Incentives and the growth of Oaxacan subsistence businesses
This research evaluates a theoretical model that explains the growth and internationalization of 76 small pottery subsistence businesses in two communities in Oaxaca, Mexico as an agency problem. The model complements resource-based explanations of growth and internationalization for small firms. Based on in-depth interviews and industry sector data, descriptive statistics, Pearson correlation, and partial correlation are used to confirm the viability of the model. Results suggest that government actions have countervailing positive and negative relationships to sales growth. In both communities, government programs are positively associated with desired outcomes such as net profits and growth because they reduce the merchants' perceived financial risks. Concurrently, government programs are negatively associated to growth because subsistence entrepreneurs' perceptions of the government's political and self-serving motivations hinder their adopting and taking full advantage of government programs.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Brown, J David & Earle, John S & Lup, Dana, 2005.
"What Makes Small Firms Grow? Finance, Human Capital, Technical Assistance, and the Business Environment in Romania,"
Economic Development and Cultural Change,
University of Chicago Press, vol. 54(1), pages 33-70, October.
- J. David Brown & John S. Earle & Dana Lup, "undated". "What Makes Small Firms Grow? Finance, Human Capital, Technical Assistance, and the Business Environment in Romania," Upjohn Working Papers and Journal Articles jse20052, W.E. Upjohn Institute for Employment Research.
- J. David Brown & John S. Earle & Dana Lup, 2003. "What Makes Small Firms Grow? Finance, Human Capital, Technical Assistance, and the Business Environment in Romania," Upjohn Working Papers and Journal Articles 03-94, W.E. Upjohn Institute for Employment Research.
- J. David Brown & John Earle & Dana Lup, 2004. "What Makes Small Firms Grow? Finance, Human Capital, Technical Assistance and the Business Environment in Romania," CERT Discussion Papers 0405, Centre for Economic Reform and Transformation, Heriot Watt University.
- J. David Brown & John S. Earle & Dana Lup, 2004. "What Makes Small Firms Grow? Finance, Human Capital, Technical Assistance, and the Business Environment in Romania," William Davidson Institute Working Papers Series 2004-702, William Davidson Institute at the University of Michigan.
- Brown, J. David & Earle, John S. & Lup, Dana, 2004. "What Makes Small Firms Grow? Finance, Human Capital, Technical Assistance, and the Business Environment in Romania," IZA Discussion Papers 1343, Institute for the Study of Labor (IZA).
- Fama, Eugene F & Jensen, Michael C, 1983. "Agency Problems and Residual Claims," Journal of Law and Economics, University of Chicago Press, vol. 26(2), pages 327-349, June.
- Jean Paul Azam & Robert Bates & Bruno Biais, 2009. "Political Predation And Economic Development," Economics and Politics, Wiley Blackwell, vol. 21(2), pages 255-277, 07.
- Azam, Jean-Paul & Bates, Robert H & Biais, Bruno, 2005. "Political Predation and Economic Development," CEPR Discussion Papers 5062, C.E.P.R. Discussion Papers.
- Azam, Jean-Paul & Bates, Robert H. & Biais, Bruno, 2009. "Political Predation and Economic Development," TSE Working Papers 09-025, Toulouse School of Economics (TSE).
- Bruno Biais & Jean-Paul Azam & Robert Bates, 2009. "Political Predation and Economic Development," Post-Print halshs-00491118, HAL.
- Azam, Jean-Paul & Bates, Robert H. & Biais, Bruno, 2009. "Political Predation and Economic Development," IDEI Working Papers 342, Institut d'Économie Industrielle (IDEI), Toulouse.
- Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
- Reuer, Jeffrey J. & Arino, Africa & Mellewigt, Thomas, 2006. "Entrepreneurial alliances as contractual forms," Journal of Business Venturing, Elsevier, vol. 21(3), pages 306-325, May.
- Charles Jabani Mambula, 2004. "Relating External Support, Business Growth & Creating Strategies for Survival: A Comparative Case Study Analyses of Small Manufacturing Firms (SMFs) and Entrepreneurs," Small Business Economics, Springer, vol. 22(2), pages 83-109, 03.
- Michael A. Hitt & David Ahlstrom & M. Tina Dacin & Edward Levitas & Lilia Svobodina, 2004. "The Institutional Effects on Strategic Alliance Partner Selection in Transition Economies: China vs. Russia," Organization Science, INFORMS, vol. 15(2), pages 173-185, April.
