IDEAS home Printed from https://ideas.repec.org/a/taf/oabmxx/v4y2017i1p1309784.html
   My bibliography  Save this article

Nexus between social capital and performance of micro and small firms in an emerging economy: The mediating role of innovation

Author

Listed:
  • Frederick Owusu Agyapong
  • Ahmed Agyapong
  • Kofi Poku

Abstract

The purpose of this study was to examine the relationship among social capital, innovation, and performance of micro and small businesses (MSBs) in emerging economies using data from a sub-Saharan African Country—Ghana. Specifically, the study sought to examine the mediating role of innovation in the relationship between social capital and performance. The study relied on a survey design and a cross-sectional data collected with the aid of questionnaire from 500 MSBs operating in the Ashanti Region of Ghana. The scales and measures of the study were validated using confirmatory factory analysis in LISREL 8.50, while the study’s proposed model was estimated using ordinary least square regression analysis in SPSS 20. The following results were obtained: (1) social capital positively influenced performance, (2) there is positive relationship between innovation and performance, (3) social capital has a positive effect on innovation, and (4) innovation was observed to partially mediate the relationship between social capital and performance. The results indicate the important role social capital and innovation play in the success of MSBs in emerging economies and the fact that managers and owners of such businesses need to pay attention to these concepts and use them to their advantage.

