Researching small firms and entrepreneurship in the U.K.: developments and distinctiveness.

This article charts the development of research on small firms and entrepreneurship in the U.K. over the last 30 years or so and identifies distinctive characteristics of the current orientation of the research field. The paper analyses the rapid increase in the number of researchers contributing to the field over the period, together with its growing legitimacy and institutionalization. One of the key underlying themes is the rich diversity of approaches, reflecting the origins and development path, with clusters of researchers ranging from those with normative objectives to those who view the phenomenon as an object of study. Specific features of the U.K. research field identified include its policy orientation; a rich empirical tradition, with methodological diversity; an emphasis on small firms, and entrepreneurship as a subject for study, rather than an object for promotion; aspects of the boundaries and language of small business and entrepreneurship research; and pro-paradigmatic and middle range theory development i.e., somewhere between grand theory and empirical findings.

Introduction

This paper discusses the origins and identifies the distinctive characteristics of research on small firms and entrepreneurship in the U.K. The historical dimension is important because the distinctiveness of the current orientation of the field, it is argued, is a result of the development path over the last 30 years or so. From what could be described as a narrow and sparse knowledge base, with contributions from a small number of often isolated researchers, the volume of research on entrepreneurship and small firms in the U.K. has exploded. This reflects an increasing interest in the field on the part of policy makers at local, national, and the European Union levels, as well as by the media and society at large, as structural changes in the economy contributed to a growing attention to entrepreneurship and small businesses. These developments have understandably contributed to heightened interest being paid to the phenomenon on the part of educationalists and academic researchers. Collectively, these developments have led to an increased legitimacy of the field as a recognized focus of academic enquiry.

Institutional recognition of the growing status of the field is evidenced by the appointment of a specialist in small firms and entrepreneurship by the Higher Education Funding Council of England for its Research Assessment Exercises in 1996, 2001, and 2007; alongside other already established fields of business and management studies, such as marketing, industrial relations, and business strategy. The growth in the number of active researchers in the field is evidenced by the number of participants in the U.K.'s main research conference on small firms and entrepreneurship, which began in 1978 with less than 40 delegates but which had risen to over 500 by 2006. In addition, estimates of the number of U.K. based professors in enterprise, entrepreneurship, or small business has risen from 158 in 2003 to 271 in 2007 and there has also been a steady growth in the number of peer-reviewed outlets for publication. (1)

Clearly, in the U.K. small business and entrepreneurship is now a distinctive field of academic enquiry with its own U.K. orientation. But this was not always the case. The first section of the paper maps out the origins of the field and its development over time. In doing so it seeks to explain the particular reasons for the style, agendas, and outcomes of research undertaken in the U.K.; the growing legitimacy of the field, as recognized by academics and external stakeholders, and increasing institutionalization, as the field of small business and entrepreneurship has become more embedded within universities, government departments, and other stakeholder bodies. The second section focuses on the distinctiveness of U.K. research in the field of small business and entrepreneurship, as identified by the authors, in relation to the topics and agendas, methodological and theoretical developments, and body of knowledge generated. In view of the fact that a focus on entrepreneurship, narrowly defined in terms of new venture creation and/or growth in existing businesses, has grown out of small business research, together with the fact that the boundary between entrepreneurship and small business is seen by many U.K. researchers as a particularly fuzzy one, the approach adopted in this paper is inclusive, rather than narrowly focusing on studies of new venture creation and business growth. Arguably, this is part of the distinctiveness of the field in the U.K.

Mapping the development of any field of study and identifying its distinctiveness is fraught with problems, not least in that it can only be a subjective endeavour by the authors. However, this paper is able to benefit from previous reflective pieces on the U.K. field (e.g., Curran, 1986, 1989; Gibb, 2000a; Landstrom, 2005; Rosa, 1997; Stanworth & Curran, 1984; Stanworth & Gray, 1991; Stanworth, Westrip, Watkins, & Lewis, 1982; Watkins, 1994), together with a thematic analyses of conference proceedings. It also draws on interviews with researchers who both contributed and witnessed the development of the field since the 1970s. (2)

From the Marginal to the Mainstream: The Development of Research on Small Business and Entrepreneurship in the U.K.

Early Days: the 1970s and 1980s

The current U.K. knowledge base on small firms and entrepreneurship can be traced to the early 1970s, although it is difficult to pinpoint the start of the research in this field with precision. Prior to the early 1970s, there had been some isolated but significant U.K. studies that could be broadly conceived as "research on small firms." These studies were often confined to disciplinary boundaries, such as employment relations (e.g., Batstone, 1969; Goldthorpe, Lockwood, Bechhofer, & Platt, 1968; Ingham, 1967); economics (Marshall, 1919); and analyses of the concentration or size distribution of firms by economists (Hart & Prais, 1956). Yet it is fair to say that the U.K. research base on small firms, or entrepreneurs, was less in abundance than in the United States, which by this time already had both policy (e.g., Mayer & Goldstein, 1961) (3) and academic research interests spanning economics, psychology, and sociology (e.g., Collins, Moore, & Unwala, 1964; McClelland, 1961; Schumpeter, 1942; Smith, 1967).

The reasons for the relatively late start in interest compared with the United States is most probably linked to differences in external environmental conditions, which in the 1970s, saw the U.K. with one of the lowest rates of new firm formation and lowest levels of small business ownership in the western world (Bolton, 1971). In addition, unlike the United States, where the Small Business Administration (SBA) had been founded as far back as 1953, small firms and entrepreneurs in the U.K. were not a focus of attention. Nor was there a demand for knowledge on the phenomenon in universities and polytechnics. While generating material for teaching may not be a prime factor influencing the demand for research, the general absence of entrepreneurship and small business studies from the curriculum in most U.K. higher education institutions, until the last decade or so, is indicative of the status of and interest in the topic in higher education at the time. Inevitably, this had implications for the research base. Another factor was that in the policy arena, as in France, U.K. industrial policy in the 1960s was focused on encouraging mergers and takeovers in order to create larger firms (Shonfield, 1965), with increased internal economies of scale, which was seen to be the key to increased competitiveness vis-a-vis the United States and Japan.

The nascent academic interest in small firms was given an enormous fillip by a Committee of Inquiry on Small Firms (the so called Bolton Report [1971]) commissioned by the Labor Government in 1969 and delivered under a Conservative Administration in 1971. This has proved to be a main foundation stone, if not the keystone, of small business research in the U.K. Contemporaneously, U.K. academics were becoming more interested in small firms. Early studies focused on owner-managers' motivations (Stanworth & Curran, 1973), the role of the petite bourgeoisie in society (Bechhofer & Elliott, 1976), employment relations (Curran & Stanworth, 1979a, 1979b; Ingham, 1967, 1970), and the economics of small firms (Boswell, 1973). Research in these early days was typically rooted in specific disciplines (particularly sociology and economics) and the ontological and philosophical approaches were, therefore, often embedded within specific scientific areas. This meant that there were few opportunities for exchange across disciplinary areas or within a "small business research community." However, one common point made by researchers in such early works was the paucity of knowledge about, or even the myths surrounding, small firms and their owner managers.

In addition to a rise in academic curiosity and research, a related activity was the growing interest in educating advisers and students for small business. This included helping potential, and existing small business owners by the provision of courses and seminars run by practitioners and academics. For example, business start-up programs were pioneered in the late 1970s at the London Business School, Central London Polytechnic, and Manchester Business School. These helped provide oxygen to a nascent field of study in the sense of requiring a pedagogic base, as well as requiring and legitimizing lecturers' and practitioners' efforts in the field.