Abstract
When seeking to internationalize, the managers of many small to medium‐sized enterprises (SMEs) often turn to government incentive programs to help them achieve their goals. The experience of one French firm shows that, in doing so, however, there is a risk of becoming dependent on the financing party for not only funding but also for management. When applied to both internal and external business relationships, Agency Theory—which focuses on the behavior and contracts between principals and agents—provides a tool for understanding the process by which a business owner can become financially dependent on and surrender decision‐making rights to an outside agency, particularly in a declining market environment. ©2014 Wiley Periodicals, Inc.
Published Version
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