Search results
1 – 10 of 849Claudio Bravo-Ortega, Carla Bustamante, Pablo Egana del Sol, Felipe Symmes and José Sexton
The purpose of this study is to investigate the role of sales, as a proxy for size, in moderating the impact of institutional incongruence between formal and informal institutions…
Abstract
Purpose
The purpose of this study is to investigate the role of sales, as a proxy for size, in moderating the impact of institutional incongruence between formal and informal institutions on the formalization of microenterprises in middle-income countries in Latin America.
Design/methodology/approach
The paper uses a probit regression model to examine business formalization as a binary outcome of formal and informal institutions. Data was collected through interviews and surveys across 52 municipalities in the Metropolitan Region of Santiago, Chile. The study used a stratified sampling approach and was conducted between November 2022 and January 2023.
Findings
The results offer three key insights into the formalization of microenterprises in middle-income countries. First, we show that formal institutions do not significantly influence formalization decisions among microentrepreneurs in middle-income countries, challenging the traditional belief that formal institutions alone significantly influence formalization in these contexts. Second, we show that informal institutions are significant predictors of informality, especially among smaller microenterprises. Third, we highlight that the smaller the business, the stronger the negative effect of informal institutions on formalization, and thus, the institutional incongruence between formal and informal institutions decreases for larger businesses.
Originality/value
This paper contributes to management literature by shedding light on the drivers of formalization in middle-income countries, a departure from most formalization studies wherein the focus is primarily on low-income economies. The findings suggest that policymakers in middle-income countries should focus on enabling microenterprise growth through sales, rather than targeting specific demographic groups or relying solely on formal institutional enforcement to promote formalization.
Propósito
El objetivo de este estudio es investigar el papel de las ventas, utilizadas como un indicador de tamaño, en la mediación del impacto de la incongruencia institucional entre instituciones formales e informales en la formalización de microempresas en países de ingresos medios en América Latina.
Método
Utilizamos un modelo de regresión Probit para examinar la formalización empresarial como un resultado binario de instituciones formales e informales. Los datos se recopilaron a través de 110 entrevistas y encuestas en 52 municipios de la Región Metropolitana de Santiago, Chile. El estudio empleó un enfoque de muestreo estratificado y se llevó a cabo entre noviembre de 2022 y enero de 2023.
Hallazgos
Nuestros resultados ofrecen tres ideas clave sobre la formalización de microempresas en países de ingresos medios. Primero, demostramos que las instituciones formales no influyen significativamente en las decisiones de formalización entre las microempresas en países de ingresos medios; esto desafía la creencia tradicional de que las instituciones formales por sí solas influyen significativamente en la formalización en estos contextos. Segundo, nuestro estudio muestra que las instituciones informales son predictores significativos de la informalidad, especialmente entre las microempresas más pequeñas. Tercero, nuestro estudio destaca que el efecto negativo de las instituciones informales sobre la formalización es más fuerte para negocios de menor tamaño; por lo tanto, la incongruencia institucional entre instituciones formales e informales disminuye para negocios de mayor tamaño.
Originalidad
Este artículo contribuye a la literatura iluminando sobre los impulsores de la formalización en países de ingresos medios, a diferencia de la mayoría de los estudios de formalización en la región latinoamericana que se centran principalmente en países de bajos ingresos. Nuestros hallazgos sugieren que los responsables de políticas en países de ingresos medios deberían centrarse en impulsar el crecimiento de las microempresas a través de las ventas, en lugar de enfocarse en grupos demográficos específicos o depender únicamente del cumplimiento institucional formal para promover la formalización.
Propósito
O objetivo deste estudo é investigar o papel das vendas, usadas como um indicador de tamanho, na mediação do impacto da incongruência institucional entre instituições formais e informais na formalização de microempresas em países de renda média na América Latina.
