Cross‐Country Determinants of Early‐Stage Necessity and Opportunity‐Motivated Entrepreneurship: Accounting for Model Uncertainty

Model uncertainty is one of the most pervasive challenges in the social sciences. Cross‐country studies in entrepreneurship have largely ignored this issue. In this paper, we evaluate the robustness of 44 possible determinants of early‐stage opportunity‐motivated entrepreneurship (OME) and necessity‐motivated entrepreneurship (NME) that are broadly classified in four groups: (1) economic variables, (2) formal institutions, (3) cultural values, and (4) legal origins and geography. The results, which are based on a representative world sample of up to 73 countries, suggest that institutional variables associated with the principles of economic freedom are most robustly correlated with OME and NME. Our findings also identify net income inequality and Scandinavian legal origins as weakly robust predictors of both types of entrepreneurial activity. Furthermore, we find that log GDP per capita is only a weakly robust predictor of NME, but not OME. We discuss implications for future research.     

Early‐Stage of Innovations: Selection System Criteria for Funding U.S. Biotech SMEs

The focus of this paper is small and medium‐sized enterprises (SMEs) operating in the U.S. biotechnology industry and how they compete for financial resources during the early stages of innovation development. We utilize selection system theory, which describes how selectors use reputation‐based information about selectees as decision factors when making investments. Our findings suggest that there are different predictive variables for SME categories and the types of investors attracted to these categories, which is consistent with selection system theory. We extend prior studies by providing context to early‐stage innovation investment funding within an environment characterized as having a long development cycle and representing high uncertainty.     

The Links between Early‐Life Cognition and Schooling and Late‐Life Financial Knowledge

Using the Wisconsin Longitudinal Study, a sample of Wisconsin high school graduates from the class of 1957, we explore the relationship between late‐life financial knowledge and human capital formed in early life. Specifically, we examine the associations between early‐life cognition and schooling experiences—such as academic performance and coursework—and late‐life financial knowledge. Financial knowledge is measured as individuals' knowledge of their own financial situations, which we argue is a prerequisite for good financial behavior. We find that those with lower early‐life cognitive functioning, especially those without college degrees, have lower levels of financial knowledge in late life. We find more limited evidence for independent associations of academic performance and math course work with late‐life financial knowledge.     

Financing constraints and US cross‐listing

This study investigates whether relaxation of firms' financial constraints is an important outcome of the US cross‐listing mechanism. We use the association between investment spending and cash flow to test for the presence and importance of firms' financing constraints. Consistent with the bonding hypothesis, the results suggest that US exchange and private placement cross‐listings significantly alleviate firms' financing constraints. In addition, the financial benefits associated with exchange listings are larger than those associated with private listings, while on the other hand, over‐the‐counter programs do not improve capital allocation. The study also shows that US exchange cross‐listing benefits have not been eroded by the enactment of the Sarbanes‐Oxley (SOX) Act in 2002. Copyright © 2014 ASAC. Published by John Wiley & Sons, Ltd.     

Financing entrepreneurship: Bank finance versus venture capital

This paper examines the entrepreneur's choice between bank finance and venture capital. With bank finance, the entrepreneur keeps full control of the firm and has efficient incentives to exert effort. With venture capital finance, there is a two-sided moral hazard problem as both the entrepreneur and venture capitalist (VC) provide unverifiable effort. The entrepreneur benefits from the VC's managerial input but must surrender partial ownership of the venture, thus diluting the entrepreneur's incentive to provide effort. Venture capital tends to be preferred to bank finance when VC productivity is high and entrepreneurial productivity is low.     

The Big Family: Informal Financing of Small‐ and Medium‐Sized Businesses by Guanxi

Guanxi facilitates interaction between companies and people in Confucian societies. Does this type of social construct still play the key role, when the entrepreneurs live in Western societies? The objective of this article is to verify the impact of Guanxi on the capacity of small and medium‐sized businesses accessing financial resources informally. To this end, data collected from small Chinese entrepreneurs active in the principal business center of Brazil were used. From nonparametric tests, the results suggest that: (1) different levels of Guanxi allow small and medium‐sized businesses to access informal financial resources; (2) different types of informal financing are mostly used, or judged to be more significant, depending on the level of Guanxi of the entrepreneur in terms of parental and nonfamily ties; and (3) unlike the Western literature on the financial cycles of start‐ups, this type of informal financing can extend beyond the initial stage of the business. © 2014 Wiley Periodicals, Inc.     

