Micro Enterprises In India Research Articles

Political connections and credit access: evidence from small businesses and microenterprises in India

Abstract This paper examines the impact of political connections on credit access for small businesses and microenterprises (SBME) in India, utilizing data from the India Human Development Survey. While such connections can facilitate overcoming challenges like high transaction costs and incomplete credit markets, they may also impede equitable credit access. This study analyzes how political connections influence the loan amounts secured by households for business purposes in both rural and urban settings. It further dissects the broader impact of political connections, revealing their nuanced effects in relation to the nature of loan and income sources. Consequently, this research offers valuable insights for policymakers and practitioners, suggesting strategies that provide fair financial opportunities to ensure a level playing field for all SBMEs. Plain English Summary Empirical research shows political ties lead to inequitable loan opportunities for Indian small businesses. This research investigates the impact of political connections on securing loans for small businesses and microenterprises (SBMEs) in India. It finds that businesses with such ties are more likely to secure larger loans, creating an uneven playing field. It highlights the challenges in the credit markets of developing countries and emphasizes the importance of distributing loans equitably. The study calls for policies that ensure equal financial access for all SBMEs, promoting a balanced approach to overcome the complexities of political influence in credit access. It advocates for a fair and inclusive economic environment, supporting equitable growth and opportunity for all SBMEs.

The enablers and stumbling blocks in sustaining growth of women-owned micro-enterprises in India – a qualitative inquiry

PurposeThe study aims to understand why women-owned microenterprises (WOMEs) in India experience a lower growth rate, where growth can be represented in increments in the venture’s size or scope. There is no conclusive understanding of the factors that affect the sustained growth of WOMEs in India.Design/methodology/approachWhat personal, social and economic factors support or hinder the choice, growth and sustainability of women-owned ventures? What role do institutional factors (government, nongovernment organizations (NGOs), self-help groups and microfinance institutions) play toward the sustainability of WOMEs? The answers to these questions were obtained through a qualitative design by interviewing 30 micro women entrepreneurs from Tamil Nadu, a Southern state of India and one of the largest hubs for WOMEs and their responses were content analyzed using NVivo 12 software.FindingsThe findings capture and apply the fundamentals of two key theoretical perspectives, resource-based view (RBV) and self-determination theory (SDT), in identifying the links between the individual, social and economic factors and their combined effect on the sustained growth of women-owned micro businesses. The findings add value in identifying the ingrained cultural norms and traditions and several internal and external factors that support or challenge the growth of WOMEs. This study highlights that the interventions by the government need to be strengthened for the growth and sustainability of WOMEs.Practical implicationsThe study’s findings provide suggestions to policymakers, banks, funding agencies, financial institutions and NGOs to design applicable policies and schemes toward the sustained growth of WOMEs.Originality/valueThis study contributes toward a better understanding of the trends in the context of WOMEs from an Indian context. This topic has received little attention in the academic literature. Second, the study’s conceptual contribution is an application of SDT and RBV to understand and categorize the enablers and deterrents in the path of growth of WOMEs, which is a novel pursuit.

Entrepreneurial marketing strategy in craft-based businesses in an emerging market: a qualitative interpretivist approach

PurposeThe primary aim of this study is to gain insight into the entrepreneurial marketing strategy (EMS) decisions made by microenterprises in the craft sector and draw comparisons between the marketing strategy formulation and implementation of conventional businesses and those of craft-based microenterprises with a specific focus on the context of emerging markets, particularly India.Design/methodology/approachThis paper follows a qualitative interpretivist paradigm using a multiple-case methodology approach. It tracks craft-based microenterprises that make furniture or home décor products in India. The study participants were the founders, principal designers, studio managers or craftspersons.FindingsThis study’s findings reveal that craft-based microenterprises implement an EMS that adopts a hybrid form of market orientation strategy. In this approach, the product or creative concept is at the centre of the decision-making, and the customer needs are factored in at a later stage for customisation. These microenterprises prioritise product positioning over segmentation and targeting strategies.Research limitations/implicationsThis study tries to understand marketing strategy decision-making processes among craft-based microenterprises in India. Given that study participants came from only two-product-based craft businesses, this limits the generalisability of the findings to similar or related contexts. This study provides a framework and methodology for replication in other contexts and industries to formulate a nuanced understanding of micro, context-specific, craft-based businesses.Originality/valueThis study uses qualitative analysis to understand EMS in craft-based businesses in India. This study contributes to this fledgling stream of literature at the interface of marketing and entrepreneurship to understand entrepreneurial marketing. This study analyses the marketing strategy of craft-based businesses using the framework of Morgan et al. (2019).

