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The Interplay of Human and Social Capital in Shaping Entrepreneurial Performance: The Case of Vietnam

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  • E. Santarelli
  • H. T. Tran

Abstract

This study investigates the effects of human capital, social capital and their interaction on the performance of 1,398 Vietnamese new-born firms. Operating profit is used as the measure of success. Human capital is captured by individual-level professional education, start-up experience, and learning. Whereas the first two dimensions of human capital are measured with traditional indicators, we define learning as ability to accumulate knowledge to conduct innovation activities (new product introduction, product innovation and process innovation). Social capital is measured as benefits obtained from personal strong-tie and weak-tie networks. Key findings are three-fold: (i) human capital strongly predicts firm success, with learning exerting a statistically significant positive impact on operating profit; (ii) benefits from weak ties outweigh those from strong ties; (iii) interaction of human capital and social capital displays a statistically significant positive effect on new-firm performance.

Suggested Citation

  • E. Santarelli & H. T. Tran, 2012. "The Interplay of Human and Social Capital in Shaping Entrepreneurial Performance: The Case of Vietnam," Working Papers wp803, Dipartimento Scienze Economiche, Universita' di Bologna.
  • Handle: RePEc:bol:bodewp:wp803
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    More about this item

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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