OBSERVATORY ON EUROPEAN RESEARCH FOR CRAFTS AND SMEs

Issued by Academy Avignon of Crafts and SMEs in Europe

The Observatory on the European Research for Crafts and SMEs was set up by the Academy Avignon of Crafts and SMEs in Europe, based in Brussels. Its mission is to monitor the results of research on Craft and SMEs carried out in Europ e by several bodies e.g. research centres, universities, the EC agencies. The Observatory diffuses the results to Crafts and SME organizations and the other relevant stakeholders.

NEWSLETTER

MARCH 2012/N.36

MAIN CONTENTS IN THIS ISSUE

1- S M E s a n d t h e c h a l l e n g e t o g o p u b l i c : e v i d e n c e f r o m a r e c e n t survey; by Marianna Caccavaio, Jacopo Carmassi, Giorgio Di Giorgio, Marco Spallone.

2- The Impact of International Research Joint Ventures on SMEs

Performance; by Barajas, A., Huergo , E., Moreno, L.

3- Do

local financial and legal systems affect SMEs capital structure? by Mariarosaria Agostino , Maurizio La Rocca ,

Tiziana La Rocca ,Francesco Trivieri.

SMES AND THE CHALLENGE TO GO PUBLIC: EVIDENCE FROM A RECENT SURVEY

Author(s): Marianna Caccavaio , Jacopo Carmassi, Giorgio Di Giorgio ,Marco Spallone (University of Luiss )
SUMMARY

(EN) Italian SMEs go public much less than SMEs located in other European countries, even though their relevance for the national economy is relatively higher in terms of employment and value added. Why do Italian SMEs so scarcely rely on equity as an external source of finance, despite the option of getting listed on SME-dedicated stock market segments? In this paper the authors address this question by analyzing the responses to a questionnaire that they submitted to a sample of listed firms and institutional investors. The authors also suggest policy interventions to provide Italian SMEs with the appropriate incentives for listing.

LINK

THE IMPACT OF INTERNATIONAL RESEARCH JOINT VENTURES ON SMES PERFORMANCE

Author(s): Barajas, A., Huergo , E., Moreno, L. ( Department of Impact Analysis, CDTI, Madrid; GRIPICO - Department of Economic Analysis, Universidad Complutense de Madrid) .
SUMMARY

(EN) The objective of the present study is to analyse the effect of technological cooperation on SMEs performance consideringtwo dimensions: technological and economic results. For that purpose, we use a data set containing information about participants in research joint ventures supported by the SME-specific measures of the sixth Framework Programme. Empirical evidence corroborates a direct and positive impact on technological assets of participants. On the part of the economic indicators, EBITDA per employee and sales are positively influenced by the improvement of technological background. The same results are found for productivity. All those effects are effective in the medium term, confirming that SMEs use to be involved in market-oriented R&D projects.

LINK

DO LOCAL FINANCIAL AND LEGAL SYSTEMS AFFECT SMES CAPITAL STRUCTURE?

Author(s): Mariarosaria Agostino , Maurizio La Rocca , Tiziana La Rocca ,Francesco Trivieri (University of Calabria )
SUMMARY

(EN) This note investigates the role of institutional differences at the local level as determinants of firms' capital structure. Specifically, its aim is to empirically assess whether and to what extent SMEs' financial decisions are affected by local financial development evaluating this influence both ceteris paribus, and by allowing it to be conditional on different levels of legal enforcement inefficiency. Controlling for debt inertia, firms' heterogeneity and endogeneity problems, the authors find that local financial development may be an important determinant of SMEs' capital structure, and that firms appear to have better access to financial debt in areas characterized by a higher quality of the legal system. Thus, despite the international process of capital markets integration, local financial institutions do not seem to become irrelevant for SMEs, which are in need of well developed institutions at local level to gain easier access to external financial resources.

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UEAPME
EU SME business climate: stabilisation at a low level Uncertainty dominates SMEs behaviour, Business Climate Index at 70.5 The picture painted by our last Barometer is far from being rosy. The decrease in SMEs expecting an upturn, the dramatic decline of output-related indicators and the quite negative forecasts for the next months all seem to suggest that small businesses in Europe are in wait and see mode and that a mild recession is actually already underway. Gerhard Huemer,
Director of the UEAPME Study Unit, which issues the Craft and SME Barometer twice a year prior to the European summits in the spring and in the autumn.

