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Deinstitutionalization through Business Model Evolution: Women Entrepreneurs in the Middle East and North Africa

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Chapter 23
Deinstitutionalization through Business Model
Evolution: Women Entrepreneurs in the Middle East
and North Africa
Richard A. Hunt and Lauren L. Ortiz-Hunt
Additional information is available at the end of the chapter
http://dx.doi.org/10.5772/intechopen.70834
Provisional chapter
© 2016 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons
Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use, distribution,
and reproduction in any medium, provided the original work is properly cited.
DOI: 10.5772/intechopen.70834
Deinstitutionalization through Business Model
Evolution: Women Entrepreneurs in the Middle East
and North Africa
Richard A. Hunt and Lauren L. Ortiz-Hunt
Additional information is available at the end of the chapter
“The rst day I sold my perfumes was the best day of my life. Customers loved them. No one had ever
bought such a good product at such a low price. I was overjoyed with the success, even though I wor-
ried about geing caught running my own business…In the early years, I couldn’t even open my own
bank account! Everything was cash only.” Esraa, Female Entrepreneur from Oman
Abstract
This chapter is among the rst to examine the interplay between deinstitutionalization
and the rollout of novel business models by women entrepreneurs in developing coun-
tries. Much of the existing literature has examined the ways in which policy directives
by formal institutions are the key drivers of entrepreneurial activity among women.
Implicitly, this orientation suggests that the fate of women entrepreneurs is tied to, and
cascades from, macro-level deinstitutionalization eorts, arising through changes in poli-
cies, laws and regulations championed at the highest levels. While this top-down view
may intuitively be aractive, there are empirical reasons to doubt that the “institutional
cascading” model accurately captures the underlying mechanisms of entrepreneurial
activity among women. Taking a radically dierent tack, we develop and test an alterna-
tive, market-based perspective in which novel business models developed by women
drive deinstitutionalization in boom-up fashion. The context for our study involves
detailed case histories of 95 women who started new businesses in the Middle East and
North Africa (MENA), 1960–2012. Using a question-driven research design, our ndings
indicate that deinstitutionalization is strongly associated with the timing and substance
of entrepreneurial action taken by MENA women.
Keywords: women entrepreneurs, business models, deinstitutionalization, institutional
theory, innovation, Middle East and North Africa
© 2018 The Author(s). Licensee InTech. This chapter is distributed under the terms of the Creative Commons
Attribution License (http://creativecommons.org/licenses/by/3.0), which permits unrestricted use,
distribution, and reproduction in any medium, provided the original work is properly cited.
1. Introduction
Success stories of female entrepreneurs in developing economies often elicit surprise, ranging
from casual intrigue to brazen incredulity. The long-standing and often intractable impedi-
ments faced by women in business are well-documented [1]. However, comparatively lile is
understood regarding the mechanisms by which women engage in entrepreneurial activity
despite business venturing prohibitions or other formal and informal limitations. To date, much
of the focus has been on the ways in which women entrepreneurs are favorably or unfavorably
aected by institutional policy changes [2] or how they may be enabled as the beneciaries of
grassroots programs, such as the micro-nance model [3]. Missing from these perspectives are
the ways in which women entrepreneurs are themselves the instigators of purposeful change, not
through political machinations and formalized programs, but through innovative business mod-
els that successfully deliver superior goods and services to competitive markets. The purposeful
deinstitutionalization wrought from these entrepreneurial actions is the focus of this study.
Recent eorts to beer understand the relationship between institutions and entrepreneur-
ial activity have drawn scholars to scrutinize the inuence from a variety of perspectives,
including: institutional barriers to growth [4, 5], the use of intermediaries to precipitate insti-
tutional change [6], the use of “soft power” [7, 8] and use of nonmarket strategies [9–11] to
inuence rms, industries and institutions through the activation of political and social lever-
age [12–15]. To varying degrees, each of these perspectives reinforces Baumol’s [16] notion
that entrepreneurial activity will emerge to varying degrees and with varying characteristics
and intents as a function of the prevailing economic, political, and legal institutions. Scholars
focusing on the mechanisms of institutional change have generated a formidable body of
empirical work supporting the argument that nonmarket dynamics are non-ignorable sources
of inuence [5, 17] and that, just as Baumol [16] had predicted, institutions play a pronounced
role in emergence and expression of entrepreneurial activity [18–20].
At rst glance, it would appear that the macro-institutional template is well suited to the
description and analysis of entrepreneurship among women, including those seeking to gain
a nancial foothold at the base of the pyramid [21]. There are, however, reasons to doubt
whether the distinctive, underlying mechanisms of entrepreneurial opportunity pursuit by
women have been aptly captured by extant theories [22]. Similarly, it is far from clear that
research connecting institutional change to entrepreneurial activity [4–6] accurately conveys
the specic set of circumstances faced by female entrepreneurs, particularly those confront-
ing institutional barriers in developing economies [23]. Scholars such as Ehlers and Main
[3], Harper [24], and Elam [25] have convincingly asserted that the descriptive accuracy and
predictive reliability of existing frameworks are suspect.
Through the eort to articulate an omnibus framework to explain the mechanisms of insti-
tutional inuence on opportunity emergence [26], scholars may have inadvertently mar-
ginalized key mechanisms of action and important sources of variance in opportunity
pursuit and venturing outcomes. If so, then explanatory frameworks may be considerably
less robust to gender dierences than scholars previously had thought and with far greater
consequences concerning the entry and survival strategies of female-owned and operated
Entrepreneurship - Development Tendencies and Empirical Approach432
ventures, particularly in developing economies where the subjugation of women is often
deeply entrenched [23, 27]. A central cause of this veridicality gap may stem from eorts by
entrepreneurship scholars to develop models of endogenous actors functioning as “insti-
tutional entrepreneurs,” individuals who drive change through existing organizations. For
example, Greenwood and Suddaby [28] make the strong case argument that institutional
entrepreneurship by central organizations is far more important than change-oriented activi-
ties occurring on the periphery of formal institutions.
