Determination of the Influence of the Economic Cycle Stages on the Innovative Potential of Small Entrepreneurship

: pp. 20 - 34
Lviv Polytechnic National University, Ukraine
Lviv Politechnic National University
Lviv Polytechnic National University
National Technical University “Dnipro politechnik”, Department of marketing

The small business sector is studied. It is hypothesized that the small business sector has a significant innovative potential, the possibilities of which depend on the economic cycle of market conjuncture. It has been hypothesized that innovation investment in the small business sector depends significantly on economic cycles, and that the structure / directions of innovation investment are determined by the global market conjuncture.

This is done in order to interpret the systemic / unsystematic development of small business in the context of public policy on the basis of appropriate calculations and the obtained results, as well as provides an understanding of the possibilities of realizing the innovative potential of small business. The peculiarity of this study is its complementarity “innovative potential of small business — technology transfer — economic cycles.”

It has been established that investment in innovation and technology transfer in the small business sector depend on market conjuncture and stages of the economic cycle that occur in a certain period (growth or recession). The identification of economic cycles allowed to form the directions of state regulation and reveal the possible risks associated with finding the innovative potential of small business.

The conducted research creates a basis for the implementation of the cluster policy program; contributes to the formation of appropriate tools for creating clusters; reveals favorable periods of labor involvement in the realization of innovation potential; helps to identify the periods of economic cycles in which it is appropriate to invest in their own self-education and modern technology. This approach will help increase the level of balance of the small business system on an innovative basis.

