Business Regulation Research Articles

The COVID-19 Pandemic and Entrepreneurship in Germany

The COVID-19 pandemic severely affected not only incumbent firms, but also the emergence of start-ups. This paper investigates and analyzes the pandemic’s effect on new business formation, as well as business exits and insolvencies, in Germany. We find that the overall level of business registrations slightly decreased during the first year of the pandemic, but that the effect is specific to certain industries. Innovative manufacturing industries and technology-oriented services experienced an increase in the numbers of start-ups. High subsidies and a temporary suspension of important criteria obliging firms to declare insolvency weakened market selection resulting in fewer exits in 2020. The relaxation of insolvency regulations may lead to considerable numbers of ‘zombie’ firms. Generally, the pandemic re-enforced ongoing structural change, but also exerted specific effects that may be temporary in nature.

Cultural Anchors in a State of Flux: the Case of Brexit

Formal institutions such as laws and regulations, enacted and administered by statutory bodies can be changed overnight. However, that degree of volatility hardly applies to informal institutions, namely traditions, beliefs, national culture values and related behaviour, deeply engrained in social consciousness. Brexit brings about new regulations of international trade and business that cause operational disturbances to international business participants so far as the British market and counterparts are involved. In such a state of flux, business people might find some stability and comfort in the established societal-level values of the United Kingdom and respectively, in the mitigating role of intercultural competence. The paper attempts to reveal the underlying cultural values at a country-level of the United Kingdom and discuss their implications for international business participants. It is a conceptual desk research drawing on contributions of renowned crosscultural communication scholars. The merits of the paper lie with its broad applicability, subject to further contextualization on behalf of international business agents.

Multinational Firm Growth and Sustainability Responses to Dynamics of Business Regulations in Host Market

Dynamics in business regulations measured by ease of doing business is a new approach that indicates countries’ business climate reforms toward suitability for investment growth. The present study took three variables from the ease of doing business data and evaluated them toward predictive power of FDI flow to 19 Sub-Saharan African countries by using fixed-effect model. Based on the analysis, the official time, procedures, costs, and minimum capitals in starting a business stage, enterprise registrations and official permissions of the firm establishment had a material effect on investment growth. Even though, on one side trade openness and the growing market size was seen as an opportunity, the deep-rooted corruption and landlocked was the trap for the smooth growth of firms in the region.

Цифрова економіка як складова розвитку системи публічного управління

Розглянуто особливості цифрової економіки як складової розвитку системи публічного управління. Проаналізовано дефініцію цифрової економіки з позиції різних науковців та представлено власне розуміння досліджуваного поняття. Виокремлено проблеми, які пов’язані із впровадженням цифрових технологій в економічну сферу України. Обґрунтовано кроки, які повинна здійснити Україна на шляху подолання проблем розвитку цифрової економіки.

The Relationship between ESG and Financial Performance Indicators in the Public Sector: Empirical Evidence from the Republic of Serbia

Research Question: This paper investigated whether a relationship exists between environmental, social and corporate governance (ESG) performance indicators and financial performance measures in the public sector. Motivation: Performance measurement plays a significant role in public management and public policy and could be considered to be a segment of the whole performance management process. Growing awareness of climate change, human capital and corporate governance issues have imposed the necessity of introducing environmental, social and corporate governance performance indicators (ESG) in public enterprises’ annual reports. ESG performance indicators encourage investors to make socially responsible investment decisions (De Lucia, Pazienza & Bartlett, 2020). Hence, the paper is focused on the specifics of measuring performance in the public sector. Besides, it is very interesting to acquire knowledge about the correlation between ESG indicators and financial performance measures (Kalaitzoglou, Pan & Niklewski, 2020; Landau, Rochell, Klein & Zwergel, 2020). Idea: The purpose of the research is to highlight relevant performance measures in the public enterprises in the energy sector in the Republic of Serbia and to examine whether the application of the ESG indicators implies better financial performance. Data: Four large Serbian companies in the energy sector were analysed. Data were collected on the web site of the Agency for Business Registers of the Republic of Serbia. The observation period is from 2017 to 2019. The financial performance indicators are ROA, ROE and the economy ratio. Tools: Based on annual financial statements, non-financial reporting of public companies is monitored, whether companies invest in environmental and social protection, as well as whether they implement activities directed to more consistent implementation of corporate governance. The dynamics of selected financial indicators is analysed according to base and chain indices. Findings: The results show that the public enterprises in the energy sector of the Republic of Serbia mainly report on traditional financial measures in their annual financial statements. One of them applies all ESG indicators and the others do it partially. However, no direct and positive correlation between ESG indicators and financial performance measures could be found. Conversely, there is the case that ESG indicators have no linkage with the financial performance measures. Contribution: This paper contributes to the existing literature in the field of public enterprises’ sustainability.

