Business acceleration program as city sowers: assessing public funding’s impact on new ventures in an emerging economy
Journal of Entrepreneurship in Emerging Economies, ISSN: 2053-4612, Vol: 17, Issue: 7, Page: 97-126
2024
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Example: if you select the 1-year option for an article published in 2019 and a metric category shows 90%, that means that the article or review is performing better than 90% of the other articles/reviews published in that journal in 2019. If you select the 3-year option for the same article published in 2019 and the metric category shows 90%, that means that the article or review is performing better than 90% of the other articles/reviews published in that journal in 2019, 2018 and 2017.
Citation Benchmarking is provided by Scopus and SciVal and is different from the metrics context provided by PlumX Metrics.
Article Description
Purpose: A debate on whether new ventures should be supported with public funding is taking place. Adopting a position on this discussion requires rigorous assessments of implemented programs. However, the few existing efforts have mostly focused on regional cases in developed countries. To fill this gap, this paper aims to measure the effects of a regional acceleration program in a developing country (Medellin, Colombia). Design/methodology/approach: The economic notion of capabilities is used to frame the analysis of firm characteristics and productivity, which are hypothesized to be heterogeneous within the program. To test these relationships, propensity score matching is used in a sample of 60 treatment and 16,994 control firms. Findings: This paper finds that treated firms had higher revenue than propensity score-matched controls on average, confirming a positive impact on growth measures. However, such financial growth is mostly observed in service firms rather than other economic sectors. Research limitations/implications: Further evaluations, with a longer period and using more outcome variables, are suggested in the context of similar publicly funded programs in developing countries. Originality/value: These findings tip the balance in favor of the literature suggesting supportive programs for high-growth firms as opposed to everyday entrepreneurship. This is an insight, especially under the context of an emerging economy, which has scarce funding to support entrepreneurship.
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