Social Network of Small Creative Firms and Its Effects on Innovation in Developing Countries

This article aims to extend the current understanding of social networking in small creative traditional sectors in developing countries. Most of the relevant studies have tended to focus on developed countries while neglecting the developing countries perspective. However, our study stresses that small craft firms—subsector of creative industries—are not only significant for income and employment generation but these businesses also are dominant in most of the developing countries. Hence, this article develops a model to demonstrate the effects of social networking on innovation and thus entrepreneurial success in small creative firms from developing countries perspective. We empirically tested our proposed research model on a sample of 254 small creative firms in the craft sector located in Bangladesh. Our results suggest that small creative firms can and do benefit from establishing a cooperative relationship with buyers, suppliers, and designers. However, cooperation with competitors does not have a significant impact on innovation. The findings of our study have substantial implications for both practitioners and policymakers interested in enhancing innovation among small creative firms mainly craft sector. In particular, we argue that a small creative firm’s innovative activity benefits from close relations with suppliers and designers.