The Impact of Digital Marketing and Digital Transformation on Brand Promotion and Brand Positioning in Kosovo’s Enterprises

Digitalization is very important for every company in today’s fierce competition. The development of Information Technologies has helped companies change means of reaching their clients and changing their working practices. The paper tries to assess digital marketing (DM) and digital transformation (DT) techniques that impact enterprises in Kosovo in the process of their brand promotion and brand positioning using google analytics, social media, e-commerce, search engines, mobile apps, or other digital channels. DT is profoundly important to every company, yet the correlation between DT, brand promotion, and brand positioning for Kosovo’s enterprises has not been researched a lot. With the DT, many companies are redefining business procedures and marketing strategies. The research will collect data using a survey with 150 companies generated by the Kosovo Business Registration Agency. Partial Least Square is used to analyse the collected data. Structural Equation modelling is used to assess the relationship between exogenous and endogenous variables used in the research proposed model. A moderation effect is used to test whether COVID-19 or the company's size is linked to the usage of DM and DT. The results are expected to reveal that DM and the digitalization process of enterprises affect brand promotion and brand position. The findings also imply that social media are widely used relative to other marketing channels. Companies that use DM and invest more in technology have better chances to promote and position their brands.
 This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

The Startup Cartography Project: Measuring and mapping entrepreneurial ecosystems

This paper presents the Startup Cartography Project (SCP), which offers a new set of entrepreneurial ecosystem statistics for the United States from 1988 to 2016. The SCP combines state-level business registration records with a predictive analytics approach to estimate the probability of “extreme” growth (IPO or high-value acquisition) at or near the time of founding for the population of newly-registered firms. The results highlight the ability of predictive analytics to identify high-potential start-ups at founding (using a variety of different approaches and measures). The SCP then leverages estimates of entrepreneurial quality to develop four entrepreneurial ecosystem statistics, including the rate of start-up formation, average entrepreneurial quality, the quality-adjusted quantity of entrepreneurship, and the entrepreneurial ecosystem performance associated with a given start-up “cohort.” These statistics offer sharp insight into patterns of regional entrepreneurship, the correlation of quality (but not quantity) with subsequent regional economic growth and the evolution of entrepreneurial ecosystems over time. The SCP includes both a public-access dataset at the state, MSA, county, and zip code level, as well as an interactive map, the U.S. Startup Map, that allows academic and policy users to assess entrepreneurial ecosystems at an arbitrary level of granularity (from the level of states down to individual street addresses). The SCP and accompanying datasets may be found at: https://www.startupcartography.com/.

