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Building entrepreneurial inter-firm networks in an emerging economy: the role of cognitive legitimacy

Wafa N. Almobaireek (), Ahmed A. Alshumaimeri () and Tatiana S. Manolova ()
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Wafa N. Almobaireek: King Saud University
Ahmed A. Alshumaimeri: King Saud University
Tatiana S. Manolova: Bentley University

International Entrepreneurship and Management Journal, 2016, vol. 12, issue 1, No 5, 87-114

Abstract: Abstract We take an organizational legitimacy perspective and use data from a large-scale nationally representative study on the state of small business in Saudi Arabia, in order to explore the antecedents to the formation of entrepreneurial ventures’ inter-firm networks in the context of an emerging economy (n = 331). We argue that entrepreneurial ventures need to overcome a threshold of cognitive legitimacy in order to develop inter-firm ties with a diverse set of large, established firms. Results indicate that having a written business plan and a formal organizational structure are positively associated with the diversity of the new venture’s inter-firm network, while the education level of the entrepreneur does not have a significant effect. In addition, the effect of having a formal organizational structure is stronger for younger ventures. Implications are discussed.

Keywords: Inter-firm networks; Legitimacy; Entrepreneurial ventures; Emerging economies; Saudi Arabia (search for similar items in EconPapers)
Date: 2016
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Handle: RePEc:spr:intemj:v:12:y:2016:i:1:d:10.1007_s11365-014-0322-7