International Small Business Journal recent issues

Entrepreneurship and Policy: Challenges and Directions for Future Research

Robson, P. J.A., Wijbenga, F., Parker, S. C. — 2009-09-22

Public Policy Support for the Informal Venture Capital Market in Europe: A Critical Review

Mason, C. M. — 2009-09-22

The ability of small firms to access finance is hindered by persistent market failure, which creates funding gaps for new businesses, particularly in technology sectors, seeking small amounts of finance. This has prompted various forms of public sector intervention to increase the supply of both debt and risk finance. For the past decade (longer in the UK) both the EU and its member states have increasingly focused on the informal venture capital market as a means of increasing the supply of early stage venture capital. This article describes the changing nature of the forms of intervention and provides a critical review of their effectiveness. The lack of data on angel investing means that there is very little evidence on the impact of these forms of intervention. The article advocates that governments should invest in appropriate methodologies which can accurately measure investment trends in the early stage venture capital market, and specifically angel investment activity, so that the need for public sector intervention can be demonstrated and the impact of such interventions can be measured.

Assessing the Effectiveness of Business Support Services in England: Evidence from a Theory-Based Evaluation

Mole, K. F., Hart, M., Roper, S., Saal, D. S. — 2009-09-22

In England, publicly supported advice to small firms is organized primarily through the Business Link (BL) network. Using the programme theory underlying this business support, we develop four propositions and test these empirically using data from a new survey of over 3000 English SMEs. We find strong support for the value to BL operators of a high profile to boost take-up. We find support for the BL’s market segmentation that targets intensive assistance to younger firms and those with limited liability. Allowing for sample selection, we find no significant effects on growth from ‘other’ assistance but find a significant employment boost from intensive assistance. This partially supports the programme theory assertion that BL improves business growth and strongly supports the proposition that there are differential outcomes from intensive and other assistance. This suggests an improvement in the BL network, compared with earlier studies, notably Roper et al. (2001), Roper and Hart (2005).

Is there Ethnic Discrimination in the UK Market for Small Business Credit?

Fraser, S. — 2009-09-22

A large-scale survey of UK small business finances is analysed for evidence of ethnic discrimination in the credit market. A summary analysis of credit outcomes (loan denials , loan interest rates and discouragement) reveals large differences across ethnic groups with Black and Bangladeshi businesses, in particular, experiencing poorer outcomes than White and Indian businesses. Econometric analysis indicates that ethnic differencs in denial rates and interest rates can be explained by variations in non-ethnic risk factors such as missed loan repayments and overdraft excesses. This suggests there is no ethnic discrimination in credit markets. However, ethnicity appears to influence whether business owners felt discouraged from applying for loans even after controlling for differences in loan application costs and risk. This suggests some ethnic groups may be affected by misperceptions of ethnic discrimination. The implications of these findings for UK policy are discussed.

Regional Opportunities and Policy Initiatives for New Venture Creation

Verheul, I., Carree, M., Santarelli, E. — 2009-09-22

This article investigates the determinants of new venture creation across industries and locations for 103 Italian provinces between 1997 and 2003. Allowing for differences in regional opportunities across industries, we investigate the impact of a range of factors, including policy initiatives, on new firm formation in manufacturing, retailing and wholesaling, hotels and restaurants. Our results show that regions with industrial districts are characterized by higher start-up rates in manufacturing and that wage costs deter entry in this industry. Firm entry in commercial sectors appears to be higher in large cities and areas with strong economic progress. For hotels and restaurants we find that tourism positively influences new firm formation. We do not find a significant effect of recently introduced regional laws promoting new firm formation in Italy.

Government Bureaucracy, Transactional Impediments, and Entrepreneurial Intentions

Griffiths, M. D., Kickul, J., Carsrud, A. L. — 2009-09-22

In environments where information asymmetries and changing market conditions are ever-present, discerning between different macro-level and contextual factors that stimulate or inhibit entrepreneurial activity still needs to be validated. Utilizing our own primary data ( N = 1473 across 10 countries) as well as secondary data (World Bank Economic Forum, Global Financial Data, and Transparency International), we investigate the role that several contextual indices (e.g. perceptions of an entrepreneurial culture) and macro-level indices (e.g. government corruption, GDP per capita, and ease of doing business indices) have on entrepreneurial intentions. Results reveal the impact government corruption and the concomitant transactional impediments have on the degree of entrepreneurial interest across countries.