Angel Financing and the Performance of High‐Tech Start‐Ups

In this paper, we investigate what drives the performance of high‐tech start‐ups receiving angel financing, while taking a closer look at the capabilities (i.e., experience) and investment behavior of business angels (BAs). We exploit a new data set (extracted from Crunchbase), which consists of 1,933 high‐tech start‐ups that received at least one financing round from a BA. The results indicate that the experience of BAs in early stage investments is positively associated with additional receipt of follow‐on rounds of financing and sequential capital injections from venture capitalists (VCs). Later‐stage experience is positively associated with the start‐up's success (i.e., probability to be listed or acquired), but reduces the need for new VCs to invest in the start‐up. Furthermore, we find consistent evidence that start‐ups that combine BA and VC financing experience higher levels of funding amounts, additional VC financing, and an improved likelihood of success. Finally, we find that the co‐localization of BA investors and start‐ups in the same area facilitates the attraction of VC financing.     

大银行信贷与中小企业融资的适配性问题研究

传统意义上,人们认为大银行信贷不适合中小企业融资,文章研究认为大银行是否适合中小企业,要考虑两个关键问题：首先是企业本身处于哪个阶段,由于风险和收益的影响,大银行不适合向初创期和衰退期的企业放贷,而处于成长期或成熟期且具有发展潜力的企业应该成为银行的主要服务对象;其次是银企之间的信息不对称,阻碍了大银行向中小企业贷款。在中小企业信用系统不健全,银行欠缺高效的贷款技术之前,大银行不适合直接面向中小企业贷款,而应该借助信息中介,例如民间金融、中小银行、电子商务平台等,才能提高银行的贷款效率,缓解中小企业融资难和融资贵的问题。     

Message‐to‐person versus person‐to‐message: An alternative way to conceptualize personalized advertising

This study provides an alternative way to conceptualize personalized advertising and discusses when and why nonpersonalized information can be more effective than personalized information in changing people's attitudes and behavioral intentions. Different from the traditional personalization approach in the literature that personalizes a message for an individual, this alternative way of thinking is to personalize an individual for a message. It is argued that an individual can be personalized for a message via priming tactics and it leads to reverse personalization effects where a nonpersonalized message generates stronger persuasion effects than a personalized message. The effects of priming on personalization are moderated by perceived prime credibility and mediated by perceived message relevance.     

Understanding Consumer Response to Sponsorship Information: A Resource‐Matching Approach

Sponsorship of sporting teams and events has become an increasingly popular form of corporate and brand communication. Despite the continued growth of sponsorship spending, the corresponding literature base is highly fragmented and little agreement exists related to the psychological mechanisms underlying response. This paper integrates several prominent sponsorship research streams in promoting a “resource‐matching” perspective of cognitive elaboration and attitude change. This research holds that in the absence of clear functional fit between sponsor and event, identifying a basis for sponsor–event fit is likely to require some degree of cognitive effort. The results indicate stronger social identification with the sponsored event influences the favorability they attribute to sponsor motives and promotes stronger perceptions of fit between the sponsor and the sponsored activity. Further, the results indicate fit perceptions mediate the relationship between attribution and sponsorship response. Consistent with ELM theory, when cognitive resources are insufficient for the complexity of the fit‐matching task, social identification may still act as a peripheral cue in driving a positive affective response to sponsorship information.     

The components of bid‐ask spread and their determinants: TAIFEX versus SGX‐DT

This paper compares the intraday components of bid‐ask spread in Taiwan stock index futures traded on Taiwan Futures Exchange (TAIFEX) and Singapore Exchange Derivatives Trading Limited (SGX‐DT). Variables that determine the components of spread are also examined. SGX‐DT uses a floor trading system while TAIFEX uses an electronic call system. This study finds that both information asymmetry and order processing cost components exhibit U‐shaped patterns in the two markets, in contrast to previous findings for U.S. equity markets. Moreover, the information asymmetry components are lower in the TAIFEX relative to the SGX‐DT futures, suggesting that the continuous open outcry markets are more vulnerable to information asymmetry than the electronic call markets. The regression results show that volatility and information are the major determinants of the components while number of trades is not the major determinant of the order processing and information asymmetry components for both markets. © 2004 Wiley Periodicals, Inc. Jrl Fut Mark 24:835–860, 2004     

Across‐ versus within‐class comparative advertising: Insights into prestige class anchoring

Advertising manipulations show that across‐class comparisons with a leader in a more prestigious class result in an increase in perceived value for the sponsoring advertiser. Such results provide suggestive insights into the viability of across‐class advertising when contrasted to an alternative advertising framework (within‐class comparisons). This study develops the theory and results of across‐class associations and addresses its limitations and areas in need of inquiry. © 1999 John Wiley & Sons, Inc.     

