Skip to main content
SpringerLink
Log in
Book cover

New perspectives on economic development pp 157–172Cite as

Entrepreneurial strategies for small firms in latecomer economies

  • Chapter

  • 329 Accesses

Abstract

The significance and performance of small enterprises in economic development is well documented (see for example, Berry and Mazumdar 1991; OECD 2009). Not only do large firms in general begin as small ones, but also regions specializing in high-technology products, such as Silicon Valley, frequently have high concentration of technologically-advanced small concerns.

This is a preview of subscription content, log in via an institution.

Chapter
USD   29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD   99.00
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever

Tax calculation will be finalised at checkout

Purchases are for personal use only

Learn about institutional subscriptions

Notes

  1. 1.

    According to Christensen (1996: 113), human resources include experience, judgement, intelligence, and the insights of the leaders and workers in the firm. Since these resources are dependent on specific people and their skills, they are the most flexible resources.

  2. 2.

    Yu (2005: 37–53) argues that the firm is a collection of capital resources. The complexity of the capital structure of a firm increases as vertical integration increases.

  3. 3.

    Cohen and Levinthal (1990: 128) defines absorptive capacity as ‘the ability of a firm to recognize the value of new, external information, assimilate it, and apply it to commercial ends’.

  4. 4.

    According to Nelson and Winter (1982: 123), there are two cases of copying, namely cooperative and non-cooperative. Cooperative copying can be either a joint venture, subcontracting or licensing. Non-cooperative copying means that the imitator cannot directly observe the original production process. When a problem arises in copying, it is not possible to resolve it by closer scrutiny of the original.

  5. 5.

    The term OEM was originated in the 1950s by computer manufacturers who used subcontractors (called the OEM) to assemble equipment for them. It was later adopted by US chip companies in the 1960s which used OEMs to assemble and test semiconductors (see Hobday 1995: 1190).

  6. 6.

    For a detail discussion of the role of OEM in latecomer technological learning, see Hobday (1995).

  7. 7.

    If firms sell products without promoting their brands, this means that they attempt to gain customers through very low prices. However, the profit margin is slim. On the other hand, if they promote their own brands, then consumers( confidence in the product is the major concern. To gain customers( confidence, imitators in developing countries follow closely the design style and the packaging of other successful branded products from overseas and try to avoid the locally-made image. For instance, they may use a German name for their brand-name. They strive to promote a high quality and a high class image for their products similar to those manufactured from the technologically advanced nations.

  8. 8.

    For an account of such international coordination by a Hong Kong company, see Berger and Lester (1997: 39–41).

References

  • Arrow, K.J. (1974) The Limits of Organization. New York, USA: Norton.

    Google Scholar 

  • Baumol, W.J. (1988), Is entrepreneurship always productive? In: H. Leibenstein and D. Ray (eds.) Entrepreneurship and Economic Development. New York, USA: United Nations, pp. 85–94.

    Google Scholar 

  • Berger, S. and R.K. Lester (eds.) (1997) Made by Hong Kong. Hong Kong, China PR: Oxford University Press.

    Google Scholar 

  • Berry, A. and D. Mazumdar (1991) Small-Scale Industry in the Asian-Pacific Region. Asian Pacific Economic Literature, vol. 5(2), 35–67.

    Article  Google Scholar 

  • Bolton, M.K. (1993) Imitation versus innovation: lessons to be learned from the Japanese. Organizational Dynamics, vol. 22, 30–45.

    Article  Google Scholar 

  • Chen, C.H. (2000) Organizational Capability and Bandi: Economic and Social Transformation in Taiwan. Society for the Advancement of Socio-Economics, 12th Annual Meeting on Socio-Economics, UK, London, 7–10 July 2000.

    Google Scholar 

  • Chiu, S. and T.L. Lui (1993) Industrial restructuring in Hong Kong: Implications for production and employment strategies. Conference Paper, Centre of Asian Studies, University of Hong Kong, 11 October 1993.

    Google Scholar 

  • Christensen, J. (1996) Analysing the Technology Base of the Firm: A Multidimensional Resource and Competence Perspective. In: N.J. Foss and C. Knudsen (ed.) Toward A Competence Theory of The Firm. London, UK: Routledge, pp. 111–132.

