J
Ö N K Ö P I N G
I
N T E R N A T I O N A L
B
U S I N E S S
S
C H O O L
JÖNKÖPING UNIVERSITY
Entrepreneurship and SME
Develop-ment in Transition Economies:
Acknowledgements
Abstract
1
INTRODUCTION
7
1.1 Background 7 1.2 Problem 7 1.3 Purpose 8 1.4 Perspective 8 1.5 Delimitation 82
METHODOLOGY
9
2.1 Research Paradigm 9 2.1.1 Epistemological Assumption 9 2.1.2 Ontological Assumption 10 2.1.3 Axiological Assumption 10 2.1.4 Rhetorical Assumption 10 2.2 Methodological Assumption 102.3 Purpose of the Research 11
2.4 Data Collection 11
2.4.1 Exploring Secondary Data 11 2.4.2 Collecting Primary Data through Interviews 12 2.4.3 Designing Interview Questions 12
2.4.4 Selecting a Sample 13
2.4.5 Qualitative Analysis of the Data 13
2.5 Trustworthiness of the Thesis 15
2.5.1 Reliability 15
2.5.2 Validity 15
2.5.3 Generalisability 15
3
FRAME OF REFERENCE
16
3.1 Entrepreneurship and SMEs in Transition Context 16
3.1.1 Determinants and Different types of Entrepreneurship 16 3.1.2 Definition of transition 17 3.1.3 Reforms in transition process 17 3.1.4 Classification of transition stages 18 3.1.5 Entrepreneurship and SMEs in Transitional Environment 19
3.2 Institutional Theory: The Role of Formal and Informal Institutions 21
3.2.1 Northean Institutional Theory 22
3.3 Barriers to Entrepreneurship and SME Development 23
3.3.1 External Barriers to Entrepreneurship and SME Development 24 3.3.2 Internal Barriers to Entrepreneurship and SME Development 25
3.4 Fostering Entrepreneurship and SME development 26
4
RESULTS
33
4.1 Secondary Data (Previous Studies) on Georgia 33
4.1.1 Entrepreneurship and SMEs in Georgia 33 4.1.2 Business Environment in Georgia 34 4.1.3 Governmental reforms towards Fostering Entrepreneurship 36 4.1.4 Existing Barriers to Entrepreneurship and SMEs in Georgia 38
4.2 Primary Data 43
4.2.1 Interviewee Profiles 43
4.2.1.1 Entrepreneurs 43
4.2.1.2 Governmental and non-governmental sector Representatives 44 4.2.2 Entrepreneur’s Interviews 45
4.2.2.1 Internal Factors 45
4.2.2.2 External Factors 45
4.2.2.3 State and Other Support 46 4.2.3 Governmental and non-Governmental Representatives 47 4.2.3.1 External Environment 47 4.2.3.2 Direct and indirect governmental and other support 48
5
ANALYSIS
51
5.1 Introduction 51
5.2 Existence of Framework Conditions in Georgia 51
5.3 Perceived Barriers to Entrepreneurship and SMEs in Georgia 53
5.3.1 External Barriers 53
5.3.2 Internal Barriers 55
5.4 Fostering Entrepreneurship and SME development in Georgia 57
5.5 Conclusions 60
6
REFLECTIONS
62
6.1 Contributions 62
6.2 Limitations 62
6.3 Propositions for Further Research 62
REFERENCES
63
APPENDICES
68
A. Interview Questions for Entrepreneurs 68 B. Interview Questions for government agents, private organization representatives 70
Figure 1 Methodological Assumption of the Main Paradigms 10
Figure 2 Components of Data Analysis Interactive Model 14
Figure 4 Entrepreneurship Policies in Transition Context 32
Figure 5 Transition Indicators 2008 33
Figure 6 Number of SMEs per 1,000 People in Georgia 34
Figure 8 Ease of Doing Business in Georgia as compared to Global rankings 35 Figure 7 SME membership in Business Associations in Georgia 35 Figure 9 Ease of Doing business rankings in Different aspects in Georgia 36 Figure 10 Processes SMEs in Georgia considered “Rather Difficult” and “Very Problematic” 38 Figure 11 Central Government Role in Business Development in Georgia 39 Figure 12 Obstacles to Business Development as viewed by the entrepreneurs in Georgia 39 Figure 13 SMEs rating of government processes as obstacles in Georgia 40
Figure 14 Businesses Identify Problematic Areas 41
Figure 15 Corruption Problem 41
Figure 16 Tax Perception 41
Figure 17 Access to Finance 41
Table 1 Perceived Barriers to Entrepreneurship and SME development in transition economies ... 26 Table 2 Perceived Barriers to Entrepreneurship and SME development in Georgia ... 57 Table 3 Barriers and Policies directed towards abolishing them ... 59
