Immigrant family businesses: social capital, network benefits and business performance

Abstract

Purpose

The purpose of this paper is to look at immigrant family business through the framework of social capital by investigating how the social capital of immigrant family business owners helps them obtain network benefits and improve business performance.

Design/methodology/approach

This paper presents an empirical investigation of 170 immigrant family business owners. The authors examine social capital as a multidimensional construct and focus on two attributes of social capital: structural embeddedness and relational embeddedness. In addition, this study examines how social capital influences business performance through the mediating effect of network benefits. Finally, the constructs of family capital and immigrant community capacity are also investigated.

Findings

The results suggest that the two attributes of social capital differed in their effects on network benefits, and that network benefits mediated the influence of social capital attributes on family business performance. Specifically, relational social capital influenced access to resources and information, and structural social capital influenced access to resources. Family ties affected network benefits and business performance, and immigrant community capacity had the predicted moderating effect on the relationship between immigrant community ties and network benefits.

Originality/value

This investigation has the potential to advance understanding of immigrant family businesses by assessing how the overall social capital of the family business owner influences business performance. The study also furthers the understanding of family capital and immigrant community capacity. In addition, these results serve practitioners by helping identify avenues to increase immigrant family business performance, an issue that is increasingly important today given the contribution of such businesses to the economic vitality of societies.

Citation

Tata, J. and Prasad, S. (2015), "Immigrant family businesses: social capital, network benefits and business performance", International Journal of Entrepreneurial Behavior & Research, Vol. 21 No. 6, pp. 842-866. https://doi.org/10.1108/IJEBR-06-2014-0111