Small- and Medium-Sized Businesses' Growth Expectations and Financial Performance in Latvia: Does Ethnicity Matter?

Applying regulatory focus theory, this paper investigates the impact of both 'initial confidence' and 'exactness of growth expectations' on the financial performance of small and medium-sized firms in Latvia. Drawing on a data set based on repeated survey design, we explore the c...

Full description

Saved in:
Bibliographic Details
Published in:Journal of Baltic studies 2011-09, Vol.42 (3), p.359-378
Main Authors: Aidis, Ruta, Marek Mickiewicz, Tomasz, Sauka, Arnis
Format: Article
Language:English
Subjects:
Business expansion
Business structures
Economic expectations
Enterprises
Entrepreneurs
Entrepreneurship
Ethnicity
Financial performance
Latvia
Minorities
Optimism
Profits
Regulation
regulatory focus theory
Regulatory theory
Russians
Sales growth
Small and medium sized enterprises
Universities
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:Applying regulatory focus theory, this paper investigates the impact of both 'initial confidence' and 'exactness of growth expectations' on the financial performance of small and medium-sized firms in Latvia. Drawing on a data set based on repeated survey design, we explore the complexity of this relationship empirically. Our overall findings suggest that when controlling for other relevant factors, such as actual growth, entrepreneurs having higher growth expectations perform significantly better in terms of profitability. In addition, education has a strong modifying effect. The impact of high growth expectations on subsequent profit performance is stronger for entrepreneurs with a lower level of education. Moreover, these effects are amplified by ethnicity. They are much stronger for ethnic Russian entrepreneurs compared with ethnic Latvian entrepreneurs.
ISSN:0162-9778
1751-7877
DOI:10.1080/01629778.2011.597130