Why Do Firms Use Franchising as an Entrepreneurial Strategy?: A Meta-Analysis

Although uncovering the factors that lead firms to offer franchises has long been a central goal of franchising research, considerable ambiguity surrounds extant findings. In an effort to help resolve this ambiguity, we used meta-analysis to aggregate results from 44 studies containing 140 tests of ten hypotheses. The ten hypotheses reflect two theoretical perspectives—resource scarcity and agency theory. Overall, the findings offer support for several of the hypotheses grounded in agency theory, but not those grounded in resource scarcity. The results also highlight the need for future inquiry to include new theoretical approaches and richer data.