Small Firm Financial Contracting and Immigrant Entrepreneurship

Posted: 24 Nov 2009

See all articles by Robert Watson

Robert Watson

Instituto de Empresa

Kevin Keasey

University of Leeds - Division of Accounting and Finance

Mae Baker

affiliation not provided to SSRN

Date Written: 2000

Abstract

The production methods, financial requirements, and supply and demand characteristics of the contract clothing manufacturing sector are studied in order to determine why market exchange relationships within the sector are often untypical (in spite of low entry barriers and set-up costs).The characteristics of the market for the final product necessitate interfirm pooling of resources and cooperation, so firms enjoying strong networks of relationships are likely to achieve competitive advantage.Because the formation of these networks is facilitated when the owner-managers involved share social ties such as ethnic identity and value systems, the contract clothing manufacturing sector has become particularly attractive to immigrant entrepreneurs.The social ties at the heart of interfirm networks create a viable and less costly alternative to formal governance systems based on contracts.Any state initiatives designed to force informally governed immigrant businesses to comply with formal regulatory demands are likely to bring about the collapse of many businesses, which may have a negative impact on the country's economic welfare.(SAA)

Keywords: Immigrant entrepreneurs, Opinion paper/position paper/essay, Public policies, Contracts & agreements, Clothing industry, Manufacturing industries, Cooperation, Competitive advantages, Interfirm alliances, Social networks

Suggested Citation

Watson, Robert and Keasey, Kevin and Baker, Mae, Small Firm Financial Contracting and Immigrant Entrepreneurship (2000). University of Illinois at Urbana-Champaign's Academy for Entrepreneurial Leadership Historical Research Reference in Entrepreneurship, Available at SSRN: https://ssrn.com/abstract=1512290

Robert Watson

Instituto de Empresa ( email )

Serrano 99
Madrid, 28006
Spain

Kevin Keasey

University of Leeds - Division of Accounting and Finance ( email )

Leeds LS2 9JT
United Kingdom
+44 (0)113 343 2618 (Phone)

Mae Baker

affiliation not provided to SSRN

No Address Available

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
547
PlumX Metrics