THEORETICAL CONTRIBUTIONS TO GOVERNANCEOF SMALLER FIRMS

Dutta and Thornhill (2013) have theoretically questioned why some smaller firms survive while others do not. Scholars of small business and entrepreneurship have addressed this question from various theoretical perspectives. Castrogiovanni and Justis (2002) claim small business success may be better...

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Bibliographic Details
Published in:Journal of business & entrepreneurship 2013-10, Vol.25 (1), p.21
Main Authors: Nelson, Terry, Singh, Kulraj, Elenkov, Detelin, Ma, Rong, Krug, Jeffrey, Davis, Barbara, Wright, Peter
Format: Article
Language:English
Subjects:
Agency theory
Boards of directors
Corporate governance
Executives
Human capital
Incentives
Institutional investments
Pay for performance
Reputations
Small & medium sized enterprises-SME
Small business
Studies
Wages & salaries
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Summary:Dutta and Thornhill (2013) have theoretically questioned why some smaller firms survive while others do not. Scholars of small business and entrepreneurship have addressed this question from various theoretical perspectives. Castrogiovanni and Justis (2002) claim small business success may be better understood by resorting to theories relevant to strategic and contextual factors. Their goal is not to cover all the theories related to firm governance, but to focus on agency, stewardship, resource dependence, and cognitive theories. Since the most dominant approach to the study of governance has utilized agency theory, they discuss this theory in relation to the other theories. Initially, they focus on agency and stewardship theories because they are in contrast to each other and may serve as substitutes with respect to small firm governance. Subsequently, they relate resource dependence and cognitive theories to agency theory because they enrich each other and may serve as complements regarding small firm governance. As will be evident, their elaborations, which are based on research evidence, may have appeal to those interested in small firm viability.
ISSN:1042-6337