Book Reviews: Prashantham Shameen, The Internationalization of Small Firms: A Strategic Entrepreneurship Perspective, Routledge Studies in Small Business. London and New York: Routledge, 2008. 163 pp. ISBN 978--0415--43177--4, {pound}70 (hbk)

Naldi, L. — 2009-09-22

Book Review: Peter Johnson ,The Economics of Small Firms: An Introduction. London and New York: Routledge, 2007. 176 pp. ISBN 978--0415--39338--6, {pound}25.99 (pbk), ISBN 978--0415--39337--9, {pound}85 (hbk)

Ashcroft, B. — 2009-09-22

Book Review: Ralf W. Seifert, Benoit F. Leleux and Christopher L. Tucci, Nurturing Science-Based Ventures: An International Case Perspective. 787 pp. London: Springer, 2008. ISBN 978--1846--28874--6, {pound}50 (hbk)

Iandoli, L. — 2009-09-22

Book Review: James O. Fiet, Prescriptive Entrepreneurship, Cheltenham and Northampton MA: Edward Elgar, 2008. 296 pp. ISBN 978--1847--20578--0, {pound}69.95 (hbk)

Baltrusaityte-Axelson, J. — 2009-09-22

Book Review: Alan Fayolle (ed.) Handbook of Research in Entrepreneurship Education, Volume 1: A General Perspective, Entrepreneurship. Cheltenham, UK and Northampton, MA: Edward Elgar, 2007. 320pp. ISBN 978-1-84542-106-9, {pound}115 (hbk)

Cooper, B. — 2009-09-22

Toward a Practice Perspective of Entrepreneurship: Entrepreneurial Legitimacy as Habitus

De Clercq, D., Voronov, M. — 2009-07-31

We argue that entrepreneurship research would benefit from a practice perspective, and drawing from Bourdieu's work, we envision entrepreneurship as a profoundly socially embedded process connected to entrepreneurs' positions in structures of power relations. In taking an initial step in the development of a practice perspective of entrepreneurship, we focus on one domain of entrepreneurial action, that is, the gaining of legitimacy by newcomers entering a field, which we conceive as the enactment of entrepreneurial habitus. We question the assumption that a newcomer entering a field automatically is deemed an entrepreneur and instead argue that he or she must be 'legitimized' as an entrepreneur by enacting taken-for-granted yet conflicting expectations about 'fitting in' with field rules and 'standing out' as a rule breaker. We discuss how newcomers' cultural and symbolic capital shape their ability to attain legitimacy and, in turn, how the interplay between newcomers' legitimacy and success influences the extent to which the structure of fields becomes reinforced or transformed.

Internationalization Process of Spanish Small Firms: Strategies, Transactions and Barriers

Arranz, N., De Arroyabe, J. C. Fdez. — 2009-07-31

The purpose of this article is to provide theoretical and empirical evidence to offer a more integrative vision of the internationalization process of SMEs. Traditionally the literature on the internationalization process has been based on two perspectives, the process theory and the international new ventures model. Combining both approaches and based on empirical data collected from 250 Spanish SMEs, the article explores two possible internationalization strategies (proactive and reactive), identifying the international transaction forms (market and cooperation agreements) and the obstacles and barriers that SMEs meet in internationalization. Our results suggest the complementariness of two theoretical perspectives to explain the internationalization process. Further, that strategic positioning of SMEs is the outcome of a 'learning cycle' that allows firms to overcome internal and external obstacles.When SMEs have a high commitment and control of their international activities, our results also show that firms tend to prefer alternative governance mechanisms such as cooperation. The implications of these results, both for managerial and public policy, are discussed as well as suggestions for future research.

Exploring Social Dynamics in Technological Innovating: A Case of Early Phases in a Chemical High-tech Firm

Yli-Kauhaluoma, S. — 2009-07-31

This study explores the crossroads of entrepreneurship and innovating. In particular, it aims to identify the types of social dynamics that take place as entrepreneurs seek to commercialize a high-tech invention in the early phases of a new venture. The empirical case focuses on an analysis of a group of scientist-entrepreneurs and the development of their social relations with representatives in several large, established organizations as they jointly develop and apply a chemical invention in an industrial process. As a result, the study identifies and specifies five different types of social dynamics crucial for entrepreneurs in the development of industrial innovations in the early phases of a firm's existence. The study highlights the importance for new entrepreneurs of gaining access to industrial projects. Also, the results discuss the intensity of collaborative relations and raise issues regarding power in social dynamics.

