The Influence of Entrepreneurship and Social Networks on Economic Growth—From a Sustainable Innovation Perspective

Abstract

Abstract:A large body of evidence demonstrates the key role played by entrepreneurship in promoting economic growth. However, the potential connections between entrepreneurship, social networking, and economic development still require in-depth exploration and discussion. This paper first establishes a theoretical framework combining entrepreneurship capital theory, resource dependence theory and transaction cost theory, then examines the possible associations between entrepreneurship, social networks, and economic growth based on the dynamic panel data model. To achieve the research objectives, the investigators collected data spanning the period between 2007 and 2016 from 31 provinces and cities in China. The authors adopted the enterprise employment rate as a measure of entrepreneurship and used the information sharing rate to assess social networks, which were then both introduced into the economic growth model. Additionally, by using the system of generalized method of moments (GMM) estimation, this article measures the influence of entrepreneurship and social networks on the economic growth of a local area. The empirical results reveal that both entrepreneurship and social networking significantly promote regional economic growth in China. Further, the effect of entrepreneurship is significantly enhanced after introducing the joint effects of entrepreneurship and social network. The findings also expound that entrepreneurship of the eastern zone and social networking of the central section exhibit the strongest potential for economic development of the respective areas. Conversely, entrepreneurship may actually hinder the economic advancement of the central areas of China. Corresponding to the findings, the researchers suggest that it is necessary to devise flexible policies for heterogeneous entrepreneurial environments and to appropriately utilize interpersonal networks to maximize the efficiency of the outputs of economic activity, which are likely to strengthen the role of entrepreneurship and social networks in contemporary economic and business milieu.

Partnership-Based Supply Chain Collaboration: Impact on Commitment, Innovation, and Firm Performance

“…Sustainable innovation cannot be driven by a sole firm, but a collective knowledge of market characteristics can be driven by interconnected firms [17]. Successful green product innovation can increase end-customers' interests in cost and environmental protection, thereby strengthening the firm's performance [18,29] Highly innovative firms have the advantage of quickly identifying and seizing new market opportunities through close working relationships with interconnected partners [40]. Previous studies strongly indicate the importance of commitment in collaboration relationship, which determines the level of risk of opportunism and information sharing in new product development [40] and operation, planning and control processes, and performance [47].…”

“…Moreover, RDT was perceived as a useful practical lens in strategic supply management with respect to the level of opportunism (difficulty level of replacing a partner) [28]. For sustainable development of the regional economy, Chen et al [29] stated that the differences in social network levels (i.e., Guanxi) among different regions influence the frequency of interacting with external resources. By reducing the cost of knowledge access and transfer, entrepreneurial capital can be accumulated through collaborative technological innovation among network connected channels.…”

“…To compete in the present global economy, firms are required to seek and foster innovation capability. In a sustainability context, green product innovation plays a significant role in both increasing the customer's interest in taking advantage of both cost and environmental protection, and improving overall firm performance [17,18,29]. Sustainable innovation, which is strategically driven by the knowledge of market demand, results in green product innovation which cannot be easily copied in other countries, thereby creating higher firm performance [17].…”

Alliance Portfolio Management and Sustainability of Entrepreneurial Firms

“…It is acknowledged that entrepreneurial firms have a higher possibility of failure than established firms because of the liability of newness [3]. Stinchcombe argued that entrepreneurial firms are short of resources, having not established stable and effective relationships with suppliers and customers.…”

“…According to the research on strategy and organizations, it is acknowledged that entrepreneurial firms have higher failure rates than established firms [1]. Due to the liability of newness [2], entrepreneurial firms are short of stable relations with suppliers and customers, as well as sufficient resources [3]. In our research sample, of the firms in the Internet and Information industry in New OTC Market (Over the Counter Market) in China, a quarter had negative profit and 3 firms even withdrew from the market 3 years after their IPO.…”