There are a number of problems with the “institutional-actor-as-central-change-agent” perspec-
tive [29], including the trenchant reality that institutions often remain uninchingly inertial for
very long periods of time [30]. These problems are magnied in the context of female entre-
preneurship [1]. First of all, women have comparatively lile presence in governing organiza-
tions. Legislative agendas and constitutional initiatives aiming to improve the status of women
are often subordinate to hegemonic forces that are more focused on preserving the status quo
[31, 32]. This suggests that the impetus for change likely materializes exogenously, not endoge-
nously. Second, the focus on institutional entrepreneurship posits a top-down approach to soci-
etal change, such that the forces of deinstitutionalization [33] are the consequence, not the cause,
of improved nancial prospects for women. This seems dubious since a framework dominated
by the conception of institutional action relegates women to the role of simply waiting for male-
dominated institutions to confer economic privileges. In fact, studies on the growth in female-
owned businesses show that women are not waiting for institutional reform [34]. Finally, an
institution-centric approach fails to account for the transformational potential of market-based
activities that tie entrepreneurial innovations to eager customers through novel business models
that may empower and enable women well beyond the reach of legislative at [35].
Our investigation addresses these shortcomings by developing and testing a novel approach
to female entrepreneurship that contributes multi-disciplinary insights to research streams in
strategic management, entrepreneurship, political science, and development economics. The
framework we propose inverts the explanatory model for female-driven business venturing
by identifying market-based mechanisms that fuel deinstitutionalization from the boom-
up, rather than the top-down. Existing scholarship on women entrepreneurs overwhelming
tends to characterize them as targets of institutional initiatives rather than as co-instigators
of deinstitutionalization [1]. While there may indeed be instances of the top-down dynamic,
counter-examples abound [35], suggesting that fresh theoretical perspectives are needed. The
purpose of this paper is to answer this call.
Leveraging insights drawn from the burgeoning domain of business model analysis [3638] and
then bridging this literature to seminal works on deinstitutionalization (e.g., [33, 39]), we investi-
gate how customer-focused, market-based innovations by female entrepreneurs are a key driver
of the institutional changes aecting the nancial and legal status of women. The context for our
study involves detailed case histories of women who started new businesses in the Middle East
and North Africa (MENA), 1960–2012. Despite their central role in fostering the survival of families
throughout the world, women entrepreneurs in developing countries are notoriously under-stud-
ied. The paucity of research is even more acute in the case of MENA women entrepreneurs due to
socio-religious and cultural restrictions that often impede the collection of detailed narratives [40].
Deinstitutionalization through Business Model Evolution: Women Entrepreneurs in the Middle…
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433
Our investigation of this under-examined population of entrepreneurs illustrates our key
contribution concerning the governing mechanisms of deinstitutionalization through entre-
preneurial action by women; namely, by bringing to market radicalizing business models
for the sake of proting from market success, women entrepreneurs unintentionally trigger
reassessments of institutional structures and aims that often result in improvements to the
economic and legal status of women.
In the absence of a clear theoretical frame to examine the boom-up deinstitutionalization
through market-based business model innovations by female entrepreneurs, we proceed in
the next section with the development of framing questions, which we use to derive a series
stylized ndings that hold rich implications for scholars and practitioners.
2. Framing questions
Theoretically and empirically, existing literature has sought to draw meaningful connections
concerning the relationship between institutional policy and entrepreneurial action. However,
the dynamics involved in deinstitutionalization from a business model-driven, boom-up per-
spective fundamentally diverge from extant scholarship. Since it is our contention that omnibus
theories of entrepreneurial action were not crafted taking into account the distinctive context
of female entrepreneurs from developing countries, there was reason to believe that our line of
inquiry would benet from the use of framing questions in order to explicate the phenomenon at
a mechanism level. Through these we sought to ascertain a set of stylized facts that could then be
compared and contrasted with frameworks, reasoning and evidence from existing theory. This
approach, one that departs from traditional hypothesis testing, applies methodological tools
and insights from recent studies by Moeen and Agarwal [41] and O’Neill and Rothbard [42].
2.1. Women entrepreneurs—material progress, continuing challenges
In recent years, despite the stymieing eects of long-standing socio-cultural and economic
constraints, women have come to play an increasingly important role in generating economic
growth though entrepreneurial activity [43]. In fact, women now account for more than 40%
of all new ventures [44], versus one-fourth that number: a mere 10% of all business start-ups:
only a quarter century ago. This dramatic increase in entrepreneurial activity includes a sig-
nicant and rapidly growing presence in developing countries [27, 45] where some govern-
ments have sought to activate the levers of public policy in order to stimulate and support the
growth and development of women-owned businesses [2]. This surge in women-led entre-
preneurship validates early aempts by policy pioneers to advocate steps to promote the role
of women in creating economic growth through business venturing [23]. It also conrms the
insights of prescient scholars who sought to highlight the importance of studying women
entrepreneurs as a unique and vital subset within the broader landscape of entrepreneurship
research [46]. Progress in the realms of public policy and scholarly research has underscored
the facets of opportunity identication and development that are unique to the conditions and
outcomes of women entrepreneurs [2]. This, in turn, has laid the groundwork for continued
growth in the quantity, diversity and impact of new business venturing by women [47–49].
Entrepreneurship - Development Tendencies and Empirical Approach434
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Entrepreneurial action is a meso-level phenomenon [56, 57] in which an actor (e.g., individual,
rm, trade association) ultimately seeks to inuence the system(s) in which it is embedded,
presumably to improve the actor’s autonomy or power in relation to the system [5658]. This
meta-theoretical relationship has been depicted graphically by Coleman [58], explicated by
Hedström and Swedberg [59], and recently applied specically to entrepreneurship [60]. Kim
and colleagues note, “Hedström and Swedberg’s application of Coleman’s bathtub model
urges scholars to focus on three types of mechanisms: (1) situational mechanisms (represented
by [B] in Figure 1) by which the macro environments in which actors are embedded: such as
countries, regions, organizations, markets, elds, and networks: shape actors’ opportunities,
goals, and beliefs; (2) action-formation mechanisms (represented by [C]) that explain how
these opportunities, goals, and beliefs inuence and actor’s behavior; and (3) transformation
mechanisms (represented by [D]) that account for how the behavior of many actors jointly
brings about both intended and unintended macro-level outcomes” (p. 277).
As Figure 1 displays, the fundamental starting point for an entrepreneur who intends to
bring to market novel technologies, organizations, or business models involves confronting
the conditions that challenge one’s ability to interact with the macro-environmental context.
