Are publicly funded Czech incubators effective? The comparison of performance of supported and non-supported firms
European Journal of Innovation Management
ISSN: 1460-1060
Article publication date: 14 May 2018
Issue publication date: 3 August 2018
Abstract
Purpose
Even in established economies, empirical studies on the relationship between business incubation and firm performance do not show unequivocally positive results. The purpose of this paper is to contribute to this debate based on the empirical evidence from the under-researched Central and Eastern European region in which no similar study has been conducted before. Due to the shorter experience with the management of business incubators and less developed institutions, business incubators may not be so effective in supporting their tenants in this region.
Design/methodology/approach
The authors utilise firm-level data from incubated Czech enterprises (n=205) founded after 2003 and compare them with those that have not received support from incubators. The authors implement three matching techniques to pair incubated and non-incubated companies. The outcome variables measured sales, price-cost margin, assets turnover, value added, size of total assets and size of personnel costs.
Findings
Compared to the control group, incubated firms reported on average lower values of the above-mentioned indicators. Presented study shows that Czech incubators have not been successful in supporting growth of incubated firms.
Practical implications
The study suggests that there is a clear room for improvements. Incubators should improve in attracting and selecting high potentials and in providing more effective support focussed on tenants’ growth, whereas policymakers should exercise stricter control regarding the money spent and effectiveness of incubators.
Originality/value
The empirical analysis was conducted based on the research gap in the studies related to the impact of business incubation in the under-researched Central and Eastern European region. It also shows that positive results from similar studies done in established economies cannot be taken for granted as they depend on the quality of institutions in a particular country.
Keywords
Acknowledgements
An earlier version of this paper was presented at the 18th Annual Conference of the European Academy of Management (EURAM), held in Reykjavik in June, 2018. The authors thank the anonymous referees for their contributions in the development of this paper. This work was supported by the Internal Grant Agency of Faculty of Business Administration, University of Economics in Prague F3/65/2016 and by the Internal Grant Agency of Faculty of Regional Development and International Studies, Mendel University in Brno, under Grant No. 2018/004.
Citation
Dvouletý, O., Longo, M.C., Blažková, I., Lukeš, M. and Andera, M. (2018), "Are publicly funded Czech incubators effective? The comparison of performance of supported and non-supported firms", European Journal of Innovation Management, Vol. 21 No. 4, pp. 543-563. https://doi.org/10.1108/EJIM-02-2018-0043
Publisher
:Emerald Publishing Limited
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