A Snapshot of the Crisis of COVID-19: Estimate of the Employment Impact Due to Lockdowns in Cagayan de Oro City, Philippines

When coronavirus disease 2019 (COVID-19) became a national health crisis, the local government of the Cagayan de Oro City (CDOC) did not implement total lockdown. The COVID-19 Adjustment Measure Program adopted by the local government probably affected the April 2020 Labor Force Survey that showed that Region 10 posted an employment rate of 88.9%, which is higher than the national average of 82.3% (Department of Labor and Employment, Region Office No. X (DOLE-X). NorMin secures highest employment rate amid COVID 19. 2020. Available from: https://pia.gov.ph/news/articles/1044898 [Accessed 9th May 2021]). Despite the regional figure being 6.6 percentage points higher than the national one, there is a decrease in employed persons by around 400,000 from 2.302 million persons employed in April 2019 to 1.883 million in April 2020 (Department of Labor and Employment, Region Office No. X (DOLE-X). NorMin secures highest employment rate amid COVID 19. 2020. Available from: https://pia.gov.ph/news/articles/1044898 [Accessed 9th May 2021]). Hence, the study determines the effect of COVID-19 protective measures implemented by the government on the economy of CDOC. Using the barangay-level and selected sectoral-level data on business registration, and employment data between 2010 and 2019, the study estimates that one-week lockdown means a ₱1,825 loss of income for a minimum-wage employee. One-month lockdown costs ₱7,300 foregone income, while one-quarter lockdown (or a half of six months) is equivalent to ₱21,900 income loss. We recommend 10 policy interventions, but the government should also think big and invest its resources into programs that create a multiplier effect on the economy. Multipliers are interventions that create ripples or positive impacts on other sectors and/or economic participants.

Microfinance and business regulations in emerging markets

The rapid expansion of microfinance has been uneven across emerging market countries. Our study examines whether the regulatory and legal environment for small and medium enterprises (SMEs) associated with microfinance institution (MFI) lending in informal markets may be part of the explanation. Our study of 51 emerging market countries for the period 2007–2015 used two measures of MFI lending: 1) the market penetration index (PI) which reflects MFI outreach and 2) gross loan portfolio per capita (GLP) which gauges the volume of MFI lending. Based on our search, this is the first study to incorporate both measures of MFI lending. We find that excessive regulation and weak legal institutions are associated with less MFI lending both in terms of outreach (PI) and loan volume (GLP). Hence, the international differences in MFI expansion may be partially attributable to business-unfriendly regulations and legal structures.

Transformation of Socio-Economic Development Priorities in the Post-Pandemic Period

Aim. The presented study aims to substantiate methodological approaches to the transformation of the priorities of government regulation of socio-economic development during the post-crisis period in the context of the circular economy.Tasks. To achieve the set aim, the authors address the theoretical and practical problems of the transformation of socio-economic development priorities; comprehensively analyze major problems and identify indicators and criteria for assessing the effectiveness of the government regulation of management in a circular economy; provide recommendations for optimizing management decisions at all levels of regulation of economic entities in the postcrisis period.Methods. This study uses the methods of complex and historical analysis, synthesis, induction, deduction, expert assessments, information and communication technologies.Results. Transformation of the strategic management goal in a circular economy implies structural changes in the priorities of socio-economic development in the classical linear functional model of economic entities based on the introduction of a chain of reusable raw materials in a closed cycle. Business regulation in Russia faces the problems of imperfect institutions of title guarantee and legal regulations that significantly increase risks. Currently, priority directions for the transformation of e-government in a circular economy include such areas as legislative support for the operation of economic entities within a single network space, education, technological innovations, innovative design, digital infrastructure, secure storage and processing of analytic databases. The efficiency of government regulation in the post-pandemic period can be improved by developing and implementing comprehensive programs strategically aimed at creating favorable conditions for sustainable interaction between the business and the government in a circular economy.Conclusions. Transformation of the priorities of government regulation of socio-economic development in the post-pandemic period involves substantiating the scenarios and organizational forms of their implementation aimed at anti-crisis optimization of the regional development program. Under modern conditions, a priority goal for administrative bodies is to achieve balanced parameters that would enhance Russia's competitiveness in the global market of goods and services with allowance for the principles of the circular economy. Target parameters affecting regional growth and development include reduced usage and replenishment of natural resource potential; introduction of closed cycles of production, consumption, distribution, exchange; transition towards zero waste technological chains in all segments; transformation of all spheres of socio-economic development to meet global environmental standards in raw materials, components, etc.

