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After floundering for a century, the successful late industrializing countries (the rest) succeeded in creating professionally managed, large‐scale, national firms, although their importance varied by country. The mix of a country's business structures by size and ownership (private or public, foreign or national) influenced the level of its investment in skills. The long‐term strategic ‘make‐or‐buy’ technology choice was a function of firm composition. The process whereby a latecomer succeeds or fails to create a corps of ‘national firm leaders’ is the subject of this chapter. A national leader may be understood as a nationally owned and controlled firm that is ‘targeted’ by government (it receives a disproportionate share of ‘intermediate assets’), which allows it to become a dominant player in its ‘competitive base’ (domestic market), in exchange for which it is obliged to invest heavily in proprietary knowledge‐based assets; these assets, in turn, allow it to globalize through exporting or outward foreign direct investment.

This chapter explores the issue of Europeanization primarily at the horizontal level of European Union (EU) policy formulation and the adaptation and Europeanization of large and small business interests in the new opportunity structures of Brussels. The movement of business and other societal interests towards the European level has long been associated with a neofunctional perspective on European integration and societal change. Business interests have always been associated with the changes in policy and polity described by the term Europeanization, begging the question of how does the study of ‘Europeanization’ add to the understanding of European business lobbying. To answer this, the first section of the chapter, ‘Europeanization and the Application to EU Public Policy’ defines what Europeanization is understand to be, and set outs a number of European policy-making process propositions to be explored empirically in the next section ‘The Europeanization of Business Interests in a Differentiated Policy Process’. This section looks at how institutional and organizational capabilities have affected representative ability over time, how firms of all sizes have developed ‘venue shopping’ strategies in a multilevel governance structure, and, finally (in resource dependency terms), how firm size affects the distinct rules and norms of interest representation with the European Commission.

Numerous studies have explored the influence of firm size on the processes of technological innovation. Despite financial constraints and a limited knowledge base, small firms may possess a superior ability to innovate. In contrast, large firms often encounter systemic problems in transforming their extensive knowledge base to stimulate new innovations, despite the advantages of large research and development budgets, economies of scale and scope in production, and established links to customers. This chapter examines the nature of small firm advantages in building knowledge assets and organizational competence. Contrary to the assumption in economic reasoning that a large knowledge base is always an advantage, the limited knowledge base possessed by small entrepreneurial firms may be one of their key advantages. This advantage may be particularly significant when considered in the context of four other factors that are commonly observed in small firms: product development processes that more readily accommodate change and uncertainty; problem-solving heuristics that facilitate creative recombination of knowledge; close network ties between individuals that support transfers of non-codified knowledge; an internal organizational climate conducive to innovation.

This Chapter develops econometric modelling to test for relationships between firm size and exports under theoretical factors of technology, organization, and economies of scale. We measured different and relevant variables. We specified the equations based on a carefully formulated hypothesis taking into account non-linearity in relationships between dependent and independent variables. It econometrically tested for the relationship between firm size and international trade behaviour from different dimensions. Large firms with domestic market power and better access to imports were less export oriented than medium and small-scale firms. Small firms in general adopted labour-intensive production practices in tune with comparative advantage. Small firms that faced inefficient subcontract relations and those that reached a critical technological size went in for export markets with efficient payments arrangements. Consequently, about 50 per cent of India’s exports were accounted for by small and medium scale firms.

Analyzing a list of all Small Business Administration (SBA) loans in 1991 to 2009 linked with annual information on all U.S. employers from 1976 to 2012, we apply detailed matching and regression methods to estimate the variation in SBA loan effects on job creation and firm survival across firm age and size groups. The number of jobs created per million dollars of loans generally increases with size and decreases in age. The results imply that firms that have grown most since birth (hiring first employee) are those that experience the greatest financial constraints to growth, while the growth of small, mature firms is least financially constrained. The estimated association between survival and loan amount is larger for younger and smaller firms facing the “valley of death.”

This chapter presents some stylized facts about firms in the Indian informal manufacturing sector, using unit-level data from the NSSO surveys of unorganized enterprises between 2000–1 and 2010–11. It suggests an upward shift in the size of the average informal firm over time and this is mostly evident among the large firms in the sector. The study finds that the most effective way to increase the wages of informal workers is to increase the productivity of the enterprises they work in; the larger these enterprises are, the more productive the workers are. The chapter also highlights the existence of social and economic barriers to informal enterprises in increasing their productivity. Interestingly, the chapter also argues that entering into a sub-contracting relationship is not necessarily a positive outcome for the firm in question.