    Google Scholar 

  • Cohen, W.M. and Levinthal, D.A. (1990) Absorptive capacity: A new perspective on learning and innovation. Administrative Science Quarterly, vol. 35, 128–152.

    Article  Google Scholar 

  • Conner, R.K. (1991) A Historical Comparison of Resource-Based Theory and Five Schools of Thought within Industrial Organization Economics. Journal of Management, vol. 17, 121–154.

    Article  Google Scholar 

  • Dahlman, C.J. and R. Nelson (1995) Social absorption capability, national innovation systems and economic development. In: B.H. Koo and D.H. Perkins (eds.) Social Capability and Long-term economic growth. New York, USA: St. Martin Press, pp. 82–122.

    Google Scholar 

  • Engardio, P. and N. Gross (1992) Asia(s high-tech quest. International Business Week, vol. 30 (November), 64, 67.

    Google Scholar 

  • Foss, N.J., C. Knudsen and C.A. Montgomery (1995) An exploration of common ground: Integrating evolutionary and strategic theories of the firm. In: C.A. Montgomery (ed.) Resources in an Evolutionary Perspective: Towards a Synthesis of Evolutionary and Resource-Based Approaches to Strategy. Boston, USA: Kluwer, pp. 1–17.

    Google Scholar 

  • Freeman, C. (1982) The Economics of Industrial Innovation. 2nd edition. London, UK: Frances Pinter.

    Google Scholar 

  • Gilad, B., S. Kaish, and J. Ronen (1988) The entrepreneurial way with information. In: S. Maital (ed.) Applied Behavioural Economics, Vol. II. Somerset, UK: Wheatsheaf, pp. 481–503.

    Google Scholar 

  • Hagedoorn, J. (1989) The Dynamic Analysis of Innovation and Diffusion: A study in Process Control. London, UK: Pinter Publisher.

    Google Scholar 

  • Hedberg, B. (1981) How organisations learn and unlearn. In: P.C. Nystrom and W.H. Starbuck (eds.) Handbook of Organizational Design Volume 1: Adapting Organisations to their Environment. Oxford, UK: Oxford University Press, pp. 3–27.

    Google Scholar 

  • Hobday, M. (1995) East Asian latecomer firms: learning the technology of electronics. World Development, vol. 23 (7), 1171–1193.

    Article  Google Scholar 

  • Jacobson, R. (1992) The Austrian School of Strategy. Academy of Management Review, vol. 17 (4), 782–807.

    Google Scholar 

  • Kay, J. (1993) Foundations of Corporate Success. Oxford, UK: Oxford University Press.

    Google Scholar 

  • Kirzner, I.M. (1973) Competition and Entrepreneurship. Chicago, USA: University of Chicago Press.

    Google Scholar 

  • Knight, F.H. (1921) Risk, Uncertainty, and Profit. New York, USA: Houghton Mifflin.

    Google Scholar 

  • Kogut, B. and U. Zander (1996) What Firms Do? Coordination, Identity and Learning. Organisation Science, vol. 7 (5), 502–518.

    Article  Google Scholar 

  • Langlois, R.N. (1995) Capabilities and Coherence in Firms and Markets. In: C.A. Montgomery (ed.) Resources in an Evolutionary Perspective: Towards a Synthesis of Evolutionary and Resource-Based Approaches to Strategy. Boston, USA: Kluwer, pp. 71–100.

    Google Scholar 

  • Langlois, R.N., T.F-L. Yu and P.L. Robertson (eds.) (2002) Alternative Theories of the Firm, 3 volumes (The International Library of Critical Writings in Economics Series). Cheltenham, UK: Edward Elgar.

    Google Scholar 

  • Liao, H.C. and C. Kao (1995) The Development of Small and Medium-Sized Enterprises in Chinese Taipei. In: E.Y. Park (ed.) Small and Medium-Sized Enterprises and Economic Development. Seoul, South Korea: Korea Development Institute.

    Google Scholar 

  • Monteverde, K. (1997) Mapping the Competence Boundaries of the Firm: Applying Resource-based Strategic Analysis. In: H. Tomas, D. O(Neal and M. Ghertman (eds.) Strategy, Structure and Style. West Sussex, UK: John Wiley.

    Google Scholar 

  • Nelson, R.R. and S.G. Winter (1982) An Evolutionary Theory of Economic Change. Cambridge, USA: Harvard University Press.