In more contemporary entrepreneurship theory, Shane and Venkataraman, [61] McMullen
and Shepherd [57], and Sarason et al. [62] each present conceptualizations of entrepreneurial
action that acknowledge the inuence of both system and individual in the contemplation
of opportunity for entrepreneurial action. McMullen and Shepherd [57], for example, note
that actors must rst become aware of the possibility that an opportunity for someone exists
before they can evaluate whether it represents an opportunity for them to engage in entrepre-
neurial action.
Question 5: From where do MENA women entrepreneurs get their innovations and ideas?
Figure 1. Coleman’s boat.
Entrepreneurship - Development Tendencies and Empirical Approach436
Upon arriving at the conclusion (intuitively, if not deliberately) that the environment may
indeed oer a possible opportunity for someone [57], actors must take action. Here, indi-
viduals contemplate the external environment and ask, how does what’s happening out there
aect me [63, 64]? How should a situation be interpreted given the actor’s knowledge, skills,
abilities, motives, and intents? These questions involve meso-level phenomena occurring
exclusively within the actor-level, such as when individual-level preferences are argued to
produce an entrepreneurial orientation at the rm-level [56, 65].
Question 6: What forms of entrepreneurial action are undertaken by MENA women? What drives the
decision to act? From where does the inuence arise?
This brings us to the transition from micro-level back up to macro-level, wherein the actor
seeks to inuence the system, institutions, or structure in which she is at least partially
embedded. Research interested in this link seeks to understand the mechanisms actors use
to transform systems and focuses on “how” as opposed to the “when and where” of situ-
ational mechanisms or the “whether, why, and who” of action-formation mechanisms. Thus,
actors do not necessarily engage in behavior with the intent of transforming the system, but
nonetheless they still can and do [66]. Through this process, social norms can evolve to govern
behavior without individuals being consciously aware of their inuence [67].
Question 7: Are the micro-level entrepreneurial actions of MENA women transformative? If so, when
and how?
3. Extant theory: institutional cascading
3.1. Women entrepreneurs and deinstitutionalization
Extant scholarship has largely focused on the capacity and resolve of existing institutions to
enhance or inhibit entrepreneurial activity among women [34, 35]. As Jennings and Brush
[1] noted, the small amount of prior research on women’s social and environmental entre-
preneurship has tended to “portray women as the targets rather than as the initiators of
enterprise initiatives,” (p. 711) including the rapidly growing literature on micro-nance
organizations. Grassroots studies examining the role of women entrepreneurs in fostering
sustainable livelihood assets [68] have framed the obstacles and opportunities of women
[34] in terms of the entrepreneurial actions women have taken within the context of existing
institutional constraints and support systems [69, 70]. Implicit in this approach is an event
sequencing logic that presumes institutional change is the key driver of entrepreneurial activ-
ity and sustainable organizational forms among women. This, in turn, suggests that the fate
of women entrepreneurs is tied to, and emanates from, deinstitutionalization, which “refers
to the erosion or discontinuity of an institutionalized organizational activity or practice.” [33].
When policy actions instigated by formal institutions foster greater participation by women,
then opportunities for women should increase in cascading fashion. The essence of this per-
spective is captured in Figure 2.
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In many instances, the top-down model is a reasonable and eective basis for conceptu-
alizing the deinstitutionalization process. As the double-headed arrows suggest, actors
operating across a wide array of formal institutions take actions that promote or inhibit
the process of deinstitutionalization. As momentum toward deinstitutionalization or away
from deinstitutionalization occurs, institutions are themselves aected in a feedback loop.
In time, this formalized process of deinstitutionalization will trickle down to women,
including entrepreneurs, who will experience an increase or decrease in the quantity and
diversity of opportunities, depending on the specic nature of the deinstitutionalization
that is occurring.
For example, prior to the Islamic Revolution, women in Iran enjoyed access to educational
and professional opportunities virtually on par with those experienced by women in western
Figure 2. “Institutional cascading” approach to deinstitutionalization.
Entrepreneurship - Development Tendencies and Empirical Approach438
industrialized democracies. When the Shah was deposed in 1979, the existing institutional
structures were largely discarded through legislative change wrought from the Islamic
Revolution, including broad policies aimed at limiting business and educational opportuni-
ties for women [73]. The deinstitutionalization and subsequent reinstitutionalization pro-
cesses involved a top-down, “institutional cascading” of constitutional reforms that had a
demonstrable impact on the dramatically reduced quantity and diversity of entrepreneurial
opportunities available to women.
While the institution-centric framework is intuitively enticing given various eorts to change
the socio-economic status among women in a top-down fashion, the “institutional cascad-
ing” model [74] may actually be constructed upside down [12, 56] when applied to many
circumstances involving women entrepreneurs in MENA. Importantly, Oliver’s framework
makes no governing assumptions regarding the origins of the mechanisms that drive dein-
stitutionalization. Rather, the top-down conceptualization appears to be an artifact of schol-
arship emanating from political science [71], sociology [72] and management [33] that have
focused on legislative reforms and other macro-institutional policies as the principal sources
of change that impact the legal and economic status of women entrepreneurs [1]. Unstudied to
date is an alternative perspective in which novel business models developed by women entre-
preneurs may instead lead to deinstitutionalization through the spread of new, market-based
approaches, in a boom-up fashion. As a source of inuence impacting the long-term sta-
tus of women and the fate of women-owned business, the dierences between the top-down
and boom-up conceptions of deinstitutionalization could not be more stark. The ability and
willingness of marginalized women exerting inuence from outside the system constitutes a
direct challenge to conceptions propounding institutional macro-mechanisms driving change
through top-down cascading.
Existing literature on institutional change is deeply bifurcated on the role of agency and
actors. On the one hand, some scholars have held that new ideas more often occur at the
margins of a eld, where individuals and groups are less beholden to formal and infor-
mal institutional norms and are more cognizant of institutional contradictions [75, 76]. On
the other hand, emerging scholarship on endogenous actors and “institutional entrepre-
neurs” holds that centrally situated individuals are far more likely to possess the means
and inclination to aect institutional change [28, 77–79]. Elam [25] makes the case that
neither perspective is entirely useful to the study of women entrepreneurs because each
view fails to account for the market-based forces that shape the decision-making logics of
women who inuence formal and informal institutions without intending to do so. Instead
of presuming an institutional provocation as a call to action, a more reasonable starting
point may be the creation of novel business models that are developed to address market
opportunities [80].
