Efendic, A; Mickiewicz, T; Rebmann, A; (2013) Growth aspirations and social capital: Young firms in a post-conflict environnment. (Economics and Business Working Paper 122). Centre for Comparative Economics, SSEES, UCL: London, UK.

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Abstract

We explore the social determinants of growth aspirations of young firms’ owners and managers in a post-conflict economy. We focus on social capital, which we treat as a multi-dimensional phenomenon, studying not only the effect of owners’ and managers’ personal networks on growth aspirations, but also other facets that facilitate cooperation such as trust in institutions and generalised trust in people. We posit that that the generalised trust amplifies the beneficial effects of personal business networks, explaining how this conclusion diverges from earlier literature. We argue that in a post-conflict country, preservation of ethnic diversity is indicative of tolerance and low communication barriers and social capital appropriable for entrepreneurship. Our empirical counterpart and hypotheses testing rely on survey of young businesses in Bosnia and Herzegovina.

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