Suggested Citation

  • Frederick Owusu Agyapong & Ahmed Agyapong & Kofi Poku, 2017. "Nexus between social capital and performance of micro and small firms in an emerging economy: The mediating role of innovation," Cogent Business & Management, Taylor & Francis Journals, vol. 4(1), pages 1309784-130, January.
    • Handle: RePEc:taf:oabmxx:v:4:y:2017:i:1:p:1309784
    DOI: 10.1080/23311975.2017.1309784
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/23311975.2017.1309784
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/23311975.2017.1309784?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. Bruce Kogut & Udo Zander, 1992. "Knowledge of the Firm, Combinative Capabilities, and the Replication of Technology," Organization Science, INFORMS, vol. 3(3), pages 383-397, August.
    2. Love, James H. & Roper, Stephen & Du, Jun, 2009. "Innovation, ownership and profitability," International Journal of Industrial Organization, Elsevier, vol. 27(3), pages 424-434, May.
    3. G. M.P. Swann, 2009. "The Economics of Innovation," Books, Edward Elgar Publishing, number 13211.
    4. Cooke, Philip & Wills, David, 1999. "Small Firms, Social Capital and the Enhancement of Business Performance through Innovation Programmes," Small Business Economics, Springer, vol. 13(3), pages 219-234, November.
    5. Yu-Shan Chen & Shyh-Bao Lai & Chao-Tung Wen, 2006. "The Influence of Green Innovation Performance on Corporate Advantage in Taiwan," Journal of Business Ethics, Springer, vol. 67(4), pages 331-339, September.
    6. Marcel Fafchamps, 2002. "Returns to social network capital among traders," Oxford Economic Papers, Oxford University Press, vol. 54(2), pages 173-206, April.
    7. Jean‐Luc Arregle & Michael A. Hitt & David G. Sirmon & Philippe Very, 2007. "The Development of Organizational Social Capital: Attributes of Family Firms," Journal of Management Studies, Wiley Blackwell, vol. 44(1), pages 73-95, January.
    8. Michael Lubatkin & John Florin & William S. Schulze, 2003. "A social capital model of high growth ventures," Post-Print hal-02311715, HAL.
    9. John Hulland, 1999. "Use of partial least squares (PLS) in strategic management research: a review of four recent studies," Strategic Management Journal, Wiley Blackwell, vol. 20(2), pages 195-204, February.
    10. Gautam Ahuja & Riitta Katila, 2001. "Technological acquisitions and the innovation performance of acquiring firms: a longitudinal study," Strategic Management Journal, Wiley Blackwell, vol. 22(3), pages 197-220, March.
    11. Paul Robson & Helen Haugh & Bernard Obeng, 2009. "Entrepreneurship and innovation in Ghana: enterprising Africa," Small Business Economics, Springer, vol. 32(3), pages 331-350, March.
    12. Donald P. Moynihan & Sanjay K. Pandey, 2006. "Creating desirable organizational characteristics," Public Management Review, Taylor & Francis Journals, vol. 8(1), pages 119-140, March.
    13. Michael Lubatkin & John Florin & William S. Schulze, 2003. "A social capital model of high growth ventures," Post-Print hal-02276699, HAL.
    14. Carrie R. Leana & Frits K. Pil, 2006. "Social Capital and Organizational Performance: Evidence from Urban Public Schools," Organization Science, INFORMS, vol. 17(3), pages 353-366, June.
    15. Rosenbusch, Nina & Brinckmann, Jan & Bausch, Andreas, 2011. "Is innovation always beneficial? A meta-analysis of the relationship between innovation and performance in SMEs," Journal of Business Venturing, Elsevier, vol. 26(4), pages 441-457, July.
    16. Charles Makanyeza & Gilbert Dzvuke, 2015. "The influence of innovation on the performance of small and medium enterprises in Zimbabwe," Journal of African Business, Taylor & Francis Journals, vol. 16(1-2), pages 198-214, January.
    17. Nattaka Yokakul & Girma Zawdie, 2011. "The knowledge sphere, social capital and growth of indigenous knowledge-based SMEs in the Thai dessert industry," Science and Public Policy, Oxford University Press, vol. 38(1), pages 19-29, February.
    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. Fabiane Tubino Garcia & Carla Schwengber ten Caten & Elaine Aparecida Regiani de Campos & Aline Marian Callegaro & Diego Augusto de Jesus Pacheco, 2022. "Mortality Risk Factors in Micro and Small Businesses: Systematic Literature Review and Research Agenda," Sustainability, MDPI, vol. 14(5), pages 1-37, February.
    2. Dabić, Marina & Stojčić, Nebojša & Simić, Marijana & Potocan, Vojko & Slavković, Marko & Nedelko, Zlatko, 2021. "Intellectual agility and innovation in micro and small businesses: The mediating role of entrepreneurial leadership," Journal of Business Research, Elsevier, vol. 123(C), pages 683-695.
    3. Rajapakshe, PSK & Gamage, SKN & Prasanna, RPIR & Jayasundara, JMSB & Ekanayake, EMS & Upulwehera, JMHM & Wijerathna, WAID & Abeyrathne, GAKNJ, 2020. "Social Capital, Performance of SMEs, and COVID-19 Pandemic," MPRA Paper 109530, University Library of Munich, Germany, revised 30 Aug 2020.
    4. Fu, Xiaolan & Mohnen, Pierre & Zanello, Giacomo, 2018. "Innovation and productivity in formal and informal firms in Ghana," Technological Forecasting and Social Change, Elsevier, vol. 131(C), pages 315-325.
    5. Zhonghao Wang, 2023. "Do Livelihood Strategies Influence Post-Epidemic Business Performance? Investigation of Social Capital and Environmental Perception," Sustainability, MDPI, vol. 15(5), pages 1-12, March.
    6. HMJCB Heenkenda & Fengju Xu & KMMCB Kulathunga & WAR Senevirathne, 2022. "The Role of Innovation Capability in Enhancing Sustainability in SMEs: An Emerging Economy Perspective," Sustainability, MDPI, vol. 14(17), pages 1-22, August.
    7. Xiaotang Zhang & Haili Zhang & Michael Song, 2019. "Does Social Capital Increase Innovation Speed? Empirical Evidence from China," Sustainability, MDPI, vol. 11(22), pages 1-22, November.
    8. Samuel Afriyie & Jianguo Du & Abdul-Aziz Musah, 2019. "Innovation and marketing performance of SME in an emerging economy: the moderating effect of transformational leadership," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 9(1), pages 1-25, December.
