Information asymmetry in the innovation adoption decision of tourism and hospitality SMEs in emerging markets: A mixed-method analysis

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Abstract

Investment decisions, particularly innovation adoption decisions, can sustain long-term viability of small and medium enterprises (SMEs). However, information asymmetry could limit the ability of SME management to make informed innovation adoption decisions. Even though information asymmetry is a multidimensional construct, prior literature has only focused on financial information asymmetry in such decisions. Therefore, the current study fills the research gap by conducting two separate studies: one analyzes World Bank Group data from 1250 observations in 11 emerging markets, and the other interviews eight SME owners and managers. The findings of the mixed-method studies suggest that financial, business regulation, and court information asymmetry decrease the likelihood of SMEs' product innovation adoption. The study contributes to a more comprehensive understanding of information asymmetry in SMEs’ decision-making rooted in agency theory. Moreover, its methodological contribution lies in measuring information asymmetry with micro-level data.

Original languageEnglish (US)
Article number104793
JournalTourism Management
Volume99
DOIs
StatePublished - Dec 2023

All Science Journal Classification (ASJC) codes

  • Development
  • Transportation
  • Tourism, Leisure and Hospitality Management
  • Strategy and Management

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