Método
Utilizamos um modelo de regressão Probit para examinar a formalização empresarial como um resultado binário de instituições formais e informais. Os dados foram coletados por meio de 110 entrevistas e pesquisas em 52 municípios da Região Metropolitana de Santiago, Chile. O estudo empregou uma abordagem de amostragem estratificada e foi realizado entre novembro de 2022 e janeiro de 2023.
Resultados
Nossos resultados oferecem três ideias-chave sobre a formalização de microempresas em países de renda média. Primeiro, demonstramos que as instituições formais não influenciam significativamente as decisões de formalização entre as microempresas em países de renda média; isso desafia a crença tradicional de que as instituições formais, por si só, influenciam significativamente a formalização nesses contextos. Segundo, nosso estudo mostra que as instituições informais são preditores significativos da informalidade, especialmente entre as microempresas menores. Terceiro, nosso estudo destaca que o efeito negativo das instituições informais sobre a formalização é mais forte para negócios de menor porte; portanto, a incongruência institucional entre instituições formais e informais diminui para negócios de maior porte.
Originalidade
Este artigo contribui para a literatura iluminando os impulsionadores da formalização em países de renda média, ao contrário da maioria dos estudos de formalização na região latino-americana, que se concentram principalmente em países de baixa renda. Nossos achados sugerem que os responsáveis pelas políticas em países de renda média deveriam focar em impulsionar o crescimento das microempresas por meio das vendas, em vez de se concentrar em grupos demográficos específicos ou depender exclusivamente do cumprimento institucional formal para promover a formalização.
Details
Keywords
- Informal economy
- Middle-income countries
- Latin America
- Formal and informal institutions
- Entrepreneurship
- Microenterprises
- Economía informal
- Países de ingresos medios
- América Latina
- Instituciones formales e informales
- Emprendimiento
- Microempresas
- Economia informal
- Países de renda media
- América Latina
- Instituições formais e informais
- Empreendedorismo
- Microempresas
This paper aims to examine the factors associated with a household business entrepreneur’s decisions to formalise the firm at a multidimensions level.
Abstract
Purpose
This paper aims to examine the factors associated with a household business entrepreneur’s decisions to formalise the firm at a multidimensions level.
Design/methodology/approach
The data set is a panel of 2,336 SMEs and household businesses from Vietnamese SME surveys during the 2005–2015 period.
Findings
This study elucidates how firm-level resources, entrepreneur characteristics and costs of doing business influence an entrepreneur’s decision to enter, the speed and the degree of formality.
Originality/value
This study provides insight into the origins of an entrepreneur’s decisions to the multidimensions of business formality through the lenses of the resource-based view, entrepreneurship and institution theories.
Details
Keywords
Abdullah M. Aljarodi, Tojo Thatchenkery and David Urbano
To date, few studies have incorporated female entrepreneurship into the context of a country that relies heavily on natural resources and still has a wide gender gap due to…
Abstract
Purpose
To date, few studies have incorporated female entrepreneurship into the context of a country that relies heavily on natural resources and still has a wide gender gap due to historically established cultural norms. This study aims to investigate the impact of entrepreneurial ecosystem factors on women’s ability and desire to become entrepreneurs in Saudi Arabia.
Design/methodology/approach
The study applied a quantitative method using secondary data from the Adult Population Survey conducted by Global Entrepreneurship Monitor and built upon the recently proposed “Entrepreneurial Ecosystem Approach,” which has three levels: institutional, organisational and individual.
Findings
The findings demonstrate the significant roles that different entrepreneurial ecosystem dimensions can play in determining female entrepreneurial activity. Relationships were found among the variables of the three dimensions, indicating that broader institutional conditions can impact women becoming entrepreneurs.
Research limitations/implications
A multi-year analysis could not be performed because the country data from one year limited the research to conditions in that time frame.
Originality/value
The findings advance entrepreneurial research by empirically examining the influencers' factors on women becoming entrepreneurs in a fast-growing emerging economy, collectivist society and non-European and non-North American institutional environment. The research tested a framework that gives more insight into the diverse factors affecting women in entrepreneurship at different levels.
