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Small Business Survival In China: Guanxi, Legitimacy, And Social Capital

Author

Listed:
  • ELLIOT CARLISLE

    (University of Massachusetts, Amherst, MA 10002, USA)

  • DAVE FLYNN

    (Hofstra University, Hempstead, NY 11549, USA)

Abstract

Previous research suggests that guanxi "costs" are significantly higher for private Chinese enterprises versus all other enterprise types, i.e., state, township and village (TVE), domestic and foreign enterprises. Also, consistent with its cultural context, guanxi is considered to be equally important in business as it is in life for all types of Chinese enterprises. Herein, the discussion is extended to describe the concept of guanxi as a means of garnering social capital in order to maintain legitimacy. Furthermore, some practical means are suggested for entrepreneurs and small business owners to build a necessary foundation for survival.

Suggested Citation

  • Elliot Carlisle & Dave Flynn, 2005. "Small Business Survival In China: Guanxi, Legitimacy, And Social Capital," Journal of Developmental Entrepreneurship (JDE), World Scientific Publishing Co. Pte. Ltd., vol. 10(01), pages 79-96.
    • Handle: RePEc:wsi:jdexxx:v:10:y:2005:i:01:n:s1084946705000070
    DOI: 10.1142/S1084946705000070
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    Citations

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    Cited by:

    1. Chen, Liang-Chih, 2015. "Building extra-regional networks for regional innovation systems: Taiwan's machine tool industry in China," Technological Forecasting and Social Change, Elsevier, vol. 100(C), pages 107-117.
    2. Son Ngoc Chu & Ligang Song, 2015. "Promoting Private Entrepreneurship for Deepening Market Reform in China: A Resource Allocation Perspective," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 23(1), pages 47-77, January.
    3. Matthew W. Rutherford & Paul F. Buller & J. Michael Stebbins, 2009. "Ethical Considerations of the Legitimacy Lie," Entrepreneurship Theory and Practice, , vol. 33(4), pages 949-964, July.
    4. Naeem A. Albihany & Abdullah M. Aljarodi, 2024. "The role of personal connections Wasta on early-stage entrepreneurial orientations: empirical evidence from Saudi Arabia," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-12, December.
    5. Tan, Justin & Yang, Jun & Veliyath, Rajaram, 2009. "Particularistic and system trust among small and medium enterprises: A comparative study in China's transition economy," Journal of Business Venturing, Elsevier, vol. 24(6), pages 544-557, November.
    6. Barthelemy Chollet & Mickaël Géraudel & Caroline Danièle Mothe, 2013. "Generating Business Referrals for SMEs: The Contingent Value of CEOs' Social Capital," Grenoble Ecole de Management (Post-Print) hal-00915173, HAL.
    7. Barthelemy Chollet & Mickaël Géraudel & Caroline Danièle Mothe, 2013. "Generating Business Referrals for SMEs: The Contingent Value of CEOs' Social Capital," Post-Print hal-00915173, HAL.
    8. Li Zhao & Jung Ha-Brookshire, 2018. "Importance of Guanxi in Chinese apparel new venture success: a mixed-method approach," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 8(1), pages 1-19, December.
    9. Chauvet, Vincent & Chollet, Barthélemy & Soda, Giuseppe & Huault, Isabelle, 2011. "The contribution of network research to managerial culture and practice," European Management Journal, Elsevier, vol. 29(5), pages 321-334.
    10. Mehmet Ali AKYURT, 2020. "Sosyo-Ekonomik Değişmeyle Başa Çıkmak: Küçük Esnafın Taktikleri," Journal of Economy Culture and Society, Istanbul University, Faculty of Economics, vol. 0(1), pages 291-314, September.
    11. Xueling Li & Jia Shen & Wenjie Ma & Weiyong Zhang, 2016. "The effect of business ties and government ties on new IT venture growth: an empirical examination in China," Information Technology and Management, Springer, vol. 17(3), pages 245-261, September.

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