Frugality, Family-Cohesiveness and Firm Growth; A Case of Small Firms around Oil & Gas Fields in Uganda

  • Rogers Matama University of Dar es Salaam


Abstract: A common impression is that most small firms largely face resource scarcity challenges that inhibit firm growth. This study concentrates on the elements of frugality, operationalized as spending discipline and delaying gratification as well as family cohesiveness, operationalized as family member supportiveness and usefulness in firms. This study is focused around Uganda’s oil and gas fields and these natural resources are expected to influence to small firms growth. In the current study, firm growth is measured in terms of asset value accumulation over time. Empirical findings on frugality, family cohesiveness and growth aim essentially to answer the overarching dilemma of small firm recurrent failures in Uganda. Results in study show that there is a mild relationship between frugality and family cohesiveness thus augmenting the existing perspectives of the resource based view theory. However, the random effect logistic regression results show contrasting results on the predictor effects of; family financing support, oil and gas operations, frugality, and family cohesiveness on the outcome variable - small firm asset growth.

Keywords: Frugality, family-cohesiveness and small firm growth


Download data is not yet available.


Agresti, A. (2002). Categorical Data Analysis. Second Edition. John Wiley &Sons, Inc., Anderson, S. W. & Lillis, A. M. (2010). Corporate Frugality: Theory, Measurement and Practice. Journal of Economic Literature, JEL M41, M20, M14. Melbourne, USA. Aneke, P. (2002). The role of major operators in the development of local content in the Nigerian oil and gas industry. A paper delivered during the national seminar on the dynamics of equipment leasing and contract financing for local contractors in the Oil and Gas sector, Port Harcourt, Nigeria. Aneki, (2010). Poorest countries in the World. Ariweriokuma, S. (2009). The Political Economy of Oil and Gas in Africa: The Case of Nigeria. New York: Routledge Ariyo, 1999; Bakunda, G. (2008). The Impact of a Liberalized Trade Regime on the Potential for Agricultural Value Addition in Uganda. Eastern Africa Social Science Research Review, 24(2). Bakunda, G., Kugonza, F. Walusimbi-Mpanga, G. Munaabi, Y. & Jooga R. K. (2013). Leveraging FDI to Increase SME Access to Finance in Africa: A Case Study of Uganda ICBE-RF Research Report N0. 59/13. Barigaba, J. (2016). SMEs struggle to meet quality standards. The East African. Aug 27- September 2. P.39. Barney, J. B. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99–120. Business in Development Network (BID). (2008). Investing in Small and Medium Sized Enterprises in Uganda. Charles, G. U. (2011). Comparing competitiveness of Family and Non-family SMEs in Tanzania. Business Management Review, 15(2). Charles, G. U. (2014). Role of family resources in firm performance: Evidence from Tanzania. Journal of African Business, 15(2). Chaston, I. & Mangles, T. (1997). Core capabilities as predictors of growth potential in small manufacturing firms. Journal of Small Business Management, 35(1), 47. Demidenko, E. (2004). Mixed Models. Theory and Applications. John Wiley & Sons, first edition. District Development Plan –DPP. (2015). Hoima Development Plan 2015/2016 – 2019/2020. Hoima District Local Government, June.
Eddleston, K. A. & Kellermanns, F. W. (2007). Destructive and productive family relationships: A stewardship theory perspective. Journal of Business Venturing, 22(4), 545-565. Eyakuze, A., Salim, A. & Prato, S. (2013). The State of East Africa: One People, One Destiny? The Future of Inequality in East Africa, Society for International Development. ISBN 9788966029218. Fjose, S., Grünfeld, L. A. & Green, C. (2010). SMEs and growth in Sub-Saharan Africa: Identifying SME roles and obstacles to SME growth. MENON Business Economics, MENON-publication no. 14/2010.
Frees, E. (2004). Longitudinal and Panel Data: Analysis and Applications in the Social Sciences. New York: Cambridge University Press. ISBN 0-521-82828-7 Gupta, P. D., Guha, S., Subramanian, S. & Krishnaswami, L. (2013). Firm growth and its determinants. Journal of Innovation and Entrepreneurship, 2(15). Habbershon, T. G., Williams, M. & Macmillan, I. (2003). A unified systems perspective of family firm performance. Journal of Business Ventures, 18, 451-465. Heum, P., Quale, C., karlsen, J. E., Kragha, M. & Osahon, G. (2003). Enhancement of Local Content in the Upstream Oil and gas Industry in Nigeria: A comprehensive and viable policy approach; joint study by SNF-Institute for Research in Economics and Business Administration, Bergen, Norway SNF Report No. 25/03 (August) Hoerger, M., Quirk, S. W. & Weed, N. C. (2011). Development and Validation of the Delaying Gratification Inventory. Psychological Assessment, 23(3), 725–738. Hsiao, C. (2003). Analysis of Panel Data (Second ed.). New York: Cambridge University Press. Ihua, U. B. (2005). Small