This chapter looks at venture financing among entrepreneurs in Wuhan, finding that informal finance comprises a large degree of start-up capital. Research has documented the importance of venture-financing and its effects on business survival, growth aspiration and strategy. It reviews the existing research in venture-financing by looking into its effects and various predictors, then highlights the unique operating and institutional environments Chinese entrepreneurs face, providing the context under which venture-financing — from both formal and informal sources — takes place. Empirical results from the survey follow, concluding with policy implications and future research directions.

This chapter examines driving forces such as occupation, financial access, and education, both in the contemporary economy and historically. Many industries are concentrated in and around Bangkok. Small and medium enterprises (SMEs) account for over 95% of all firms and about 50% of employment and capital. Satellite imagery shows urbanization and deforestation. Commercial banks dominate access, credit extended, and number of branches, but in rural household data, the Bank for Agriculture and lending are high in the informal sector. In the Central region, out-of-village transactions rise in importance. Education varies across provinces and within provinces by proximity to major roads or towns. Secondary schools are further away from the typical rural village than are elementary schools. Many households have low levels of education, and the education of children still varies with parental wealth. Income differentials have increased over time, while the number of illiterate has declined substantially.

The enormous growth of international direct investment and multinational corporations (MNCs) in the postwar period has raised challenging issues for international trade theory and practical policy alike. This chapter analyzes the determinants and effects of foreign investment by Sweden to explore how foreign production influences home-country exports and, indirectly, the pattern of employment. It first describes the importance of Swedish MNCs in the Swedish economy before looking at the determinants of foreign production by Swedish manufacturing firms and the effects on parent-company exports over the period from 1965 to 1994. It also discusses the effects on the firm's overall competitiveness and implications for changes in the pattern of specialization in the home country. What are the implications of MNC growth for Sweden? The most important effect comes from the impact of larger firm size on the ability of MNCs to invest more in research and development, in specialized headquarter services, and in a more widespread distribution network abroad — all of which benefit the Swedish part of the MNCs.

Chapter 1 introduces the conceptual and theoretical framework of the book. It offers an introduction to the various ways in which manufacturing affected everyday Athenians and their standard of living, provides an overview of the literary and archaeological sources relevant to manufacturing, and addresses the relevance of M. I. Finley’s Embeddedness Paradigm to an enquiry of this nature. It goes on to identify the wide variation in firm size observed in classical Athens and the failure of common theories such as division of labor to explain it. Finally it introduces the theories of competitive advantage and barriers to entry, from which a framework is derived that underpins the sector specific analyses that comprise the rest of the book.

Greece's trade deficit declined by 10 percent of gross domestic product (GDP) between 2007 and 2012, removing one of the great economic imbalances of the pre-crisis years. However, this reduction was achieved exclusively through import compression while exports fell over that period, thereby worsening the economic crisis. This chapter studies Greece's export underperformance in comparison to Ireland, Portugal and Spain as well as Greece's own pre-crisis experience. The main findings are that (1) given past performance, Greece's exports should have increased by 25 percent, rather than drop by 5 percent between 2007 and 2012; (2) labor markets have adjusted to the new economic environment; (3) product markets did not adjust, hindering the recovery of competitiveness; (4) export underperformance is responsible for a third of the decline in GDP since 2007. The chapter concludes that the business environment and firm size distribution in Greece are also hindering the necessary adjustment.

This chapter analyses India’s ‘employment problem’ and the measures needed to tackle it. The essence of the problem is that the high-productivity ‘organized sector’ manifests inordinately low demand for labour that leaves most workers bottled up in the low-productivity ‘unorganized sector’. The latter is not, properly speaking, an employment problem but a general development problem. Raising the demand for labour in the organized sector will require policies to increase a) the pace and b) the labour-intensity of the sector’s growth. To this end, constraints on firm-size will have to be addressed, especially infrastructure deficiencies and various obstacles to the ‘ease of doing business’. For greater labour-intensity, it will be necessary to make India’s job-destructive labour laws more flexible. But the necessary weakening of job security in the organized sector could be achieved only if it were accompanied by steps to strengthen income security.

If formal institutions of contract governance are absent or ineffective, traders try to substitute relational governance based on norms and sanctions. However, these alternatives need good information and communication concerning members’ actions; that works well only in relatively small communities. If there are fixed costs, the market has too few firms for perfect competition. The optimum must be a second best, balancing the effectiveness of contract governance and dead-weight loss of monopoly. This chapter explores this idea using a spatial model with monopolistic competition. It is found that relational governance constrains the size of firms and can cause inefficiently excessive entry, beyond the excess that already occurs in a spatial model without governance problems. Effects of alternative methods of improving governance to ameliorate this inefficiency are explored.