recent research

A team of researchers recently assessed the relationship between angel investing and venture capital (VC) for startups. Although they found some variation in the performance of companies based on their share of angel and VC financing, there was no clear indication that angel investing provides any unique value for a startup.

Adding to the debate about whether smaller or larger businesses play an outsized role in the nation’s economy, a new Census Bureau report finds that the concentration of both older and larger firms has continued to increase in the U.S. economy over the last several decades, giving these firms an overall greater impact on employment and job growth than younger and smaller firms. Specifically, the report indicates that decreases in the national share of startup firms over the last several decades lead to an increased concentration of older firms, which in turn has had a greater impact on national employment and job creation than an increase in larger firms over the same period.

Faculty of the nation’s higher education institutions have long used research publications and citations as a measure of success. A new working paper posted by the National Bureau of Economic Researchers (NBER) suggests a select group of research publications may do more than gain the authors tenure and celebrity in their chosen field: these works are correlated with reductions in local disease-related mortality. In an era of marked increases in anti-intellectualism among legislatures, is this finding an additional argument to add to TBED policymakers’ arsenal for increasing state and regional investments targeting R&D?

A recent research study suggests that diverse identity representation of website spokespeople increases the likelihood of attracting a higher proportion of prospective entrepreneurs.

Forthcoming research suggests venture development organizations, that is, those publicly-supported nonprofits that combine risk financing with expert technical assistance to grow local innovation-based startups, should give careful consideration to the exit histories of the venture capitalists they partner with to move the VDO’s portfolio firms through seed and series A investment rounds. Who those VCs know and have worked with to achieve successful exits previously through acquisitions or IPOs, in many cases, may be more important than the VC firms’ zip codes or assets under management.

High-risk/high-reward research can yield breakthroughs, produce new technologies, and allow the surrounding region to remain economically relevant. However, the scientific community remains concerned that research and development-focused policies, both in the U.S. and elsewhere, continue to be conservative with their goals by only encouraging incremental growth that can yield tangible results in shorter amounts of time. These concerns, and potential policy solutions, are explored in a recently published research paper by the Organization for Economic Cooperation and Development (OECD). Effective Policies to Foster High Risk/High Reward Research, authored by an international group selected by the Global Science Forum, examines the current policy environment, notes the roadblocks to supporting high-risk/high-reward research, and investigates what can be done to provide long term support for high-risk/high-reward projects.

Building on top of the notion that diversity of industry is central to a region’s entrepreneurial success, recent research has noted that the personalities of people living throughout a region also play an important role in local knowledge spillover and the economic diversity of the area. The report, Entrepreneurship in Cities by Sam Tavassoli, Martin Obschonka, and David B. Audretsch, examines the relationship between a city’s entrepreneurial success and its ability to provide a favorable and connected environment for its residents through urban density and local psychological openness.

“The Achilles Heel of Reputable VCs,” a recent paper by Nuri Ersahin et al., finds that the most successful venture capital (VC) funds make fewer and smaller investments in states after investment tax credits go into effect. These VCs also co-invest with fewer firms, are less likely to invest in “serial” entrepreneurs and experience fewer positive exits after the introduction of the tax credit.

Having interdisciplinary teams of scientists and relationships with “star” entrepreneurs are factors that can influence the chances for academic discoveries to reach the commercialization stage. While proximity to capital has traditionally been viewed as the core stimulus for academic commercialization, a recently released working paper by the National Bureau of Economic Research reexamines the variables that play a role in the commercialization of academic sciences, and provides new insight into the importance of team composition throughout the commercialization process.

Discussions surrounding automation’s power and the effect it could have on jobs have only increased over time. The current pandemic adds to the debate of whether automation and robotics, which are unaffected by viruses and have the potential for cost savings, could offer a safer bet for industries than human labor. Such are the debates the authors of a new working paper considered in their research examining jobs that were identified in the past as being at risk of elimination through automation. While building on previous studies from the Organisation for Economic Cooperation and Development (OECD) of the impact of automation on jobs, OECD authors Alexandre Georgieff and Anna Milanez seek to expand that knowledge to a cross-country context and the paper claims to be the first to evaluate employment outcomes using the task-based measure of automation risk developed by the OECD. The researchers found no support for net job destruction at the broad country level. However, they did find evidence that automation has worsened employment prospects for some workers including skilled agricultural workers, clerical support workers, and metal and machinery workers.