IDEAS home Printed from https://ideas.repec.org/a/spr/decisn/v46y2019i3d10.1007_s40622-019-00209-6.html
   My bibliography  Save this article

Education, experience, social network and firm survival: the case of the electrical fittings cluster in Sargodha, Pakistan

Author

Listed:
  • Sana Ullah

    (Quaid-i-Azam University)

  • Muhammad Tariq Majeed

    (Quaid-i-Azam University)

  • Muhammad Hafeez

    (Beijing University of Posts and Telecommunications)

Abstract

In modern era of industrialization, firm survival is widely acknowledged and geared through industrial cluster in developing countries. The present study unfolds the impact of education, experience and social network on firm death by using two rounds of electrical fittings cluster survey from 2008 to 2017. The empirical outcomes from Cox PH model spotlight that entrepreneurs are relatively more educated, rich in experience of production and marketing, have low hazard rate in their business. The empirical analysis also revealed that firm survival can be achieved through strong social network of entrepreneur. The study findings infer that Small and Medium Enterprises Development Authority and United Nations Industrial Development Organization training programs are needed to focus on cluster entrepreneurs and sustained firm survival.

Suggested Citation

  • Sana Ullah & Muhammad Tariq Majeed & Muhammad Hafeez, 2019. "Education, experience, social network and firm survival: the case of the electrical fittings cluster in Sargodha, Pakistan," DECISION: Official Journal of the Indian Institute of Management Calcutta, Springer;Indian Institute of Management Calcutta, vol. 46(3), pages 267-278, September.
    • Handle: RePEc:spr:decisn:v:46:y:2019:i:3:d:10.1007_s40622-019-00209-6
    DOI: 10.1007/s40622-019-00209-6
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s40622-019-00209-6
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s40622-019-00209-6?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Yujiro Hayami, 2009. "Social Capital, Human Capital and the Community Mechanism: Toward a Conceptual Framework for Economists," Journal of Development Studies, Taylor & Francis Journals, vol. 45(1), pages 96-123.
    2. Robert Cressy, 2006. "Why do Most Firms Die Young?," Small Business Economics, Springer, vol. 26(2), pages 103-116, March.
    3. Patrick Musso & Stefano Schiavo, 2008. "The impact of financial constraints on firm survival and growth," Journal of Evolutionary Economics, Springer, vol. 18(2), pages 135-149, April.
    4. Nafziger, E. Wayne & Terrell, Dek, 1996. "Entrepreneurial human capital and the long-run survival of firms in India," World Development, Elsevier, vol. 24(4), pages 689-696, April.
    5. Akoten, John E & Sawada, Yasuyuki & Otsuka, Keijiro, 2006. "The Determinants of Credit Access and Its Impacts on Micro and Small Enterprises: The Case of Garment Producers in Kenya," Economic Development and Cultural Change, University of Chicago Press, vol. 54(4), pages 927-944, July.
    6. Cassar, Gavin, 2006. "Entrepreneur opportunity costs and intended venture growth," Journal of Business Venturing, Elsevier, vol. 21(5), pages 610-632, September.
    7. Eiji Yamamura & Tetsushi Sonobe & Keijiro Otsuka, 2005. "Time path in innovation, imitation, and growth: the case of the motorcycle industry in postwar Japan," Journal of Evolutionary Economics, Springer, vol. 15(2), pages 169-186, January.
    8. Colombelli, Alessandra & Haned, Naciba & Le Bas, Christian, 2013. "On firm growth and innovation: Some new empirical perspectives using French CIS (1992–2004)," Structural Change and Economic Dynamics, Elsevier, vol. 26(C), pages 14-26.
    9. Cressy, Robert, 1996. "Are Business Startups Debt-Rationed?," Economic Journal, Royal Economic Society, vol. 106(438), pages 1253-1270, September.
    10. Sonobe, Tetsushi & Hu, Dinghuan & Otsuka, Keijiro, 2004. "From inferior to superior products: an inquiry into the Wenzhou model of industrial development in China," Journal of Comparative Economics, Elsevier, vol. 32(3), pages 542-563, September.
    11. Gebreeyesus, Mulu & Mohnen, Pierre, 2013. "Innovation Performance and Embeddedness in Networks: Evidence from the Ethiopian Footwear Cluster," World Development, Elsevier, vol. 41(C), pages 302-316.
    12. Gimmon, Eli & Levie, Jonathan, 2010. "Founder's human capital, external investment, and the survival of new high-technology ventures," Research Policy, Elsevier, vol. 39(9), pages 1214-1226, November.
    13. George Saridakis & Kevin Mole & David Storey, 2008. "New small firm survival in England," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 35(1), pages 25-39, March.
