Number Of New Businesses Research Articles

Taxes and the Impact on Investment and Business

Advocates of the low rate of tax on profits of activity and personal income tax, base their argument to the competition between neighboring countries with Albania in the race of absorbing as much as more foreign investment, and the effect on the level of employment in the country. Reducing corporate tax rates and personal income tax rate (including dividend tax and other taxes on income), besides increasing of economy value added has expectations in expanding the labor market, and expanding the taxable base (by increasing the number of new businesses), primarily medium enterprises and large ones. To the latter ones, the profit tax in effective rate could help to reduce the ability to pay higher prices to suppliers for future periods, which translates to effect the post of jobs in business suppliers. All this scheme of fiscal policy is a model which brings tax revenue added to the country's budget.The link between taxes and economic growth remains a major issue in the politics of the day. This paper, focusing on the presentation of producer associations and expert of economic and fiscal issues aims to answer the big question how much it affects the tax rate for profit activities (medium and large) and incomes of employees?

Analyzing the determinants of entrepreneurship in European cities

This study investigated the determinants of business creation as a measure of entrepreneurship in European cities. It examined supply- and demand-side elements, actual and equilibrium rates of entrepreneurship, institutions and culture. These components were characterized using a dataset consisting of 21 indicators drawn from 184 cities in 20 European countries during the years 1999–2010. The study found that city size, self-employment, and tertiary education have a significant and positive impact on the number of new businesses registered. The implications of these findings are discussed in view of the European Commission’s Small Business Act, which provides guidelines for the conception and implementation of entrepreneurship policies in the European Union. This paper’s main contribution lies in the differentiation of factors that are context-specific (e.g., city-size) and others that can be influenced by policy (e.g., tertiary education).

Latent Class Analysis of Entrepreneurial Reframing: Effect of Latent Class on Innovation and Success

Reframing strategies of 88 experienced business entrepreneurs were analyzed using latent class analysis to create discrete classes of entrepreneurial reframers. Logistic regression was used to investigate the relationship between class membership, background/demographic factors, and entrepreneurial innovation and success. Results found entrepreneurs were categorized into one of four latent classes based on their reframing strategies: Class 1, Social re-framers; Class 2, Reflection re-framers; Class 3, Optimistic re-framers; and Class 4, Converse re-framers. Reframing strategies usage increased from class one to four. The entrepreneur’s background/demographic factors did not affect the use of reframing strategies except for the number of new businesses started. Entrepreneurial innovation increased across the four reframing strategies latent classes, although entrepreneurial success was not affected. Results are discussed and emphasize the benefits of reframing on innovation, and drive the need for future research to expand the knowledge of, and tools associated with, improved reframing ability. This study provides many findings that can help the research scholar and practitioner expand their knowledge of reframing, increase their use of latent class analysis, and link reframing strategies with entrepreneurial innovation and success.

The Decision to Start a New Firm: An Econometric Analysis of Regional Entrepreneurship in Tunisia

Understanding the factors that promote or mitigate transitions into self-employment is crucial to regional economic development efforts, while the number of new business created play a significant role to regional economic vitality and represent a major signal of a dynamic economy. We use a new measure of firm formation based on the combination between individual background with effects depending on the regional context in Tunisia such as entrepreneurial human capital and labour force characteristics. Even though some of these factors have been the subject of several entrepreneurship studies, it is still difficult to identify which one impact significantly the decision to create a new firm. As an illustration, the model is estimated using a data provided by the National Tunisian Global Entrepreneurship Monitor (GEM) 2010 Project, based on the analysis of a sample of 1966 cases. The main findings of the study show that “competencies” measured by the two variables “knowing someone personally who started a business in the past 2 years” and “presence of good opportunities for starting a business” increase significantly the probability to create a new venture. In addition, we have found that the interaction between these two factors has a positive influence. However, “fear of failure” influences negatively the decision to start up. Finally, some fixed region-specific factors notably the average real wage of a region must be accounted for when estimating regional self-employment relationships. We discuss the implications of our results for policy-makers with useful information in designing and implementing policies to promote enterprise development.

A Methodology For Developing And Testing The Effectiveness Of Using Entrepreneurial Skills And Supply-Side Innovations To Improve The Performance Of Small And Medium Sized Enterprise

The study identified and took stock of the supply-side resources, which can be harnessed for entrepreneurial development in Nigeria. Although there is a considerable gender gap in entrepreneurial development, the study reveals that there is a considerable desire for private sector-driven entrepreneurial development, supported by a large pool of highly educated and relatively young entrepreneurs, who may be responsible for the enormous growth in the number of new businesses formed since 1990. Future studies and government empowerment policies should be directed to addressing the problem of the limited management and technological orientations identified in this study to enable funding initiatives to be beneficial.

