Chapter

Firm Ownership and Entrepreneurship

Alice H. Amsden

in Entrepreneurship, Innovation, and Economic Development

Published in print April 2011 | ISBN: 9780199596515
Published online September 2011 | e-ISBN: 9780191729133 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780199596515.003.0003

Series: WIDER Studies in Development Economics

Firm Ownership and Entrepreneurship

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This chapter emphasizes the key entrepreneurial and innovative role played in catch‐up countries by large privately‐ owned domestic enterprises and conglomerates (POEs). The chapter argues that POEs are much more dynamic than foreign‐owned enterprises (FOEs) and have a more substantial impact on development than FOEs, which operate more bureaucratically and are less innovative. The chapter argues that the more important impacts of innovation in developing countries derive from indigenous, privately‐owned firms rather than multinational firms. The analysis places the dynamic role of POEs in the context of the history of decolonization. FOEs have been more important in Latin America than in East Asia. It is argued that this may well help explain Latin America's relatively weak performance after the Second World War. No developing country entered the orbit of modern world industry after the Second World War with its own POEs that did not have pre‐war manufacturing experience.

Keywords: entrepreneurship; foreign investment; firm ownership; industrialization; decolonization; Latin America

Chapter.  5443 words. 

Subjects: Economic Development and Growth

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