4. “Boom-up” alternative: business model innovation
By its very nature, institutional cascading presumes a “wait and see” approach by prospective
women entrepreneurs for propitious times that ensure a high degree of social validation, as
Deinstitutionalization through Business Model Evolution: Women Entrepreneurs in the Middle…
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439
would be suggested by the macro-structural-dominant consideration represented by Point
4 in our earlier rendering of Coleman’s Boat (Figure 1). While the importance of formal and
informal institutional inuence enjoys a strong scholarly heritage (e.g., Baumol [16]; North
[18]) and selected sources of empirical support [4–6, 10, 14, 15], it lacks much needed veridical-
ity in the context of women who persist in pursuing entrepreneurial activity even in the face of
institutional impediments and outright prohibitions. Solely engaging a top-down conceptual-
ization of deinstitutionalization appears untenable under these circumstances. Our alternative
approach proposes a boom-up conceptualization based on business model innovation [81].
4.1. The deinstitutionalizing eects of novel business models
Business models are the distinctive means by which a rm creates and captures economic
value. Zo and Amit [82] refer to business models as the logic of the rm, “the content, struc-
ture, and governance of transactions designed so as to create value through the exploitation of
business opportunities” (p. 511). It is, in the words of Porter [83] an “activity system,” consist-
ing of dynamic linkages that form a system of managerial decisions that, if successful, inter-
lock in a complementary fashion with customer choices [82]. The focus on systemic linkages,
value-enhancing activities and transactions [56] is a key facet to understanding novel business
models developed by individuals through entrepreneurial activity. The customer-focused
nature of business model frameworks [84, 85] is expressed through an explicit emphasis on
developing and delivering the rm’s value proposition [86–88]. In this sense, the customer is
the “central anchor” for managerial decision-making [89, 90].
In the context of deinstitutionalization, the generation of novel business models to service
evolving customer needs functions as a leading indicator of socio-cultural change [84]. While
models of institutional entrepreneurship have suggested that “individualistic values are not
superior to collective values as far as alertness and entrepreneurial discovery are concerned”
[24] (p. 4), the sum total of market-based inuences involves an amalgamation of individual-
istic values that can be a potent force in directing behaviors, decisions and business outcomes
[89]. It is likely, then, that women who face an unfavorable constitutional regime or oner-
ous policy environment still seek value-creating opportunities that long precede changes to
institutional strictures and structures. As the proposed model depicted in Figure 3 suggests,
the starting point for this deinstitutionalization emanates from pragmatic, market-based deci-
sions to oer beer goods and services to customers.
Regardless of whether a business is owned and operated by a man or a woman, the rst con-
sideration is the owner’s ability to behave entrepreneurially when seeking to generate distinc-
tive value for customers. As Wir et al. [91] noted: “A business model reects the operational
and output system of a company, and as such captures the way the rm functions and cre-
ates value” (p. 274). McGrath took a similar tack, emphasizing that business models consist
of “process or operational advantages, which yield performance benets when more adroit
deployment of resources leads a rm to enjoy superior eciency or eectiveness on the key
variables that inuence its protability” [92] (p. 249). Thus, the decisive characteristic of a suc-
cessful female entrepreneur is not that she is female, but that she is entrepreneurial [34] and
has the willingness and ability to develop and implement novel resource combinations that
deliver superior eciency and/or eectiveness to her customers.
Entrepreneurship - Development Tendencies and Empirical Approach440
In Figure 3, customer receptivity to new and beer modes of delivering value results in market
feedback that validates strategic and operational decisions. “Transactional support” refers to
the development and implementation of specic business model support systems through mar-
ket transactions with customers. Based on customer receptivity, transactional support is con-
tinuously modied to beer deliver value [56]. The consequence of this is the emergence of new
business models that are “interlocked” in complementary fashion with customer choices [82].
Our proposed boom-up model theorizes that the validation of these complementary inter-
locks exerts deinstitutionalizing forces on a wide assortment of formal institutions (indicated
by positively oriented “FI” reactions to deinstitutionalization in Figure 3). When deinstitu-
tionalization occurs in this fashion, constitutional reform and other legislative changes aect-
ing women are a consequence of grassroots mechanisms originating with market-based
decisions by women who did not aspire to precipitate institutional change, but did so unin-
tentionally through receptivity to the novel business models by the market. Thus, rather than
Figure 3. Business model innovation approach to deinstitutionalization.
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441
witnessing an institutional cascade through formal instructional reforms being the starting
point for female entrepreneurs, we posit deinstitutionalization as a consequence of novel,
customer-centric actions already taken in the marketplace.
5. Study design
5.1. Question-driven inquiry
Our line of inquiry constitutes a signicant departure from existing frameworks and empiri-
cal studies that have focused on the ways in which women entrepreneurs primarily exploit
existing, institutionally endorsed business models Jennings and Brush [1]. Missing from
existing perspectives are important ways in which women entrepreneurs experiment with
novel business models that precede the endorsement of formal institutions. For this reason,
we engaged in a question-driven empirical analysis. The ecacy of this approach is under-
scored through a Special Issue (SI) call by the Strategic Management Journal (SMJ) focusing on
“Question-Driven and Phenomenon-Based Empirical Strategy Research,” led by Graebner,
Kno, Lieberman, and Mitchell. The intent of this emerging methodology, and SMJ’s SI, is to
“focus on identifying and analyzing key questions about strategy and strategically relevant
phenomena, as alternatives to developing specic hypotheses.” Like many studies employ-
ing contexts that were neither well-contemplated nor fully appreciated at the time of theory
development, the methodological design employed in this study was justied by the fact that
an inverted, boom-up approach to the institutional inuence of MENA women entrepre-
neurship is not well-explained by the logics of existing theories.
5.2. Case histories
We tested our re-conceptualization of the interplay between entrepreneurship and institutions
through detailed case studies of 95 women entrepreneurs in seven MENA countries, each col-
lected over a period of 1–5 days, through interviews with the entrepreneurs and associates.
