Ethnic diversity in SME business teams: generating employment growth through digitalisation, innovation, and exporting

Julia Korosteleva (), Tomasz Mickiewicz and Mario Davide Parrilli ()
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Julia Korosteleva: University College London
Mario Davide Parrilli: Bournemouth University

Small Business Economics, 2025, vol. 65, issue 1, No 5, 107-130

Abstract: Abstract This paper examines how the ethnic composition of SMEs’ business teams, also in conjunction with their strategic behaviour (including digitalisation, innovation and exporting), affect their employment growth. The study conceptualises different forms and aspects of social capital to develop the theoretical framework and hypotheses. We utilise the UK Office for National Statistics’ Longitudinal Small Business Survey data for the period of 2018–2020 to test our hypotheses. Our study shows that ethnically diverse business teams achieve relatively higher employment growth as compared to more homogeneous teams. Moreover, ethnically diverse business teams that embrace innovation, international expansion, and digitalisation translate these strategies more effectively into increased employment compared to their more homogenous counterparts.

Keywords: SMEs growth; Ethnic diversity; Social capital; Digitalisation; Exporting; Innovation; D22; J15; L25; O31; Z13 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:kap:sbusec:v:65:y:2025:i:1:d:10.1007_s11187-024-00985-1

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DOI: 10.1007/s11187-024-00985-1

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