IngentaConnect Performance of microenterprises in Ghana: a resource-based view

Authors: Masakure, Oliver; Henson, Spencer; Cranfield, John

Source: Journal of Small Business and Enterprise Development, Volume 16, Number 3, 2009 , pp. 466-484(19)

Publisher: Emerald Group Publishing Limited

Abstract:

Purpose - The purpose of this paper is to assess the financial performance of microenterprises in Ghana by applying the resource-based theory of the firm. Specifically, it is tested that if firm-specific resources dominate sector and market-wide effects in explaining microenterprise performance, as suggested by the resource-based theory. Design/methodology/approach - The relevant literature for both microenterprise performance and the resource-based theory is reviewed. Data from the 1998/1999 Ghana Living Standards Survey are analysed using ordinary least squares, followed by robustness checks. Findings - Factors embodied in firm-specific resources jointly impact enterprise performance. However, sector/market factors also play a role, suggesting that the interaction between microenterprise, sector, and market factors helps explain enterprise performance. Research limitations/implications - All the constructs of the resource-based theory cannot be tested due to data limitations. Originality/value - Small enterprises play a key role in promoting developing country growth, but no study has evaluated microenterprise performance using this particular data set and the resource-based theory of the firm. Future research should focus on collecting data to further validate this theory.

Keywords: Financial performance; Ghana; Small enterprises

Document Type: Research article

DOI: 10.1108/14626000910977170

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