Information Asymmetries between Parents and Educators in German Childcare Institutions

Economic theory predicts market failure in the market for early childhood education and care (ECEC) due to information asymmetries. We empirically investigate information asymmetries between parents and ECEC professionals in Germany, making use of a unique extension of the German Socio-Economic Panel Study (SOEP). It allows us to compare quality perceptions by parents and pedagogic staff of 734 ECEC institutions which were attended by children in SOEP households. Parents and staff were asked to rate the same quality measures. We detect considerable information asymmetries between these groups which differ across quality measures but little by parental socio-economic background or center characteristics. Our findings imply that information is not readily available to parents, an issue that should be addressed by policy-makers

Australian franchising research: review, synthesis and future research directions

This article represents a brief history of the development of franchising in Australia and its regulatory framework and links this to an analysis of relevant research. Findings indicate a disparate ad hoc approach to research including scoping studies at the embryonic stage of franchise development; significant evidence of census style research culminating in a trajectory of disparate studies utilising more sophisticated research methods. For franchising research to advance there appears to be a need to interface with other research domains in SME and entrepreneurship research, extend the range of issues which are the subject of franchising research: begin longitudinal studies in order to better understand change over time; promote studies which have a sectoral focus in order to improve knowledge and understanding at that level of analysis; and. increase the representation of cross-border/cultural research in the volume of work being undertaken

Pre-Contractual Due Diligence by Franchisees and Independent Small Business Buyers

The role of pre-commitment due diligence in small business has received little academic attention to date. This is of particular concern given the reported high rate of failure in small business which is often attributed to a lack of adequate pre-contractual assessment of the particular small business opportunity. Data collected from a sample of 610 current and former franchisees and independent small business owners in Australia was used to empirically examine relationships between due diligence effort, business performance, owner satisfaction and relationship health. The analysis reveals different patterns of behaviour between current and former franchisees and independent business owners. In particular, franchisees spend more time and commit greater effort than their independent counterparts when conducting due diligence. Implications for theory and practice are discussed

The Adequacy of Pre-purchase Due Diligence in Independent Small Business and Franchising

This research reports an in-depth study of the due diligence activities that prospective independent small business operators and franchisees in Australia undertake prior to purchasing or starting up their businesses. Although academic literature and industry publications promote undertaking ‘proper due diligence’, there is a lack of empirical research into the nature of due diligence and its effect on business outcomes. Using a qualitative approach, 60 currently and formerly operating independents and franchisees were personally interviewed, exploring the diversity of approaches to undertaking due diligence prior to entering business. The research revealed that differences occur in both the type and amount of due diligence undertaken by independents and franchisees and highlighted further differences between current and former operators. In general, the due diligence undertaken by participants was relatively unsophisticated with few exceptions of rigour and planning. Where prospective independents and franchisees were entering business for the first time, their appreciation of business was naïve. A steep learning curve followed during which they often recognised flaws in their initial research. As a result of this qualitative in-depth research, we present a set of propositions regarding due diligence and a model for future testing on a large sample