Pengaruh Corporate Social Responsibility (CSR) Dan Good Corporate Governance (GCG) Terhadap Tax Avoidance

This study aims to test the influence of corporate social responsibility (CSR) and good corporate governance (GCG) on tax avoidance. The population in this study was a CGPI-winning company registered with IICG in 2018. The samples selected for use in the study were 15 companies that met the sample criteria. The study was analyzed using partial last square analysis (PLS). The results showed that CSR has a negative influence on tax avoidance. The higher the csr disclosure rate made by the company, the lower the value of CETR which means the level of tax avoidance is high. Meanwhile, good corporate governance has a significant positive influence on tax avoidance. This shows that good corporate governance then corporate tax avoidance will decrease, and the company will be able to run its business in accordance with applicable business regulations including fiscal regulations. This research is potentially relevant to academia, and management. This research provides empirical insight into two major concepts: agency and stakeholder theory issues in tax avoidance schemes.

Sustaining South African Small and Medium-sized Enterprises Through Monetary Access and Literacy in the COVID-19 ERA

Abstract Research background: Monetary access and literacy are significant factors of concern confronting the survival and sustainability of small and medium-sized enterprises. Purpose: This led to this paper seeking to understand the impact monetary access and monetary literacy have on the sustainability of SMEs in the COVID-19 era. Research methodology: The method was employed by this study is a quantitative research method, which is supported by a positivism research paradigm. Data was collected using a questionnaire completed by 310 sampled participants. Using the Statistical Package for Social Sciences to analyse data, descriptive, the Pearson correlation and regression analyses were used to estimate the model. Results: The Pearson correlation indicated a positive and significant correlation between monetary access and monetary literacy to the sustainability of small and medium-sized enterprises (r = 0.564). The result indicated that some small and medium-sized enterprises do possess basic monetary skills while some do not. A significant number of small and medium-sized enterprises do not understand basic monetary terms, which justifies the lack of monetary literacy. Novelty: The study recommends that government agencies that assist with business registration should include a monetary training course as part of registration formalities. Further to that, the study recommended that government, banks and other business support institutions should simplify support programmes for the prosperity of small and medium-sized enterprises during and post COVID-19 pandemic.

БІЗНЕС-КЛІМАТ РЕГІОНУ ЯК ЧИННИК ЗАБЕЗПЕЧЕННЯ СТІЙКОГО ЕКОНОМІЧНОГО ЗРОСТАННЯ

Despite a number of reforms, Ukraine has not created the necessary environment to stimulate entrepreneurial activity, active investment inflows and economic growth in the regions. The article analyzes the assessment of the business environment of Ukraine according to different world ratings and comparative assessment of the business environment of Ukraine and other countries. Risks for the development of the business environment in Ukraine have been identified. An assessment of the interdependence between the quality of the business environment in the regions of Ukraine and the growth rate of GRP. The analysis of regional features of the quality of the business environment in Ukraine shows positive changes in all regions in terms of ease of business registration, land registration, connection to the grid and difficulties with paying local taxes and the development of electronic services. However, the achieved results have not yet been converted into a stable dynamics of economic growth and increasing the level of Ukraine's competitiveness in the world economy. Among the main problems of business environment development are low level of protection of intellectual property and property of business entities, inefficiency of the judicial system in Ukraine, low level of financial and investment freedom of business, unavailability of credit resources for starting and conducting business. Interregional comparisons of the business environment and economic growth of Ukraine's regions prove that the leading regions in terms of economic growth are characterized by a relatively higher quality of business climate, moreover, in recent years they have increased their position in the regional ranking of ease of doing business. At the same time, the largest group of regions in Ukraine, which still manages to maintain a positive pace of economic development, are outsiders in terms of both the quality of the business climate and the loss of ranking positions. The most difficult situation with the business environment has developed in such industrial regions as Zaporizhia, Poltava, Kharkiv regions. That is, the regions, which have always focused on large enterprises in the industrial sector, have not yet been able to refocus on supporting entrepreneurship and stimulating entrepreneurial activity.