and medium-scale enterprises: catalysts of economic growth of the nation. Unpublished MBA Dissertation. University of Ado-Ekiti. Korunka, C., Kessler, A., Frank, H. & Lueger, M. (2011). Conditions for growth in one-person startups: A longitudinal study spanning eight years. Psicothema, 23(3), 446-452 Lastovicka, J. L., Bettencourt, L. A. Hughner, R. S. & Kuntze, R. J. (1999). Lifestyle of the tight and frugal: Theory and measurement. Journal of Consumer Research, 26(1), 85-98. Lee, Y. & Nelder, J. (2004). Conditional and marginal models: Another view. Statistical Science, 19(2), 219–238. Lim, N. E. (2011). Family Closeness, Parental Role Fulfillment and Immigration Stress: A Study on Filipino American Young Adults’ Satisfaction with Parental Upbringing, Doctor of Philosophy in Psychology Dissertation, Graduate College of the University of Illinois at Urbana-Champaign, Urbana, Illinois, USA. Lokhande, M. A. (2011). Financial Inclusion: Options for Micro, Small and Medium Enterprises. Synergy, (0973-8819), 9(2). McCulloch, C. & Searle, S. (2001). Generalized, Linear and Mixed Models. John Wiley & Sons, first edition. Ministry of Energy and Mineral Development. (2008). National Oil and Gas Policy for Uganda. Ministry of Energy and Mineral Development. (2010). Paper presented at the United Kingdom/Uganda Investment Forum, London, September, 2010. Molenberghs, G. & Verbeke, G. (2005). Models for Discrete Longitudinal Data. Springer, first edition. Mwakali, J. A. & Byaruhanga, J. N. M. (2011, January). Local Content in the Oil and Gas Industry: Implications for Uganda. In Proceedings of the 2nd International Conference on Advances in Engineering and Technology, Entebbe, Uganda (pp. 517-522). Namatovu, R., Balunywa, W., Kyejjusa, S. & Dawa, S. (2010). Global entrepreneurship monitor: GEM Uganda 2010 executive report. GEM Uganda. National Planning Authority. (2010). Uganda’s National Development Plan(NDP 1), 2010/11 – 2014/15. National Planning Authority. (2015). Uganda’s National Development Plan (NDP 11), 2015/16 – 2019/20. Nordbø, E. W. & Stensland, N. (2015). The petroleum sector and the Norwegian economy. Economic Commentaries No. 4. Olingo, A. (2016). Rush is on to get EAs oil, gas to the market. The East African. August 27 – September 2, Page 4-5. Olson, D. H., Bell, R. & Portner, J. (1982). FACES II: Family adaptability and cohesion evaluation scales. Family Social Science, University of Minnesota, St. Paul, Minnesota. Olson, D. H. & Gorall, D. M. (2003). Circumplex model of marital and family systems. In F. Walsh (Ed.), Normal family processes: Growing diversity and complexity (pp. 514–549). New York: The Guilford Press. Penrose, E. T. (1959). The Growth of the Firm. Wiley: New York. Quinn, R. E. & Rohrbaugh. F. (1981). A competing values approach to organizational effectiveness. Public Productivity Review, 5, 122-140.
Rahman, S. U. (2001). A comparative study of TQM practice and organizational performance of SMEs with and without ISO 9000 certification. International Journal of Quality & Reliability Management, 18(1), 35-49. Schillaci, C. E., Romano, M. & Nocotra, M. (2013). Family Business Foundations: Theoretical and Empirical Investigation. Journal of Innovation & Entrepreneurship, 2, 2210. Doi 1186/2192-5372-2-22. Schumpeter, J. (1934). The theory of Economic Development. Cambridge, Mass: Harvard University Press. Tatzel, M. (2014). Value Seekers, Big Spenders, Non-Spenders, and Experiences: Consumption, Personality, and Well-Being. In Consumption and Well-Being in the Material World (pp. 75-108). Springer Netherlands. Uganda Bureau of Statistics. (2010). Census of Business Establishments 2010/2011. Ugwushi Bellema Ihua. (2010). Local Content Policy and SMEs Sector Promotion: The Nigerian Oil Industry Experience. United Nations. (2009). Human Development Index Report, Secretariat of the. United Nations, New York and Geneva. Van Wyk, R. (2012). Constrictive Vs. Distinctive Familiness and Culturing of Familiness Capital. African Journal of Business Management, 6(36), 9892-9900. Wamono, R. N., Kikabi, P. & Mugisha J. (2012). Constraints and Opportunities for SMEs Investment in Uganda’s Oil and Gas Sector. ICBE-RF Research Report No. 34/12. Webb J. W., Pryor C. G. & Kellermanns, F. W. (2015). Household Enterprise in Base-of-the-Pyramid Markets: the Influence of Institutions and Family Embeddedness. Africa Journal of Management, 1(2), 115-136. Welsh, J. A. & White, J. F. (1981). A small business is not a little big business. Harvard business review, 59(4), 18. Wooldridge, J. M. (2013). Random Effects Estimation - Introductory Econometrics: A Modern Approach (Fifth international ed.). Mason, OH: South-Western. World Bank. (2007). Oil and Gas: A Blessing or a Curse?
How to Cite
MATAMA, Rogers. Frugality, Family-Cohesiveness and Firm Growth; A Case of Small Firms around Oil & Gas Fields in Uganda. Journal of Economics and Behavioral Studies, [S.l.], v. 8, n. 6, p. 188-205, jan. 2017. ISSN 2220-6140. Available at: <>. Date accessed: 24 nov. 2017.
Research Paper