The case histories were compiled as part of a joint cultural anthropology and economic geog-
raphy study conducted by faculty members and doctoral students from two large, American
research universities as well as USAID employees working in the region. All 21 investigators
had professional training in recording detailed ethnographies. The co-authors of this paper
worked with the ethnographers to obtain specic entrepreneurship-oriented narratives that
were relevant to our research questions, including the renement of the framing questions.
This ensured linguistic accuracy and preserved meaning across dialects. One or more of the
co-authors accompanied the ethnographers on 23 of the in-depth interviews, totaling more
than 400 hours of contact with the subjects.
The sample was comprised of 25 women in Morocco, 15 each in Egypt and Jordan, and 10
each in Algeria, Tunisia, UAE and Oman. The set of cases for each country included former
and current women entrepreneurs, ranging in age from under 20 to over 70. The average
age across all the cases was 47 years old. The stipulation for participation required that each
woman must have founded her own revenue-generating business. None of the businesses
Entrepreneurship - Development Tendencies and Empirical Approach442
were inherited from family members or spouses. Thirteen of the women had started multiple
businesses. The average lifespan for the businesses was 11 years, with a range of 2–55 years.
Annual revenues ranged from U.S.$3700 to $45MM.
In addition to extensive discussions with the entrepreneurs, researchers also spoke with other
individuals in each entrepreneurs’ family and business network, with the permission of the
entrepreneur. These “triangulating” interviews provided conrmation and signicant elabora-
tion of details oered by or omied from the entrepreneurs’ own accounts. No fewer than ve tri-
angulating interviews were held for each subject, with a small number exceeding 20 interviews.
The entrepreneurship-related facets of the case histories focused on obtaining a detailed
description of each entrepreneur’s business model, using key elements and common threads
drawn from the conceptual frameworks developed by Hamel [93], Linder and Cantrell [94],
Applegate and Collura [95], Osterwalder and Pigneur [37], and Zo and Amit [82]. Through
these case histories, we sought to examine the evolution of viable business models in three
regards: (i) The evolution of rm-level business models from the time of market entry until
the sale or closure of the business; (ii) The evolution of viable business models over time
across the full population of case histories, consisting of rm foundings from 1960 to 2012; (iii)
The evolution specically of market entry business models over time.
Each case history sought to elucidate the experiences of actual individuals drawn from spe-
cic entrepreneurial action that had been undertaken, usually involving the formation of a
company and necessarily involving the sale of goods and services, evidenced by actual trans-
actions that had occurred. Consistent with theory-building methods that employ the analysis
of heterogeneous case studies [96, 97], the real-life cases compromising this study intention-
ally sought to illustrate diverse individuals and contexts in order to synthesize ndings that
were representative of common experiences, not fringe cases.
5.3. Stylized ndings
Central to harvesting stylized ndings from heterogeneous cases are two nely balanced
aims: (i) diversity of the individual contexts, and (ii) representativeness of the overall col-
lection of contexts [98, 99]. Single case studies are often used in management research to
delve into extreme exemplars to address observational gaps that elude mainstream deductive
research [100], such as Duon and Dukerich’s examination of New York’s Port Authority
[101] or Weick’s classic exposition of the Mann Gulch Fire [102]. However, as Eisenhardt and
Graebner [97] noted, while single-case studies may be an excellent tool for establishing the
existence of a phenomenon, theory building is beer serviced by the use of multiple cases.
Analysis of diverse cases is also highly instrumental in addressing the “multiple meanings
problem” [97, 103] that often bedevils qualitative research. Since multiple-case studies are
characterized by intentional dissimilarity of an appropriately diverse set of cases [96, 104], the
central analytical aims are triangulation and synthesis [105], not the extrapolation witnessed
in single-case designs, or the renement of extant theory by repetitive cases in a particular
context. Multiple meanings are systematically culled out through the process of investigating
a similar phenomenon across distinctive contexts [105, 106]. In the exposition that follows,
our triangulation reveals common threads emerging from varying individuals and contexts.
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6. Findings and synthesis
As noted from the outset, the purpose of this study was to investigate the underlying mecha-
nisms driving MENA women to pursue entrepreneurial action even when confronted by insti-
tutional impediments. Our testable conjecture was that prot-seeking women developed and
implemented innovative alternatives to extant goods and services. Further, these disruptive
business models had an indelible, though largely unintended, eect on deinstitutionalization,
thereby improving the nancial and legal status of women. In the absence of a clear frame-
work through which to construct hypotheses regarding a boom-up process of deinstitution-
alization, we developed seven framing questions to guide the interview process as we built
the case histories. Ten stylized ndings emerged, each of which generate novel theoretical
contributions germane strategy, entrepreneurship, sociology and development economics.
Of the 95 case histories included in our study, 82 involved women entrepreneurs using busi-
ness models in a fashion that did not strictly subscribe to the prevailing legal, social, cultural
or economic conventions at the time of the rm’s founding, but nonetheless achieved prot-
ability, acceptance and longevity as institutions morphed to accommodate consumer-driven,
market-based outcomes. Our ndings provide support for our central argument: Evolving
business models developed and promulgated by women entrepreneurs in developing coun-
tries simultaneously create new sources of customer value and, in an unintended fashion,
contribute to the deinstitutionalization of barriers to entrepreneurial activity by women.
As noted above, we structured our inquiry to ascertain if and how business models evolved
over time in three respects: (i) The evolution of rm-level business models from the time of
market entry until the sale or closure of the business; (ii) The evolution of viable business
models over time across the full population of case histories, consisting of rm foundings
from 1960 to 2012; (iii) The evolution specically of market entry business models over time.
First, we needed to establish that women had in fact started businesses and, since we were
interested in whether entrepreneurial activity pre-dates or post-dates deinstitutionalization,
we needed to establish whether the businesses were legal or illegal at the time each woman
commenced commercial activities. As Table 1 indicates, being a MENA woman entrepreneur
almost always involved launching businesses that were illegal in some form or fashion.