The euBusinessGraph ontology: A lightweight ontology for harmonizing basic company information

Company data, ranging from basic company information such as company name(s) and incorporation date to complex balance sheets and personal data about directors and shareholders, are the foundation that many data value chains depend upon in various sectors (e.g., business information, marketing and sales, etc.). Company data becomes a valuable asset when data is collected and integrated from a variety of sources, both authoritative (e.g., national business registers) and non-authoritative (e.g., company websites). Company data integration is however a difficult task primarily due to the heterogeneity and complexity of company data, and the lack of generally agreed upon semantic descriptions of the concepts in this domain. In this article, we introduce the euBusinessGraph ontology as a lightweight mechanism for harmonising company data for the purpose of aggregating, linking, provisioning and analysing basic company data. The article provides an overview of the related work, ontology scope, ontology development process, explanations of core concepts and relationships, and the implementation of the ontology. Furthermore, we present scenarios where the ontology was used, among others, for publishing company data (business knowledge graph) and for comparing data from various company data providers. The euBusinessGraph ontology serves as an asset not only for enabling various tasks related to company data but also on which various extensions can be built upon.

The Unrealized Potential of National Human Rights Institutions in Business and Human Rights Regulation: Conditions for Effective Engagement and Proposal for Reform

While National Human Rights Institutions (NHRIs) are widely regarded as particularly promising tools in the emerging transnational regime for the regulation of business and human rights, we still know little about their potential and actual contribution to this field. This article bridges the gap between business and human rights research and NHRI scholarship, proceeding in three steps: Firstly, I analyze the structural conditions for NHRIs to tackle business-related human rights abuses effectively, focusing on the key conditions of legitimacy and competences. Secondly, I examine the envisaged role and functions of NHRIs in business and human rights regulation according to the Paris Principles and the UN Guiding Principles. Thirdly, I reconstruct and critically assess NHRIs’ mandates and powers to address corporate human rights abuse, based on the analysis of surveys and reports. I argue that there is a significant mismatch between the essential structural conditions for effective NHRI engagement with business and human rights, the expected contribution of NHRIs to the prevention and remedy of corporate human rights abuses, and the limitations of their mandates and powers in practice. To overcome that misalignment and unlock NHRIs’ full potential, this article proposes a reform of the Paris Principles which would provide these institutions with a robust source of international legitimacy and increase the pressure on state governments to extend their powers.

Agribusiness and policy failures

AbstractThere is often a clear need for business regulation, as the market fails in many ways that are well understood. However, there are also important examples of policy failure, or cases where policy intervention seemed like a good idea at one time, but likely caused more problems than it solved. I consider three examples of failed regulatory interventions, in labor, antitrust, and disaster response. In reviewing the literature on each topic, some of which is our own, I hope to draw general conclusions regarding the value of careful economic analysis in policy design, particularly in the regulation of agribusiness enterprises.

AUTOMATION OF BUSINESS PROCESSES AS A MECHANISM TO INCREASE THE EFFICIENCY OF A HOTEL ENTERPRISE

The peculiarities of regulation of hotel business with the help of information technologies are covered in the work. The urgency of the problem is confirmed by the fact that the existing methods of assessing the use of automated management systems of hotel enterprises and the specifics of individual software products increase the competitiveness of modern hotel enterprises. The main purpose of this study is to identify trends and concepts of hotel services, characterized by a high level of competition, a variety of services provided and increasing the level of service. The implementation of this task involves the analysis and forecasting of the development of the automation process taking into account the socio-economic situation of the countries. Today, hotel companies against the background of a fierce struggle for each guest are forced to improve actively, using a variety of internal organizational and technological innovations as the most effective mechanisms to increase competitiveness. The article examines the impact of information technology on hotel management, as it is directly related to improving the efficiency of both the individual manager and the hotel, as well as the impact on competitiveness in today's market. The article analyzes the use of computer networks, the Internet and Internet technologies, software products for end-to-end automation of all business processes of the hotel, which today are not just a matter of leadership and competitive advantage, but also survival in the market.
 Today, a significant number of Ukrainian hotel businesses are actively implementing automation systems that fully meet modern requirements. The main advantage of using ACS is the integration with such global booking systems as Amadeus, Galileo, Saber and Worldspan.
 The competitive advantage of enterprises in the hospitality industry largely depends on the active use of innovations in information technology, which in turn is a strong marketing tool that allows you to manage consumer loyalty to the guest.

