When to Start a New Firm?: Modelling the Timing of Novice and Serial Entrepreneurs

The success of new start-up firms often depends on timing. It is valuable for the potential entrepreneur to wait for the right moment before starting a new firm. In this paper we provide a theoretical model to determine the optimal time for starting a new firm. We integrate insights from the real option theory with the theory on entrepreneurial market entry. An important and novel feature of our model is that it allows the start-up timing decisions of novice and serial entrepreneurs to be distinguished.entrepreneurship, serial entrepreneurship, start-ups, real options, stochastic optimal control

Institutional Aspects of Dynamics of Inclusion of Accession Countries into the EMU

The main topic of the paper is optimal dynamics, i.e., timing of entry of the accession countries in the ERM 2 and EMU. Some of the crucial questions addressed in the paper are as follows: a) Should accession countries aim at an early or a delayed entry into the EMU? b) What are economic and other arguments for an early or late inclusion? c) What are the institutional external constraints which may prevent an early inclusion of accession countries? Institutional rules of the phased process of monetary integration for the accession countries are not quite transparent and leave much room for discretion to the EU side. In such circumstances it is difficult for the accession countries to devise clear and consistent strategies with respect to the timing of entry in the ERM 2 as an interim institutional mechanism in the run-up to the EMU.

ON THE ENDOGENOUS TIMlNG IN TRADE POLICY GAMEFA GENERAL CASE

This paper discusses the timing and the optimal trade policy in the presence of oligopolisitic industries and free entry. Collie (1994) proved that an importing government should not commit a countervailing duty in response to a foreign export subsidy. We show that his main conclusion does not always hold, since the timing, as well as the optimal trade policy, depends on the number of firms in both countries and the characteristic of the industry, i.e. no entry or free entry.

Now or Never Revisited: An Analysis of Market Entry Timing for Successive Product Generation

Determining the optimal market entry timing for successive technological innovations is a critical decision for firms. Pioneering studies dealing with this issue have focused one-time sale (e.g., HDTV), and concluded that a new product should be introduced to the market either now or never, or now or at maturity. However, these prior studies do not examine another commonly seen business practice —revenue is generated from continuous services (e.g., Office 365). In this research, we derive the optimal market entry timing under both one-time sale and continuous service, and check whether the prior findings remain valid under today’s diverse market landscape. We find that under one-time sale, the optimal entry timing is not limited to now, maturity, or never; but it can also lie between now and maturity. More interestingly, our results show that the now or never rule holds only under a scenario not considered in the prior studies

Administrative Delays as Barriers to Trade

One domestic firm and one foreign firm must decide when to introduce their new product to the home market. The home government may apply an import tariff, an administrative delay, or both to the product of the foreign firm. We show that, while both the tariff and administrative delay can ensure the socially optimal timing of entry, the administrative delay is the less efficient instrument for maximising home welfare. If trade liberalization constrains the import tariff to be below its domestically optimal level, we show that the optimal administrative delay leads to lower levels of world welfare than the optimal tariff, so that trade liberalization can be welfare decreasing.