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Empirical Analysis of Regions, Fund Allocation and Profits for Startups

In: Proceedings of the 2022 4th International Conference on Economic Management and Cultural Industry (ICEMCI 2022)

Author

Listed:
  • Zhongjian Wang

    (University of Michigan-Ann Arbor, Department of Economics)

Abstract

This paper focuses on four indicators for different startups: R&D spending, marketing spending, administration spending, and profit. First, in the multiple linear regression of the original variables on profit, the presence of Collinearity between R&D and market spending only led to a single linear regression between R&D spending and profit. Then, factor analysis concluded two factors that resolved the Collinearity and allowed a better multiple linear regression. Moreover, the significant differences between startups with large and small profits for different spending were analyzed using comparative analysis. It concluded that different R&D and marketing spending made significant differences between startups’ profit, but not for administration spending. Finally, the Normal distribution, ANOVA, and Non-parametric tests prove that there is no significant difference between different spending and profits among different regions, which shows the homogeneity of the development of different geographical startups. All these analyses can help startup entrepreneurs to generate profits better.

Suggested Citation

  • Zhongjian Wang, 2023. "Empirical Analysis of Regions, Fund Allocation and Profits for Startups," Advances in Economics, Business and Management Research, in: Hrushikesh Mallick & Gaikar Vilas B. & Ong Tze San (ed.), Proceedings of the 2022 4th International Conference on Economic Management and Cultural Industry (ICEMCI 2022), pages 874-882, Springer.
  • Handle: RePEc:spr:advbcp:978-94-6463-098-5_100
    DOI: 10.2991/978-94-6463-098-5_100
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