Immigrant Entrepreneurship in South Africa. A Focus on the Role of Bridging and Bonding Social Capital in Accessing Finance

Abstract

Research reveals that in many emerging nations, as a result of weak institutions and the failings of governments, immigrant entrepreneurs depend on various forms of human capital and social networks to ensure enterprise success. Although human and social capital have been studied extensively in the generic entrepreneurship literature, this article provides a novel contribution by offering a more nuanced approach towards understanding how different forms of capital are relevant to the immigrant entrepreneurship domain from an African emerging market perspective. Primary data are collected from immigrant entrepreneurs in South Africa. Results show that bridging network ties positively and significantly moderates the primary relationship between human capital experience (HCE) and access to finance. Study implications relate to how immigrant entrepreneurs can adapt and apply the study findings to their local settings to gain access to finance. Specifically, immigrant entrepreneurs need to be aware of how bridging social capital and HCE are intertwined and have a substantial effect on each other when accessing finance. This article provides a novel understanding of how different forms of capital influence immigrant entrepreneurship in South Africa.