ASSOCIATIVE COMMUNITY BANKS IN BRAZIL

The fundamentals of capitalism lie not only in the private ownership of capital but also in its concentration in the hands of a minority. Because they do not have capital, those who need to work for a living—the vast majority—are forced to sell their ability to produce to those who control the means of production. Therefore, capitalists have at their disposal an abundant supply of labor force that usually outnumbers labor demand. If workers had access to credit, many of them would open their own businesses instead of being someone else's employees.1The bigger the number of new businesses established, the more likely they would be to succeed because the insertion of small fractions of capital into the market would expand demand and allow these businesses to find buyers for their goods. In 2003, Brazil had 10 million small and micro entrepreneurs, 1 million families in rural settlements from land‐based reform programs, and over 11 million households depending on the Bolsa Família2 government program, along with a huge mass of unemployed, all in need of access to funds. Despite several credit democratization measures adopted by the current government, among which the sixfold increase in funds from Pronaf (Brazilian National Programme to Strengthen Family Agriculture) stands out, the great majority of those mentioned have not been aided as yet.3

Civil Society and the Anatomy of a Rural NGO

More than 230,000 non-governmental organizations have been officially registered in China in quarter century since onset of post-Mao reforms.1 Involved in wide range of socioeconomic activities and issues, such organizations represent an important new development in state-society relations, one that has begun to attract attention among China scholars.2 In late 1980s, interest in Chinese NGOs was spurred by onset of democratic transitions in several countries in Soviet bloc.3 Propelled by Habermasian revolution in study of state-society in East and Central Europe, China scholars asked whether proliferation of non-governmental bodies heralded rise of that might eventually challenge political monopoly of Chinese Communist Party-state.4 In event, wave of optimism that greeted prospect of an emergent civil society in China lost much of its luster in repressive aftermath of 1989 Tiananmen crackdown, when state summarily shut down number of newborn societal organizations. There followed almost decade of healthy skepticism about relevance of Western-derived civil society models in contemporary China.5 In 1990s growing number of scholars employed models to capture state's continued domination of non-statal organizations through such indirect mechanisms as government sponsorship, overlapping leadership, co-optation and state licensing.6 Empirical investigations of number of new business and commercial associations, for example, revealed complex, hybrid forms of state influence, with strength of governmental supervision and control varying from group to group. The terms used to describe these organizations varied widely. Kang Xiaoguang called business associations banguan, banmin (semi-official, semi-civil);7 Jonathan Unger referred to them as a hybrid of socialist corporatism and clientelism;8 Margaret Pearson referred to the merger of state and business;9 Dorothy Solinger spoke of business-state collaboration;10 Ray Yep and David Wank noted existence of symbiotic relations with state;11 while Kenneth Foster referred to business associations as embedded within state agencies.12 A feature common to almost all of these business and commercial associations is that they were perceived to lie closer to statist end of continuum between state domination and societal autonomy. This report seeks to contribute to literature on social organizations in post-reform China by examining case of single rural non-governmental organization, Sanchuan Development Association (SDA) of Guanting Township in Qinghai Province. SDA is relatively autonomous, indigenous NGO of type that appears to be popping up with increasing frequency in rural China, but that to date has not been widely reported on or taken account of in civil society/corporatism literature.13 Unlike most research sites selected for study by Western scholars, which tend to be clustered either in coastal urban locales (Guangzhou, Shanghai, Yantai, Xiamen, Tianjin, etc.) or in relatively affluent rural areas (Xiaoshan, Wenzhou, Zhoushan, Yiwu), Guanting lies in poor, remote, mountainous region of northwest China. Also unlike most associations studied by Western scholars, SDA is neither business group nor trade association. It is devoted exclusively to local poverty alleviation and community development projects, ranging from school construction, public sanitation and water conservation to horticulture and animal husbandry. As true minjian (people's) NGO, SDA differs from state-dominated corporatist bodies described in literature. Almost wholly autonomous and self-directed, it is only loosely and intermittently linked to state. And finally, unlike previously described organizations, SDA derives its funding primarily from international philanthropic sources. In its distinctive constellation of organizational characteristics, SDA exemplifies an increasingly common-but hitherto understudied-genre of Chinese grass-roots organizations. …

Has new business creation in russia come to a halt?