Rational Actors, Knowledgeable Agents: Extending Pecking Order Considerations of New Venture Financing to Incorporate Founder Experience, Knowledge and Networks

Atherton, A. — 2009-07-31

Standard explanations of the decisions made by new firm founders when acquiring financing to start ventures tend to refer to the efficiency and economic rationales underpinning such choices. In this article, pecking order approach is applied to 26 cases of new venture creation to test such 'rational actor' approaches.When pecking order considerations are extended to incorporate previous experiences of acquiring finance and perceptions of the ease and feasibility of doing so, a fuller explanation of decisions and patterns in new venture financing emerges.A key implication of this analysis is the need to consider the experiential and knowledge base of founders when seeking to understand the dynamics and drivers of new business funding.

SME Strategy, Embeddedness and Performance in East Cleveland, North East England

Kalantaridis, C. — 2009-07-31

The impact of the defining characteristics of rural areas on SME development has attracted considerable interest among researchers on both sides of the Atlantic. Despite conflicting findings - influenced in part by the specificities of national contexts - there is considerable agreement among academics that SME development in the countryside may be influenced by the connectivity of rural areas with their urban counterparts.Within this context, the concept of the city-region is often used to capture the 'ripple effects' from urban centres to nearby rural areas.This article sets out to examine the case of a rural area (East Cleveland) within a city-region (Tees Valley). The article aims to explore the linkages between embeddedness patterns, enterprise strategy and performance. In doing so, it compares the experience of rural SMEs in the study area with that of a control group located in the core of the city-region (Middlesbrough).The evidence presented here shows that in the case of East Cleveland (unlike other rural areas of the UK) local embeddedness is commonly reported by the great majority of SMEs - the result of the specificities of the regional context. While disembeddedness is often linked with robust performance, local embeddedness may also underpin survival and growth among certain SMEs (for example those with no coherent strategy).At the level of the locality however, this may impact adversely upon the processes of economic development.

Book Review: Magnus Henrekson and Robin Douhan (eds) The Political Economy of Entrepreneurship Volumes I & II. Cheltenham, UK and Northampton, MA: Edward Elgar (International Library of Entrepreneurship Series), ISBN 978-1-84542-187-8, 1 120 pp. {pound}295.00 (hbk)

Dannreuther, C. — 2009-07-31

Book Review: Leo-Paul Dana and Robert B. Anderson (eds) International Handbook of Research on Indigenous Entrepreneurship. Cheltenham, UK and Northampton, MA: Edward Elgar. 620 pp. ISBN 978-1-84376-834-0, {pound} 175 (hbk)

Doern, R. — 2009-07-31

Book Review: Geoffrey Jones and Daniel Wadhwani (eds) Entrepreneurship and Global Capitalism. Cheltenham, UK and Northampton, MA: Edward Elgar (International Library of Entrepreneurship Series), 2007. 516 pp. ISBN 1-84542-407-7, {pound}275 (hbk), two volumes

Foreman-Peck, J. — 2009-07-31

Entrepreneurial Action, Identity Work and the Use of Multiple Discursive Resources: The Case of a Rapidly Changing Family Business

Watson, T. J. — 2009-05-20

Research is increasingly questioning the way in which the notion of entrepreneurial self or entrepreneurial identity was initially used to throw light on the connection between the variety of relevant discourses that exist in contemporary societies and the everyday actions of entrepreneurial actors.To take this trend further, two developments are made. First, the concept of identity is refined by identifying two intertwined aspects: a self-identity aspect and a discourse-related social identities aspect. Both the `self' and the `social' aspects of entrepreneurs' identity work are influenced by discourses existing in the society around them. Second, existing empirical research is supplemented by a very close focus on individuals in a specific entrepreneurial context.A case study is presented in which we see two principle figures in a growing family firm being influenced by, making use of and contesting a variety of discursive resources. This fine-grained analysis of entrepreneurially related identity work in practice shows how people in entrepreneurial contexts use discursive resources in a negotiated, shifting, creative and nuanced but often ambiguous manner. These discursive resources include but go beyond notions from `entrepreneurial' discourses.

Investigating Barriers to SME Growth and Development in Transition Environments: A Critique and Suggestions for Developing the Methodology

Doern, R. — 2009-05-20

A perennial question for management scholars, economists and policy makers alike is why businesses do or do not grow. One way of explaining why so many businesses do not grow is through the notion of `barriers'. In formerly planned European economies in transition, barriers have been used to account for why so few businesses grow and why the SME sector has not developed as widely or rapidly as expected; yet, studies in this context tell us very little about why, how or indeed, if, this is the case.This article explores the limitations of the previous approach to investigating barriers, looking at the research assumptions, definitional issues, conceptualizations, and methodological limitations and challenges present in some of these studies. It begins to develop and integrate the previous approach into a more rounded methodology, shifting the focus away from prediction to understanding, and away from quantifying what kinds of barriers affect growth to exploring how barriers may influence growth intentions and behaviours. It encourages researchers to unpack the meaning of barriers and to take into account the context in which they are perceived. It also aims to overcome some of the challenges encountered by researchers working in transition environments.