Details
Keywords
This study investigated the moderating role of democracy in the relationship between corruption and foreign direct investment. The purpose of this study is to understand whether…
Abstract
Purpose
This study investigated the moderating role of democracy in the relationship between corruption and foreign direct investment. The purpose of this study is to understand whether corruption has different effects on the location decisions of multinational enterprises (MNEs) depending on the regime type.
Design/methodology/approach
This study explored how institutional context influenced the impacts of corruption on the location decisions of MNEs, specifically using a sample of Chinese cross-border mergers and acquisitions between 2000 and 2020.
Findings
This study assessed the role of democracy in the relationship between corruption and the location decisions of Chinese MNEs. In general, this study found that Chinese MNEs were hindered by host country corruption, but that these detrimental effects were weaker in the presence of more effective democratic institutions.
Originality/value
This study contributes to the literature on institutional factors in international business through its simultaneous investigation of the effects of both democracy and corruption on the location decisions of MNEs. Moreover, there is a prevailing view that Chinese MNEs are willing to enter countries with high corruption, but the results of this study indicate that they are risk-averse in ways similar to their Western counterparts.
Details
Keywords
Rostand Arland Yebetchou Tchounkeu
This work aims to analyse the relationship between public health efficiency and well-being considering a panel of 102 Italian provinces from 2000 to 2016 and evaluates if there…
Abstract
Purpose
This work aims to analyse the relationship between public health efficiency and well-being considering a panel of 102 Italian provinces from 2000 to 2016 and evaluates if there are omitted variable biases and endogeneity biases and also evaluates if there are heterogeneous effects among provinces with different income levels.
Design/methodology/approach
We use a multi-input and output bootstrap data envelopment analysis to assess public health efficiency. Then, we measure well-being indices using the min-max linear scaling transformation technique. A two-stage least squares model is used to identify the causal effect of improving public health efficiency on well-being to account for time-invariant heterogeneity, omitted variable bias and endogeneity bias.
Findings
After controlling for important economic factors, the results show a significant effect of an accountable and efficient public health system on well-being. Those effects are concentrated in the North, the most economically, geographically and environmentally advantageous areas.
Research limitations/implications
The use of the sample mean, probably the oldest and most used method for aggregating the indicators, could be affected by variable compensation, with consequent misleading results in the process of constructing the well-being index. Another limitation is the use of lagged values of the main predictor as an instrument in the instrumental variables setting because it could lead to information loss. Finally, the availability of data over a long period of time.
Practical implications
The findings could help policymakers adopt measures to strengthen the public health system, encourage private providers and inspire countries worldwide.
Social implications
These results draw the attention of local authorities, who play an important role in designing and implementing policies to stimulate local public health efficiency, which puts individuals in the conditions of achieving overall well-being in their communities.
Originality/value
For the first time in Italy, a panel of well-being indices was constructed by developing new methodologies based on microeconomic theory. Furthermore, for the first time, the assessment of the relationship between public health efficiency and well-being is carried out using a panel of 102 Italian provinces.
Details
Keywords
Giovanna Culot, Matteo Podrecca and Guido Nassimbeni
This study analyzes the performance implications of adopting blockchain to support supply chain business processes. The technology holds as many promises as implementation…
Abstract
Purpose
This study analyzes the performance implications of adopting blockchain to support supply chain business processes. The technology holds as many promises as implementation challenges, so interest in its impact on operational performance has grown steadily over the last few years.
Design/methodology/approach
Drawing on transaction cost economics and the contingency theory, we built a set of hypotheses. These were tested through a long-term event study and an ordinary least squares regression involving 130 adopters listed in North America.
Findings
Compared with the control sample, adopters displayed significant abnormal performance in terms of labor productivity, operating cycle and profitability, whereas sales appeared unaffected. Firms in regulated settings and closer to the end customer showed more positive effects. Neither industry-level competition nor the early involvement of a project partner emerged as relevant contextual factors.