Firm formation and other market-based action ensued despite formal institutional impedi-
ments. Key insights on this point are dramatized by the following perspectives:
“I started my business because I saw the opportunity to make money. I was not ignorant of the fact
that I might get in trouble, but I wasn’t going to let a good idea slip away either.” Sunny, from Oman
“People used to say that I was brave to strike out on my own at a time when women simply did not
operate businesses, but now it is very common. Some of the best business owners are women.” Farah,
from Tunisia
In many cases, the impediments involved signicant gender-related socio-cultural issues, as
well:
“You think it’s easy for a woman to run a business in Egypt? Try telling a male employee that he has
made a mistake. Try telling a company with a male owner that they owe you money.” Sara, from Egypt
Entrepreneurship - Development Tendencies and Empirical Approach444
These recurrent themes ran throughout the ethnographies, crystallizing in two key ndings
related to unsponsored grassroots action:
Finding 1: MENA women can and do start businesses despite legal strictures and social conventions
barring such actions.
Finding 2: Women take market-based action before institutional policies formally allow them to do so.
As Table 1 illustrates, the women in our study launched 175 total businesses that were based
on business models that were forbidden by laws that existed at the time of founding. In time,
87% of these businesses (152 businesses in total) eventually became legal enterprises under
the applicable laws of each country. This means that the study participants launched a mul-
titude of illegal businesses across a span of 50 years, of which the overwhelming majority
were eventually sanctioned. The frequency with which new foundings consisted of partially or
wholly illegal enterprises is not atypical in countries characterized by large informal economic
sectors, sometimes accounting for more than two-thirds of the overall economy [107, 108];
however, MENA women entrepreneurs historically have had few, if any, formal sector alterna-
tives, driving them to engage in illegal, informal entrepreneurial action, or non-participation.
Overwhelmingly then, market entry and survival were driven by business model innovations
developed by the women, despite impediments, which ranged from prohibitions against hold-
ing a bank account to owning land, and from laws against driving to laws forbidding the con-
summation of transactions. In time, all but 23 of these businesses became legal, meaning that
in the vast majority of instances, MENA women entrepreneurs acted prior to the activation of
institutional policy. A sample of these innovations and the legal impediments at the time of
founding are captured in Table 2.
As the examples in Table 2 reveal, MENA women entrepreneurs often operate illegal busi-
nesses for lengthy periods of time before they were institutionally sanctioned. This means that
market entry and commercial operations preceded formal legitimacy to do so. The deinsti-
tutionalization-reinstitutionalization processes involve a bale between non-conformity and
institutional inertia [33]. Through societal reassessment of behavioral standards, Oliver posited
Country Study
participants
Participants who
launched illegal
businesses
Illegal businesses
launched by participants
Illegal businesses that became
legal through institutional
changes
Morocco 25 21 47 40
Egypt 15 12 22 17
Jordan 15 11 36 36
Algeria 10 9 16 14
Tunisia 10 9 21 21
UAE 10 10 17 13
Oman 10 10 16 11
Total 95 82 175 152
Table 1. Illegal business foundings and the institutional response.
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institutional “erosion” occurring over long periods of time, which eventually brings societies to
a “tipping point” when deinstitutionalization can be observed. The timelines for the 152 illegal
businesses suggest that the entrepreneurial activities drawn from the case histories occurred as
part of the erosion leading to deinstitutionalization, not an ex post, reinstitutionalized bene-
ciaries of a top-down policy changes. The narrative is clearly one of “act-and-see,” not “wait-
and-see” [109] From the half century of erosive activity we discover that:
Finding 3: Female entrepreneurship in MENA is associated with deinstitutionalization
Finding 4: Institutional policy action follows after entrepreneurial actions by MENA women more
often than it precedes it.
6.1. Customer focus
Having established that MENA women entrepreneurs emerged despite an array of legal pro-
hibitions and that their entrepreneurial activities are associated with the erosional phase of
deinstitutionalization, it is necessary to ask how this occurs if we are interested in examining
the micro-level, boom-up mechanisms of this action. The following excerpts are typical of
the comments drawn from the ethnographies. Above all else, early-stage innovating and go-
to-market decision-making hinged on the women’s ability to identify and exploit customers’
needs, wants and desires more eciently and eectively than existing solutions available in
the market.
“Women make most of the purchases for their families, so who is in the best position to create new prod-
ucts that women like? It is easy to out-think and out-maneuver businesses run by men when it involves
things that women purchase.” Raghda, from Jordan
“I love selling to customers. Most of them have become loyal to me over the years because they trust me
and know that I will do what I promise. A customer is the most valuable thing for a business and I treat
my customers like they are part of my family.” Meriem, from Algeria
Business model innovation Legal status Institutional response
Prepare fresher food for vendors by cooking the
morning of sale in 1960
Illegal at the time to be involved in
commercial enterprise
Law changed in 1974
Sell customized orders direct-to-consumer contact
in 1971
Illegal at the time to publicly transact for
goods or services
Law changed in 1985
Establish co-location of complementary businesses
1984
Illegal at the time for women to own or
manage real estate
Law changed in 1989
Finance the business activity of other women as
franchises 1993
Illegal at the time for woman to hold a
bank account
Law changed in 2007
Provide consulting services to women 1999 Illegal own and operate a business. Law changed in 2003
Design B2B website and monetize its content 2001 Illegal to solicit and process online
transactions
Law changed in 2010
Table 2. Sample business model innovations and deinstitutionalizing responses.
Entrepreneurship - Development Tendencies and Empirical Approach446
A dedicated sense of connectedness to customers is a hallmark of business model research
[92, 110]. In this context, it helps to explain how illegal businesses were able to survive and
thrive despite laws prohibiting their existence. Ultimately, customers made decisions based
on demonstrable value, not the legal system [111]:
Finding 5: Customers of MENA women entrepreneurs are aracted to goods and services despite
institutional policy, not because of it.
Single-minded aentiveness to customer satisfaction provides a kind of “security blanket,”
insulating women entrepreneurs from legal strictures because loyal customers are their best
protection to the extent that women entrepreneurs can deliver superior value. In a sense, the
transformational nature of their eort was vastly subordinate their customer-focused aims,
not because they were indierent to the plight of women, but because the best way to pursue
entrepreneurial passion and ensure that their respective business survived was to remain
relentlessly customer-centric. Thus, the motives and actions of the 95 women in the study
were unambiguously focused on being an outstanding businessperson.