Understanding the Antecedents to the Adoption of CRM Technology by Small Retailers: Entrepreneurs vs Owner-managers

Peltier, J. W., Schibrowsky, J. A., Yushan Zhao, — 2009-05-20

Customer relationship management (CRM) technology provides a strategic opportunity to better understand customers. Virtually unexplored is research targeting CRM adoption by small businesses. This exploratory study investigates the factors that influence the adoption of CRM technology by small entrepreneurial retail firms. A key premise is that `entrepreneurial' retail store owners can be differentiated from `owner-managers' through their adoption of CRM. A preliminary model is developed and tested through a sample of 386 small hardware retailers responding to a mail questionnaire. The findings show that CRM adopters had higher product class knowledge, a greater risk orientation, saw a stronger relative advantage, perceived higher environmental complexity and hostility, and had a more open business change orientation.

Internationalization and Alliance Formation: Evidence from Turkish SMEs

Ali Ulubasoglu, M., Akdis, M., Kok, S. B. — 2009-05-20

This study explores the issue of internationalization through forming alliances with foreign capital in the small business sector in Turkey. Using a sample of 257 SMEs from this emerging market economy, collected via a field study, it finds that Turkish SMEs would like to form alliances with foreign capital for expanding their production capacity and accessing to world markets. Multivariate multinomial logit models are employed to analyse the survey data econometrically. Size-specific, sector-specific and management-specific factors are identified in the alliance motivation. The `market' and `finance' aspects of alliances prevail in the multivariate analysis with significant implications. There is also evidence that some conditional relationships offered by multivariate analysis differ from unconditional associations found in the survey, which implies that alliance motivation is partly a product of multidimensional decision-making process on behalf of SMEs.

The National Pensions Savings Scheme: Its Implications for Jobs in Small Firms

Casey, B. H. — 2009-05-20

The National Pensions Savings Scheme (NPSS) provides a supplementary personal pension for all employees who choose not to opt out. If they do not opt out, their employer is obligated to pay a contribution. The article considers the employment effect of the increase in labour costs implied by the NPSS. It shows how this employment effect is likely to be greatest for small firms since few of them have any supplementary pensions of the quality that is required.The negative employment effect will be reduced to the extent that there is non-compliance or opt-out, but if this occurs, the purpose of extending pension coverage to employees on lower earnings will be defeated.

Book Review: Francis J. Greene, Kevin F Mole and David J. Storey, Three Decades of Enterprise Culture: Entrepreneurship, Economic Regeneration and Public Policy. Basingstoke: Palgrave Macmillan, 2008. 288 pp. ISBN 13 978-1-4039-4102-2, {pound}55 (hbk)

Arshed, N. — 2009-05-20

Book Review: Marilyn L. Kourilsky and William B. Walstad, The Entrepreneur in Youth: An Untapped Resource for Economic Growth, Social Entrepreneurship, and Education. Cheltenham: Edward Elgar, 2007. 166 pp. ISBN 978-1-84542-250-9, {pound}55 (hbk)

Lewis, K. — 2009-05-20

Book Review: Per Davidsson, The Entrepreneurship Research Challenge. Cheltenham: Edward Elgar, 2008. 246 pp. ISBN 978-1-84720-2 19-2, {pound}59.95 (hbk)

Matthews, R. — 2009-05-20

Erratum

2009-05-20

Exploring the Impact of Gender upon Women's Business Ownership: Introduction

Marlow, S., Henry, C., Carter, S. — 2009-03-17

Perceived Financial Barriers and the Start-up Decision: An Econometric Analysis of Gender Differences Using GEM Data

Roper, S., Scott, J. M. — 2009-03-17

Although accessing finance is key to the foundation of any business, particular concerns have been expressed about the ability of UK women-owned firms to obtain external finance. In this article we use an econometric approach to explore the effect of perceptions of financial barriers to start-up on the start-up decision itself. Our analysis is based on the Global Entrepreneurship Monitor (GEM) UK 2004 database. Standardizing for a range of individual characteristics, we find that women are around 7.4% more likely to perceive financial barriers to business start-up than men.As perceptions of financial barriers are linked negatively to the start-up decision, stronger perceptions of financial barriers among women are having a disproportionate effect on women's start-up decisions. However, being female also has an additional negative effect on the start-up decision, not linked to financial barriers. Policy responses, therefore, need to take into account the demand-side with the aim of countering the more negative perceptions of start-up finance among potential women entrepreneurs. Mentoring and confidencebuilding programmes are obvious possibilities.We also find support for the value of university and college-based work experience programmes.

