Evaluating Firm level and Societal impacts of rural SMEs’ Internationalisation: A developing country perspective

Odunukan, Kenny, Rahman, Mahfuzur, Igwe, Paul and Hack-polay, Dieu (2021) Evaluating Firm level and Societal impacts of rural SMEs’ Internationalisation: A developing country perspective. In: 18th Rural Entrepreneurship Conference, 13th – 15th July 2021, Swansea, UK.

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Purpose of this paper: Firm level growth and Societal benefits are key impacts for the internationalisation of large and Small businesses. Although existing literature has identified several competitive advantages attached to internationalisation strategy of small businesses, studies that identify both firm level and societal impacts for rural SME Internationalisation within the field of International Business (IB) and Regional Studies (RS) are scarce. The paper aims to evaluate firm level and societal impacts of rural SMEs internationalisation from an emerging market context. In addition, the paper examines the degree to which firm level and societal dynamics have bearing on the internationalisation of rural SMEs in developing countries.

Design/methodology/approach: Quantitative data analysis technique is used in this study to identify the impacts of these firm level/ societal forces on internationalisation of rural SMEs both from micro and macro levels. This paper employed primary data collected through the questionnaires from 403 Nigerian rural SMEs. Based on the data, this study has developed and validated partial least square based structural equation model (PLS-SEM) to assess the impacts of firm level/societal factors on the internationalisation of rural SMEs with particular attention to entrepreneurial attractiveness. Research limitations: A few limitations include the following. First, focusing on firm level and social impact indicates a form of limitation as the study could widen its scope to include other factors such Technological, political, legal and economic impacts. Second, the paper could have been better served if it also tried to include the use of qualitative analysis as attempted elsewhere. Third, the paper focusing on developing country in Sub-Saharan African which somehow limit the applicability of the context to emerging markets.

Findings: The paper has successfully framed Firm level and Societal impacts of rural SMEs’ Internationalisation as a second order hierarchical reflective model and found that there is a significant positive relationship between societal and firm level performance and the internationalisation of rural SMEs. It further shows that societal impacts are marginally more significant.

Practical implications: Practically, this paper researched in an area which was neglected and under-reported by existing studies. The contribution of the research can provide better guidance to internationalising SMEs operating in rural Nigeria and presents opportunities for further research to examine rural SME internationalisation processes in other developing countries too. In addition, it makes a significant contribution to understand the precautions, supports and consequences of internationalisation of rural SMEs and above all to achieve sustainable economic development through the international growth of rural SMEs.

Policy Implications: The paper is very useful and significant to policy makers, owners and managers of rural SMEs and international businesses. Its exploration showed that it has potential to contribute significantly to the policy makers and implementer as it comprises SMEs and emerging countries. It has been noted in the literature that these economies and firms are less capable to conduct research independently as they are resource constrained.

What is the originality/value of paper: Despite increasing research on SMEs and Internationalisation as a strategy for growth, little is known about firm level and societal impacts for rural SME Internationalisation in developing countries. The overall image that appears from literature focused on developed and partly developing Asian countries like India and Bangladesh leaving potential research gap for rural SMEs in African developing countries. Based on insufficient coverage of international business activities of African rural SMEs, this paper filled some of the gaps in literature and provided a useful reference point for rural SMEs and IB research in Africa. This paper combines firm level and societal impacts in a hierarchical model using PLS based SEM to investigate their contributions particularly in under explored area of rural SMEs from a Nigerian contextual perspective that seeks to encourage international entrepreneurship.

Keywords:SMEs, Developing Countries, PLS-SEM, International entrepreneurship, Internationalisation
Subjects:N Business and Administrative studies > N120 International Business studies
Divisions:Lincoln International Business School
ID Code:45842
Deposited On:09 Aug 2021 10:41

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