Social Ties, Absorptive Capacity, Entrepreneurial Orientation, and Performance of SMEs in Transition Economy: A Contingency Framework

What are the influential factors determine SME’s performance in transition economy? From the resource-based view, researchers have explored the effects of social ties, absorptive capacity and entrepreneurial orientation on firm performance. This study adds to this literature by distinguishing the types of social ties based on the resources they supply, while prior studies generally focus on the sources of such resources. This study also advance a holistic framework outlining not only the three main effects, but also two interaction effects (social ties with absorptive capacity and social ties with entrepreneurial orientation) to demonstrate how they facilitate SMEs filling the gap of institutional voids and achieving superior performance in transition economies.