“Hard work. That is my only rule and my only moo: Hard work. Everything I’ve ever gained has
come from hard work. No one works harder than I do and my prots prove it.” Nadia, from Morocco
“This is the third business I’ve started so far. As soon as I think I’m done starting new businesses I
think of a new way of doing something beer, something that customers will love even more!” Aqila,
from Jordan
The ubiquitous theme of customer-focused, market-based decision-making logics leads to the
following stylized ndings:
Finding 6: The goals of MENA women entrepreneurs are grounded in market-based, prot-driven
logics —the delivery of exceptional quality of goods and services to satised customers—not social
transformation.
Finding 7: Successful MENA women entrepreneurs have taken an “act-and-see” rather than a “wait-
and-see” approach to market-based innovations.
6.2. Innovative business model generation and deinstitutionalization
As the foregoing demonstrates, MENA women entrepreneurs formed the legacy of their mar-
ket-based inuence by seeking to cater zealously to the needs, wants and demands of custom-
ers, which simultaneously provided commercial success and protective insulation from laws
prohibiting the popular goods and services they proered. But, how do we know that these
success stories had any material relationship to the process of deinstitutionalization? How
do we know that it was boom-up inuence through novel business models rather than top-
down inuence through the erosion of pre-existing institutional constraints? To answer these
questions, we need to look at the entire population of 175 businesses over time (Figure 4).
As Figure 4 reveals, there continues to be a material gap between the “founding date” and the
“legitimacy date,” meaning that the great preponderance of new business models launched by
MENA women entrepreneurs are illegal at the time of inception. However, it is apparent that
the average time elapsed between founding and legal legitimacy has dramatically shortened.
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Entrepreneurship - Development Tendencies and Empirical Approach448
A low-rated rm along these dimensions might be a nail salon or tea house that simply repli-
cated the product and service oerings of existing businesses. A rm rated very high for inno-
vation might be one that is the rst to oer a category of products or services to the market,
such as online dating services. Another example of high novelty was a business that bundled
disparate products and services in a fashion that met multiple user needs and provided sym-
biotic pricing advantages. In this sense, we would expect that high value creation and high
novelty locks in new customers in new ways that disrupt both the marketplace for goods and
services and the institutional framework. Using the time gap to legal legitimacy, we examined
the role of novel business models and predicted the relationships depicted in Figure 5.
There is no reason to expect that deinstitutionalization would be homogeneously responsive to
innovation, and a regression analysis bore this out. Although a quantitative assessment was not
an aspect of our original design, we had a sucient population of rms to entertain preliminary
analysis of our stylized ndings, based on the model that had emerged. Using time to legal
legitimacy as a dependent variable, we found that our predictive model was highly signicant
(F7,168 = 43.17; Adj. R2 = .451) and that the coded values for both value creation for customers
and business model innovation novelty are positively associated with deinstitutionalization
(p-value < 0.01). Since we did not have full controls available for all of the subjects, we are at loath
to draw extended conclusions from these analyses, but believe they are quite intriguing. With or
without the preliminary regression results, two key stylized ndings emerged from this inquiry
Finding 9: MENA women entrepreneurs both copy and create business models. They are neither pa-
tently followers nor leaders. Situational eects are more important than generalizable conditions and
women who can capitalize on novel innovations, do so.
Finding 10: Greater business model innovation is associated with a faster rate of deinstitutionalization.
Figure 5. Relationship between market-based innovation and deinstitutionalization.
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The rich, detailed information drawn from the ethnographies provide a revealing perspective
on the landscape of entrepreneurial activity among women in the MENA region. Despite
formal prohibitions, the vast majority of participants took business models to market that
found customer acceptance and economic success. In many cases, the formulation and imple-
mentation of the business model signicantly preceded institutional action to reassess the
governing laws.
7. Discussion
By pioneering novel organizational forms and customer-focused innovations despite insti-
tutional impediments, women entrepreneurs not only create consumer demand for valued
goods and services, they also build a sustainable foundation to improve the lives of their
children, their communities and themselves. Oftentimes, as the foregoing results reveal, these
entrepreneurial actions create lasting pathways for institutional change. While extant theory
envisions institutional change seeding an increasingly receptive environment for women
entrepreneurs, our framework and supporting empirics suggest that in the case of MENA
women entrepreneurs the exact opposite may be occurring; that is, entrepreneurial pursuits
are well out in front of policy initiatives in driving deinstitutionalization through new activ-
ity systems [112] stemming from business models that seek novel sources of prots by more
eectively addressing customer needs [84, 89], thereby resulting in fresh opportunities for
new entrepreneurs who may be ready to test new business models. As Oliver [33] noted, it
is common for deinstitutionalization to emanate from individuals who are neither aware nor
concerned with facilitating institutional change.
Our study of MENA region women suggests that grassroots activities to beer serve willing
customers constitute an important instigator of institutional change. Our analysis of 95 women
revealed that their novel approaches were often eective and, in some case highly subversive
(see Figure 5), even though institutional change was neither the stated nor the implicit motive
for engaging in entrepreneurial activity. The ndings shift aention to market-based, boom-
up approaches to commerce that address functioning markets. Concomitantly, institutions
are fundamentally changed in the process, opening the door for future generations of women
in a manner and with a speed that cannot be equaled through constitutional reforms.
The ability of these women to deliver meaningful, market-based value to their respective cus-
tomers, we believed, would prove to be more compelling to customers than informal and for-
mal strictures pertaining new venturing by women. Although social transformation was not
a consideration to these entrepreneurs, their actions did in fact precede institutional change
and, as suggested by the detailed case histories, contributed to that change.
7.1. Limitations and opportunities
All research designs involve compromises and tradeos, the ecacy of which ultimately rests
upon the ability of the methodology to service the research aims of the investigation. Here
too, then, there are limitations and opportunities stemming from three design decisions that
Entrepreneurship - Development Tendencies and Empirical Approach450
deserve greater scrutiny: (i) the use of a question-driven design, (ii) the use of ethnographic
narratives, and (iii) the focus on the under-studied context of MENA women entrepreneurs.
