Are social networks more important for new business activity in emerging than developed economies? An empirical extension

To extend prior theoretical and empirical work in the IB and entrepreneurship fields, this study examines how fundamentally different institutional conditions in emerging versus developed economies may clarify variations in the level of new business activity across countries. The empirical results support the argument that social networks are more important for new business activity in emerging than in developed economies. Furthermore, in emerging economies, the relationship between associational activity and new business activity is stronger for countries with higher regulatory and normative institutional burdens, whereas these moderator effects are absent in developed economies. The study's findings offer important implications for research and practice.