  1. Constantinescu-Băeșu, C. (2005). Studiul managementului firmei în condițiile ciclicității din viața economică. Lasi: Sedcom Libris Publishing House.
  2. Negucioiu, A. (1998). Economie Politic, Vol.1 si 2, editura George Bariiu, ClujNapoca. 208 p.
  3. Ritonga, W. (2018). How to Enhance Society’s Income through Entrepreneurship, Information and Legislation Policy. European Research Studies Journal, Volume XXI, Issue 4, 459–469.
  4. Hustan T., Lykholat S., Veresklya M., Mykhalitska N., Taranskyi I. (2020). Standardization, specialization and formatization as the factors of retail trade competitiveness. Financial and credit activity: problems of the theory and practice, 34(3), 432–440.
  5. Kozubíková, L., Belás, J., Bilan, Y., & Bartoš, P. (2015). Personal Characteristics of Entrepreneurs in the Context of Perception and Management of Business Risk in the SME Segment. Economics and Sociology, 8(1).
  6. Břečková, P., Havlíček, K. (2013). Leaders Management and Personnel Controlling in SMEs. European Research Studies Journal, Volume XVI, Issue 4, 3–14.
  7. Havlíček, K., Schlossberger, O. (2013). New Trends of Management of European SMEs:The M-C Model. European Research Studies Journal, Volume XVI, Issue 4, 43–56, 2013.
  8. Meutia Tubagus Ismail, Ahmad Bukhori (2017). The Role of Feedback and Feed Forward Control System to Improve Competitive Advantage of SMEs in Indonesia. European Research Studies Journal, Volume XX, Issue 2A, 496–506, 2017.
  9. Lee, V.H., Foo, A.T., Lai-Ying, L.Y., Keng-Boon, K.B. (2016). Can competitive advantage be achieved through knowledge management? A case study on SMEs. Expert Systems with Applications, 65 (1), 136–151.
  10. Varnalii Z. S., Kampo V. (2005). M. Political and legal regulation of entrepreneurship in Ukraine: theory and practice: a monograph. Kyiv: Znannia Ukraiiny. 324 p.
  11. Downs, Anthony. An Economic (1957). Theory of Political Action in a Democracy. Journal of Political Economy, vol. 65, no. 2, pp. 135–150.
  12. Pokryshka D. S., Zhalilo Ya. A., Liapin D. V., Belinska Ya. V. and others (2010). Mechanisms of business development in the conditions of post-crisis recovery of Ukraine’s economy. Kyiv: NISD. 72 p. (Analytical report).
  13. Belás, J., Bartoš, P., Habánik, J., & Novák, P. (2014). Significant Attributes of the Business Environment in Small and Meduim-Sized Enterprises. Economics and Sociology, 7(3).
  14. Pisar, P., & Bilkova, D. (2019). Controlling as a tool for SME management with an emphasis on innovations in the context of Industry 4.0. Equilibrium. Quarterly Journal of Economics and Economic Policy, 14(4), 763–785.
  15. Eric Heyer (2011). The effectiveness of economic policy and position in the cycle: The case of tax reductions on overtime in France. HAL Id: hal-01069482.
  16. Krajnakova, E., Navickas, V., & Kontautiene, R. (2018). Effect of macroeconomic business environment on the development of corporate social responsibility in Baltic Countries and Slovakia. Oeconomia Copernicana, 9(3), 477–492.
  17. Zygmunt, J. (2018). Entrepreneurial activity drivers in the transition economies. Evidence from the Visegrad countries. Equilibrium. Quarterly Journal of Economics and Economic Policy, 13(1), 89–103.
  18. Karpak, B., Topcu, I. (2010), Small medium manufacturing enterprises in Turkey: an analytic network process framework for prioritizing factors affecting success, International Journal of Production Economics, 125, pp. 60–70.
  19. Henderson, J., Weiler, S. (2010), Entrepreneurs and job growth: probing the boundaries of time and space, Economic Development Quarterly, 24(1), pp. 23–32.
  20. Sumiati, Ainur Rofiq, Sigit Pramono (2019). The Role of Strategic Planning and Flexibility in Shaping SMEs Market Orientation in Turbulence Business Environment. European Research Studies Journal, Volume XXII, Issue 1, 221–236, 2019.
  21. Behr, P., & Guettler, A. (2007). Credit Risk Assess ment and Relationship Lending: An Empirical Analysis of German Small and Medium-Sized Enterprises. Journal of Small Business Management, 45(2).
  22. Cipovova, E., & Dlaskova, G. (2016). Comparison of Different Methods of Credit Risk Management of the Commercial Bank to Accelerate Lending Activities for SME Segment. European Research Studies Journal, Volume XIX, Issue 4, 17–26, 2016.
  23. Jindrichovska, I. (2013). Financial Management in SMEs. European Research Studies Journal, Volume XVI, Issue 4, 79–96, 2013.
  24. Havlíček, K., Thalassinos, E., Berezkinova, L. (2013). Innovation Management and Controlling in SMEs. European Research Studies Journal, Volume XVI, Issue 4, 57–70, 2013.
  25. Janssen, C., Sen, S., & Bhattacharya, C. B. (2015). Corporate crises in the age of corporate social responsibility. Business Horizons, 58.
  26. Przybylska A (2005). Innowacje w przedsiębiorstwie – skuteczność a wymiar społeczny. Prace Naukowe Instytutu Organizacji i Zarządzania Politechniki Wrocławskiej. Studia i Materiały. vol. 18. Issue nr 76, t. 2, 51–61. Available at:$2&qt=IN_PAGE
  27. Osuch-Rak E (2017). Transfer technologii w Polsce na przykładzie spółek odpryskowych wywodzących się z instytutów badawczych i naukowych. Kwartalnik Kolegium Ekonomiczno-Społecznego Studia i Prace / Szkoła Główna Handlowa. Issue nr 3, 131–149.
  28. Krykavskyy, Y., Pokhylchenko, O., & Hayvanovych, N. (2019). Supply chain development drivers in industry 4.0 in Ukrainian enterprises. Oeconomia Copernicana, 10(2), 273–290.
  29. Schumpeter Josef A. (2014) Theory of Economic Development: A Study of Profit, Capital, Credit, Interest, and the Economic Cycle. K.: Publishing House «Kyiv-Mohyla Academy». Pp. 205–243.
  30. Menshikov SM (1989). Long waves in the economy. When society changes its skin. M.: International relations. S. 182.
  31. Perez K. (2011). Technological revolutions and financial capital. Dynamics of bubbles and periods of prosperity. Moscow: Delo Publishing House, Russian Academy of Natural Sciences and Geography. Pp. 76–86.
  32. Snyder M. (2014) Economic Cycle Theorists Are Correct, 2015 To 2020 Will Be Pure Hell For The United States / Michael Snyder// MND. Available at:
  33. Doing business-2019. Ukraine is ranked by the World Bank as an ease of doing business. Economic discussion club. Available at:
  34. Andersson T., Schwaag-Serger S., Sörvik J., Hansson E. (2004). The Cluster Policies Whitebook / IKED. Available at:
  35. Kotlebova, J., Arendas, P., & Chovancova, B. (2020). Government expenditures in the support of technological innovations and impact on stock market and real economy: the empirical evidence from the US and Germany. Equilibrium. Quarterly Journal of Economics and Economic Policy, 15(4), 717–734.
  36. Kijek, A., & Matras-Bolibok, A. (2020). Technological convergence across European regions. Equilibrium. Quarterly Journal of Economics and Economic Policy, 15(2), 295–313.