Growth of Incumbent Firms and Entrepreneurship in Vietnam

Quaderni DSE Working Paper No. 785

30 Pages Posted: 16 Sep 2011

See all articles by Enrico Santarelli

Enrico Santarelli

University of Bologna - Department of Economics

Hien T. Tran

affiliation not provided to SSRN

Date Written: September 15, 2011

Abstract

This paper analyzes the relationship between the performance of incumbent firms and the net entry of new firms by combining different theoretical views of entrepreneurship. It shows that new knowledge and ideas created but not commercialized by incumbents are an important source of entrepreneurial opportunities for nascent firms. Different regression models to treat dynamics and endogeneity issues are applied to test the research hypothesis that growth of incumbent firms in a region will stimulate start-up activities by creating new profit opportunities for potential entrepreneurs. Vietnam’s regional micro-data from 2000 to 2008 are used for this test. Four controlling indicators – entrepreneurial demand, market structure, regional economic environment, and market innovativeness – are found to exert a statistically significant effect on new entries.

Keywords: Firm growth, Entrepreneurship, Region, Vietnam

JEL Classification: L25, L26, O53, R12

Suggested Citation

Santarelli, Enrico and Tran, Hien T., Growth of Incumbent Firms and Entrepreneurship in Vietnam (September 15, 2011). Quaderni DSE Working Paper No. 785, Available at SSRN: https://ssrn.com/abstract=1927942 or http://dx.doi.org/10.2139/ssrn.1927942

Enrico Santarelli (Contact Author)

University of Bologna - Department of Economics ( email )

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Hien T. Tran

affiliation not provided to SSRN

No Address Available

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