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Effect of Social Capital on Firm Performance: The Role of Entrepreneurial Orientation and Dynamic Capability

Author

Listed:
  • Tian Hongyun

    (Department of Marketing, School of Management, Jiangsu University, 301 Xuefu Road, Zhenjiang 212013, Jiangsu, P.R. China.)

  • William Adomako Kankam

    (Department of Marketing, School of Management, Jiangsu University, 301 Xuefu Road, Zhenjiang 212013, Jiangsu, P.R. China.)

  • Florence Appiah-Twum

    (Department of Marketing, School of Management, Jiangsu University, 301 Xuefu Road, Zhenjiang 212013, Jiangsu, P.R. China.)

  • Isaac Gumah Akolgo

    (Department of Marketing, School of Management, Jiangsu University, 301 Xuefu Road, Zhenjiang 212013, Jiangsu, P.R. China.)

Abstract

Social capital is a concept that describes good quality social relations that can lead to mutu­al benefits. The social capital theory thrives on relationships in networks to gain access to resources, especially information benefits not available to non-members of the network. The study reports the effects of social capital on firm performance. The study further examines the moderating role of entrepreneurial orientation in the relationship between social capital and firm performance; and the mediating role of dynamic capabilities in the relationship between social capital and firm performance. Using SmartPLS software 3.2.8 to analyze primary data collected from 787 small and medium-sized enterprises (SMEs) operating in Ghana, the results show that social capital has a positive and direct relationship with firm performance in Ghana. The findings suggest that EO moderates the relationship between social capital and firm performance. Again, dynamic capabilities mediate the relationship between social capital and firm performance. The study also provides managers with practical ways of building relationships within their networks for achieving competitive advantage in the current business environment.

Suggested Citation

  • Tian Hongyun & William Adomako Kankam & Florence Appiah-Twum & Isaac Gumah Akolgo, 2019. "Effect of Social Capital on Firm Performance: The Role of Entrepreneurial Orientation and Dynamic Capability," International Review of Management and Marketing, Econjournals, vol. 9(4), pages 63-73.
    • Handle: RePEc:eco:journ3:2019-04-9
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    More about this item

    Keywords

    Social capital; Entrepreneurial Orientation; Dynamic capabilities and firm performance;
    All these keywords.

    JEL classification:

    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship
    • M1 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration

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