Session 108

The Impact of Institutions, Regions and Countries on Entrepreneurial Ventures

Track K

Date: Tuesday, October 13, 2009

 

Time: 14:30 – 15:45

Paper

Room: Meeting Room5


Session Chair:
Donna De Carolis, Drexel University

Title: A Cross-Country Study of Entrepreneurial Optimism and Valuations

Authors

  • Gary Dushnitsky, London Business School

Abstract: Optimism is a well-documented entrepreneurial characteristic. To date, the literature has focused on the (erroneous) actions of the individual optimistic entrepreneur, yet less attention was given to the effect this characteristic has on the interaction between entrepreneurial-ventures and prospective resources-providers. How does optimism affect entrepreneur-investor interaction? What are the implications to ventures’ valuations? We conjecture that contingent-pay contracts (e.g., preferred-shares) can deter charlatans but may be less effective in screening optimists, thus resulting in an optimism discount. We further conjecture that IPR regime may minimize the discount: an entrepreneur can attract higher valuation by disclosing her invention, but she would do so only when disclosure is not vulnerable to imitation (e.g., patents are effective). Analyses of international venture capital investments between 1990-2006 support our hypotheses.

Title: Dynamics of Institutional Legacy, Organizational Imprints and Entrepreneurial Strategy: A Longitudinal Study in Emerging Economy

Authors

  • Indrajit Mukherjee, XLRI Xavier School of Management
  • Sougata Ray, Indian Institute of Management - Calcutta
  • Somnath Dutta, Indian Institute of Management-Calcutta

Abstract: The paper studies how the legacies of the institutional environment experienced by emerging economy firms influence the evolution of entrepreneurial strategy. The multiple industry longitudinal study of 4415 firms for seven years reveals legacies of historical institutional context have a bearing on firms’ current strategic orientations, but over time entrepreneurial managers play a role in adapting the strategy to suit the current environment. It illustrates organizational imprints are not only institutionalized by entrepreneurs during the founding to establish relationship with environment; but are also modified subsequently by entrepreneurial managers to reestablish the relationship with environment, through the processes of de-institutionalization and re-institutionalization. It has implications for entrepreneurship literature, strategic transformation literature, research in business groups, practicing entrepreneurs and managers.

Title: Global vs. Local Status: Status Inconsistency in Venture Capital Syndication and the Performance of Entrepreneurial Ventures

Authors

  • Dali Ma, Drexel University
  • Mooweon Rhee, University of Hawaii
  • Daegyu Yang, University of Hawaii

Abstract: Status, a major mechanism to reduce market uncertainties, has attracted considerable attention in economic sociology and strategy. Nonetheless, most studies neglect multiple hierarchical orders, and fail to capture status heterophily stemming from the discrepancy of an actor’s position in different status orders. We take a status multiplexity approach and attempt to analyze the impact of status inconsistency (SI) between global status (GS) and local status (LS). We use venture capital syndication as our context and identify two types of SI – positive SI (GS > LS) and negative SI (GS < LS). We argue that negative SI has a negative effect on the performance of entrepreneurial ventures, and positive SI and prior collaboration can mitigate the negative effect.

Title: Regional Industrial Clusters: What are the Implications for Individual Firms?

Authors

  • Srikanth Paruchuri, Pennsylvania State University
  • Richard Gentry, University of Mississippi

Abstract: What are the implications for a firm located in a dense regional industrial clusters? Being part of a dense cluster provides a firm benefits such as quick access to the latest technological developments, but also will create detrimental effects such as intense competition for the firm. Consequently, a firm needs to evaluate if the beneficial effects of being in a dense cluster outweigh the detrimental effects. We examine how the failure rate of firms relates to the density of the cluster around them how this relationship varies with technological and market dynamism. Employing event history analysis of multiplexer manufacturers, we find the failure rate of firms increases with the density of the cluster around them, and that this relationship is negatively moderated by market size.

All Sessions in Track K...

Sun: 10:00 – 11:30
Session 254: Developing a Game Plan for Strategy Research on Social Entrepreneurship
Sun: 13:00 – 14:30
Session 253: Knowledge Spillovers and Strategic Entrepreneurship
Sun: 15:00 – 16:30
Session 252: Key Issues and Emerging Questions in Entrepreneurial Strategy Research
Sun: 16:30 – 17:30
Session 315: Entrepreneurship & Strategy, IG Meeting
Mon: 12:45 – 14:00
Session 102: Networks, Alliances and Entrepreneurship
Session 244: Entrepreneurship in Emerging and Transition Economies
Mon: 15:45 – 17:00
Session 100: Founders, Founding Conditions and Human Capital
Session 249: Examining Entrepreneurial Phenomena at Multiple Levels
Mon: 17:15 – 18:30
Session 101: Opportunities & Founders
Session 248: Issues in Governance and Technology Commercialization in New Ventures
Tue: 10:00 – 11:15
Session 107: Current Thoughts on Entrepreneurship in Emerging and Transition Economies
Session 111: Opportunties, Uncertainty & Innovation in Entrepreneurial Ventures
Tue: 11:30 – 12:45
Session 106: Current Thoughts on Signaling and Venture Capital
Tue: 14:30 – 15:45
Session 108: The Impact of Institutions, Regions and Countries on Entrepreneurial Ventures
Wed: 10:00 – 11:15
Session 105: Current Research on Serial Entrepreneurs and Market Makers
Session 112: The Impacts of Diversification on Entrepreneurial Ventures
Wed: 11:30 – 12:45
Session 104: Employees Mobility and Corporate Entrepreneurship
Session 109: Current Research on Uncertainty and Entrepreneurship


Strategic Management Society

Washington DC