AIB 2012 Conference Proceedings - Academy of International ...

SUNDAY
both drive MNCs practice standardization. In contrast, a local firm with established relationships with other
MNCs in the home country is able to maintain their autonomy and accordingly the focal MNC partner may adapt
their practices. The data collected from 257 Fortune 500 U.S. companies supported our predictions. (For more
information, please contact: Marshall Shibing Jiang, Brock University, Canada: mjiang@brocku.ca)
Session: 1.3.15 - Interactive
Track: 1 - Institutions, Governance, and CSR
International Business in Developing Countries
Presented On: July 1, 2012 - 13:00-14:15
Chair: John Raymond Dilyard, St. Francis College
Social Entrepreneurship in BOP Countries
Vladislav Maksimov, University of Miami
Yadong Luo, University of Miami
Stephanie Lu Wang, University of Miami
We extend the emerging BOP perspective by examining how firms in BOP countries contribute to social wealth
despite the multitude of institutional hardship conditions they face. First, we argue that a firm's awareness of
social problems that can be solved by forming entrepreneurial ventures helps the recognition of social
entrepreneurial opportunities. We suggest that a firm's domestic market orientation and foreign ownership
foster such awareness. Second, we assert that the possession of capabilities that help firms mitigate the
influence of institutional hardship conditions improves the exploitation of identified opportunities. We suggest
that young firm age and large firm size indicate different aspects of such capabilities. Third, we posit that a
firm's social entrepreneurial awareness and hardship survival capabilities are mutually reinforcing in the pursuit
of social outcomes. In a sample of 1577 firms in 11 BOP countries from Africa and Asia, we find support for
these propositions. We draw important theoretical implications at the end. (For more information, please
contact: Vladislav Maksimov, University of Miami, USA: vmaksimov@bus.miami.edu)
Exploitation and Empowerment at the Base of the Pyramid
Denis G. Arnold, University of North Carolina, Charlotte
Andrew Valentin, University of North Carolina, Charlotte
We begin this article by clarifying the scope of the Base of the Pyramid (BoP) and the poorest segments of
consumers within the BoP: those living in extreme and moderate poverty as defined by the World Bank. Next,
we utilize research in development economics and consumer behavior to characterize the vulnerability of the
extreme and moderately poor. We go on to defend an account of kind of benefits that should be conceived
when targeting those living on less than US$2.00 per day grounded in the capabilities approached developed by
Amartya Sen and recently adopted by the United Nations Development Programme. We then link this approach
to an account of the human rights obligations of MNCs, an approach explicitly endorsed by many MNCs
operating at the base of the pyramid. Some scholars have argued that the poor may be wrongly exploited by
MNCs targeting the BoP, but it is not clear from their analyses in what way offering a product or service to
consumers is objectionable from a theoretical perspective. We provide a theoretical account of exploitation tied
to human rights that explains why offering some products or services to the MEP may be properly regarded as
wrongfully exploitative. We defend a model of serving the MEP grounded in the empowerment of the poor. We
conclude by offering theoretical and practical insights regarding the alleviation of poverty via business ventures
that target the MEP and sketch a decision model for assessing the legitimacy of BoP activities. (For more
information, please contact: Denis G. Arnold, University of North Carolina, Charlotte, USA:
denisarnold@uncc.edu)
AIB 2012 Conference Proceedings
Page 53