Josep-Maria Arauzo-Carod (p)

Mariusz E. Sokolowicz

This paper uses Mercantile Register data to analyse the location decisions of firms in Catalan municipalities (2010 and 2019). Using count data panel estimations, we focus on local sustainability characteristics. The identification of the location patterns and the effects of local environmental policies on firms belonging to different sustainability industries constitute a contribution to the empirical location literature. Our results help in understanding entry processes at local level and how both citizens’ environmental values and local environmental policies shape these. We show that i) firms locate differently depending on their sustainability profile and that ii) local environmental policies have stronger effects on the location decisions of sustainability-oriented firms.

Vincent Boitier (p), Antoine Vatan

Josep-Maria Arauzo-Carod

Constant Elasticity of Substitution (CES) demand systems are building blocks in many economic fields. On top of its simplicity/tractability, these systems constitute the only case where the decentralized economy sustains the social allocation. In this theoretical article, we demonstrate that this feature is not robust to the inclusion of entrepreneurship and space. Toward that goal, we develop a city model with monopolistic competition, CES preferences, and where entry is determined through occupational choice. We provide a full analysis of the market outcome. Notably, we highlight the presence of general equilibrium linkages left out by traditional models. These new linkages generate a striking result that contradicts conventional wisdom. Even if preferences are CES, the market outcome does not deliver optimum product diversity, which makes the city size inefficient. In particular, the market outcome generates an under-provision of diversity, and urban growth is too large compared to what is socially desirable.

Balazs Gyorgy Forman (p)

Vincent Boitier

Foreign Direct Investments account for nearly 90% of the value of investments in Hungary. Behind the phenomenon is the low saving of the Hungarian population and the low willingness of Hungarian enterprises to invest. The Hungarian population is now paying the debts of its pre-2008 loan-financed consumption and property purchases. The growth potential, technological level and willingness to take risks of Hungarian-owned SMEs is low. Most of the SME investments of the last almost 20 years were financed from the resources of the structural funds of the European Union. Instead of being oriented towards growth, Hungarian businesses have become dependent on annuities. Although the investments of foreign companies are increasingly large, they do not make up for the lagging developments of domestic enterprises. The number of jobs they create and their added value are small. Well-educated workers are increasingly lured by foreign companies to growth nodes characterized as small islands. Domestic enterprises are less and less able to pay their employees competitive wages with those of foreign companies. The very different level of technology makes it difficult for Hungarian and foreign companies to cooperate and form clusters. The question is whether it is possible to create a common platform, a common interest, on the basis of which Hungarian SMEs will be able to become suppliers of at least the TNCs operating here?

Mariusz E. Sokolowicz (p), Agnieszka Kurczewska (p)

Balazs Gyorgy Forman

The paper aims to enhance understanding of citizen entrepreneurship by decomposing its evolvement in time, focusing on subsequent phases and their boundaries. After Mitra (2019), by citizen entrepreneurship, we understand the involvement of citizens, as users, producers and collective governance gatekeepers, in the private, social and public entrepreneurship process. By applying an interdisciplinary perspective and by combining different streams of literature (capabilities approach, urban commons, social innovation), we outline the conceptualization of citizen entrepreneurship and identify its four constituting transitional stages: citizen engagement (recognition of common good existence by a community), collective efficacy (as an element of territorialized norms and rules), citizen capabilities as a desired effect (as at least one of perceived benefits), and hybridity perceived as a value (from combining public, private and civic regimes). It leads us to the citizen entrepreneurship framework, the central contribution of our paper. The framework consists of four mentioned pillars, each extended to include further stages, and illustrates how entrepreneurship in the hands of citizens evolves over time. We apply a qualitative approach and explore five cases to verify this framework and pretest its validity in decomposing citizen entrepreneurship. We chose in-depth interviews with citizen entrepreneurs, which we extend with field studies. Different locations and activity profiles help us get to the heart of citizen entrepreneurship and provide the diversity and specifics needed. Applying investigator triangulation (one former citizen activist working for a city, one urban studies scholar, and one entrepreneurship scholar) enabled us to reach out to respondents, build trust, and analyze their responses from complementary yet different research perspectives. We adopt pattern matching analytical logic for data analysis, which allows us to check whether our empirical material supports our theoretical construct (Pauwels & Matthyssens, 2003). Acknowledging the peculiarities of each case and its reference to the framework, we recognize common features across all cases, which we characterize in the paper, referring to the research on entrepreneurship to get an insightful picture of citizen entrepreneurship. The result is the verified and extended framework of citizen entrepreneurship that helps to understand its evolving nature, together with practical implications for individuals involved or planning to engage in this type of entrepreneurial activity.