The informal economy consists of economic activities that occur outside of formal institutional boundaries but which remain within informal institutional boundaries for large segments of society. We ...draw from diverse disciplines to frame research concerning entrepreneurship in the informal economy around three separate theories: institutional theory, motivation-related theories from a sociological perspective, and resource allocation theory. Each of these theories provides a complementary lens through which to examine the incentives, constraints, motivations, strategies, and abilities of entrepreneurs to operate and grow their ventures in the informal economy. Employing these theoretical perspectives facilitates efforts to highlight the breadth of informal economy research in different domains and lays foundations for future entrepreneurship research.
► We frame informal economy research within three separate theories. ► Institutional theory, motivation-related theories, and resource allocation theory frame informal economy research. ► Each framing is used to develop propositions that may serve as a foundation for future research.
State Ownership and Political Connections Tihanyi, Laszlo; Aguilera, Ruth V.; Heugens, Pursey ...
Journal of management,
07/2019, Volume:
45, Issue:
6
Journal Article
Peer reviewed
Open access
The influence of the state on firms in the global economy is alive and well. States have become dominant owners of companies in many countries around the world. Firms have also increasingly ...established political connections to access resources and improve their competitive positions. Nonetheless, our understanding of how state ownership and political connections affect firm performance remains limited and marked by conflicting findings. Using meta-analytical techniques on a sample of 210 studies spanning 139 countries, we examine two key research questions: (a) How do state ownership and political connections affect firm strategies and financial performance? and (b) How does firm-level strategic decision making mediate the relationships between state ownership, political connections, and firm financial performance? Our findings show that state ownership has a small negative effect on firm financial performance and that political connections have no direct consequences for performance. However, we find evidence that both state ownership and political connections have a profound effect on the strategies firms pursue, such as financial leverage, R&D intensity, and internationalization, and that these strategies play a mediating role in the state ownership–firm performance relationship. We conclude with some suggestions for fruitful future research in further connecting these two important and timely research fields.
Ownership as a Form of Corporate Governance Connelly, Brian L.; Hoskisson, Robert E.; Tihanyi, Laszlo ...
Journal of management studies,
December 2010, Volume:
47, Issue:
8
Journal Article
Peer reviewed
Firm ownership is an increasingly influential form of corporate governance. Although firms might be owned by different types of owners, most studies examine owner influence on a particular firm ...outcome in isolation. This study synthesizes research from multiple disciplines on different types of owners and offers a unifying framework of governance through ownership. Using this framework, we describe the motivations of various types of owners, the tactics owners use to affect firms in which they are invested, and the dominant firm outcomes these owners seek to influence. We note how heightened managerial awareness of heterogeneous owner interests increases owner influence on firm‐level outcomes. We also provide a roadmap for future study and offer research questions about where scholars might turn their attention to better understand the role of owners in directing firm actions. Our study draws attention to emerging forms of ownership, such as hedge funds and sovereign wealth funds, and highlights the changing (and often competing) interests of shareholders and how this impacts theories of governance.
We examine variation in the rate of divestment by multinational firms from Burma. We argue that in addition to a set of firm-level characteristics known to impact divestment decisions, firms are also ...influenced by characteristics of their home country and the divestment patterns of others. Using data on firms operating in Burma during 1996–2002, we model these multiple influences on firms to divest. Our results show that beyond firm-level concerns, firms divest in response to the political characteristics of their home country, including protest, the level of political freedom, and transparency of institutions. We also find that the centrality of their home country in the network of intergovernmental organizations impacts divestment patterns in interesting ways.
We identify key theoretical developments in international managerial decision-making research, synthesize how they have been employed, and discuss contributions that may emerge as researchers devote ...increased attention to bounded rationality. Since behavioral factors were first introduced into the international business literature, there has been an increasing trend toward acknowledging the decision makers’ role in foreign direct investment and related strategies. However, the reasoning, which explains the characteristics and outcomes of managerial decision-making in the multinational enterprise (MNE), remains implicit and ambiguous. There are a number of potential concerns associated with the assumptions of dominant rational decision-making models and with models that omit decision makers. We highlight these concerns and discuss the benefits of, and opportunities for, models that incorporate bounded rationality, decision-making biases, and judgments by managers.
Tournament Theory Connelly, Brian L.; Tihanyi, Laszlo; Crook, T. Russell ...
Journal of management,
01/2014, Volume:
40, Issue:
1
Journal Article
Peer reviewed
Tournament theory is useful for describing behavior when reward structures are based on relative rank rather than absolute levels of output. Accordingly, management scholars have used tournament ...theory to describe a wide range of inter- and intraorganizational competitions, such as promotion contests, innovation contests, and competition among franchisees. While the use of tournament theory has gained considerable momentum in recent years, the ideas that underlie the theory have become blurred and potentially useful insights remain trapped within disciplines. We, therefore, provide a synthesis of the theory’s foundational concepts, review its use in the management literature, identify advancements from related disciplines that may be imported to management research, and delineate the steps likely to be critical to moving the theory forward. Our hope is this review will make tournament theory more accessible and salient to management researchers with a view toward developing more nuanced versions of the theory and applying it in a wider range of contexts.
One of the most influential articles in management was written by the late sociologist Murray S Davis. The author of several books on humor, human sexuality, and obscenity. Davis wrote an article ...titled ;That's interesting: Towards a phenomenology of sociology and a sociology of phenomenology' that was published in the journal Philosophy of the Social Sciences in 1971. The article is considered a 'cult classic" by many sociologists (Ryan, 2008), and it has also entered the mainstream of management as a required reading in most doctoral programs over the past 50 years. Davis's (1971) position about theoretical contribution the focus of Academy of Management Journal {AMJ), is undoubtedly provocative. He argued, ;'A theorist is considered great not because his theories are true, but because they are interesting. ... In fact the truth of a theory has very little to do with its impact, for a theory can continue to be found interesting even though its truth is disputed even refuted!" (Davis, 1971: 309).
The entrepreneurial process drives economic activities in the formal economy; however, little is known theoretically about how the entrepreneurial process works in the informal economy. To address ...this theoretical gap, we employ a multilevel perspective integrating entrepreneurship theory (microlevel) with institutional (macrolevel) and collective identity (mesolevel) theories to examine the role institutions and collective identity play in the recognition and exploitation of opportunities in the informal economy. Additionally, we explore factors that influence the transition to the formal economy.
PDF
