A West–East Perspective
Edited by Hans-Hermann Höhmann and Friederike Welter
Chapter 11: Emergence of and Changes in Trust in SMEs in Estonia
Urve Venesaar INTRODUCTION Estonia has experienced major changes in both the external and internal environment of enterprises during the period of nearly 15 years since the restoration of national independence, accompanied by a change in people’s attitudes and business ethics (Neivelt 1999; Vetik 2002). This presumes changes in the enterprises’ behaviour and in the mechanisms that influence this behaviour. However, in transition economies the external environment is assessed by authors as one of the dominant features influencing the nature and pace of entrepreneurship (for example, Welter and Smallbone 2003). This has also been confirmed by several empirical studies on Estonia, in which most of the research has been dedicated to the assessment of external political, economic and social influences on enterprise development (for example, Jürgenson et al. 2003; Phare 1998; Smallbone et al. 1997). Today, Estonia has reached a kind of economic and institutional stability. The system of regulation which has been developed should make inter-firm relationships more predictable when compared with the past and promote the development of mutual trust when they co-operate. The institutional environment provides safeguards for the implementation of business deals, thus reducing managers’ risks in decision-making. Notwithstanding the fast systemic change within the country and success in many spheres, one needs to emphasise that the market-oriented reforms are still ongoing, particularly on the micro level. This includes repeated amendments to laws, as well as further institutional changes during implementation in order to adapt regulations and laws. Although society has accepted the general principles of...
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