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The role of human and social capital and entrepreneurial orientation for small business performance in a transitional economy

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  • Ivan M. Manev
  • Bojidar S. Gyoshev
  • Tatiana S. Manolova

Abstract

We develop a model of small business performance in transitional economies in which owners' human and social capital are expected to be directly and positively related to the firm's entrepreneurial orientation, and all three are hypothesised to have a positive impact on performance. In transitional economies, these factors are particularly salient because of the scarcity of resources and the lack of entrepreneurial tradition and adequate institutional infrastructure. The model is tested with structural equations analysis of data from 160 owners of small businesses in Bulgaria. We find that social capital is related to entrepreneurial orientation, and both are positively associated with business performance. This means that social capital is an important initial resource endowment in transforming economies, and small business owners need to establish and develop connections with partners, suppliers, customers, and institutions. Also, they should seek to identify opportunities and develop proactive and innovative strategies.

Suggested Citation

  • Ivan M. Manev & Bojidar S. Gyoshev & Tatiana S. Manolova, 2005. "The role of human and social capital and entrepreneurial orientation for small business performance in a transitional economy," International Journal of Entrepreneurship and Innovation Management, Inderscience Enterprises Ltd, vol. 5(3/4), pages 298-318.
    • Handle: RePEc:ids:ijeima:v:5:y:2005:i:3/4:p:298-318
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    Citations

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    Cited by:

    1. Najib Ullah Khan & Shuangjie Li & Muhammad Nabeel Safdar & Zia Ullah Khan, 2019. "The Role of Entrepreneurial Strategy, Network Ties, Human and Financial Capital in New Venture Performance," JRFM, MDPI, vol. 12(1), pages 1-16, March.
    2. Lim, Dominic S.K. & Oh, Chang Hoon & De Clercq, Dirk, 2016. "Engagement in entrepreneurship in emerging economies: Interactive effects of individual-level factors and institutional conditions," International Business Review, Elsevier, vol. 25(4), pages 933-945.
    3. De Clercq, Dirk & Danis, Wade M. & Dakhli, Mourad, 2010. "The moderating effect of institutional context on the relationship between associational activity and new business activity in emerging economies," International Business Review, Elsevier, vol. 19(1), pages 85-101, February.
    4. Huatao Peng & Bingbing Li & Yang Liu, 2022. "How Social Network Influences the Growth of Entrepreneurial Enterprises: Perspective on Organizational and Personal Network," SAGE Open, , vol. 12(2), pages 21582440221, June.
    5. Miao, Chao & Coombs, Joseph E. & Qian, Shanshan & Sirmon, David G., 2017. "The mediating role of entrepreneurial orientation: A meta-analysis of resource orchestration and cultural contingencies," Journal of Business Research, Elsevier, vol. 77(C), pages 68-80.
    6. Marjolein C. J. Caniëls & Anna Motylska-Kuźma, 2023. "Entrepreneurial intention and creative performance – the role of distress tolerance," International Entrepreneurship and Management Journal, Springer, vol. 19(3), pages 1131-1152, September.
    7. Huatao Peng & Chen Zhou & Yang Liu, 2020. "Entrepreneurial Experience and Performance: From the Aspect of Sustainable Growth of Enterprises," Sustainability, MDPI, vol. 12(18), pages 1-24, September.
    8. Traikova, Diana, 2013. "Determinants of non-farm entrepreneurial intentions in a transitional context: Evidence from rural Bulgaria," Studies on the Agricultural and Food Sector in Transition Economies, Leibniz Institute of Agricultural Development in Transition Economies (IAMO), volume 72, number 72.
    9. Hao-Chen Huang, 2016. "Entrepreneurial resources and speed of entrepreneurial success in an emerging market: the moderating effect of entrepreneurship," International Entrepreneurship and Management Journal, Springer, vol. 12(1), pages 1-26, March.
    10. Stam, Wouter & Arzlanian, Souren & Elfring, Tom, 2014. "Social capital of entrepreneurs and small firm performance: A meta-analysis of contextual and methodological moderators," Journal of Business Venturing, Elsevier, vol. 29(1), pages 152-173.
    11. Maribel Guerrero & Radzivon Marozau, 2023. "Assessing the influence of institutions on students’ entrepreneurial dynamics: evidence from European post-socialist and market-oriented economies," Small Business Economics, Springer, vol. 60(2), pages 503-519, February.
    12. Zaremohzzabieh, Zeinab & Ahrari, Seyedali & Krauss, Steven Eric & Samah, Asnarulkhadi Abu & Meng, Lee Kwan & Ariffin, Zaifunizam, 2019. "Predicting social entrepreneurial intention: A meta-analytic path analysis based on the theory of planned behavior," Journal of Business Research, Elsevier, vol. 96(C), pages 264-276.
    13. Marek Matejun, 2017. "Characteristic features of small business and large firms: An empirical comparative study," Journal of Administrative and Business Studies, Professor Dr. Usman Raja, vol. 3(4), pages 192-203.
    14. Traikova, Diana & Mollers, Judith & Buchenrieder, Gertrud, 2012. "How Farmers Become Entrepreneurs - Prenatal Diagnostic of Rural Firms in Bulgaria," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126816, International Association of Agricultural Economists.
    15. Shuai Qin & Xiaolan Chen, 2023. "The role of entrepreneurship policy and culture in transitional routes from entrepreneurial intention to job creation: a moderated mediation model," SN Business & Economics, Springer, vol. 3(3), pages 1-25, March.
    16. Tatiana S. Manolova & Nancy M. Carter & Ivan M. Manev & Bojidar S. Gyoshev, 2007. "The Differential Effect of Men and Women Entrepreneurs’ Human Capital and Networking on Growth Expectancies in Bulgaria," Entrepreneurship Theory and Practice, , vol. 31(3), pages 407-426, May.
    17. Wang, Peizhang, 2023. "Corporate social responsibility and corporate innovation–The moderating role of CEO social capital," Finance Research Letters, Elsevier, vol. 55(PA).
    18. Danis, Wade M. & De Clercq, Dirk & Petricevic, Olga, 2011. "Are social networks more important for new business activity in emerging than developed economies? An empirical extension," International Business Review, Elsevier, vol. 20(4), pages 394-408, August.
    19. Tim Heubeck & Reinhard Meckl, 2022. "Antecedents to cognitive business model evaluation: a dynamic managerial capabilities perspective," Review of Managerial Science, Springer, vol. 16(8), pages 2441-2466, November.
    20. Sirec, Karin & Mocnik, Dijana, 2012. "Gender specifics in entrepreneurs’ personal characteristics," Journal of East European Management Studies, Nomos Verlagsgesellschaft mbH & Co. KG, vol. 17(1), pages 11-39.
    21. Wafa N. Almobaireek & Ahmed A. Alshumaimeri & Tatiana S. Manolova, 2016. "Building entrepreneurial inter-firm networks in an emerging economy: the role of cognitive legitimacy," International Entrepreneurship and Management Journal, Springer, vol. 12(1), pages 87-114, March.
    22. Léo-Paul Dana & Vanessa Ratten, 2017. "International entrepreneurship in resource-rich landlocked African countries," Journal of International Entrepreneurship, Springer, vol. 15(4), pages 416-435, December.

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