Towards an explanation of the formalisation process of home-based businesses in Kuwait

Abstract

In recent decades, the ‘Home-Based Business’ (HBB) has become an increasingly important form of entrepreneurial activity, driven by the fact that this type of business is the largest and fastest growing subset in the overall business sector around the world. Hitherto, HBBs were comparatively under-researched and literature on them was limited. Despite the global nature of HBB activities, few academics have researched this type of business activity. The process of HBB formalisation is an action that follows an intention. Therefore, it is important to understand the reasons behind formation of intention and how these might lead to HBB formalisation. This thesis contributes to a body of literature on HBBs, entrepreneurial intention, the intention–action gap, and formalisation of informal entrepreneurship, by exploring the HBB formalisation process in Kuwait. The research uses the Theory of Planned Behaviour (TPB) as an orienting theoretical framework to better understand how the intention of an HBB owner to formalise their HBB is formed, and when and why this intention is translated into actual HBB formalisation. Drawing on a qualitative longitudinal approach, a sample of 50 informal Kuwaiti HBB owners were interviewed and followed throughout the three-phases spanning a 2-year period, resulting in 112 interview sessions. Using constructivist grounded theory methods, in-depth semi-structured interviews were conducted over this time. This research yielded several important results: push and pull factors, other motivations, key circumstances, and personal characteristics all played important roles in the formalisation process of HBBs in Kuwait. The unique contribution of this research resides in understanding the situations under which the intentions of informal Kuwaiti HBB owners to formalise their HBB are translated into actual formalisation, in addition to exploring the barriers and facilitators to the HBB formalisation process. Implications for theory, policy, practice, and methodology are provided. Finally, recommendations for future research, and research limitations, are presented.