Bureaucratic and Societal Determinants of Female-Led Microenterprises in India

This study examines the barriers to female entrepreneurship in India’s microenterprise sector through society and bureaucracy. The study uses grammatical genders in languages to capture the societal attitudes towards female entrepreneurship. Using a probit model, it was found that states where the spoken language is two-gendered, have poor representations of women in entrepreneurial positions compared with states with languages that are multi-gender or no gender. It is further argued that these societal attitudes also reflect through people in power, such as bureaucrats, credit managers, bankers, etc., which affects female entrepreneurship. The paper finds empirical evidence for the grease-the-wheel hypothesis, i.e., in the presence of a discriminating inefficient business ecosystem, women entrepreneurs use non-market strategies such as corruption to alter decisions in their favour. Thus, an effort to reduce corruption at an immature stage, when these societal institutions have not yet developed, might cause more harm than benefit.

An Analysis of Growth and Progress of Micro Enterprises in India : A Comparative Study of Rajasthan and Uttarakhand

An Analysis of Growth and Progress of Micro Enterprises in India : A Comparative Study of Rajasthan and Uttarakhand

Modeling the Interface Among the Critical Barriers to Innovation Capability in Microenterprises

The marketplace is predominantly a microbusiness-dominated phenomenon. Across the globe, the status of the tiniest form of business is different and dynamic. It has been widely argued that the tiniest forms of business do not get equal opportunities and the resources to come up with something new for the world. There are several barriers to the innovation capability of existing research, and they are all treated with equal importance. Authors opine that prioritization will advance our knowledge further. This article, based on primary data collected using focus group discussions, identifies 14 barriers to innovation capability and seeks to establish a causal (utilizing Decision-Making Trial and Evaluation Laboratory method) relationship among them in the context of microenterprises. Low involvement of Generation Z emerged as the most important barrier to innovation capability in Indian microenterprises, resulting in limited availability of resources, an orthodox approach, shallow lateral creativity, isolation from the mainstream, lack of market sense and foresight, one person shouldering all responsibility, and a highly unorganized sector. To the best of the researcher's knowledge, no study in the literature has attempted to identify barriers to innovation capability and establish causal relationships among them in the context of microenterprises in India.

FINANCING MICRO AND SMALL ENTERPRISES: ASSESSING THE IMPACT OF MUDRA LOANS IN AN EMERGING ECONOMY

This paper studies the impact of mudra on small and micro enterprises in terms of income generation, business expansion, standard of living, and employment generation in the process. The research is socio-economic research. The project applied mean difference method for quantitative data analysis and relative importance index method to analyse qualitative data. Paper used Schedule to conduct personal interviews to collect data from 384 respondents using convenience sampling. It was found that to some extent, the schemes have been successful in providing loans to MSME sector. The enterprises are benefitted due to collateral free mudra loan in terms of income generation and business expansion. But there was no significant impact on employment generation and standard of living as proved from the data collected from the respondents due to mudra loan. Also, no significant improvement in human development index was found among the respondents. No significant improvements in quality of food and nutrition were found as informed by the respondents. Financial independence has not been achieved for the women entrepreneurs. Policy implications for government and bank has been discussed at the end of paper. The paper is based on the project funded by Indian Council of Social Science Research, New Delhi. This is a first kind of study conducted to study the impact of mudra loans on small and micro enterprises in India.