    Google Scholar 

  • Numazaki, I. (1997) The Laoban-Led Development of Business Enterprises in Taiwan: An Analysis of the Chinese Entrepreneurship. Developing Economies, vol. 15 (4), 440–457.

    Google Scholar 

  • OECD (2009) OECD Small and Medium Enterprise Outlook, 2009 Edition. Paris, France: OECD.

    Google Scholar 

  • Phares, E.J. (1988) Introduction to Personality, 2nd edition. London, UK: Scott, Foresman and Co.

    Google Scholar 

  • Rumelt, R. (1995) Inertia and Transformation. In: C.A. Montgomery (ed.) Resources in an Evolutionary Perspective: Towards a Synthesis of Evolutionary and Resource-Based Approaches to Strategy. Boston, USA: Kluwer Academic Publishers, pp. 101–132.

    Google Scholar 

  • Sit, V. and S-L. Wong (1989) Small and Medium Industries in an Export-Oriented Economy: The Case of Hong Kong. Hong Kong, China PR: The Centre of Asian Studies, University of Hong Kong.

    Google Scholar 

  • Teece, D.J., G. Pisano and A. Shuen (1997) Dynamic Capabilities and Strategic Management. Strategic Management Journal, vol. 18 (7), 509–533.

    Article  Google Scholar 

  • Ting, W. (1985) Business and Technological Dynamics in Newly Industrialising Asia. London, UK: Quorum Books.

    Google Scholar 

  • Vesper, K.R. (1990) New Venture Strategies. revised edition. Englewood Cliffs, USA: Prentice Hall.

    Google Scholar 

  • Wilson, J. (1991) It(s Do or Die for a Struggling Chip Industry. Electronics Business Asia, July, 71.

    Google Scholar 

  • Winter, S. (1986) The Research Program of the Behavioural Theory of the Firm: Orthodox Critique and Evolutionary Perspective. In: B. Gilad and S. Kaish (eds.) Handbook of Behavioural Economics (Vol. A). Greenwich, USA: JAI press.

    Google Scholar 

  • Witt, U. (1998) Imagination and Leadership: The Neglected Dimension of the Evolutionary Theory of the Firm. Journal of Economic Behaviour and Organisation, vol. 35 (2), 161–177.

    Article  Google Scholar 

  • Wong, P-K. (1999) National Innovation Systems for Rapid Technological Catch-up: An Analytical framework and a Comparative Analysis of Korea, Taiwan and Singapore. Paper delivered at the DRUID Summer Conference on National Innovation Systems, Industrial Dynamics and Innovation Policy, Rebild, Denmark, 9–12 June 1999.

    Google Scholar 

  • Yeung, H.W-C. (1998) Transnational Corporations and Business Networks: Hong Kong Firms in the ASEAN Region. London, UK: Routledge.

    Google Scholar 

  • Yu, T.F-L. (2003) Guerrilla Entrepreneurship and Hong Kong(s Economic Dynamics. In: Yu, T.F-L. (ed.) East Asian Business Systems in Evolutionary Perspective: Entrepreneurship and Coordination. New York, USA: Nova Science.

    Google Scholar 

  • Yu, T.F-L. (2005) Firms, Strategies, and Economic Change: Explorations in Austrian Economics. Cheltenham, UK: Edward Elgar.

    Google Scholar 

  • Yu, T.F-L., H-D. Yan and S-Y. Chen (2006) Adaptive Entrepreneurship and Taiwan(s Economic Dynamics. Laissez-Faire, vol. 24–25, 57–74.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Department of Economics and Finance, Hong Kong Shue Yan University, Hong Kong, China

    Fu-Lai Tony Yu (Professor)

Authors
  1. Fu-Lai Tony Yu
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Fu-Lai Tony Yu .

Rights and permissions

Reprints and permissions

Copyright information

© 2011 Wageningen Academic Publishers

About this chapter

Cite this chapter

Yu, FL.T. (2011). Entrepreneurial strategies for small firms in latecomer economies. In: New perspectives on economic development. Wageningen Academic Publishers, Wageningen. https://doi.org/10.3920/978-90-8686-716-5_9

Download citation

Publish with us

Policies and ethics

Societies and partnerships

Search

Navigation