Additionality and public sector support to Irish industry: some methodological issues

For a number of decades, a significant amount of resources have been devoted to supporting Irish industrial policy interventions. There has, however, been a distinct lack of evaluation of such interventions. Evaluation should consider what would have happened in the absence of assistance. To produce an assessment of this counter-factual involves considering the concepts of deadweight and displacement. Jointly these concepts facilitate an assessment of the additional impact of financial assistance provided by the public sector. Despite the widespread recognition amongst academics and policymakers alike regarding the need to evaluate, the issue of how to evaluate (methodology) continues to be a key challenge. The prime focus of the current paper is to report the findings from the Irish experience of the evaluation of industrial policy interventions. In so doing, the paper reflects and considers some of the key methodological issues in this field of study. The paper highlights that, regardless of ‘what’ is being evaluated, many of the key concepts and frameworks discussed in the context of industrial policy evaluation in this paper are highly transferable to varying contexts

Evaluating the impact of Enterprise Ireland assistance: methodological considerations when estimating deadweight and displacement

This paper examines an approach to estimating the net additionality of financial assistance to indigenously-owned firms in Ireland for the period 2000 to 2002. Using a sample of Enterprise Ireland assisted-firms an innovative self-assessment case study methodology was adopted in order to test the ways in which estimates of partial deadweight can be derived. The results show that the net additionality of Enterprise Ireland assistance can be estimated as around 50 per cent for this sample of case studies which represent a pool of clients which accounted for just-over two-thirds of the financial assistance provided by Enterprise Ireland in the period of the study

Developing an evaluative framework for industrial policy in Ireland: fulfilling the audit trail or an aid to policy development

Evaluation is one of the buzzwords of current day parlance in Irish policymaking circles. It is one of those words (like sustainable development a number of years ago) to which everyone claims allegiance, but few actually know how to define, let alone operationalise. More often than not the discussion rarely moves beyond the need to ensure transparency and probity in the allocation of public funds. What we set out in this paper are the key components of a framework for evaluation which seeks to provide an assessment of the impact of public sector interventions and, more importantly, arrive at some sense of how particular programmes and initiatives contribute wider economy effects

A Nation of Angels: Assessing the impact of angel investing across the UK

In a European context, the UK business angel market is seen as one of the most mature and extensively researched. However, there is a lack of recent systematic evidence on the profile and approach of business angels, their investing activities and notably their impact on the growth and performance of the businesses in which they invest. This report sets out to fill this gap by providing new findings from the largest survey of business angels in the UK and the impact of their investment activities to date. This report, commissioned by the UKBAA in association with the Centre for Entrepreneurs (CFE) and with the support of the BVCA, Deloitte, Barclays and the ESRC, presents the results of the largest study of the investment behaviour and impact of business angels in the UK to date. The study comprised responses from 403 individual angels who responded to the online Nation of Angels survey, detailed follow-up telephone interviews with 42 individual angels who shared more details of their investment behaviour, and an online survey of 28 angel syndicate and network leads across the UK representing 8,000 angels

Measuring the impact of innovative human capital on small firms' propensity to innovate

The ability to identify and evaluate the competitive advantage of employees' transferable and innovative characteristics is of importance to firms and policymakers. This research extends the standard measure of human capital by developing a unique and far reaching concept of Innovative Human Capital and emphasises its effect on small firm innovation and hence growth (jobs, sales and productivity). This new Innovative Human Capital concept encapsulates four elements: education, training, willingness to change in the workplace and job satisfaction to overcome the limitations of measurements used previously. An augmented innovation production function is used to test the hypothesis that small firms who employ managers with Innovative Human Capital are more likely to innovate. There is evidence from the results that Innovative Human Capital may be more valuable to small firms (i.e. less than 50 employees) than larger-sized firms (i.e. more than 50 employees). The research expands innovation theory to include the concept of Innovative Human Capital as a competitive advantage and determinant of small firm innovation; and distinguishes Innovative Human Capital as a significant concept to consider when creating public support programmes for small firms. (C) 2014 The Authors. Published by Elsevier B.V

Evaluating the net additionality of industrial development assistance in Ireland

This paper examines an approach to estimating the net additionality of financial assistance to indigenously-owned firms in Ireland for the period 2000 to 2002. Using a sample of Enterprise Ireland assisted-firms an innovative self-assessment case study methodology was adopted in order to test the ways in which estimates of partial deadweight can be derived. The results show that the net additionality of Enterprise Ireland assistance can be estimated as around 50 per cent for this sample of case studies which represent a pool of clients which accounted for just-over two-thirds of the financial assistance provided by Enterprise Ireland in the period of the study

New business formation: an important element of Ireland's rapid growth experience?

The extraordinary growth of the Irish economy - the ‘Celtic Tiger’ - since the mid-1990s has attracted a great deal of interest, commentary and research. Indeed, many countries are now looking to Ireland as an economic development role model, and The Sapir Report (2003) has suggested that Ireland should be seen as providing key lessons for other EU countries with regards to realising the objectives set out in the Lisbon Agenda. Much of the discussion of Ireland’s growth has focussed around growth triggers such as: the long term consequences of fiscal stabilisation of the late 1980s; EU structural funds; education; wage moderation; devaluations of the Irish punt. From an industrial policy perspective, the focus has been on the importance of FDI inflows and to a lesser extent on the performance of an indigenous stock of firms to Ireland’s growth record. A notable absence from the industrial policy discourse on the ‘Celtic Tiger’ has been any consideration of the role of new business venture creation and entrepreneurship. In this paper we use unpublished annual Irish VAT data for the period 1988-2004 to provide the first detailed look at national and regional trends in business birth and death rates in Ireland. We also undertake a sub-national analysis of the Irish VAT data to understand more clearly the importance of new venture creation to past and emerging spatial trends in Ireland. Our conclusion is that new business formation made no detectable contribution to the acceleration of Ireland’s growth in the late 1990s

New business formation in a rapidly growing economy: the Irish experience

The extraordinary growth of the Irish economy since the mid-1990s - the 'Celtic Tiger' - has attracted a great deal of interest, commentary and research. Indeed, many countries look to Ireland as an economic development role model, and it has been suggested that Ireland might provide key lessons for other EU members as they seek to achieve the objectives set out in the Lisbon Agenda. Much of the discussion of Ireland's growth has focused on its possible triggers: the long term consequences of the late 1980s fiscal stabilisation; EU structural funds; education; wage moderation; and devaluation of the Irish punt. The industrial policy perspective has highlighted the importance of inflows of foreign direct investment, but a notable absence from the discourse on the 'Celtic Tiger' has been any mention of the role of new business venture creation and entrepreneurship. In this paper we use unpublished Irish VAT data for the years 1988 to 2004 to provide the first detailed look at national trends in business birth and death rates in Ireland over the 'take-off' period. We also use sub-national VAT data to shed light on spatial trends in new venture creation

Public support for business innovation in Mexico: a cross-sectional analysis

Public support for business innovation in Mexico: a cross-sectional analysis. Regional Studies. This paper explores the impact of government support in Mexico on the likelihood of firms achieving functional and/or inter-sectoral upgrading in global value chains (GVCs). Employing a unique dataset, regression analysis was undertaken to estimate the predicted probabilities of firms upgrading in GVCs considering their regional location. The results suggest that firms located in Mexico City are more likely to achieve functional upgrading vis-à-vis northern firms. Additionally, the presence of a research and development laboratory is crucial if firms are to engage in upgrading. There was no evidence that government support affects the likelihood of firms achieving functional and/or inter-sectoral upgrading