Regarding the use of a question-driven design, as noted earlier, the development of fram-
ing questions was strongly indicated by paucity of existing literature on deinstitutionaliza-
tion and female entrepreneurship. Moreover, much of the theory that does exist has taken a
patently top-down, institutional cascading perspective to the process of deinstitutionaliza-
tion. Studies examining the role of grassroots social movement inuence, such as that seen
in the wind power industry [14, 15] take up coevolutionary dynamics with some aention to
boom-up sources of inuence. Contexts such as wind power validate the theory-building
emphasis on exogenous, grassroots-level change mechanisms; however, the emphasis of this
research stream does not focus on several facets that are indispensable to our study: legal
strictures, individual decision-making, and business model innovations [80]. The purpose of
this study was to deconstruct the macro-micro convergence of entrepreneurial action of social
structures occurring at Point 4 of Coleman’s Model (Figure 1) with the aim of ascertaining the
micro-level mechanisms of deinstitutionalization. Since existing scholarly sentiments either
had not considered this avenue or were inclined in a dierent direction, a more open-ended,
question-driven design was ideal.
As for the use of ethnographic narratives, here too there are pros and cons. Utilizable data is
rarely collected on marginalized groups, especially for women [1] and those residing in devel-
oping countries [23]. Often, the only data that is available is highly aggregated [44, 113] or
consists dicult-to-generalize single-case studies. The liability of ethnographic narratives is the
potential for corrupting biases emanating from the researcher and the self-presentation biases
of the subjects. Concerning the former, all the ethnographers were well-trained, experienced
researchers, who had extensive in-country tenures and language uency. More importantly, all
subject research was conducted while rigorously applying modern techniques that invite sub-
jects to be “co-investigators” rather than maintaining the pretense of dispassionate observers
[114]. Concerning the potential biases from self-presentation, by triangulating throughout the
network of the study subjects, ethnographers could feel condent with a high degree of certainty
that customers, suppliers, family members and friends provided conrmatory perspectives.
Finally, regarding the focus on MENA, the benets of examining countries that have a persis-
tent disconnect between the aspirations of women entrepreneurs and legally endowed consti-
tutional freedoms provides an exceptional portal through which to observe the processes of
institutionalization, deinstitutionalization and reinstitutionalization. However, several cave-
ats are worth noting. First, MENA is far from monolithic. The ethnographies and data are
aggregated here for the purpose of demonstrating “critical mass” in the focal phenomenon.
By no means are the seven countries included in the study identical to one other’s past, pres-
ent or future. Although the countries were, by design, selected because each is overwhelm-
ingly Muslim, the socio-cultural, linguistic and post-colonial heritages across these countries
exhibit enormous dierences. Second, global generalization from the MENA context is chal-
lenging. In the same sense that each MENA country is distinctive, so too are regions and coun-
tries outside MENA. Future studies can and should exploit access to other societal contexts
to delve deeper and to establish meaningful boundary conditions while testing the stylized
ndings drawn from this study.
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An additional challenge of this study stems from the emergence of potential alternative
explanations. As a theory-building research design, question-driven methodologies are more
prone to exposure to challenges from alternative explanations than studies applying quan-
titative tools regarding well-trodden research questions. In some sense, however, it is the
ability to ignite purposeful debate that makes question-driven methods valuable to the eld
of strategic management. One prominent alternative explanation emerging from this study
pertains to the issue of enforcement. The essence of this argument is that prohibitions against
MENA women in various facets of commercial activity are the equivalent of “blue laws” in
the U.S.; that is, they are arcane prohibitions that are never actually enforced, such as archaic
state-level provisions forbidding activities like walking one’s dog on Sunday. The claim could
be that throughout MENA, informal institutions: such as norms, preferences and customs:
have fundamentally changed, but that there is a “constitutional lag” as the formal institu-
tional changes move more slowly. Thus, a society may have no interest in legal enforcement
even while the laws still exist. Moreover, both women entrepreneurs and their customers
know this. Like so many facets of deinstitutionalization, there is almost certainly some inter-
action between formal and informal institutions during the process of institutional erosion
[33]. However, the logic of this argument actually supports the concern that top-down institu-
tional cascading is not the sole driver of deinstitutionalization. There are, as our study reveals,
a whole host of individual actions that soften institutional inertia from the boom-up. As the
results suggest, those actions aimed at consumer-focused, market-based improvements by
innovating entrepreneurs are likely to be particularly impactful.
7.2. Conclusion
The evidence that MENA women entrepreneurs display an “act-and-see” rather “wait-and-
see” approach is itself transformative tot eh study of women entrepreneurship. Scholars
examining institutions, entrepreneurial action and economic development can benet from
the potential micro-level mechanisms highlighted in this study. Extant theory has provided
extensive support for an important truism: institutions maer. Institutional inuence theories
from Baumol [16], North [18] and others appear to be secure in their assertion that the struc-
ture and content of institutions exerts noteworthy inuence on the quantity, diversity and
purpose of entrepreneurial action. However, a focus solely on macro-structural drivers of the
macro-micro nexus at Point 4 of Coleman’s Model (Figure 1) misses entirely the role of micro-
level mechanisms, emanating from individual decisions about the commercial prospects of
business model innovations.
It is beyond the scope of this study to prove causal connections between the novelty of busi-
ness model innovations by women entrepreneurs and the deinstitutionalization of legal
strictures that limit the access to commercial opportunities for women. Future studies will
need to leverage and stress-test our ndings in search of increasingly well-rened data and
research designs that allow for the use of strong-theory models and robust instruments that
will together provide directional certainty regarding causation. However, our ndings indi-
cate that institutional entropy [33] is strongly associated with the timing and substance of
entrepreneurial action taken by MENA women. In the end, the mechanisms of deinstitution-
alization appear to be less a frontal assault enacted from hegemonic seats of political power
Entrepreneurship - Development Tendencies and Empirical Approach452
than the steady delegitimization of accepted practices through the power of the pocketbook.
Fatima, a serial entrepreneur now specializing in Moroccan Argan oil, captures the notion in
this fashion:
“My suppliers love me because I pay on time and I’m able to move huge quantities. My customers love
me because they get an authentic product, not the imitations. And as for me, I have ten more ideas for
new businesses…I’ve done this myself. No family money. No husband money. It was hard. I won’t tell
you how hard. But, I was born to be in business and that’s what I’ve done.”
Author details
Richard A. Hunt1* and Lauren L. Ortiz-Hunt2
*Address all correspondence to: rahunt@mines.edu
1 Strategy & Entrepreneurship, Colorado School of Mines, Golden, CO, USA
2 Dyson School of Applied Economics, Cornell University, Ithaca, NY, USA
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