The Influence of Social Capital on Entrepreneurial Behavior

Traditionally, the theory of entrepreneurship is associated with an individual's employment choice and with innovation. In the last decade, however, sociologists, economists and organisation theorists have shown that social networks and embeddedness are also crucial factors in the decision whether to become entrepreneurs. The aim of this chapter is a a review of the literature on the subject and assess how social capital (in its variety of meanings) has been used for, and has contributed to, our understanding of entrepreneurial behaviour. We show that although social capital is recognised as a valuable resource for entrepreneurs, a rigorous generally accepted theory of social capital is still lacking, implying gaps in our understanding of this interdependence