Social Capital Types and Internationalization: A Study of Indian Software SMEs

Advanced Institute of Management Research Paper No. 045

43 Pages Posted: 1 Dec 2008

See all articles by Shameen Prashantham

Shameen Prashantham

affiliation not provided to SSRN

Shaker A. Zahra

University of Minnesota - Twin Cities - Carlson School of Management

Date Written: August 22, 2006

Abstract

Small business enterprises (SMEs) from emerging economies have become active participants in international markets. Seeking to capitalize on their unique skills and capabilities and achieve rapid growth and diversify the sources of their revenue streams, SMEs have used their social capital to penetrate foreign markets and acquire market share. In this study we focus on Indian software producers who have used their ethnic ties to enter foreign markets. Our analyses of 96 SMEs suggest that bonding social capital, arising from friendship and kinship relationships, enhances SMEs' ability to adopt and implement higher and more costly modes of entry to international markets. Bridging social capital (between dissimilar groups) enables SMEs to gain a greater percentage of revenues from foreign markets.

Suggested Citation

Prashantham, Shameen and Zahra, Shaker A., Social Capital Types and Internationalization: A Study of Indian Software SMEs (August 22, 2006). Advanced Institute of Management Research Paper No. 045. Available at SSRN: https://ssrn.com/abstract=1309510 or http://dx.doi.org/10.2139/ssrn.1309510

Shameen Prashantham (Contact Author)

affiliation not provided to SSRN ( email )

Shaker A. Zahra

University of Minnesota - Twin Cities - Carlson School of Management ( email )

19th Avenue South
Minneapolis, MN 55455
United States

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