Link

Newspapers: More SMEs for government suppliers: Liam Maxwell's three-step plan
Government's ICT advisor on how to get more small businesses used for government procurement.

(EN) 15/02/2012 - The Guardian "The idea of getting more SMEs into the government's roster of suppliers ranks somewhere alongside kittens and rainbows in terms of popularity. But it's easier said than done central government IT continues to be dominated by the usual suspects."

Small businesses want plan B to step up lending 20bn has been earmarked for a national loan guarantee scheme but there are fears it will not get credit flowing. (EN) 15/02/2012 - The Guardian By Jill Treanor "The government is facing calls to bolster credit to small business amid fears that the 20bn of credit easing being promised by the chancellor will not be enough on its own to get loans flowing."

Good practice: Best Practice in SME Recommendations for the Direction and Control of Small and Mediumsized Enterprises
Goal of, and audience for these recommendations These recommendations should serve as a basis for Small (10 to 50 employees) and Medium-sized (up to 500 employees) Enterprises (in the form of unlisted Swiss corporations) to ensure the exercise of responsible and sustainably valueadded direction and control after the completion of the star t-up period. Successful SMEs always fur ther long-term satisfaction and voluntary loyalty of:

customers and suppliers, employees and the general public, as well as the owners of the enterprise. These recommendations present handy and simple direction and control instruments and contain best practice advice for entrepreneurially managed SMEs. The recommendations are to serve their audience as a means of reflection. Divergences should be reasonably justifiable. With regard to small enterprises and other businesses in the star t-up period, these recommendations can be taken as an incitement.

Link

Events:

Growing the Extended Enterprise: integrating SMEs in smart digital supply chains
Event date: 15-16/03/2012 Location: Liederhalle Congress Centre Berliner Platz 1-3 - 70174 Stuttgart - (Germany) The one and a half day event will bring together more than 200 automotive players from across Europe to present concrete business cases on how autogration improved the functioning of the automotive supply chain and aftermarket, how it helped smaller dynamic businesses to link to larger industry players and participate in global supply chains, and will prepare the way for wide-scale implementation of the auto-gration Architecture. The conference programme features distinct speakers and leading names in the automotive and ICT industry. The event will target key stakeholders from the automotive and ICT industries and will include an official ceremony for the signature of a Memorandum of Understanding among these stakeholders. More information: Link
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THE LIST OF SOURCES IN THIS ISSUE.

University of Luiss : The Libera Universit Internazionale degli Studi Sociali Guido Carli is a private university founded in 1974 in Rome, Italy. LUISS University is an independent university set up by a consortium of private and public companies that reorganised a preexisting institution, Pro Deo, founded in 1966. Banque de France: The Banque de France is the central bank of France; it is linked to the
European Central Bank (ECB). Its main charge is to implement the interest rate policy of the European System of Central Banks (ESCB). It is headquartered in Paris.

Le Figaro: is a French daily newspaper founded in 1826 and published in Paris. It has been generally well respected in post-World War II France. Its editorial line is conservative. Le Figaro is the second-largest national newspaper in France after Aujourd'hui en France and before Le Monde. It is one of the three French newspapers of record, along with social-liberal papers Le Monde and Libration, and is the oldest still-existing newspaper in France. The Financial Times: is an international business newspaper. It is a morning daily newspaper published in London and printed in 24 cities around the world. The Financial Times in print format has an average daily circulation of 333,771 copies worldwide, as of December 2011. University of Calabria: The University of Calabria is a state-run university in Italy. Located in
Arcavacata di Rende, a suburb of Cosenza, the university was founded in 1972.

The Complutense University : was founded by Cardinal Cisneros in the ancient town of Complutum, the present day Alcal de Henares, by a Papal Bull granted by Pope Alexander VI in 1499. Its true history, however, can be traced back to May 20th 1293, the date on which Sancho IV of Castile created the Estudio de Escuelas Generales de Alcal which two centuries later became Cisneros' Complutense University. The Department for Business, Innovation and Skills (BIS) is making a difference by supporting sustained growth and higher skills across the economy. BIS: working together for growth.

The present edition of the Newsletter for the Academy Avignon was edited by Maura Albanesi.

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