External Financing,Export Intensity and Inter‐Organizational Collaborations: Evidence from Canadian SMEs*

Drawing on institutional theory, resource‐based perspective and internationalization theory, we propose that the domestic collaborations of small and medium‐sized enterprises (SMEs) have a direct positive effect on their export intensity, as well as an indirect effect through enhancing these firms' access to external financing. We test our hypotheses on a sample of 151 Canadian manufacturing SMEs and find partial support for the indirect relationship. Overall, our results suggest that domestic collaborations positively affect SMEs' access to equity financing but not to bank financing. While both equity and bank financing are found to enhance these firms' export intensity, bank financing seems to have a greater impact. The implications of these results are discussed.     

Matching a cause with self‐schema: The moderating effect on brand preferences

The moderating roles of consumer brand involvement type and product type on the effect of a match between consumers' self‐schema and the cause a brand supports on consumers' preference for the cause‐supporting brand is investigated. The authors show that a schema–cause match enhances consumer preference for a brand engaging in cause‐related marketing when (1) consumers' involvement with the brand is of the impression‐relevant type (vs. outcome‐relevant type) and (2) when the branded product is functional (vs. hedonic). © 2011 Wiley Periodicals, Inc.     

Financing patterns in transition economies: Privatized former SOEs versus ab initio private firms

We employ 37,987 firms in 30 transition economies to investigate the relation between the origins of private firms and their financing patterns. We find that relative to ab initio (from the beginning) private firms, privatized former state-owned enterprises (SOEs) finance a higher proportion of their fixed assets from bank finance (especially from state-owned banks) and supplier credit. We argue that privatized former SOEs continue to benefit from the political and financial connections established during their SOE era. We document that country governance, financial development and legal origins play an important role in the financing patterns of privatized versus private firms.     

现阶段民营企业的融资饥渴症考察——以归真堂两次公开市场融资失败为例

民营企业深陷融资饥渴囹圄早已为世人普遍认知,归真堂两次折戟公开市场融资或揭业务持续性的重要性,同时,近年来异军突起的PE资本极大拓宽了民营企业融资渠道,但若PE仅为短期套现进入企业,非但不能解决民营企业融资饥渴,反而将加剧企业经营困难.此外,处于不同成长期的民营企业将表现出不同症状的融资饥渴,有必要明确不同融资来源、资金类别的特有属性,从而更好对症下药,解决现阶段我国民营企业融资饥渴症.     

Comparing financial and social costs for top‐down versus fixed‐band selection: A practical application with bus drivers

A number of solutions have been proposed to the diversity‐validity dilemma arising from the use of cognitive ability tests in employment selection. Cognitive ability tests predict training and job performance but also produce adverse impact against minority groups. Although banding reduces adverse impact, it has been criticized for also reducing the utility of the selection process. We assessed the social and financial impact of a fixed band approach with top‐down hiring across several hiring scenarios with a pool of bus driver applicants. Overall, the fixed band approach reduced adverse impact without substantially reducing the cost effectiveness of the hiring process. We discuss the implications of these two approaches in the context of the diversity‐validity dilemma. Copyright © 2016 ASAC. Published by John Wiley & Sons, Ltd.     

Customer Relationship Stage and the Use of Picture-Dominant versus Text-Dominant Advertising: A Field Study

This research reports the results of two field experiments designed to help determine what format of email advertising is most effective with customers at different lifecycle stages. The experiments examine customer response to picture-dominant versus text-dominant advertising. Although the relative effectiveness of picture- versus text-dominant advertising has received some attention in previous research, the issue of which type would be most effective at different points in the customer's relationship with the brand and for different metrics has not been explored. The two field experiments were executed by a major fashion retailer that sells clothing and accessories for special events. The first experiment was conducted with prospective customers and focused on advertising for the retailer's primary product, which typically occurs first in the purchase cycle. The second experiment was conducted with customers who had already purchased the primary product and focused on advertising for an accessory typically purchased later in the cycle. The investigation was conducted from a customer relationship management perspective, examining the financial impact of each type of advertisement at different stages in the customer's relationship with the brand. At the aggregate level we find only minor differences in the performance of the picture-dominant versus text-dominant advertisements. However, we find that the retailer can greatly improve revenue by customizing ad format based on observed customer traits.