TYING STRONG TIES IN INFORMAL ENTREPRENEURSHIP: A CONSTRAINT OR AN ENTREPRENEURIAL DRIVER?

Cristian E Villanueva, Adrianela Angeles () and Luz Cecilia Revilla
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Cristian E Villanueva: Economics and Business Department, Anahuac University, Av. Universidad Anáhuac 46, Lomas Anáhuac, Huixquilucan, Edo. México 52786, México
Adrianela Angeles: Economics and Business Department, Anahuac University, Av. Universidad Anáhuac 46, Lomas Anáhuac, Huixquilucan, Edo. México 52786, México
Luz Cecilia Revilla: Economics and Business Department, Anahuac University, Av. Universidad Anáhuac 46, Lomas Anáhuac, Huixquilucan, Edo. México 52786, México

Journal of Developmental Entrepreneurship (JDE), 2018, vol. 23, issue 01, 1-19

Abstract: Informal entrepreneurship is a persistent and extensive phenomenon in both developed and developing countries and considerable efforts have been made to understand it from an ecosystem perspective. Nevertheless, literature that analyzes networks within and among individuals in the informal economic sector has received less attention. This study presents an interesting extension of Granovetter's “strength of weak ties” hypothesis. Until now, strong ties are perceived to be constraining and less beneficial than weak ties for the entrepreneurial activity. However, this paper critically examines this assumption in the context of informal entrepreneurship to explore in detail this networking dynamic and how it affects their financial and social performance. A qualitative approach using 50 face-to-face interviews in Mexico was conducted. Our findings demonstrate that strong ties provide the resources, support and information informal entrepreneurs need to reduce their adversity and vulnerable conditions, having a positive impact on their financial and social outcomes.

Keywords: Network theory; developing country; financial performance; social performance (search for similar items in EconPapers)
Date: 2018
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DOI: 10.1142/S1084946718500024

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