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Compensating resource constraints? A discriminant analysis of collaborating and non-collaborating small businesses in New Zealand

Author

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  • Martina Battisti
  • Raja Peter

Abstract

Following Nahapiet and Ghoshal's framework of social capital, it is argued that in order to understand and foster SME collaboration the focus has to shift from exploring the structure of collaboration networks to exploring the cognitive characteristics of SME owner/managers. The aim of this paper is to contribute to an understanding of the differences between small firms that engage in collaboration and those that do not, by examining SME owner/managers' perceptions of the barriers and benefits of collaboration. Based on a sample of 841 New Zealand small firms, discriminant analysis was conducted. Results suggest that non-collaborating SMEs see collaboration as a means of compensating their resource constraints by gaining access to labour and capital. Owner-managers of collaborating SMEs, however, seem to be able to exploit opportunities beyond available resources. This paper contributes to the ongoing debate of how SMEs can be engaged in collaborative practices.

Suggested Citation

  • Martina Battisti & Raja Peter, 2011. "Compensating resource constraints? A discriminant analysis of collaborating and non-collaborating small businesses in New Zealand," International Journal of Entrepreneurship and Small Business, Inderscience Enterprises Ltd, vol. 12(2), pages 245-256.
    • Handle: RePEc:ids:ijesbu:v:12:y:2011:i:2:p:245-256
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