IDEAS home Printed from https://ideas.repec.org/a/spr/elmark/v29y2019i2d10.1007_s12525-019-00333-2.html
   My bibliography  Save this article

Social networks and online store performance in emerging economies: the mediating effect of legitimacy

Author

Listed:
  • Xiaoyu Yu

    (Shanghai University)

  • Yida Tao

    (Shanghai University)

  • Yi Chen

    (Shanghai University)

  • Weiyong Zhang

    (Old Dominion University)

  • Pinglei Xu

    (Shanghai University
    Guilin University of Aerospace Technology)

Abstract

Although it is well established in the literature that social networks affect firm performance, few studies have quantified the effects on online store performance, particularly in the context of emerging economies. Building upon the framework proposed by Hoang and Antoncic (2003), we developed a model to explore the effects of family ties, tie strength, and structural holes on online store performance. Informed by the organization science literature, we incorporated legitimacy as a mediator in our model. Using empirical data collected from 243 online stores operating on Taobao (the largest e-marketplace in China), we found that (1) family ties have a negative effect on online store performance and legitimacy partially mediates this negative effect, (2) tie strength has a positive effect on online store performance and legitimacy fully mediates this positive effect, and (3) structural holes have a positive effect on online store performance and legitimacy partially mediates this positive effect. These insights contribute to a more in-depth understanding of the relationship between social networks and online store performance in emerging economies. Further, this research empirically validated legitimacy’s mediating effect. We conclude the paper with a discussion of theoretical contributions, managerial implications, and future research directions.

