RELATIONSHIP BETWEEN SOCIAL CAPITAL AND MICRO, SMALL, AND MEDIUM ENTERPRISES (MSMES) RESILIENCE: A THEORETICAL FOUNDATIONAL MODEL
Abstract
The MSMEs constitute a substantial proportion of livelihoods worldwide and the academic community need to provide policymakers and practitioners with knowledge on factors influencing their resilience development. The aim of this study is to formulate a theorical foundational model of the relationship between social capital and organizational (MSMEs) resilience with focus on developing countries. The overriding premise of the study comprises two theories, the dynamic capability theory and the social capital theory. Resilience is a critical ability for the MSMEs to withstand and overcome obstacles by ironing out risks and uncertainties brought about by internal and external shocks. In essence, social capital acts as a catalyst for developing and leveraging dynamic capabilities, enabling firms to navigate complex and dynamic environments effectively. Social capital can leverage adaptability and flexibility of MSMEs to the uncertainties through fostering collaboration and cooperation to build strong networks, which in times of crisis, can provide the MSMEs with a safety net that bolsters their resilience, and can also increase their visibility within the industry and the market.
Keywords: MSMEs, Shocks, Theoretical Model, Social Capital, Dynamic Capabilities, Organizational Resilience
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