Minority Business Networks as a Source of Social Capital for Minority-Owned Firms
Vol. Volume 18, Number 3 September/2013
Ian Y. Blount, Delmonize A. Smith, James A. Hill
Much of our understanding of minority-owned firms is based on nascent entrepreneurial businesses. Therefore, it is difficult to answer the question of how a minority-owned firm’s age and size may influence the social capital derived from a minority business network. We utilize a resource-dependence perspective to hypothesize that the social capital derived from participation in a minority business network will be negatively related to the minority-owned firm’s age and size. We find that firm size (as measured by revenue and number of employees) is negatively related with social capital derived from the minority business network. Our findings may help minority business owners understand the relative value of membership in minority business networks before committing limited resources. Our associated implications offer guidance to minority business networks who often employ a “one-size-fits all” value proposition to their minority business members.
Social Capital, Networks, Resource Dependence, and Minority Business