INDIAN MSMES' ENCOUNTER WITH DELAYED PAYMENTS: A RESOURCE DEPENDENCE THEORY PERSPECTIVE (RDT)

Vishnusaranya Ivaturi and Anubha Shekhar Sinha ()
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Vishnusaranya Ivaturi: Indian Institute of Management Kozhikode
Anubha Shekhar Sinha: Indian Institute of Management Kozhikode

No 563, Working papers from Indian Institute of Management Kozhikode

Abstract: The growth of the nation is significantly influenced by the MSME sector. It is viewed as the country's economic engine in India. Understanding the numerous issues this sector faces becomes crucial given its significance to the nation's prosperity. The literature on MSMEs includes references from a variety of authors who discuss the numerous issues that MSME industries face globally. The MSME sector, particularly in India, faces numerous challenges, including access to technology, issues with infrastructure, issues getting bank loans, and more. But, one issue on which we concentrate in this article is the issue of delayed payments experienced by the Indian MSME sector from its corporate clients. The government has established numerous policies and measures to aid in resolving this issue because it is one of the most important and frequently encountered issues, yet this problem still persists. So, it is crucial for us to comprehend why MSMEs are still facing this issue and how MSMEs are responding to it. In this article, we have developed a conceptual framework to examine the relationship between the MSME suppliers and its corporate customers by incorporating the theoretical lens of Resource Dependence Theory (RDT). We did this by utilizing the extensive literature on delayed payments and by using a grounded theory approach to analyze the interviews of 25 entrepreneurs from the MSME sector.

Keywords: MSME Sector; Delayed payments; Resource dependence theory (RDT) (search for similar items in EconPapers)
Date: 2023-03
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