Suchergebnisse

This paper proposes a theory according to which entrepreneurial ability to deal with the adoption of new technology is a key determinant of value creation in entrepreneurship. In a single conceptual framework, we demonstrate that a bimodal pattern of entrepreneurial entry emerges: both individuals possessing high job‐related human capital and individuals with low job‐related human capital enter entrepreneurship. Our empirical analysis, using information from the Scientists and Engineers Statistical Data System, shows that entrepreneurial earnings crucially depend on the level of job‐related human capital.

We explore how firms grow by adding products. We leverage detailed data from Japan's cotton spinning industry at the turn of the last century to do so. This setting allows us to fully characterize the type of differentiation (vertical or horizontal) of new product introductions as well as whether the product is within or outside of the firm's prior technological capabilities. We find that trying to introduce innovative products beyond the firm's previous technologically feasible set, even if such trials fail, is a key to firm growth. Indeed, it mostly facilitates growth through the firm's later success in horizontal product diversification. In long-term outcomes, the right tail of the firm size distribution becomes dominated by firms that first moved into technologically challenging products and then later applied their newly acquired technical competence to horizontal expansion of their product portfolios. Two mechanisms through which this knowledge transfer occurs are greater production system flexibility and higher product appeal to downstream buyers. (JEL D22, L11,L67, N65, N85, O31, O33)

We explore how changes in ownership affect the productivity and profitability of producers. Using detailed data from the Japanese cotton spinning industry at the turn of the last century, we find that acquired firms' production facilities were not on average less physically productive than the plants of the acquiring firms before acquisition. They were much less profitable, however, due to higher inventory levels and lower capacity utilization—differences that reflected problems in managing the uncertainties of demand. After acquisitions, less profitable acquired plants saw drops in inventories and gains in capacity utilization that raised both their productivity and profitability levels. (JEL D24, G32, G34, L11, L25, L66, N65)