Originality/value
This research presents the first extensive analysis of operational performance based on objective measures. In contrast to previous studies and theoretical predictions, the results indicate that blockchain adoption is not associated with sales improvement. This can be explained considering that secure data storage and sharing do not guarantee the factual credibility of recorded data, which needs to be proved to customers in alternative ways. Conversely, improvements in other operational performance dimensions confirm that blockchain can support inter-organizational transactions more efficiently. The results are relevant in times when, following hype, there are signs of disengagement with the technology.
Details
Keywords
Dongni Wang and Carmen Fillat-Castejón
The purpose of this paper is to analyse the institutional threshold effects of foreign aid on foreign direct investment (FDI).
Abstract
Purpose
The purpose of this paper is to analyse the institutional threshold effects of foreign aid on foreign direct investment (FDI).
Design/methodology/approach
This paper develops a theoretical model from an extended Solow model that introduces the conductive effect of institutions in an aid recipient country towards the capacity of attracting FDI. This study evidences threshold effects with the most recent panel threshold models that consider endogeneity issues. The data on economic institutions and foreign aid are decomposed into disaggregated level to reveal the detailed threshold pattern. Several sample subsets are used for a heterogeneity analysis.
Findings
Conducting empirical research on a sample of 62 countries during the period 2003–2016, this study finds robust evidence of the existence of an institutional threshold in the aid–FDI nexus which a country must attain to reap the full attraction of FDI by foreign aid providing financial resources. Furthermore, foreign aid tends to promote FDI in institutions characterized by a right-sized government, a strengthened legal system and an appropriate regulatory environment. On the other hand, aid may crowd out FDI. The results are robust to regional combinations and a subset of low and lower-middle-income countries. In addition, this study finds that aid targeted at social infrastructure and services has a positive effect regardless of institutional threshold.
Originality/value
This paper contributes to the literature by introducing a non-linear and discontinuous effect of aid on FDI, i.e. a threshold effect, highlighting the relevance of legal systems and regulations and the possibility of a crowding-out effect on FDI for specific institutional regimes. The thresholds provide a guide for donor countries to ensure aid effectiveness at the risk of being counterproductive and for recipient countries to better assess the institutional dimensions that need to be improved.
Details
Keywords
Elvis Achuo, Bruno Emmanuel Ongo Nkoa, Nembo Leslie Ndam and Njimanted G. Forgha
Despite the longstanding male dominance in the socio-politico-economic spheres, recent decades have witnessed remarkable improvements in gender inclusion. Although the issue of…
Abstract
Purpose
Despite the longstanding male dominance in the socio-politico-economic spheres, recent decades have witnessed remarkable improvements in gender inclusion. Although the issue of gender inclusion has been widely documented, answers to the question of whether institutional arrangements and information technology shape gender inclusion remain contentious. This study, therefore, empirically examines the effects of institutional quality and information and communication technology (ICT) penetration on gender inclusion on a global scale.
Design/methodology/approach
To control for the endogeneity of modeled variables and cross-sectional dependence inherent with large panel datasets, the study employs the Driscoll-Kraay fixed effects (DKFE) and the system generalised method of moments (GMM) estimators for a panel of 142 countries from 1996 to 2020.
Findings
The empirical findings from the DKFE and system GMM estimators reveal that strong institutions significantly enhance gender inclusion. Moreover, by disaggregating institutional quality into various governance indicators, we show that besides corruption control, which has a positive but insignificant effect on women’s empowerment, other governance indicators significantly enhance gender inclusion. Furthermore, there is evidence that various ICT measures promote gender inclusion.
Practical implications
The study results suggest that policymakers in developing countries should implement stringent measures to curb corruption. Moreover, policymakers in low-income countries should create avenues to facilitate women’s access to ICTs. Hence, policymakers in low-income countries should create and equip ICT training centers and render them accessible to all categories of women. Furthermore, developed countries with high-tech knowledge could help developing countries by organizing free training workshops and sensitization campaigns concerning the use of ICTs vis-à-vis women empowerment in various fields of life.