Social and Political Connections and Access to Credit: Evidence from Micro-Enterprises in India

Social and Political Connections and Access to Credit: Evidence from Micro-Enterprises in India

Informality and structural change: evidences from microenterprises in India's unorganised manufacturing sector

PurposeThis article analyses the structural change in microenterprises located at India's unorganised manufacturing sector in terms of output mix, choice of technique and productivity during the last few decades.Design/methodology/approachBased on data collected from a quinquennial survey of unorganised firms, this study attempts productivity analysis by using the growth accounting technique.FindingsThe paper finds that there is a significant structural change which has occurred in the small firm sector in Indian manufacturing. The share of capital-intensive industries has increased substantially in recent years. Further, though small firms are more labour intensive, the labour productivity and total productivity of these firms are very low. The falling labour productivity and rising capital intensity indicates replacement of labour with capital in Indian small firm sector.Practical implicationsLow productivity of the sector is a cause for concern and this needs to be addressed by making the sector more competitive in the world market. To achieve this, policies should be designed so that small firms reach the efficient scale of production.Originality/valueThis is the first paper which examines structural changes in the Indian MSME sector. The findings have strong implications for creation of a viable ecosystem of entrepreneurship in the country.

Measuring the innovation capability of micro enterprises in India

PurposeThe development of innovation capability (IC) is a central issue for both practitioners and academicians. However, studies that investigate the dimension of IC in the context of micro-enterprises are absent. Based on capability-based view, the purpose of this paper is to identify important dimensions to build a scale to measure IC in micro-enterprises.Design/methodology/approachThe study is based on focus group discussions for item generation and questionnaire survey on a sample of 379 micro-enterprises in India. The scale is developed with the help of exploratory factor analysis and confirmatory factor analysis. Statistical tests demonstrate that the scale presents composite reliability as well as discriminant and convergent validity.FindingsThe findings show that four dimensions form IC in micro-enterprises: resources, networking, risk taking and involvement.Originality/valueThis study develops a new scale, which is a measure of IC of micro-enterprises. The implications have been recommended, which focus upon entrepreneurs, academicians and policymakers interested in developing the IC of micro-enterprises in India.

The influence of entrepreneurial traits on success of microenterprises in India: a mediator analysis

The influence of entrepreneurial traits on success of microenterprises in India: a mediator analysis

The influence of entrepreneurial traits on success of microenterprises in India: a mediator analysis

This study examined the relationships among three entrepreneurial traits, passion for work and business success using survey data from 304 microentrepreneurs. We used path analysis to test the direct and indirect effects of the trait variables on perceptual measures of business success. Passion for work is used as the mediating variable for explaining the relationship between entrepreneurial traits and business success. The results indicated that all the three entrepreneurial traits-need for achievement, self-efficacy and locus of control (internal) was positively related to business success, and passion for work play a mediating role in this relationship.

Development of Micro Enterprises in India and Karnataka: A Critical Review of Public Policy Support

Micro enterprises (M Es) find a special place in em ploym ent creation and poverty alleviation in India, and this is true also o f other parts o f the world. M Es basically develop on their own due to the needs o f the people and do not depend on m acro enterprise or the overall business environm ent for their survival in the economy. The problems and prospects o f micro enterprises are different from those o f small and medium industries. Though India has clearly defined M SM Es by the M SM ED Act 2006, micro enterprises need different treatm ent and policy initiatives for their development. MEs find it difficult to enjoy or make use o f m axim um benefit of different national and state industrial policies. Though policies are norm ally developed for micro, small, medium, as well as large and m ega industries, policy support m ay not be applicable or accessible for the M E support, and M E issues do not figure in such policies.

The case for lock-up storage facilities for microenterprises in India

In spite of the reluctance of municipal authorities to recognize them, microenterprises continue to increase in number in urban areas. Trading entrepreneurs in Hyderabad, South India, value the availability of lockup storage space near the market to safeguard their stock at the end of the day. Such stores mean that traders do not have to commute home with their stock every day; they provide a number of other advantages as well, such as toilet facilities and a place to rest. Renting arrangements for such stores are not formalized, however, and there are insufficient lockup stores available. This article describes how the municipal authorities' attempts to provide small shops have become uneconomic, and calls for recognition from the authorities of the storage needs of microentrepreneurs.