There has been considerable debate about the impact that Foreign Direct Investment has upon home grown enterprise (Pathak et al., 2015). The purpose of this paper is to examine…
Abstract
Purpose
There has been considerable debate about the impact that Foreign Direct Investment has upon home grown enterprise (Pathak et al., 2015). The purpose of this paper is to examine how foreign business ownership at the local level affects the decision of individual UK entrepreneurs to export their production.
Design/methodology/approach
The Global Entrepreneurship Monitor data and ONS foreign firm employment data are used within this study. In order to control for entrepreneurial and firm characteristics, a multivariate approach is adopted with logit, ordered logit and multinominal logit regressions utilised.
Findings
It is found that the influence of foreign firms, as captured by their share of local employment, has a negative influence on domestic entrepreneurs’ probability of exporting, but has no significant effect on the intensity of these export activities.
Research limitations/implications
The results suggest that local economies may not only become highly reliant on foreign employers, but also on local demand for domestic production. This means actions might be required to reduce this over-reliance to ensure the development of resilient local economies.
Originality/value
Unlike many other studies the relationship between the SME exports and foreign influence is considered at a local level. With the current UK government seeking to increase UK firms’ exports substantially, understanding this relationship is of key importance to policy makers.
Details
Keywords
Although foreign direct investment and entrepreneurship are potential routes to recovery (Girma and Wakelin, 2001; Lyon et al., 2002), existing literature is divided on the…
Abstract
Purpose
Although foreign direct investment and entrepreneurship are potential routes to recovery (Girma and Wakelin, 2001; Lyon et al., 2002), existing literature is divided on the relationship between the two. The purpose of this paper is to examine the influence of foreign investment on the local SME sector after the 2008 financial crisis.
Design/methodology/approach
Local authority district data from Great Britain is used to examine the influence of foreign firm employment on the size of the local SME sector as a proportion of all firms, and foreign firm influence on firm births in the locality. In order to control for local geographical, infrastructural and economic conditions regression analysis is used to examine the relationship between foreign business employment and indigenous business activities.
Findings
The potential for technological spillovers and spinout activities appears to dominate with firm birth rates higher where there is greater foreign firm employment. However, there is also evidence of crowding out in relation to the existing SME sector, which is found to be reduced in size where foreign influence through employment is greater.
Research limitations/implications
The results here indicating a complementarity relationship between foreign influence on employment and firm births is important for policy makers looking to revive struggling local economies. However, the relevant support needs to be in place to maximise the benefit from the supply of new entrepreneurs generated.
Originality/value
Unlike many other studies the relationship between the SME sector, firm births and foreign influence is considered at a local level and where economic conditions are more uncertain and economic recovery is less taken for granted. A better understanding of the relationship allows more appropriate policy to be developed in order to aid local economies to recover.
Details
Keywords
Ying Song, Wenyu Wu and Dario Miocevic
The literature shows that e-commerce adoption brings many benefits to farmers and agricultural businesses. However, the literature offers very limited guidance on the most…
Abstract
Purpose
The literature shows that e-commerce adoption brings many benefits to farmers and agricultural businesses. However, the literature offers very limited guidance on the most effective ways for them to utilize e-commerce platforms. In this study, we unfold how a farmer's choice between endogenous (their own) vs. exogenous (third-party) e-commerce platforms should be aligned with the external (support from agricultural cooperative) and internal (usage of quality labels) resources they can leverage and the performance goals they want to achieve (market expansion vs. price premium).
Design/methodology/approach
Our study draws on transaction cost economics (TCE) and resource-based theory (RBT) to test the conceptual model with data from a cross-sectional survey of 324 farmers from two provinces in PR China.
Findings
Our findings show that external and internal resources shed additional light on the effectiveness of endogenous vis-à-vis exogenous e-commerce platforms. For farmers who rely on exogenous e-commerce, support from an agricultural cooperative appears to be critical in increasing their market expansion. On the other hand, farmers seeking to earn a price premium should focus on developing their own e-commerce platforms, while at the same time emphasizing the quality labels of their agricultural products.
Practical implications
Farmers should pay close attention to the value-added benefits provisioned through farmers' cooperatives, as well as the benefits of acquiring quality labels for their agricultural products. However, the decision to utilize these resources should be aligned with the chosen e-commerce platform (endogenous vs. exogenous) as well as with the performance goal the farmer wants to achieve.
Originality/value
Our work goes beyond the traditional focus on transaction costs and efficiency of e-commerce channels and provides specific insights into when an endogenous or exogenous e-commerce model might provide benefits for farmers. On top of this, we argue and show that this decision should reside with the farmer's ability to leverage external and internal resources, envisioned through support from an agricultural cooperative and the quality labels of agricultural products.