Firms in developing countries

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Firms in developing countries

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Title: Firms in developing countries
A theoretical probe into the borderland of Business Studies and Development Studies
Author: Hansen, Michael W.; Schaumburg-Müller, Henrik
Abstract: Business studies and development studies have evolved relatively independently of each other – business studies occupied with profit maximizing strategies and the activities of entrepreneurs, firms and value chains, and development studies with economic, social and political development strategies of countries and regions. However, as more and more of the world’s value-adding activities take place in developing countries and as MNCs increasingly incorporate developing countries’ markets and resources in their strategies, business studies has taken a growing interest in the particular conditions of local and foreign firms doing business in such environments. Simultaneously, as the limitations of state led development strategies have become apparent and as market ideology has become prevalent in a growing number of countries, development studies has directed growing attention towards the role of entrepreneurship, firm strategy, private sector development and foreign direct investment as vehicles for economic and social development. In other words, both fields approach business in development from different sides. This paper seeks to identify themes related to the firm in developing countries as taken up by both business and development studies. We suggest the themes of common interest and potential convergence to be those of market failures, institutions, entrepreneurship, clusters, and firm internationalization. The paper illustrates that there are substantial opportunities for cross-fertilization between the two bodies of academic enquiry, and indeed, that without a conversation between the two literatures in the era of globalization, the analytical and predictive power of both may be seriously impaired.
URI: http://hdl.handle.net/10398/6756
Date: 2007-12-06

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