    9. Say Keat Ooi & Chan Hua Lee & Azlan Amran, 2023. "Assessing the influence of social capital and innovations on environmental performance of manufacturing SMEs," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(6), pages 3242-3254, November.
    10. Tian Hongyun & William Adomako Kankam & Florence Appiah-Twum & Isaac Gumah Akolgo, 2019. "Effect of Social Capital on Firm Performance: The Role of Entrepreneurial Orientation and Dynamic Capability," International Review of Management and Marketing, Econjournals, vol. 9(4), pages 63-73.
    11. Juan-Gabriel Martínez-Navalón & María Fernández-Fernández & Fernanda Pedrosa Alberto, 2023. "Does privacy and ease of use influence user trust in digital banking applications in Spain and Portugal?," International Entrepreneurship and Management Journal, Springer, vol. 19(2), pages 781-803, 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. Ismael Barros-Contreras & Héctor Pérez-Fernández & Natalia Martín-Cruz & Juan Hernangómez B., 2023. "Can we make family social capital flourish? The moderating role of generational involvement," Journal of Family and Economic Issues, Springer, vol. 44(3), pages 655-673, September.
    2. Acquaah, Moses, 2011. "Utilization and value of social networking relationships in family and nonfamily firms in an African transition economy," European Management Journal, Elsevier, vol. 29(5), pages 347-361.
    3. Emma Su & Michael Carney, 2013. "Can China’s family firms create intellectual capital?," Asia Pacific Journal of Management, Springer, vol. 30(3), pages 657-675, September.
    4. Frida Thomas Pacho, 2018. "Diversified Network Effects on Innovation Performance in Tanzania: Innovation Strategy in Service Firms," Journal of Entrepreneurship and Business Innovation, Macrothink Institute, Journal of Entrepreneurship and Business Innovation, vol. 5(1), pages 1-1, December.
    5. Li, Dan, 2013. "Multilateral R&D alliances by new ventures," Journal of Business Venturing, Elsevier, vol. 28(2), pages 241-260.
    6. Junfu Zhang, 2011. "The advantage of experienced start-up founders in venture capital acquisition: evidence from serial entrepreneurs," Small Business Economics, Springer, vol. 36(2), pages 187-208, February.
    7. Zheng, Yanfeng & Liu, Jing & George, Gerard, 2010. "The dynamic impact of innovative capability and inter-firm network on firm valuation: A longitudinal study of biotechnology start-ups," Journal of Business Venturing, Elsevier, vol. 25(6), pages 593-609, November.
    8. Stienstra, Miranda, 2020. "The determinants and performance implications of alliance partner acquisition," Other publications TiSEM 7fdee0c2-d4d2-4f5b-95e3-2, Tilburg University, School of Economics and Management.
    9. Christopher Boudreaux & George Clarke & Anand Jha, 2022. "Social capital and small informal business productivity: the mediating roles of financing and customer relationships," Small Business Economics, Springer, vol. 59(3), pages 955-976, October.
    10. Nasser Saad Al Kahtani & Sulphey M. M., 2022. "A Study on How Psychological Capital, Social Capital, Workplace Wellbeing, and Employee Engagement Relate to Task Performance," SAGE Open, , vol. 12(2), pages 21582440221, May.
    11. Joern H. Block & Christian O. Fisch & Mirjam van Praag, 2017. "The Schumpeterian entrepreneur: a review of the empirical evidence on the antecedents, behaviour and consequences of innovative entrepreneurship," Industry and Innovation, Taylor & Francis Journals, vol. 24(1), pages 61-95, January.
    12. Yunis, Manal & Tarhini, Abbas & Kassar, Abdulnasser, 2018. "The role of ICT and innovation in enhancing organizational performance: The catalysing effect of corporate entrepreneurship," Journal of Business Research, Elsevier, vol. 88(C), pages 344-356.
    13. Criaco, Giuseppe & van Oosterhout, J. (Hans) & Nordqvist, Mattias, 2021. "Is blood always thicker than water? Family firm parents, kinship ties, and the survival of spawns," Journal of Business Venturing, Elsevier, vol. 36(6).
    14. Walter, Jorge & Lechner, Christoph & Kellermanns, Franz W., 2007. "Knowledge transfer between and within alliance partners: Private versus collective benefits of social capital," Journal of Business Research, Elsevier, vol. 60(7), pages 698-710, July.
    15. Abdul-Fatahi Abdulai & Lyndon Murphy & Brychan Thomas, 2019. "University Knowledge Transfer And Innovation Performance In Firms: The Ghanaian Experience," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 24(03), pages 1-33, April.
    16. Wu Zhao & Jizhen Li & Xiaohua Li & Thomas Schøtt, 2020. "Implications of Network Diversity for Venture Growth: The Mediation Effect of Entrepreneurial Alertness," Sustainability, MDPI, vol. 12(22), pages 1-15, November.
    17. Gaia Rubera & Deepa Chandrasekaran & Andrea Ordanini, 2016. "Open innovation, product portfolio innovativeness and firm performance: the dual role of new product development capabilities," Journal of the Academy of Marketing Science, Springer, vol. 44(2), pages 166-184, March.
    18. Johan Wiklund & Dean A. Shepherd, 2008. "Portfolio Entrepreneurship: Habitual and Novice Founders, New Entry, and Mode of Organizing," Entrepreneurship Theory and Practice, , vol. 32(4), pages 701-725, July.
    19. Francesco Chirico & Carlo Salvato, 2016. "Knowledge Internalization and Product Development in Family Firms: When Relational and Affective Factors Matter," Entrepreneurship Theory and Practice, , vol. 40(1), pages 201-229, January.
    20. Oleksandr Talavera & Charlie Weir & Lin Xiong, 2017. "Time Allocation and Performance: The Case of Chinese Entrepreneurs," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 24(1), pages 27-51, January.

    More about this item

    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:taf:oabmxx:v:4:y:2017:i:1:p:1309784. 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: Chris Longhurst (email available below). General contact details of provider: http://cogentoa.tandfonline.com/OABM20 .

    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.