IDEAS home Printed from https://ideas.repec.org/a/inm/ororsc/v34y2023i3p987-1003.html
   My bibliography  Save this article

Informal Legacy and Exporting Among Sub-Saharan African Firms

Author

Listed:
  • Marcus M. Larsen

    (Department of Strategy and Innovation, Copenhagen Business School, 2000 Frederiksberg, Denmark; Department of Strategy and Entrepreneurship, BI Norwegian Business School, 0484 Oslo, Norway)

  • Caroline T. Witte

    (Department of Strategy and Entrepreneurship, Rotterdam School of Management, Erasmus University Rotterdam, 3000 DR Rotterdam, The Netherlands)

Abstract

Around the world and especially in areas of widespread poverty, firms start their operations without registering with relevant authorities (i.e., in the informal economy). We explore whether firms that initiated their operations in the informal economy but later register have a higher propensity to export than firms that register at the time of their foundation. We reason that the experience of having operated informally provides formally registered firms with the advantage of low-cost and flexible exploration but also a domestic legitimacy liability. We suggest that these factors likely contribute to making foreign export markets more attractive after registration. Based on a comprehensive sample of sub-Saharan African firms, we find that, conditional on registration, firms with an informal legacy have a higher propensity to initiate exporting than firms that started their operations formally. We contribute with theoretical and policy-oriented insights on the dynamics of informality and exporting.

Suggested Citation

  • Marcus M. Larsen & Caroline T. Witte, 2023. "Informal Legacy and Exporting Among Sub-Saharan African Firms," Organization Science, INFORMS, vol. 34(3), pages 987-1003, May.
    • Handle: RePEc:inm:ororsc:v:34:y:2023:i:3:p:987-1003
    DOI: 10.1287/orsc.2022.1623
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1287/orsc.2022.1623
    Download Restriction: no
    File URL: https://libkey.io/10.1287/orsc.2022.1623?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inm:ororsc:v:34:y:2023:i:3:p:987-1003. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Asher (email available below). General contact details of provider: https://edirc.repec.org/data/inforea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.