Originality/value
The present study fills a significant research gap by comprehensively exploring the nexuses between governance, ICT penetration and the socio-politico-economic dimensions of gender inclusion from a global perspective. Besides the paucity of studies in this regard, the few existing studies have been focused on either region and country-specific case studies in developed or developing economies. Moreover, this study is timely, given the importance placed on gender inclusion (SDG5), quality of institutions (SDG16) and ICT penetration (SDG9) in the 2015–2030 global development agenda.
Details
Keywords
Amir Ghazinoori, Manjit Singh Sandhu and Ashutosh Sarker
The purpose of this study is to examine how formal and informal institutions play a role in the Iranian context in shaping corporate social responsibility (CSR) policies and…
Abstract
Purpose
The purpose of this study is to examine how formal and informal institutions play a role in the Iranian context in shaping corporate social responsibility (CSR) policies and practices.
Design/methodology/approach
Using a multiple case-study approach combining comparative and cross-sectional methods with semi-structured interviews, primary data was collected from eight corporations that actively participated in CSR activities in Iran. A microanalysis approach was used to examine the meanings and dynamics in the data. Through thematic analysis and pattern-matching techniques, the authors separately examined the roles of formal and informal institutions. Cross-case analysis was used to highlight the cases’ similarities and differences.
Findings
This study demonstrates that both formal and informal institutional structures exist in Iran and that both types influence CSR. This study also shows that informal institutions (such as personal values, culture, religion, traditions, charity and philanthropy) play a more explicit role than formal institutions (such as legal regulations and laws) in shaping CSR adoption policies and practices. The results indicate that, among institutions linked to CSR, formal and informal institutions are complementary and potentiate each other in Iran. Nevertheless, compared to formal ones, informal institutions play a more prominent role in shaping CSR policies and practices.
Research limitations/implications
The authors recognize that, although the eight corporations are large, and although they interviewed their key personnel, they do not claim that these findings are generalizable, owing to the qualitative nature of the study and the small number of selected corporations.
Originality/value
This study makes relevant theoretical and empirical contributions. First, it contributes to the growing body of CSR literature that highlights the necessity of linking informal and formal institutions. Although the CSR literature lacks research on informal institutions in developing economies, researchers have yet to push forward and explore how the CSR adoption process works in developing economies that have influential informal institutions.
Details
Keywords
The main objective of this article is to analyze the role of governance quality in influencing the economic growth of 22 selected Sub-Saharan African Countries.
Abstract
Purpose
The main objective of this article is to analyze the role of governance quality in influencing the economic growth of 22 selected Sub-Saharan African Countries.
Design/methodology/approach
The study applied the panel dynamic Generalized Method of Moments (GMM) to analyze the data obtained from the World Bank database over the period from 2002 to 2020.
Findings
The overall finding indicated that the composite governance index has a positive significant effect on the economic growth of the countries; where a unit improvement in the aggregate governance index leads to a 3.05% increase in GDP. The disaggregated result has shown that corruption control and government effectiveness have a negative significant effect on growth performance, whereas, the rule of law and regulatory quality showed a positive significant effect. Political stability and voice and accountability have an insignificant effect on economic growth.
Research limitations/implications
Due to data limitations, this study could not address the whole members of Sub Sahara African Countries and could not see the causal relationship.
Practical implications
The study suggested a strong commitment to the implementation of policy and reform measures on all governance factors. This may add to the need to devise participatory corruption control mechanisms; to closely look at the proper implementation of policies and reforms that constitute the government effectiveness factors, and properly implement the rule of law at all levels of the government with a strong commitment to realizing it so that citizens at all levels can have full confidence in and abide by the rules of society.
Originality/value
Even though there are some studies conducted using conventional methods of panel data analysis such as random effect or fixed effects, this empirical study used more advanced panel dynamic generalized moment of methods to examine the role of improvement in governance quality on economic growth.
Details