Effect of Social Networks and Performance of Agribusinesses Owned by Young Women in a Developing Country: The Moderating Effect of Business Environment

Abstract

The structure and types of social networks created by entrepreneurs are important factors influencing business performance. This study examined how social networks influence the performance of agribusinesses owned by young women, as well as the moderating effects of business environments on these relationships. Data were collected from a sample of 365 young women agri-food processing business owners in Benin. Moderated multiple regression methods were used to test the suggested hypotheses including the interaction effects of business environment. Network size, network centrality, competitive network, and supportive network each has a positive effect on the performance of agribusinesses owned by young women. Network size and network centrality are more beneficial when barriers in business environment are low than when they are high. The two-way interactions of network types (competitive and supportive) and business environment on business performance were not significant. Drawing on social capital theory, this study provides a contingent perspective of network size and net- work centrality in a developing country context. The findings of the study provide useful guidelines for young women agribusiness owners on which social ties to develop. Rules and regulations on taxes need to be streamlined and made more flexible.