Successful transformation of centrally planned economies requires not just the privatization of the existing firms, but also the formation of new ones. New entrants serve to correct for the central planners' neglect of such sectors as services and consumer goods, and their bias in favor of large firms. Indeed, Central European economies have been experiencing a rapid rate of new business creation, as measured by the change in the number of small firms. Russia also experienced a short period of explosive growth in the number of new business. However, since 1994 net new business formation has stagnated. This paper looks into the possible causes of this phenomenon. Official data on the change in the number of small businesses, which serve as a proxy for net new business formation, arouse justified suspicion because of the frequent changes in the definition of “small enterprise.” Like everywhere in the world, some Russian registered firms do not become operational, and some firms that have ceased operations do not legally disband. If the share of these “dead souls” in the total count of small firms changes over time and official statistics does not adjust its count accordingly, the data may show the opposite of the actual processes. This paper analyzes Russian data collection procedures and other evidence, and concludes that stagnation in the new business formation is a real phenomenon, rather than a statistical artifact. The difficulty in finding out the causes of stagnation is that empirical studies focus on the existing businesses and miss those that should have been born but were not. The problems faced by the incumbents and frustrated entrants may well be different. The likely causes of the end of new business creation are the increased tax and regulatory burden, combined with plunder by the numerous tax and regulatory authorities. Other possible explanations involve the incumbents' use of the authorities and/or racketeers to erect barriers against new entrants.

New Business Start-ups: The More The Better?

The importance of new ventures in the economic process is well established and many governments embark on programs designed to stimulate new businesses start-ups in the belief that increasing the number of new businesses will have a positive impact. Much effort is expended in trying to reduce the failure rate of businesses, usually based on the belief that failure is the result of rectifiable shortcomings within a business, particularly a failure in management. This paper looks at start-up businesses in New Zealand for the period 1987 to 1994. It shows that during the period studied, 5.75 times as many new businesses started up as the economy was able to absorb, and argues that this large oversupply is the underlying cause of the high rate of business failure. Conventional methods aimed at reducing business failure are therefore incapable of reducing the failure rate, they merely help decide who the survivors will be. The paper argues that, in New Zealand, programs aimed at increasing the volume of new business start-ups are misguided and that it is impossible for the economy to absorb the volume of new firms entering the market. It seems likely that a similar situation exists in other western countries and that public policy efforts would be better directed at improving the quality of start-ups rather than the quantity.

Policy Review Section

In this Policy Review Section, Ivan Turok of Strathclyde University and Pat Richardson of Stirling University consider the contribution of new firms to local economic development based upon recent survey evidence from central Scotland. Support for the formation of small enterprises remains an important part of government policy, at central and local levels. Turok and Richardson argue that the experience in West Lothian offers insights into the scope of small firms policy in an unfavourable environment. The study of 200 new firms shows that access to jobs has been provided for several hundred people who might otherwise have been unemployed and job satisfaction given to over 100 new firm founders. Turok and Richardson, however, cast doubts surrounding the more far reaching claims made about the economic contribution of small firms based on their survey. The scale of expansion has been modest, innovation limited and the prospects for sustained growth are not good. They conclude that to foster economic developments in areas such as central Scotland requires far more than merely the promotion of an increase in the number of new business starts. In the second article, Richard Oakey of Heriot-Watt University examines some implications for the future development of high technology industry of the so-called ‘peace dividend’ arising from savings which are likely to be made in defence expenditure. Oakey points out that most research into the industrial and regional policy aspects of high technology focuses on input data covering R&D expenditure or employment and yet it is often the case that there is a weak link between R&D investment and the development of commercially successful products. For example, many larger British and American high technology companies, unlike their German and Japanese counterparts, are dependent for much of their business on non-commercial military research and the guaranteed purchase of expensive defence products. Such companies could well face problems of adaptation in the post ‘cold war’ era. In geographical terms, many supposedly successful ‘high tech’ areas, far from being examples of free market growth, are ‘propped up’ by a constant stream of hidden government subsidies in the form of defence-related business which involves a commitment to purchase final products at often exorbitant prices. In conclusion, Oakey points to the danger that at a time when the UK balance of payments suggests the need to increase investment in high technology industry, there is a danger that defence expenditure savings will not be invested by the current government since there is no ideologically sound means by which it can be recycled.

Success and Failure in New Business Start-Ups

DAVID SMALIBONE IS A SENIOR LECTURER IN the school of Geography and planning at Middlsex Polytechnic, Engalnad,with urrentresearch interest in enterprise agaencies, new business and adjusttment processes in nature small frims. this paer aims to ccontribute to knowlede of the charctersitics nd problems of new firms through a lngtudiinal study of a group ofo new business helped tostart by a loca lenterpriise eagency, a unique British organisatiion which provides free or low-cost advice andsupport to young firm and which are themselves funded by laarge local business and local authorities. The characteristics of survving andfaled businesses are described, together wiith theproblems faced in the itnitial trading periodl. the role of external agencies n provding continued support aftr start upsi also discussed breifly. Apart from contributing to a more informed assesment of the recent grwth in the number of new business and self-employed, the paer outlines smeimplcation of the findings for improving the qualty of new business starts.