Patrick A. Saparito

Social Capital, Cognition, and Entrepreneurial Opportunities: A Theoretical Framework

Entrepreneurship—the recognition and exploitation of opportunities—is valuable within organizations as well as in the establishment of new ventures. Some studies have addressed the issue why some individuals take advantage of opportunities and some do not. While some studies find that psychological variables, personality traits and demographic factors may distinguish entrepreneurial activity, these findings are equivocal. Other research has looked to the importance of social capital and network ties to new venture creation. Yet, there is little discussion regarding the possibility that social capital and personal factors interact and influence entrepreneurial behavior.  Drawing from social cognitive theory (Augoustinos & Walker, 1995; Fiske & Taylor, 1984; Bandura, 1986; Wood & Bandura, 1989) this paper advances a model suggesting that entrepreneurial behavior is a result of the interplay of environments (i.e., social networks) and certain cognitive biases in entrepreneurs. We propose that both individual cognition and social capital are important in understanding entrepreneurial behavior. If the domain of entrepreneurship is “…the nexus of two phenomena: the presence of lucrative opportunities and the presence of enterprising individuals” (Shane & Venkataraman, 2000) then our model suggests an explanation of this nexus through exploring how both external (i.e., social capital) and internal factors (i.e., cognition) affect why some people and not others exploit opportunities.

Individualism, Collectivism, and Opportunism: A Cultural Perspective on Transaction Cost Economics

Researchers criticize the transaction cost economics (TCE) paradigm for over-generalizing the assumption of opportunism as human nature. We suggest that opportunistic propensity is affected by cultural prior conditioning of individualism-collectivism (I-C). Specifically, we propose that individualists have a higher opportunistic propensity in intra-group transactions, and collectivists in inter-group transactions. Our cultural specification of opportunism helps TCE to more effectively accommodate some criticisms and more realistically deal with problems of economic organization in today’s global economy.

Patterns of venture capital funding: Is gender a factor?

Since the early 1980s, new ventures with high growth potential and large capital needs have found an ever-increasing pool of venture capital available to support their growth. However, the flow of venture capital investment to women-led businesses remains meager in spite of the fact that in the US and Europe an increasing number of businesses are owned by women. The apparent disparity between potential investment opportunity and actual deals made between venture capital firms and women-led businesses raises the question of whether gender is an issue. The majority of venture capital studies investigate equity funds flows, investor criteria and the nature of the investor-investee relationship. Research on women entrepreneurs focuses on psychological dimensions, business characteristics and performance. Questions about the intersection of gender and venture capital financing are largely unexamined. This exploratory study utilizes longitudinal data to track US venture capital investments by proportion, stage, industry and gender. The descriptive statistics and our analysis of the findings suggest several hypotheses to explain the apparent gender gap.

The firm's trust in its university partner as a key mediator in advancing knowledge and new technologies

Although industry-university relationships (I/URs) are of growing importance for creating knowledge and new technologies, I/URs remain relatively understudied. We build a theoretical framework that examines communication frequency, a facet of communication effectiveness, the personalness of the communication form (i.e., face-to-face, telephone, e-mail, and written), the firms trust in its university partner, and the I/URs knowledge and new technology outcomes. Our theoretical framework is tested using primarily survey questionnaire data collected from senior managers in 189 industrial firms across 21 university research centers. While previous research demonstrates the important connection between the way partners communicate and various collaborative venture outcomes, our results suggest that trust is an important mediator between communication and knowledge and technological outcomes in I/URs. We conclude by discussing the implications of our findings for both research and practice.

Self-Interest Assumption and Relational Trust in University-Industry Knowledge Transfers

Since knowledge is a critical resource for ensuring firm growth and survival, firms are increasingly going outside their boundaries and collaborating with other organizations to obtain new knowledge. This study focuses on two distinct self-enforcing safeguards important for interorganizational knowledge transfer. Using survey questionnaire data from senior executives in 180 small to large-sized industrial firms working with university research centers, we focus on the self-enforcing safeguards of self-interest assumption and relational trust and examine the role of each in university-industry knowledge transfer. Results from multiple linear regression show both self-interest assumption and relational trust are positively associated with greater knowledge transfer, however, relational trust is more strongly associated to knowledge transfer than self-interest assumption. We also found that as knowledge becomes more tacit, self-interest assumption becomes negatively associated with knowledge transfer while relational trust becomes more strongly positive. We conclude by discussing implications for future research and management practice

Responding to trust breaches: The domain specificity of trust and the role of affect

Abstract Trust researchers have called for additional work examining trust breaches and trust erosion, as well as an explicit inclusion of affect in trust models. This paper directly responds to these calls. Based on a critical analysis and extension of Mayer, Davis and Schoormans (1995) integrative trust model, we examine the relative amount of positive affect associated with each dimension of trustworthiness (i.e., ability, integrity and benevolence). We further explore how breaches of different trustworthiness expectations for a particular joint activity influence trust erosion of the overall relationship. Finally, we identify specific negative emotions that mediate trust breaches and trust erosion.

Small and Medium-Sized Enterprise's Entrepreneurial versus Market Orientation and the Creation of Tacit Knowledge†

The ability to create tacit knowledge is important to the competitive advantage of firms in general but is critical to the survival and growth of small and medium‐sized enterprises ). Consequently, strategic orientations that facilitate tacit knowledge creation, especially in hostile environments, are important factors that can enhance competitiveness. This paper shows that while an entrepreneurial orientation () and environmental hostility are positively related to an cultivation of tacit knowledge, market orientation () is negatively related to tacit knowledge. Additionally, we find that in benign environments, the relationship between an and tacit knowledge becomes more strongly negative than in hostile environments.

The Influence of Communication Richness, Self-Interest, and Relational Trust on Banks’ Knowledge About Firms Within the Small-Cap Debt Finance Markets

Knowledge about small firmspsila circumstances in the debt finance markets is unevenly dispersed. Since efficient debt markets depend upon bankspsila adequate knowledge to make investment decisions, the mechanisms by which knowledge is transferred become particularly salient. Using information richness and structural embeddedness theories, we examined knowledge transfer within this context. We used survey data from 914 firms and found a positive association between firmspsila use of rich communication modes with the bank and a bankspsila knowledge about the firm. We unexpectedly found no significant relationship between firmspsila assumptions of aligned self-interest and knowledge transfer to banks but did find a strong positive association between firmspsila relational trust in banks and knowledge transfer. We also found that as communication forms become richer, self-interest becomes positively associated with knowledge transfer while and relational trust has a weaker positive association with knowledge transfer.

Bureaucratic Systems' Facilitating and Hindering Influence on Social Capital

This study demonstrates how banks’ bureaucratic systems (i.e., formalization, management continuity, customer orientation) are associated with social capitals relational and cognitive dimensions. We collected survey data from a matched sample of 884 small– and medium–sized enterprises (SME) executives and 217 bank managers across 22 banks to test hypothesized relationships. Our results showed that formalization is negatively associated with both dimensions of social capital, while management continuity and customer orientation are positively associated with them. These results are a first step in answering calls in the literature to study bureaucratic systems’ influence on social capital. Theoretical and future research implications are discussed.

The Central Role of Calculus-Based Trust and Relational Trust in Bank-Small Firm Relationships

We examine trusts central role in bank-small firm relationships. In doing so, we draw upon two trust perspectives which pervade the inter-organizational literature: calculus-based trust and relati...