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While the number of green start-ups has steadily increased around the world in response to the environmental problems demanding immediate solutions, there are several unresolved questions on the behaviour and performance of such ventures. The papers in this special issue shed light on these issues by underscoring the role of several factors, such as industry life cycles, knowledge spillovers, institutions, and availability of external finance, in shaping decision-making and firm behaviour in green start-ups. This paper highlights the state-of-the-art developments in the literature, discusses the key contributions of the papers put together in this special issue, and presents a future research agenda for scholars interested in green entrepreneurship.

This paper models the determinants of exporting (both in terms of export propensity and export intensity), with a particular emphasis on the importance of absorptive capacity and the endogenous link between exporting and undertaking R&D. Based on a merged dataset of the 2001 Community Innovation Survey and the 2000 Annual Respondents Database for the UK, our results suggest that establishment size plays a fundamental role in explaining exporting. Meanwhile, alongside other factors, undertaking R&D activities and having greater absorptive capacity (for scientific knowledge, international co-operation, and organizational structure) significantly reduce entry barriers into export markets, having controlled for self-selectivity into exporting. Nevertheless, conditional on entry into international markets, only greater absorptive capacity (associated with scientific knowledge) seems to further boost export performance in such markets, whereas spending on R&D no longer has an impact on exporting behaviour once we have taken into account its endogenous nature.

In recent years, both economic geographers and innovation scholars have paid considerable attention to knowledge-intensive-business-services (KIBS) and professional service firms (PSFs). Both communities have also shown a strong interest in knowledge and ‘knowledge bases’. Considering architecture to be based on symbolic and synthetic knowledge, and engineering to be based on analytical and synthetic knowledge, and using a panel dataset, this article examines the different geographies of performance among architecture practices and engineering consultancies active in the UK construction industry. We find that architecture practices are significantly more concentrated in inner London, whereas the engineering consultancies are much more dispersed. Locating in inner London provides significant financial benefits to architects but not to engineers. Ultimately, the various drivers of performance are rather different, with a Christallerian logic applying to architects but not to engineers. We consider that different knowledge bases are fundamental to understanding these differences between architects and engineers and KIBS/PSFs more generally.

Various models explaining micro knowledge-generating behaviour (in particular exporting and innovating) in the economics literature are underpinned by the overlapping assumption that these activities are largely determined by the resources/capabilities possessed by firms. Despite their perceived importance, there is a dearth of evidence on how these heterogeneous resources and firm-specific capabilities can be incorporated into economics models to quantify their roles in determining microeconomic behaviour. Therefore this thesis attempts to bridge this gap in the literature by integrating the resource-based view (RBV) as a new IO theory into the microeconomics literature and empirically utilising micro level data to investigate the significance of such resources/capacities in determining exporting and innovation activities, moderating their inter-relationships as well as conditioning their impacts on the firm’s performance. These heterogeneous resources have been proxied using firm size, productivity, capital intensity, intangible assets, various dimensions to absorptive capacity, the deployment of R&D sourcing strategies and so on. Using establishment-level data covering all UK market-based sectors in 2000, the findings show that all these factors have a large impact upon the propensity and/or intensity of establishments’ exporting and/or R&D activities, with an especially noticeable role in breaking down entry barriers to undertaking such activities. Given the significant impact of exports on knowledge-creating R&D activity, the thesis subsequently investigates and confirms additional learning effect of exporting as embodied in the firm-level exports-productivity relationship using a nationally representative panel dataset covering both manufacturing and services sectors in the UK, for the 1996-2004 period. Lastly, this thesis also attempts to provide an initial inspection of the contribution of innovation (proxied by R&D stock) to productivity using plant-level panel data for Northern Ireland. Based on the estimation of a ‘knowledge production function’ separately for various manufacturing industries, the overall long-run results show that R&D stock does have a positive impact upon productivity.

This report provides a review of knowledge spillovers and sources of knowledge in the manufacturing sector. The literature reviewed indicates the importance of intangible investments in firms' internal knowledge assets. The weight of evidence also emphasises the importance of firms' absorptive capacity in increasing internal capabilities and in benefiting from external knowledge sources. We also highlight the importance of external knowledge and knowledge-assets (i.e., knowledge spillovers) in determining productivity and competitiveness, as well as the spatial dimension of knowledge flows in particular knowledge clusters. Our study subsequently provides an empirical analysis of firms' knowledge sourcing and cooperation behaviour for innovation activities in the UK manufacturing sector, using establishment-level data from recent four waves of the UK Innovation Survey covering the 2002-2010 period. Following the approach developed in Harris and Li (2009), we have constructed an empirical multi-index of absorptive capacity to measure a firm's ability to internalise and appropriate external knowledge for innovation activities. Our results show substantial heterogeneity across sectors; and overall, manufacturing (especially higher tech or advanced) makes the strongest use of knowledge sources and is associated with highest levels of absorptive capacity followed by Knowledge-Intensive Services (KIS), where the UK has a strong comparative advantage. There is evidence that manufacturers responded to external market conditions in their utilisation of knowledge sources and more specifically, firms were making greater use of knowledge sources in response to the recent economic recession.

This study empirically assesses the microeconomic exporting-productivity nexus for both the UK manufacturing and services sectors during 1996-2004, based on a weighted FAME dataset. Our results show that firms that are older, that possess intangible assets or that have higher (labour) productivity in the year prior to exporting, are significantly more likely to sell overseas. In testing the post-entry 'learning-by-exporting' effect, we employ three approaches to controlling for endogeneity and sample selection, viz. instrumental variables, control function and matching, and find that this effect is present in many industries but not universal, and also varies amongst different types of exporting firms. Our overall estimate for the UK economy suggests a substantial post-entry productivity effect for firms new to exporting; a negative effect for firms exiting overseas markets; and large productivity gains while exporting for those that both enter and exit.

This paper studies the antecedents of internationalization amongst professional service firms (PSFs). Using a unique panel of UK-based engineering consultancies over the 1994-2009 period, we show that more specialized PSFs are more likely to internationalize than firms with a broader scope of activities, and that domestic geographical diversification as well as diversification into more unrelated fields enhances the international competitiveness of PSFs. Specific human capital also fosters internationalization, and moreover, significantly intensifies the advantages of various forms of diversification. Business size, age, foreign ownership and management buy-outs also exert positive and significant effects. The findings contribute to the literature on services internationalization and provide novel insights for the management of firms' geographical and industrial diversification.

This study presents the first empirical analysis of the determinants of firm closure in the UK with an emphasis on the role of export-market dynamics, using panel data for a nationally representative group of firms operating in all-market based sectors during 1997-2003. Our findings show that the probability of closure is (cet. par.) significantly lower for exporters, particularly those experiencing export-market entry and exit. Having controlled for other attributes associated with productivity (such as size and export status), the following factors are found to increase the firm's survival prospects: higher capital intensity and TFP, foreign ownership, young age, displacement effects (through relatively high rates of entry of firms in each industry), and belonging to certain industries. Interestingly, increased import penetration (a proxy for lower trade costs) leads to a lower hazard rate for exporting entrants and continuous exporters, whilst inducing a higher hazard rate for domestic producers or those that quit exporting.