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Social Networks and Business Success

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  • Stein Kristiansen

Abstract

. The main objective of this paper is to illuminate social and cultural preconditions for networking and success in business in an African context. By in‐depth studies of small‐scale entrepreneurs in the wood business in Tanzania, we find that people belonging to an Asian subculture probably have a better standing for entering and thriving in business, due to group cohesion, mobility, and level of education. Through high‐quality social networks, characterized by a high number and variety of relations, certain groups seem to be in a better position to enact their business environment and raise entrepreneurial resources such as motivation and ideas, information, capital, and trust. To reduce social discontent and inter‐ethnic and religious conflicts in this area, we suggest that policy measures be taken to enhance levels of education and access to information for all citizens to create a “level playing field” in economic affairs.

Suggested Citation

  • Stein Kristiansen, 2004. "Social Networks and Business Success," American Journal of Economics and Sociology, Wiley Blackwell, vol. 63(5), pages 1149-1171, November.
    • Handle: RePEc:bla:ajecsc:v:63:y:2004:i:5:p:1149-1171
    DOI: 10.1111/j.1536-7150.2004.00339.x
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    References listed on IDEAS

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    Cited by:

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    3. Zuzana Brixiová & Thierry Kangoye, 2019. "Networks, start-up capital and women's entrepreneurial performance in Africa: Evidence from Eswatini," SALDRU Working Papers 257, Southern Africa Labour and Development Research Unit, University of Cape Town.
    4. Egbert, Henrik & Fischer, Gundula & Bredl, Sebastian, 2009. "Advertisements or friends? Formal and informal recruitment methods in Tanzania," Discussion Papers 46, Justus Liebig University Giessen, Center for international Development and Environmental Research (ZEU).
    5. Brixiova, Zuzana & Kangoye, Thierry, 2016. "Gender Disparities in Employment and Earnings in Sub-Saharan Africa: Evidence from Swaziland," IZA Discussion Papers 10455, Institute of Labor Economics (IZA).
    6. Ufere, Nnaoke & Gaskin, James & Perelli, Sheri & Somers, Antoinette & Boland, Richard, 2020. "Why is bribery pervasive among firms in sub-Saharan African countries? Multi-industry empirical evidence of organizational isomorphism," Journal of Business Research, Elsevier, vol. 108(C), pages 92-104.
    7. Asma Basit, 2017. "Ethnography of Female Diaspora Networks: The Emerging Case of Pakistani Female Entrepreneurs in London," Journal of Entrepreneurship and Innovation in Emerging Economies, Entrepreneurship Development Institute of India, vol. 3(1), pages 1-15, January.
    8. Donna Marie De Carolis & Barrie E. Litzky & Kimberly A. Eddleston, 2009. "Why Networks Enhance the Progress of New Venture Creation: The Influence of Social Capital and Cognition," Entrepreneurship Theory and Practice, , vol. 33(2), pages 527-545, March.
    9. Mai, Nhat Chi, 2021. "Determinants of successful adoption of the Balanced Scorecard in Vietnamese small and medium-sized enterprises," OSF Preprints 5hx2r, Center for Open Science.
    10. Henrik Egbert, 2009. "Business Success Through Social Networks? A Comment on Social Networks and Business Success," American Journal of Economics and Sociology, Wiley Blackwell, vol. 68(3), pages 665-677, July.
    11. Getahun Fenta Kebede, 2018. "Social Capital and Entrepreneurial Outcomes: Evidence from Informal Sector Entrepreneurs in Ethiopia," Journal of Entrepreneurship and Innovation in Emerging Economies, Entrepreneurship Development Institute of India, vol. 27(2), pages 209-242, September.
    12. Swati Dutta & Lakshmi Kumar, 2016. "Is Poverty Stochastic or Structural in Nature? Evidence from Rural India," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 128(3), pages 957-979, September.
    13. Jean-Philippe BERROU & Claire GONDARD-DELCROIX, 2010. "Social networks in the entrepreneurial career: life-stories analysis of informal entrepreneurs in Bobo-Dioulasso (Burkina-Faso) (In French)," Cahiers du GREThA (2007-2019) 2010-09, Groupe de Recherche en Economie Théorique et Appliquée (GREThA).
    14. Stein Kristiansen, 2003. "Linkages and Rural Non-Farm Employment Creation: Changing Challenges and Policies in Indonesia," Working Papers 03-22, Agricultural and Development Economics Division of the Food and Agriculture Organization of the United Nations (FAO - ESA).
    15. Dr. Yen, Shang-Yung & Fan, Song-Chin, 2014. "An Exploration on the Business Model of Social Enterprises Owned By Chinese Entrepreneurs in Taiwan," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 4(10), pages 1275-1289, October.
    16. Henrik Egbert & Gundula Fischer & Sebastian Bredl, 2011. "Different Background— Similar Strategies," Journal of Entrepreneurship and Innovation in Emerging Economies, Entrepreneurship Development Institute of India, vol. 20(2), pages 189-205, September.
    17. Hammad Siddiqi, 2011. "A Creative Institutional Response to Twin Problems of Liquidity and Information Gaps in Certain Emerging Markets," International Review of Finance, International Review of Finance Ltd., vol. 11(4), pages 537-552, December.
    18. Getahun Fenta Kebede, 2020. "Network Locations or Embedded Resources? The Effects of Entrepreneurs’ Social Networks on Informal Enterprise Performance in Ethiopia," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 11(2), pages 630-659, June.
    19. Egbert, Henrik & Fischer, Gundula & Bredl, Sebastian, 2010. "Different background - Similar strategies: Recruitment in Tanzanian-African and Tanzanian-Asian companies," Discussion Papers 53, Justus Liebig University Giessen, Center for international Development and Environmental Research (ZEU).

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