Women Entrepreneurs: Jumping the Corporate Ship and Gaining New Wings

Patterson, N., Mavin, S. — 2009-03-17

This article offers a post hoc analysis of the reasons why women leave corporate careers to enter self-employment. Four case studies of women entrepreneurs from North East England are presented.The subjective narratives of these female entrepreneurs highlight the complex nature of their career transition motivations and the issues they confronted while reaching the decision to begin new ventures. It transpired that original motivations for entering self-employment were not fully realized, however, this was compensated for by positive experiences in terms of personal and professional development and a new-found independence and control. Finally, it is suggested that the `Career Transition Motivation Framework' is a useful way of understanding the complexity of women's career transition experiences.

Female Entrepreneurial Networks and Networking Activity in Technology-based Ventures: An Exploratory Study

Hampton, A., Cooper, S., Mcgowan, P. — 2009-03-17

The ability to develop and manage effective networks is a crucial entrepreneurial competence for venture establishment and growth. Relatively little attention has been paid to the network development and networking activities of female entrepreneurs in general, and even less to such activities in technology-based ventures.The limited existing evidence suggests that female entrepreneurs may develop different approaches to network development and participation to that of their male counterparts.This article presents findings from exploratory, qualitative research conducted in Northern Ireland, which focused on the nature and dynamics of female entrepreneurial networks in traditionally male-dominated science, engineering and technology-based ventures. Drawing upon information-rich evidence from 18 in-depth interviews with the lead female entrepreneurs of technology-based ventures, insights are presented into the nature and dynamics of female entrepreneurial networks and networking at different stages of the business life cycle.

Managing Maternity Fairly and Productively: Support for Small Employers

Rouse, J., Sappleton, N. — 2009-03-17

Multiple policy objectives depend on creating a fair and operational social contract between the small employer, family and state in managing the disruption to paid work (economic production) caused by employee pregnancy and maternity (social reproduction).An Equal Opportunities Commission (EOC) investigation into pregnancy discrimination suggests this social contract is undermined in the UK by ignorance and dispute, causing high rates of non-compliance in small businesses. The EOC recommended that small employers need more support to manage maternity fairly and productively. In this research note we present analysis of the type of support development required.We draw on an audit of existing support and analysis of small employer behaviour and needs to identify failure in existing provision and to present detailed policy recommendations. Further research directions are also identified.

Women and Home-based Entrepreneurship: Evidence from the United Kingdom

Thompson, P., Jones-Evans, D., Kwong, C. — 2009-03-17

For women, owning and managing a home-based business can provide the flexibility to meet family responsibilities and undertake employment, although potentially at the cost of business performance and growth. Using data from the Global Entrepreneurship Monitor survey for the UK, this research note explores the characteristics of those self-employed women who operate their businesses from home. Results indicate that a greater proportion of women with poor levels of entrepreneurial resources are more likely to operate home-based businesses, suggesting this decision is shaped by circumstance.The research also finds that such home-based businesses are more likely to operate part time, thus contributing further to their marginality.

Book Review: Robert Huggins and Hiro Izushi, Competing forKnowledge:Creating,Connecting, and Growing (Routledge Studies in Global Competition Series) Routledge: London, 2007. 220 pp. ISBN 978--041537--512--2, {pound}80 (hbk)

Prashantham, S. — 2009-03-17

Book Review: Pierre-Andre Julien, A Theory of Local Entrepreneurship in the Knowledge Economy. Cheltenham: Edward Elgar, 2007. 336 pp. ISBN 978--1--84720--388--5, {pound}75 (hbk), ISBN 978--1--84720--875--0 (electronic)

Madsen, E. L. — 2009-03-17

Book Review: Deniz Ucbasaran, Gry Agnete Alsos, Paul Westhead and Mike Wright, `Habitual Entrepreneurs', Foundations and Trends(R) in Entrepreneurship 4(4): 309--450. Boston, MA: NOW Publishers, 2008. 156pp. ISBN 978--1--60198--112--7, {pound}75 (pbk)

Rosa, P. — 2009-03-17