, the cognitive distance plays a negatively moderating role between network embeddedness and balanced OEM.

Research on the nonlinear relationship between technology entrepreneurs’ narcissism and team’s innovation performance: from the perspective of entrepreneurial vision

LI Jin;HOU Hongmei;LI Yanshu

Business Management Journal,Vol 40,No. 04

【Abstract】 The personalities of entrepreneurs are considered to be a key factor influencing entrepreneurial activities and output. As a special group, technology entrepreneurs have both leadership and creativity, so it is of great significance to study their narcissistic personality. From the perspective of entrepreneurs, the success of entrepreneurship largely depends on the output of start-up teams. Narcissism involves a series of self-centered characteristics, such as self-appreciation and self-inflation. Although studies have suggested that narcissistic leaders’ arrogance, indifference and even hostility will damage the relationship between leaders and team members, and inhibit the effectiveness of leadership, narcissists’ self-confidence, attraction and humor features can play a positive role. The inconsistency suggests that there is still insufficient evidence for a simple linear relationship between narcissism and leadership effectiveness. This article explored if there is an inverted-U relationship between entrepreneurs’ narcissism and team’s innovation performance. Considering the complexity and uncertainty of entrepreneurial activities, whether entrepreneurs can effectively transfer the vision information to team members and persuade the team members to trust each other and sacrifice for each other is related to the success of entrepreneurial activities to a certain extent. Organizational strategy and performance are the outcomes of vision in general and entrepreneurial vision in particular, which have been most discussed. For the incubating companies, entrepreneurial visions shared by team members will help to improve their innovation performance. The implementation of innovative ideas needs to be supported by team. From the perspective of entrepreneurial vision, this article studied how the entrepreneurs’ narcissism affects the shared entrepreneurial visions, and then took entrepreneurial vision as a mediating variable to analyze their relationship. The process from proposing entrepreneurial ideas to actualizing them consists of the two stages of innovation activities. During this process, social support activities are necessary. The implementation of innovative ideas needs to be supported by team. Based on the impression management theory, narcissistic entrepreneurs can promote positive impression during the management of their teams, thus enhancing the level of performance. But another characteristic of narcissists is arrogance, that is, disregard of other people’s opinions. Whether the influence of narcissistic impressions is stable or not has not been studied yet. As a consequence, this article will explore if there is a nonlinear relationship between entrepreneurs’ narcissism and team’s innovation performance. For entrepreneurial activities, the biggest feature is the uncertainty which is taken as moderating variables in the curve linear. This article divides the uncertainty into two aspects: environmental uncertainty and task uncertainty.

Impact of venture capital on the performance of technology entrepreneurship: considering the mediating role of strategic orientation

XIE Yaping;SONG Chaoli;ZHENG Chenguo;YANG Ju

Technology Economics,Vol 37,No. 05

【Abstract】 This paper divided the entrepreneurial performance of technology startups (hereinafter referred to as technology entrepreneurial performance) into two dimensions, namely growth performance and innovation performance. Venture capital was divided into financial investment and strategic investment. The strategic orientation of technology startups was divided into technological orientation and market orientation. Taking strategic orientation as an intermediary factor and proceeding from a resource-based perspective, it constructed a conceptual model of venture capital, strategic orientation and entrepreneurial performance. Taking 209 technology startups as the research samples, it empirically examined the impact of venture capital on technology entrepreneurial performance and the mediating role of strategic orientation in this impact. The research results are shown as follows. Firstly, venture capital and entrepreneurial performance are positively correlated, and the two investment models, financial investment and strategic investment, have significantly different impacts on entrepreneurial performance. Secondly, there is a correlation between venture capital and strategic orientation in which financial investment makes technological start-ups tend to choose market orientation, and strategic investment makes technological start-ups tend to choose technological orientation. Thirdly, strategic orientation and entrepreneurial performance are positively correlated. Finally, strategic orientation between venture capital and entrepreneurial performance plays a partial mediating role.

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