    14. Thomas Astebro & John L. Michela, 2005. "Predictors of the Survival of Innovations," Post-Print hal-00476886, HAL.
    15. Richard Ericson & Ariel Pakes, 1995. "Markov-Perfect Industry Dynamics: A Framework for Empirical Work," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 62(1), pages 53-82.
    16. Bates, Timothy, 1990. "Entrepreneur Human Capital Inputs and Small Business Longevity," The Review of Economics and Statistics, MIT Press, vol. 72(4), pages 551-559, November.
    17. Babur Wasim Arif & Tetsushi Sonobe, 2012. "Virtual Incubation in Industrial Clusters: A Case Study in Pakistan," Journal of Development Studies, Taylor & Francis Journals, vol. 48(3), pages 377-392, March.
    18. Sonobe, Tetsushi & Kawakami, Momoko & Otsuka, Keijiro, 2003. "Changing Roles of Innovation and Imitation in Industrial Development: The Case of the Machine Tool Industry in Taiwan," Economic Development and Cultural Change, University of Chicago Press, vol. 52(1), pages 103-128, October.
    19. Schmitz, Hubert & Nadvi, Khalid, 1999. "Clustering and Industrialization: Introduction," World Development, Elsevier, vol. 27(9), pages 1503-1514, September.
    20. P. Holmes & A. Hunt & I. Stone, 2010. "An analysis of new firm survival using a hazard function," Applied Economics, Taylor & Francis Journals, vol. 42(2), pages 185-195.
    21. Fontana, Roberto & Nesta, Lionel, 2010. "Pre-entry experience, post-entry learning and firm survival: Evidence from the local area networking switch industry," Structural Change and Economic Dynamics, Elsevier, vol. 21(1), pages 41-49, March.
    22. Masatoshi Kato & Yuji Honjo, 2015. "Entrepreneurial human capital and the survival of new firms in high- and low-tech sectors," Journal of Evolutionary Economics, Springer, vol. 25(5), pages 925-957, November.
    23. Eiji Yamamura & Tetsushi Sonobe & Keijiro Otsuka, 2003. "Human capital, cluster formation, and international relocation: the case of the garment industry in Japan, 1968--98," Journal of Economic Geography, Oxford University Press, vol. 3(1), pages 37-56, January.
    24. Hoang, Ha & Antoncic, Bostjan, 2003. "Network-based research in entrepreneurship: A critical review," Journal of Business Venturing, Elsevier, vol. 18(2), pages 165-187, March.
    25. Stam, Wouter & Arzlanian, Souren & Elfring, Tom, 2014. "Social capital of entrepreneurs and small firm performance: A meta-analysis of contextual and methodological moderators," Journal of Business Venturing, Elsevier, vol. 29(1), pages 152-173.
    26. Morikawa, Masayuki, 2013. "Productivity and survival of family firms in Japan," Journal of Economics and Business, Elsevier, vol. 70(C), pages 111-125.
    27. Alex Coad & Jaganaddha Tamvada, 2012. "Firm growth and barriers to growth among small firms in India," Small Business Economics, Springer, vol. 39(2), pages 383-400, September.
    28. David Audretsch & Xiaodan Guo & Adrian Hepfer & Hugo Menendez & Xingzhi Xiao, 2016. "Ownership, productivity and firm survival in China," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 43(1), pages 67-83, March.
    29. Khalid Nadvi, 1999. "The cutting Edge: Collective efficiency and international competitiveness in Pakistan," Oxford Development Studies, Taylor & Francis Journals, vol. 27(1), pages 81-107.
    30. Barr, Abigail, 2000. "Social Capital and Technical Information Flows in the Ghanaian Manufacturing Sector," Oxford Economic Papers, Oxford University Press, vol. 52(3), pages 539-559, July.
    31. David Audretsch & Xiaodan Guo & Adrian Hepfer & Hugo Menendez & Xingzhi Xiao, 2016. "Ownership, productivity and firm survival in China," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 43(1), pages 67-83, March.
    32. Marcus Box, 2008. "The death of firms: exploring the effects of environment and birth cohort on firm survival in Sweden," Small Business Economics, Springer, vol. 31(4), pages 379-393, December.
    33. Vu Hoang Nam & Tetsushi Sonobe & Keijiro Otsuka, 2010. "An Inquiry into the Development Process of Village Industries: The Case of a Knitwear Cluster in Northern Vietnam," Journal of Development Studies, Taylor & Francis Journals, vol. 46(2), pages 312-330.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sana Ullah & Muhammad Tariq Majeed & Babur Wasim Arif, 2021. "Social capital and firms’ choice of financing under credit constraints: microeconomic evidence from Pakistan," DECISION: Official Journal of the Indian Institute of Management Calcutta, Springer;Indian Institute of Management Calcutta, vol. 48(1), pages 3-13, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sana Ullah & Babur Wasim Arif & Muhammad Tariq Majeed, 2019. "The Determinants of Firm Survival among Small Cluster Firms," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 24(1), pages 131-145, Jan-June.
