Entrepreneurial Social Capital and the Gatsby Effect
Journal of Business & Entrepreneurship, Vol. 20, No. 1, pp. 18-36, 2008
Posted: 30 Dec 2008
Date Written: March 30, 2008
Drawing insights from Fitzgerald's "The Great Gatsby", we explore a potentially significant impediment facing entrepreneurial firms as they attempt to augment and utilize their relationships with other firms. Significant differences in the quality of social capital can exist for entrepreneurial firms with similar sets of capabilities and initial structural connections to potential exchange partners. The influence of status differences between firms' representatives is emphasized as potentially detrimental whenever entrepreneurial firms are establishing new connections. Further, entrepreneurial firms attempting to convert existing weak ties into strong ties with established firms are most likely to encounter problems due to representatives' social status differences. Thus, entrepreneurs are encouraged to consider the downside of status when developing new relationships with existing firms.
Keywords: social capital, entrepreneurship, status
Suggested Citation: Suggested Citation