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Growth of Incumbent Firms and Entrepreneurship in V ietnam

Author

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  • Enrico Santarelli
  • Hien Thu Tran

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.
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Suggested Citation

  • Enrico Santarelli & Hien Thu Tran, 2012. "Growth of Incumbent Firms and Entrepreneurship in V ietnam," Growth and Change, Wiley Blackwell, vol. 43(4), pages 638-666, December.
    • Handle: RePEc:bla:growch:v:43:y:2012:i:4:p:638-666
    DOI: 10.1111/grow.2012.43.issue-4
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    JEL classification:

    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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