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Publicly funded business advisory services and entrepreneurial outcomes

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  • Cumming, Douglas J.
  • Fischer, Eileen

Abstract

Given the mixed evidence for the impact of various publicly funded initiatives that aim to foster entrepreneurial activity, this paper empirically examines the efficacy of publicly funded business advisory services in relation to entrepreneurial outcomes. Based on a sample of 228 early-stage firms, of which 101 used business advisory services focused on helping companies secure 1st rounds of financing and start generating revenues, we examine the firm-level impact such services can have on sales growth, innovation, finance and alliances. We find services are positively associated with firms’ sales growth, patents, finance and alliances. We assess statistical and economic significance, and assess robustness to controls for the non-randomness of the firm's using business advisory service program, as well as endogeneity of advisors’ hours spent with firms. Other robustness checks are also included. We find significant robustness of hours spent on sales and finance, but sensitivity of the effect of hours on patents and alliances after controlling for endogeneity.

Suggested Citation

  • Cumming, Douglas J. & Fischer, Eileen, 2012. "Publicly funded business advisory services and entrepreneurial outcomes," Research Policy, Elsevier, vol. 41(2), pages 467-481.
  • Handle: RePEc:eee:respol:v:41:y:2012:i:2:p:467-481 DOI: 10.1016/j.respol.2011.09.004
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    References listed on IDEAS

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    Cited by:

    1. Nancy Haskell & Sophie Veilleux & Donald Béliveau, 2016. "Functional and contextual dimensions of INVs’ alliance partner selection," Journal of International Entrepreneurship, Springer, vol. 14(4), pages 483-512, December.
    2. Rakićević, Zoran & Omerbegović-Bijelović, Jasmina & Lečić-Cvetković, Danica, 2016. "A model for effective planning of SME support services," Evaluation and Program Planning, Elsevier, vol. 54(C), pages 30-40.
    3. Douglas Cumming & Sofia Johan & Jeffrey G. MacIntosh, 2017. "A drop in an empty pond: Canadian public policy towards venture capital," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 44(1), pages 103-117, March.
    4. Cumming, Douglas & Li, Dan, 2013. "Public policy, entrepreneurship, and venture capital in the United States," Journal of Corporate Finance, Elsevier, vol. 23(C), pages 345-367.
    5. Martin Jaekel & Arto Wallin & Minna Isomursu, 2015. "Guiding Networked Innovation Projects Towards Commercial Success—a Case Study of an EU Innovation Programme with Implications for Targeted Open Innovation," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 6(3), pages 625-639, September.
    6. Maximilian Goethner & Michael Wyrwich, 2017. "Cross-faculty proximity and academic entrepreneurship: The role of business schools," Jena Economic Research Papers 2017-017, Friedrich-Schiller-University Jena.
    7. Fidelis A. Ayatse & Nguwasen Kwahar & Akuraun S. Iyortsuun, 2017. "Business incubation process and firm performance: an empirical review," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 7(1), pages 1-17, December.

    More about this item

    Keywords

    Entrepreneurship policy; Business advisory services; Alliances; Angel finance; Patents;

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • L50 - Industrial Organization - - Regulation and Industrial Policy - - - General
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage

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