This paper conducts a theoretical and quantitative analysis of how entrepreneurs choose firm size, capital structure, default, and owner consumption to manage firm risk, including how these choices change with risk aversion. We decompose an entrepreneur's default decision into three elements: the fraction of firm debt; the potential reduction in personal consumption from losing the firm; and the ratio of personal wealth to firm scale, which determines an entrepreneur's ability to inject personal funds to continue operation. Data from the Survey of Small Business Finances is used to calibrate the model and estimate entrepreneur risk aversion. We determine the evolution of entrepreneur net worth, consumption, and firm assets over time. We find that many entrepreneurs have lower net worth and consumption than non-entrepreneurs with the same preferences, but the densities of the distributions of consumption and net-worth have wide upper tails. Thus, entrepreneurship can be a path toward great wealth and high consumption for the top quantiles of entrepreneurs.

This article studies the impact of differences in citation practices at the subfield, or Web of Science subject category level, using the model introduced in Crespo, Li, and Ruiz-Castillo (2013a), according to which the number of citations received by an article depends on its underlying scientific influence and the field to which it belongs. We use the same Thomson Reuters data set of about 4.4 million articles used in Crespo et al. (2013a) to analyze 22 broad fields. The main results are the following: First, when the classification system goes from 22 fields to 219 subfields the effect on citation inequality of differences in citation practices increases from ∼14% at the field level to 18% at the subfield level. Second, we estimate a set of exchange rates (ERs) over a wide [660, 978] citation quantile interval to express the citation counts of articles into the equivalent counts in the allsciences case. In the fractional case, for example, we find that in 187 of 219 subfields the ERs are reliable in the sense that the coefficient of variation is smaller than or equal to 0.10. Third, in the fractional case the normalization of the raw data using the ERs (or subfield mean citations) as normalization factors reduces the importance of the differences in citation practices from 18% to 3.8% (3.4%) of overall citation inequality. Fourth, the results in the fractional case are essentially replicated when we adopt a multiplicative approach.

In many datasets, articles are classified into sub-fields through the journals in which they have been published. The problem is that many journals are assigned to a single sub-field, but many others are assigned to several sub-fields. This paper discusses a multiplicative and a fractional strategy to deal with this situation, and introduces a normalization procedure in the multiplicative case that takes into account differences in mean citation rates across sub-fields. The empirical part studies different aspects of citation distributions under the two strategies, namely: (i) the number of articles, (ii) the mean citation rate, (iii) the broad shape of the distribution, (iv) the characterization in terms of size-and scale-invariant indicators of high-and low-impact, and (v) the presence of extreme distributions, or distributions that behave very differently from the rest. It is found that, in spite of large differences in the number of articles according to both strategies, the similarity of the citation characteristics of articles published in journals assigned to one or several sub-fields guarantees that choosing one of the two strategies may not lead to a radically different picture in practical applications. Nevertheless, the evaluation of citation excellence through a high-impact indicator may considerably differ depending on that choice.

Small Firms, SSBF, Entrepreneur, Legal Organization, Risk, D92, E01, G33, G38, L25, L26,

This paper evaluates the European Paradox according to which Europe plays a leading world role in terms of scientific excellence, measured in terms of the number of publications, but lacks the entrepreneurial capacity of the US to transform this excellent performance into innovation, growth, and jobs. Citation distributions for the US, the European Union (EU), and the Rest of the World are evaluated using a pair of high and low impact indicators, as well as the mean citation rate (MCR). The dataset consists of 3.6 million articles published in 1998 2002 with a common 5 year citation window. The analysis is carried at a low aggregation level, namely, the 219 sub fields identified with the Web of Science categories distinguished by Thomson Scientific. The problems posed by international co authorship and the multiple assignments of articles to sub fields are solved following a multiplicative strategy.