    2. Babur Wasim Arif, 2013. "Education, Experience and Enterprise Development," Journal of South Asian Development, , vol. 8(3), pages 273-299, December.
    3. Babur Wasim Arif & Tetsushi Sonobe, 2012. "Virtual Incubation in Industrial Clusters: A Case Study in Pakistan," Journal of Development Studies, Taylor & Francis Journals, vol. 48(3), pages 377-392, March.
    4. Marco Vivarelli, 2013. "Is entrepreneurship necessarily good? Microeconomic evidence from developed and developing countries," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 22(6), pages 1453-1495, December.
    5. Francesco Quatraro & Marco Vivarelli, 2015. "Drivers of Entrepreneurship and Post-entry Performance of Newborn Firms in Developing Countries," The World Bank Research Observer, World Bank, vol. 30(2), pages 277-305.
    6. Alexandra Tsvetkova & Jean-Claude Thill & Deborah Strumsky, 2014. "Metropolitan innovation, firm size, and business survival in a high-tech industry," Small Business Economics, Springer, vol. 43(3), pages 661-676, October.
    7. Francesco Quatraro & Marco Vivarelli, 2013. "Entry and Post-Entry Dynamics in Developing Countries," GREDEG Working Papers 2013-20, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France.
    8. Quatraro, Francesco & Vivarelli, Marco, 2013. "Entrepreneurship In A Developing Country Context," Department of Economics and Statistics Cognetti de Martiis LEI & BRICK - Laboratory of Economics of Innovation "Franco Momigliano", Bureau of Research in Innovation, Complexity and Knowledge, Collegio 201314, University of Turin.
    9. Sonobe, Tetsushi & Hu, Dinghuan & Otsuka, Keijiro, 2006. "Industrial development in the inland region of China: A case study of the motorcycle industry," Journal of Comparative Economics, Elsevier, vol. 34(4), pages 818-838, December.
    10. Keijiro Otsuka, 2006. "Cluster‐Based Industrial Development: A View From East Asia," The Japanese Economic Review, Japanese Economic Association, vol. 57(3), pages 361-376, September.
    11. Vivarelli, Marco, 2012. "Drivers of entrepreneurship and post-entry performance : microeconomic evidence from advanced and developing countries," Policy Research Working Paper Series 6245, The World Bank.
    12. Babur Wasim Arif & Sana Ullah, 2021. "From subcontractors to company owners: modeling firm-type choices in industrial clusters," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 11(1), pages 153-161, December.
    13. Aysa Ipek Erdogan, 2023. "Drivers of SME Growth: Quantile Regression Evidence From Developing Countries," SAGE Open, , vol. 13(1), pages 21582440231, March.
    14. Masatoshi Kato & Yuji Honjo, 2020. "CEO Succession and New-Firm Performance: Does Successor Origin Matter?," Discussion Paper Series 213, School of Economics, Kwansei Gakuin University.
    15. Masatoshi Kato & Yuji Honjo, 2015. "Entrepreneurial human capital and the survival of new firms in high- and low-tech sectors," Journal of Evolutionary Economics, Springer, vol. 25(5), pages 925-957, November.
    16. Tetsushi Sonobe & Yuki Higuchi & Keijiro Otsuka, 2012. "Productivity Growth and Job Creation in the Development Process of Industrial Clusters," GRIPS Discussion Papers 11-22, National Graduate Institute for Policy Studies.
    17. Ashish Arora & Anand Nandkumar, 2011. "Cash-Out or Flameout! Opportunity Cost and Entrepreneurial Strategy: Theory, and Evidence from the Information Security Industry," Management Science, INFORMS, vol. 57(10), pages 1844-1860, October.
    18. Giuseppe Criaco & Tommaso Minola & Pablo Migliorini & Christian Serarols-Tarrés, 2014. "“To have and have not”: founders’ human capital and university start-up survival," The Journal of Technology Transfer, Springer, vol. 39(4), pages 567-593, August.
    19. Masatoshi Kato, 2017. "Founders’ human capital and external knowledge sourcing: An absorptive capacity perspective for innovative start-ups," Discussion Paper Series 162, School of Economics, Kwansei Gakuin University, revised Jun 2017.
    20. Enrico Santarelli & Marco Vivarelli, 2007. "Entrepreneurship and the process of firms’ entry, survival and growth," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 16(3), pages 455-488, June.

    More about this item

    Keywords

    Industrial cluster; Firm survival; Human capital; Social capital; Pakistan;
    All these keywords.

    JEL classification:

    • I20 - Health, Education, and Welfare - - Education - - - General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:decisn:v:46:y:2019:i:3:d:10.1007_s40622-019-00209-6. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.