The limits of evidence-based anti-bribery law

Evidence-based regulation is a term of art that refers to the process of making decisions about regulation based on evidence generated through systematic research. There is increasing pressure to treat evidence-based regulation as a global best practice, including in the area of anti-bribery law. Too little attention has been paid to the fact that under certain conditions evidence-based regulation is likely to be a less appealing method of decision making than the alternative – namely, relying on judgment. Those conditions are: it is difficult to collect data on either interventions or outcomes; accurate causal inferences are difficult to draw; there is little warrant for believing that the same causal relationships will apply in a new context; or the decision makers in question lack the capacity to undertake one of these tasks. These conditions are likely to be present in complex, transnational, decentralized, and dynamic forms of business regulation such as the global anti-bribery regime.

The Milk Producers’ Organization and Indian dairy sector

The needs of the Milk Producers’ Organization are achieved by strengthening the scattered and poorly organized Indian milk producers, who lack access to resources and services. In fact, the Milk Producers’ Organization has emerged as an interface between the business environment and individual milk producers through forward and backward linkages, while facilitating the strength of collective action, bargaining power and economies of scale. It has thus responded appropriately to the economic and socio-cultural needs of producer members and surrounding entities. The National Accounts Statistics (2020) of India estimates that the contribution of livestock in total agriculture and allied sectors Gross Value Added (at Constant Prices) has reached to 28.63 per cent (2018-19) which again shows the importance of the Milk Producers’ Organization in a populous country such as India. The Organization extends its assistance in the form of financial support, technical inputs, milk productivity, quality produce, managing value chains, access to market actors and handling environmental and business regulation. This review paper outlines the key viewpoints and aims to explore how the Milk Producers’ Organization has built capabilities and optimized capacities in the existing scope and challenges of the Indian dairy sector. The livestock sector supports the livelihood of approximately 20.5 million people in India. India’s milk production is at 4.8% CAGR as opposed to 1.8% CAGR of global milk production. However, the Organization faces conflicting areas of interest, such as social concern and business demands and this ambivalence necessitates enabling policy and professionalism to steer organizational growth and sustainability. In view of the globalized business environment, the Milk Producers’ Organization has taken on the responsibility to compete both on the domestic and global markets. In view of emerging international trade practices, further study is required to establish mechanisms to deal with Sanitary and Phytosanitary measures. A co-operative business model can be further explored with additional utilization of bovine manure and unproductive bovines to re-establish a more cost efficient model to deal with global price levels of milk and dairy products.

Unemployment as a determinant of local service-oriented entrepreneurship: a case study of Poland

Motivation: Unemployment is an important entrepreneurship determinant which is captured by the unemployment push/pull hypotheses. Those issues remain underexplored, with only few studies investigating the relationship between unemployment and the sector structure of entrepreneurship, while considering the specificity of the local economy.
 Aim: The main goal of the study is to assess the impact of local unemployment rate on the number of newly registered service businesses in Poland, taking into account both the heterogeneity of that sector and the specificities of local economies in 2003–2018.
 Results: The research results show that in Poland growing unemployment contributed to the increasing registration of new service businesses, which empirically supports the unemployment-push hypothesis. Both the occurrence and the intensity of the unemployment-push effect were conditioned by territorial factors, with the higher elasticity of entrepreneurship in relation to unemployment changes in lagged local units.