Suggested Citation

  • Xiaoyu Yu & Yida Tao & Yi Chen & Weiyong Zhang & Pinglei Xu, 2019. "Social networks and online store performance in emerging economies: the mediating effect of legitimacy," Electronic Markets, Springer;IIM University of St. Gallen, vol. 29(2), pages 201-218, June.
    • Handle: RePEc:spr:elmark:v:29:y:2019:i:2:d:10.1007_s12525-019-00333-2
    DOI: 10.1007/s12525-019-00333-2
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s12525-019-00333-2
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s12525-019-00333-2?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Akbar Zaheer & Geoffrey G. Bell, 2005. "Benefiting from network position: firm capabilities, structural holes, and performance," Strategic Management Journal, Wiley Blackwell, vol. 26(9), pages 809-825, September.
    2. Deniz Ucbasaran & Paul Westhead & Mike Wright, 2008. "Opportunity Identification and Pursuit: Does an Entrepreneur’s Human Capital Matter?," Small Business Economics, Springer, vol. 30(2), pages 153-173, February.
    3. Susanna Khavul & Garry D. Bruton & Eric Wood, 2009. "Informal Family Business in Africa," Entrepreneurship Theory and Practice, , vol. 33(6), pages 1219-1238, November.
    4. Ardichvili, Alexander & Cardozo, Richard & Ray, Sourav, 2003. "A theory of entrepreneurial opportunity identification and development," Journal of Business Venturing, Elsevier, vol. 18(1), pages 105-123, January.
    5. Lee Cronbach, 1951. "Coefficient alpha and the internal structure of tests," Psychometrika, Springer;The Psychometric Society, vol. 16(3), pages 297-334, September.
    6. Hoang, Ha & Antoncic, Bostjan, 2003. "Network-based research in entrepreneurship: A critical review," Journal of Business Venturing, Elsevier, vol. 18(2), pages 165-187, March.
    7. Sarah L. Jack, 2005. "The Role, Use and Activation of Strong and Weak Network Ties: A Qualitative Analysis," Journal of Management Studies, Wiley Blackwell, vol. 42(6), pages 1233-1259, September.
    8. 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.
    9. Bat Batjargal, 2007. "Network triads: transitivity, referral and venture capital decisions in China and Russia," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 38(6), pages 998-1012, November.
    10. Olivier Boiral, 2003. "ISO 9000: Outside the Iron Cage," Organization Science, INFORMS, vol. 14(6), pages 720-737, December.
    11. Jiing-Lih Farh & Anne S. Tsui & Katherine Xin & Bor-Shiuan Cheng, 1998. "The Influence of Relational Demography and Guanxi: The Chinese Case," Organization Science, INFORMS, vol. 9(4), pages 471-488, August.
    12. Haiyang Li & Yan Zhang, 2007. "The role of managers' political networking and functional experience in new venture performance: Evidence from China's transition economy," Strategic Management Journal, Wiley Blackwell, vol. 28(8), pages 791-804, August.
    13. Bruton, Garry D. & Ahlstrom, David, 2003. "An institutional view of China's venture capital industry: Explaining the differences between China and the West," Journal of Business Venturing, Elsevier, vol. 18(2), pages 233-259, March.
    14. Alex Stewart, 2003. "Help One Another, Use One Another: Toward an Anthropology of Family Business," Entrepreneurship Theory and Practice, , vol. 27(4), pages 383-396, October.
    15. Fred Neubauer & Alden G. Lank, 1998. "The Family Business," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-349-14465-5.
    16. Yadong Luo & Mike W Peng, 1999. "Learning to Compete in a Transition Economy: Experience, Environment, and Performance," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 30(2), pages 269-295, June.
    17. David G. Sirmon & Michael A. Hitt, 2003. "Managing Resources: Linking Unique Resources, Management, and Wealth Creation in Family Firms," Entrepreneurship Theory and Practice, , vol. 27(4), pages 339-358, October.
    18. Bat Batjargal & Michael Hitt & Anne Tsui & Jean-Luc Arregle & Justin Webb & Toyah Miller, 2013. "Institutional Polycentrism, Entrepreneurs' Social Networks, and New Venture Growth," Post-Print hal-02313079, HAL.
    19. M. Ann McFadyen & Matthew Semadeni & Albert A. Cannella, 2009. "Value of Strong Ties to Disconnected Others: Examining Knowledge Creation in Biomedicine," Organization Science, INFORMS, vol. 20(3), pages 552-564, June.
    20. Granovetter, Mark, 1995. "Coase Revisited: Business Groups in the Modern Economy," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 4(1), pages 93-130.
    21. Yubo Chen & Jinhong Xie, 2008. "Online Consumer Review: Word-of-Mouth as a New Element of Marketing Communication Mix," Management Science, INFORMS, vol. 54(3), pages 477-491, March.
    22. Wenyan Zhou & Oliver Hinz, 2016. "Determining profit-optimizing return policies – a two-step approach on data from taobao.com," Electronic Markets, Springer;IIM University of St. Gallen, vol. 26(2), pages 103-114, May.
    23. Bat Batjargal & Mannie (Manhong) Liu, 2004. "Entrepreneurs’ Access to Private Equity in China: The Role of Social Capital," Organization Science, INFORMS, vol. 15(2), pages 159-172, April.
    24. Gedajlovic, Eric & Cao, Qing & Zhang, Hongping, 2012. "Corporate shareholdings and organizational ambidexterity in high-tech SMEs: Evidence from a transitional economy," Journal of Business Venturing, Elsevier, vol. 27(6), pages 652-665.
    25. Dahlstrom, Robert & Ingram, Rhea, 2003. "Social networks and the adverse selection problem in agency relationships," Journal of Business Research, Elsevier, vol. 56(9), pages 767-775, September.
    26. Julie M. Hite, 2005. "Evolutionary Processes and Paths of Relationally Embedded Network Ties in Emerging Entrepreneurial Firms," Entrepreneurship Theory and Practice, , vol. 29(1), pages 113-144, January.
    27. Michael A. Hitt & David Ahlstrom & M. Tina Dacin & Edward Levitas & Lilia Svobodina, 2004. "The Institutional Effects on Strategic Alliance Partner Selection in Transition Economies: China vs. Russia," Organization Science, INFORMS, vol. 15(2), pages 173-185, April.
    28. Bat Batjargal & Michael Hitt & Anne Tsui & Jean-Luc Arregle & Justin Webb & Toyah Miller, 2013. "Institutional Polycentrism, Entrepreneurs' Social Networks, and New Venture Growth," Post-Print hal-02276709, HAL.
