Gender, Social Networks, and Entrepreneurial Outcomes in Tanzania

Abstract

This article presents results of a study that investigates egocentric network differences between female and male entrepreneurs and their entrepreneurial outcomes in Tanzania. Based on a random sample of 272 micro-, small, and medium-size enterprises, the study reveals that female and male entrepreneurs have diverse networks. However, when compared to their male counterparts, female entrepreneurs' strong ties included more kin members. No significant gender difference in the composition of weaker ties was observed, suggesting gender differences in the choice of individuals with whom to have strong ties but not with whom to have weak ties. A significant gender difference in entrepreneurial outcomes at both start up and at the time of research was found, suggesting an antecedent networking behavior influence on performance.

Social Capital in Selected Business Associations of Food Processing SMEs in Tanzania and Rwanda: A Synthetic Based Approach

“…Therefore, SC facilitates BAs in acquisition of resource and functional capabilities necessary for their members" enterprise performance such as financial, physical, technological as well as human capital (Firkin, 2003;Mbura, 2007). It is also a base for collective action, cost saving and simplification of business operations through acquisition and sharing of market information and facilities, joint marketing, purchasing and sub-contracting (McCord, 2005;Mbura, 2007;Rutashobya and Shimba, 2009). Though availability of such SC generated capabilities can enable improved performance of enterprises, their contribution to SMEs performance is more critical due to SMEs challenging business environment (OECD, 2013 …”

Step-Change: Micro-Entrepreneurs’ Entry into the Middle-Class Market

“…Micro-entrepreneurs may be limited by their current networks when, for the implementation of new business opportunities, they seek new information or resources that are currently unavailable in their existing network. Furthermore, when relationships deepen, micro-entrepreneurs may become less independent, potentially leading to ineffective decision making (Rutashobya et al, 2009;Villena, Revilla, & Choi, 2011). Micro-entrepreneurs may, for example, give too much credit to customers because these customers can place considerable noneconomic claims on their sense of obligation such as reciprocity and reputation claims (e.g., Dussuc & Geindre, 2012).…”

“…Although bonding social capital helps micro-entrepreneurs at the BoP to survive, it may also lock them into their current social networks (Kuada, 2009;Rutashobya et al, 2009). Micro-entrepreneurs may be limited by their current networks when, for the implementation of new business opportunities, they seek new information or resources that are currently unavailable in their existing network.…”

“…Their situation is characterized by, among others, inadequate infrastructures and a lack of support from formal institutions (Burgess & Steenkamp, 2006). Micro-entrepreneurs adapt to these conditions through social networking, which enables them to survive by making efficient use of scarce resources (Kuada, 2009;Rutashobya et al, 2009). Hierarchy and embeddedness, such as strong cultural norms, therefore represent important informal institutions that characterize BoP (Burgess & Steenkamp, 2006).…”

“…In particular, they would need to acquire additional resources, of which some, such as capital and insurance, require registration at a Chamber of Commerce and inclusion in the tax-payment system (de Soto, 2000;Spring, 2009). Taking a step upwards may further be complicated by the fact that micro-entrepreneurs may feel locked into social mechanisms of reciprocal one-toone relationships, characterized by borrowing and lending, that enable survival but constrain growth (Rutashobya Allan, & Nilsson, 2009;Viswanathan, Rosa, & Ruth, 2010).…”