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1 – 6 of 6Niklas Elert, Magnus Henrekson and Joakim Wernberg
Evasive entrepreneurs innovate by circumventing or disrupting existing formal institutional frameworks. Since such evasions rarely go unnoticed, they usually lead to responses…
Abstract
Purpose
Evasive entrepreneurs innovate by circumventing or disrupting existing formal institutional frameworks. Since such evasions rarely go unnoticed, they usually lead to responses from lawmakers and regulators. The paper aims to discuss this issue.
Design/methodology/approach
The authors introduce a conceptual model to illustrate and map the interdependencey between evasive entrepreneurship and the regulatory response it provokes. The authors apply this framework to the case of the file sharing platform The Pirate Bay, a venture with a number of clearly innovative and evasive features.
Findings
The platform was a radical, widely applied innovation that transformed the internet landscape, yet its founders became convicted criminals because of it.
Originality/value
Applying the evasive entrepreneurship framework to this case improves the understanding of the relationship between policymaking and entrepreneurship in the digital age, and is a first step toward exploring best responses for regulators facing evasive entrepreneurship.
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Panagiotis Liargovas, Nikolaos Apostolopoulos, Zacharias Dermatis and Dimitrios Komninos
The volatile tax system is a huge disincentive for taking business, as frequent changes in the tax system create extremely difficult problems. It is a major barrier to…
Abstract
The volatile tax system is a huge disincentive for taking business, as frequent changes in the tax system create extremely difficult problems. It is a major barrier to entrepreneurship, it fails to address them economic inequalities, is too complex, changing very often, and is made in a way that facilitates tax evasion.
The factors that discourage investors from investing in our country are as follows (as research has shown in the past five years in our country by researchers and scientists): high taxation, complex institutional framework, bureaucracy, corruption, political liquidity and limited access to finance. These pathogens hamper the ability of the economy to produce competitive goods and quality services on the market.
The purpose of this paper is to investigate the main pathogens of the tax system which are a brake on the development of Greek entrepreneurship and how they can be tackled so that our country produces competitive goods and quality services.
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Anders Bornhäll, Sven-Olov Daunfeldt and Niklas Rudholm
High-growth firms have recently received considerable attention in the firm growth literature. These firms might have grown despite the existence of growth barriers, and evidence…
Abstract
High-growth firms have recently received considerable attention in the firm growth literature. These firms might have grown despite the existence of growth barriers, and evidence also suggests that, having already grown exponentially, they may not be in the best position to grow further. Policies targeting high-growth firms may therefore be misdirected. We argue that entrepreneurship researchers should concentrate more on firms that are not hiring, despite having high profits. We call these firms “sleeping gazelles,” and demonstrate that they represented almost 10% of all limited liability firms in Sweden from 1997 to 2010. Nearly half of these firms continued to earn high or moderate profits in subsequent three-year periods, while still displaying no growth. Regression analyses indicate that these firms were significantly smaller, older, more likely to be active in industries with high profit uncertainty, and more likely to be located in less densely populated municipalities than were corresponding growing firms.
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Magnus Henrekson and Mikael Stenkula
The purpose of this paper is to show that entrepreneurship can be fruitfully analyzed by positing that entrepreneurs are searching for rates of return exceeding the risk-adjusted…
Abstract
Purpose
The purpose of this paper is to show that entrepreneurship can be fruitfully analyzed by positing that entrepreneurs are searching for rates of return exceeding the risk-adjusted market rate of return, i.e., they try to create or discover economic rents.
Design/methodology/approach
A conceptual paper trying to bridge the gap between neoclassical economics and the entrepreneurship field by seeing entrepreneurship as the search for and creation of (entrepreneurial) rents.
Findings
In the short to medium term the search for and creation of entrepreneurial rents give rise to supernormal profits if successful. In the longer term these rents are dissipated and accrue to society at large as cheaper and better products. Entrepreneurial rents are crucial for bringing about the innovation and continuous structural change required to generate economic growth.
Practical implications
The search for entrepreneurial rents is crucial for economic development. Without the possibility to earn entrepreneurial rents, no entrepreneur would be willing to exercise entrepreneurship and exploit entrepreneurial opportunities. Successful entrepreneurship attracts imitating firms that push back profits to normal levels and the benefits of the innovation will be diffused to consumers.
Social implications
Understanding the role of entrepreneurship and its compensation is crucial for analyses of potential policy measures. High ex post compensation for successful entrepreneurship cannot be taxed harshly without affecting entrepreneurs’ willingness to supply effort.
Originality/value
The entrepreneurial function and its compensation are often neglected in neoclassical economics. This is a major shortcoming, as the presence of and search for entrepreneurial rents are necessary for bringing about the innovation and structural change that result in economic growth.
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Anders Bornhäll, Dan Johansson and Johanna Palmberg
The purpose of this paper is to investigate the importance of the entrepreneur’s quest for independence and control over the firm for governance and financing strategies with a…
Abstract
Purpose
The purpose of this paper is to investigate the importance of the entrepreneur’s quest for independence and control over the firm for governance and financing strategies with a special focus on family firms and how they differ from nonfamily firms.
Design/methodology/approach
The analysis is based on 1,000 telephone interviews with Swedish micro and small firms. The survey data are matched with firm-level data from the Bureau van Dijks database ORBIS.
Findings
The analysis shows that independence is a prime motive for enterprises, statistically significantly more so for family owners. Family owners are more prone to use either their own savings or loans from family and are more reluctant to resort to external equity capital. Our results indicate a potential “capital constraint paradox”; there might be an abundance of external capital while firm growth is simultaneously constrained by a lack of internal funds.
Research limitations/implications
The main limitation is that the study is based on cross-section data. Future studies could thus be based on longitudinal data.
Practical implications
The authors argue that policy makers must recognize independence and control aversion as strong norms that guide entrepreneurial action and that micro- and small-firm growth would profit more from lower personal and corporate income taxes compared to policy schemes intended to increase the supply of external capital.
Originality/value
The paper offers new insights regarding the value of independence and how it affects strategic decisions within the firm.
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