Efficiency and social capital in Micro, Small and Medium Enterprises: the case of Ethiopia

Abstract

This study extends the existing literature on how social networks enhance the performance and sustainability of small enterprises. More specifically, the study isolates and investigates the mechanisms through which social capital helps with the growth and survival of MSMEs. The evidence presented in this study strongly suggests that an indigenous social network widely practiced in Ethiopia, the "iqqub", contributes significantly to the start-up, survival and development of urban MSMEs.