Capital constraints and the performance of entrepreneurial firms in Vietnam

Tran Thu, H and Santarelli, E 2014, 'Capital constraints and the performance of entrepreneurial firms in Vietnam', Industrial and Corporate Change, vol. 23, no. 3, pp. 827-864.


Document type: Journal Article
Collection: Journal Articles

Title Capital constraints and the performance of entrepreneurial firms in Vietnam
Author(s) Tran Thu, H
Santarelli, E
Year 2014
Journal name Industrial and Corporate Change
Volume number 23
Issue number 3
Start page 827
End page 864
Total pages 38
Publisher Oxford University Press
Abstract Entrepreneurship has been among the key driving forces of the emergence of a dynamic private sector during the recent decades in Vietnam. This article addresses for Vietnam the questions "how capital constraints affect the performance of family firms" and "how entrepreneurs' human and social capital interact with capital constraints to leverage entrepreneurial income." A panel of 1721 firms in 4 years is used. Results are consistent with the resource dependency approach, indicating an adverse effect of capital constraints on firm performance: firms suffering capital constraints perform substantially better, suggesting that they need more capital simply to finance newly recognized profit opportunities. Human capital plays a vital role in relaxing capital constraints and improves the entrepreneurial performance, whereas the effect of social capital stemming from strong ties and weak ties is limited: strong ties bring emotional support and weak ties give nonfinancial benefits from regular and useful business contacts. Advanced econometric analysis tools to take into account the endogeneity of capital constraints are used to establish relationships among relevant variables.
Subject Entrepreneurship
Industry Economics and Industrial Organisation
Keyword(s) Non-Family Firms
Exploratory Evidence
Credit Constraints
Ownership
Businesses
Networks
Success
Growth
Determinants
Investments
DOI - identifier 10.1093/icc/dtt030
Copyright notice © The Author 2013. Published by Oxford University Press on behalf of Associazione ICC.
ISSN 0960-6491
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Citation counts: TR Web of Science Citation Count  Cited 17 times in Thomson Reuters Web of Science Article | Citations
Scopus Citation Count Cited 5 times in Scopus Article | Citations
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Created: Tue, 18 Nov 2014, 08:24:00 EST by Catalyst Administrator
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