The effect of centralization and formalization on entrepreneurship in export firms

Abstract

Centralization and formalization represent 2 key aspects of organizational structure whose effect on corporate enterpreneurship is explored in a study. Hypotheses linking these 2 constructs with entrepreneurial behavior are formulated. The effect of company size on entrepreneurial behavior is also considered. The findings are reported from a survey of export manufacturing firms from Malta. The results show that increased centralization limits entrepreneurial behavior. They also indicate that entrepreneurial behavior may be higher under conditions of increased formality. The implications of the findings for management action are discussed.