    29. Jane N. O. Khayesi & Gerard George & John Antonakis, 2014. "Kinship in Entrepreneur Networks: Performance Effects of Resource Assembly in Africa," Entrepreneurship Theory and Practice, , vol. 38(6), pages 1323-1342, November.
    30. Breugelmans, Els & Campo, Katia, 2011. "Effectiveness of In-Store Displays in a Virtual Store Environment," Journal of Retailing, Elsevier, vol. 87(1), pages 75-89.
    31. Xiongfei Cao & Xitong Guo & Hefu Liu & Jibao Gu, 2015. "The role of social media in supporting knowledge integration: A social capital analysis," Information Systems Frontiers, Springer, vol. 17(2), pages 351-362, April.
    32. Tornikoski, Erno T. & Newbert, Scott L., 2007. "Exploring the determinants of organizational emergence: A legitimacy perspective," Journal of Business Venturing, Elsevier, vol. 22(2), pages 311-335, March.
    33. Bat Batjargal, 2013. "Institutional Polycentrism, Entrepreneurs??? Social Networks, And New Venture Growth," William Davidson Institute Working Papers Series wp1060, William Davidson Institute at the University of Michigan.
    34. Mollick, Ethan, 2014. "The dynamics of crowdfunding: An exploratory study," Journal of Business Venturing, Elsevier, vol. 29(1), pages 1-16.
    35. Julie M. Hite & William S. Hesterly, 2001. "The evolution of firm networks: from emergence to early growth of the firm," Strategic Management Journal, Wiley Blackwell, vol. 22(3), pages 275-286, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Xiongfei Cao & Sohail Chaudhry & Li Xu, 2019. "Electronic markets in emerging markets," Electronic Markets, Springer;IIM University of St. Gallen, vol. 29(2), pages 151-152, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jean–Luc Arregle & Bat Batjargal & Michael A. Hitt & Justin W. Webb & Toyah Miller & Anne S. Tsui, 2015. "Family Ties in Entrepreneurs’ Social Networks and New Venture Growth," Entrepreneurship Theory and Practice, , vol. 39(2), pages 313-344, March.
    2. Kerr, Jon & Coviello, Nicole, 2020. "Weaving network theory into effectuation: A multi-level reconceptualization of effectual dynamics," Journal of Business Venturing, Elsevier, vol. 35(2).
    3. 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.
    4. Salih Zeki Ozdemir & Peter Moran & Xing Zhong & Martin J. Bliemel, 2016. "Reaching and Acquiring Valuable Resources: The Entrepreneur's Use of Brokerage, Cohesion, and Embeddedness," Entrepreneurship Theory and Practice, , vol. 40(1), pages 49-79, January.
    5. Hongjuan Zhang & Rong Han & Liang Wang & Runhui Lin, 2021. "Social capital in China: a systematic literature review," Asian Business & Management, Palgrave Macmillan, vol. 20(1), pages 32-77, February.
    6. Hongjuan Zhang & Rong Han & Liang Wang & Runhui Lin, 0. "Social capital in China: a systematic literature review," Asian Business & Management, Palgrave Macmillan, vol. 0, pages 1-46.
    7. Busch, Christian & Barkema, Harry, 2022. "Align or perish: Social enterprise network orchestration in Sub-Saharan Africa," Journal of Business Venturing, Elsevier, vol. 37(2).
    8. Boris Bauke & Thorsten Semrau & Zheng Han, 2016. "Relational trust and new ventures’ performance: the moderating impact of national-level institutional weakness," International Entrepreneurship and Management Journal, Springer, vol. 12(4), pages 1007-1024, December.
    9. Jianhua Ge & Michael Carney & Franz Kellermanns, 2019. "Who Fills Institutional Voids? Entrepreneurs’ Utilization of Political and Family Ties in Emerging Markets," Entrepreneurship Theory and Practice, , vol. 43(6), pages 1124-1147, November.
    10. Yaqun Yi & Yuan Li & Michael A. Hitt & Yi Liu & Zelong Wei, 2016. "The influence of resource bundling on the speed of strategic change: Moderating effects of relational capital," Asia Pacific Journal of Management, Springer, vol. 33(2), pages 435-467, June.
    11. Sohrab Soleimanof & Kulraj Singh & Daniel T. Holt, 2019. "Micro-Foundations of Corporate Entrepreneurship in Family Firms: An Institution-Based Perspective," Entrepreneurship Theory and Practice, , vol. 43(2), pages 274-281, March.
    12. Hongjuan Zhang & Liang Wang & Rong Han, 2019. "The China-West divide on social capital: A meta-analysis," Asia Pacific Journal of Management, Springer, vol. 36(3), pages 745-772, September.
    13. Feng-Wen Chen & Meng-Xian Lin & Ting Wang, 2018. "Sustainable Resource Acquisition Path: A Dynamic Model of Embedded Entrepreneurial Network Governance under Uncertainty," Sustainability, MDPI, vol. 10(11), pages 1-25, November.
    14. Istipliler, Baris & Bort, Suleika & Woywode, Michael, 2023. "Flowers of adversity: Institutional constraints and innovative SMEs in transition economies," Journal of Business Research, Elsevier, vol. 154(C).
    15. Zou, Na & Storz, Cornelia, 2023. "Why do some entrepreneurs thrive? A network content perspective," Journal of Business Research, Elsevier, vol. 161(C).
    16. Soetanto, Danny, 2019. "Examining change in entrepreneurial networks: Using visualisation as an alternative approach," European Management Journal, Elsevier, vol. 37(2), pages 139-150.
    17. Ronald S. Burt, 2019. "Network Disadvantaged Entrepreneurs: Density, Hierarchy, and Success in China and the West," Entrepreneurship Theory and Practice, , vol. 43(1), pages 19-50, January.
    18. Congcong Zheng & Mujtaba Ahsan & Alex F. DeNoble, 2020. "Entrepreneurial Networking During Early Stages of Opportunity Exploitation: Agency of Novice and Experienced New Venture Leaders," Entrepreneurship Theory and Practice, , vol. 44(4), pages 671-699, July.
    19. Xiaoyu Yu & Yajie Li & Daniel Q. Chen & Xiaotong Meng & Xiangming Tao, 2019. "Entrepreneurial bricolage and online store performance in emerging economies," Electronic Markets, Springer;IIM University of St. Gallen, vol. 29(2), pages 167-185, June.
    20. Sui Sui & Matthias Baum & Shavin Malhotra, 2019. "How Home-Peers Affect the Export Market Exit of Small Firms: Evidence From Canadian Exporters," Entrepreneurship Theory and Practice, , vol. 43(5), pages 1018-1045, September.

    More about this item

    Keywords

    Online store performance; Social networks; Family ties; Tie strength; Structural holes; Legitimacy;
    All these keywords.

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:elmark:v:29:y:2019:i:2:d:10.1007_s12525-019-00333-2. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.