- P. Hart, 2000. "Theories of Firms' Growth and the Generation of Jobs," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 17(3), pages 229-248, November.
- Becchetti, Leonardo & Trovato, Giovanni, 2002. "The Determinants of Growth for Small and Medium Sized Firms: The Role of the Availability of External Finance," Small Business Economics, Springer, vol. 19(4), pages 291-306, December.
- John Victor Mensah & Michael Tribe & John Weiss, 2007. "The small-scale manufacturing sector in Ghana: a source of dynamism or of subsistence income?," Journal of International Development, John Wiley & Sons, Ltd., vol. 19(2), pages 253-273.
- Mead, Donald C. & Liedholm, Carl, 1998. "The dynamics of micro and small enterprises in developing countries," World Development, Elsevier, vol. 26(1), pages 61-74, January.
- Majocchi Antonio & Zucchella Antonella, 2001. "Internationalization and Performance: findings from a set of Italian SMEs," Economics and Quantitative Methods qf0110, Department of Economics, University of Insubria.
- Graham C. Hall & Patrick J. Hutchinson & Nicos Michaelas, 2004. "Determinants of the Capital Structures of European SMEs," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 31(5-6), pages 711-728.
- Lee, Khai S & Lim, Guan H & Tan, Soo J, 1999. "Dealing with Resource Disadvantage: Generic Strategies for SMEs," Small Business Economics, Springer, vol. 12(4), pages 299-311, June.
- Chris Graves & Jill Thomas, 2004. "Internationalisation of the family business: a longitudinal perspective," International Journal of Globalisation and Small Business, Inderscience Enterprises Ltd, vol. 1(1), pages 7-27.
- Beck, Thorsten & Demirguc-Kunt, Asli, 2006. "Small and medium-size enterprises: Access to finance as a growth constraint," Journal of Banking & Finance, Elsevier, vol. 30(11), pages 2931-2943, November.
- Robert E. Carpenter & Bruce C. Petersen, 2002. "Is The Growth Of Small Firms Constrained By Internal Finance?," The Review of Economics and Statistics, MIT Press, vol. 84(2), pages 298-309, May.
- Meghana Ayyagari & Asli Demirgüç-Kunt & Vojislav Maksimovic, 2008. "How Important Are Financing Constraints? The Role of Finance in the Business Environment," World Bank Economic Review, World Bank Group, vol. 22(3), pages 483-516, November.
- Ayyagari, Meghana & Demirguc-Kunt, Asli & Maksimovic, Vojislav, 2006. "How important are financing constraints ? The role of finance in the business environment," Policy Research Working Paper Series 3820, The World Bank.
- Roland Bénabou & Jean Tirole, 2003. "Intrinsic and Extrinsic Motivation," Review of Economic Studies, Oxford University Press, vol. 70(3), pages 489-520.
- William S. Schulze & Michael H. Lubatkin & Richard N. Dino & Ann K. Buchholtz, 2001. "Agency Relationships in Family Firms: Theory and Evidence," Organization Science, INFORMS, vol. 12(2), pages 99-116, April.
- Zevallos Vallejos, Emilio G., 2003. "Micro, pequeñas y medianas empresas en América Latina," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), April.
- L.A.A. Berghe & Steven Carchon, 2003. "Agency Relations within the Family Business System: an exploratory approach," Corporate Governance: An International Review, Wiley Blackwell, vol. 11(3), pages 171-179, 07.
- Fajnzylber, Pablo & Maloney, William F. & Rojas, Gabriel V. Montes, 2006. "Releasing constraints to growth or pushing on a string ? the impact of credit, training, business associations, and taxes on the performance of Mexican micro-firms," Policy Research Working Paper Series 3807, The World Bank.
- Wanda J. Orlikowski, 1992. "The Duality of Technology: Rethinking the Concept of Technology in Organizations," Organization Science, INFORMS, vol. 3(3), pages 398-427, August.
- Peres, Wilson & Stumpo, Giovanni, 2000. "Small and Medium-Sized Manufacturing Enterprises in Latin America and the Caribbean Under the New Economic Model," World Development, Elsevier, vol. 28(9), pages 1643-1655, September. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:eee:jbrese:v:63:y:2010:i:6:p:630-638. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.