Measurement Model of Social Capital, Entrepreneurial Orientation, Entrepreneurial Financing Choice and Performance in SMEs in West Sumatra
Keywords:
Measurement Model, CFA, Social Capital, Entrepreneurial Orientation, Entrepreneurial Financing Choice, Performance
Abstract
This research provides evidence of a measurement model, (confirmatory factor analysis--CFA) of performance, social capital, entrepreneurial orientation, and entrepreneurial financing choice of SMEs in West Sumatra in 2023. The purpose of this research is to test the accuracy of the measurement model on the data that has been collected. To answer this research question using a structural equation model (SEM). With a sample of 342 SMEs, it was found that the hypothesized model is valid and significant. The highest SL performance indicators are on the 2nd indicator with a value of 0.0972 and the lowest SL is on the 5th indicator with a value of 0.517. The Social capital indicators the highest SL is on the 7th indicator with a value of 0.905 and the lowest SL is on the 1st indicator with a value of 0.496. The highest SL entrepreneurial orientation indicators are on the 3rd indicator with a value of 0.876 and the lowest SL is on the 9th indicator with a value of 0.600. The Entrepreneurial financing choice indicators the highest SL is on the 4th indicator with a value of 0.962 and the lowest SL is on the 1st indicator with a value of 0.565.
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References
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Aidoo, S. O., Agyapong, A., & Mensah, H. K. (2020). Social capital and performance of SMEs: The role of entrepreneurial orientation and managerial capability. Africa Journal of Management, 6(4), 377–406. https://doi.org/10.1080/23322373.2020.1830698
Covin, Jeffrey, G., & Slevin, Dennis, P. (1989). Strategic Management of Small Firms in Hostile and Benign Environments. Strategic Management Journal, 10(March 1987), 75–87.
Covin, J. G., & Lumpkin, G. T. (2011). Entrepreneurial orientation theory and research: Reflections on a needed construct. Entrepreneurship: Theory and Practice, 35(5), 855–872. https://doi.org/10.1111/j.1540-6520.2011.00482.x
Degong, M., Ullah, F., Khattak, M. S., & Anwar, M. (2018). Do international capabilities and resources configure firm’s sustainable competitive performance? Research within Pakistani SMEs. Sustainability (Switzerland), 10(11). https://doi.org/10.3390/su10114298
Dudley, E. (2021). Social capital and entrepreneurial financing choice. Journal of Corporate Finance, 70(August), 102068. https://doi.org/10.1016/j.jcorpfin.2021.102068
Fitriati, T.K., Purwana, D., & Dharmawan, A. (2020). The role of innovation in improving small medium enterprise ( SME ) Performance. International Journal of Innovation, Creativity and Change, 11(2), 232– 250.
Fukuyama, F. (1995). Trust : the Social Virtues and. Simon and Schuster.
Ghozali, I. (2013). Aplikasi Analisis Multivariate Dengan Program IBM SPSS 21 Update PLS Regresi (7th ed.). Badan Penerbit Universitas Diponegoro.
Haber, S., & Reichel, A. (2005). Identifying performance measures of small ventures - The case of the tourism industry. Journal of Small Business Management, 43(3), 257–286. https://doi.org/10.1111/j.1540-627X.2005.00137.x
Hult, G. T. M., Hurley, R. F., & Knight, G. A. (2004). Innovativeness: Its antecedents and impact on business performance. Industrial Marketing Management, 33(5), 429–438. https://doi.org/10.1016/j.indmarman.2003.08.015
Karaivanov, A., & Kessler, A. (2018). (Dis)advantages of informal loans – Theory and evidence. European Economic Review, 102, 100–128. https://doi.org/10.1016/j.euroecorev.2017.12.005
Lee, S., Persson, P., & Mathews, R. D. (2015). an us cr ip t Ac ce pt us cr ip t Ac ce pt ed. In Review of Financial Studies (Vol. 29, Issue 9).
Li, Y. H., Huang, J. W., & Tsai, M. T. (2009). Entrepreneurial orientation and firm performance: The role of knowledge creation process. Industrial Marketing Management, 38(4), 440–449. https://doi.org/10.1016/j.indmarman.2008.02.004
Lumpkin, G. T. (1996). the Entrepreneurial Clarifying It Construct and Linking Orientation. Academy of Management Review, 21(1), 135–172.
Lumpkin, G. T., & Dess, G. G. (2015). Entrepreneurial Orientation. Wiley Encyclopedia of Management, 1983, 1–4. https://doi.org/10.1002/9781118785317.weom030030
Lyon, F. (2000). Trust, networks and norms: The creation of social capital in agricultural economies in Ghana. World Development, 28(4), 663–681. https://doi.org/10.1016/S0305-750X(99)00146-1
Manning, M. L., & Munro, D. (2004). The business survey researcher’s SPSS cookbook. (Unpublishe).
Miller, D. (1983). The Correlates of Entrepreneurship in Three Types of Firms. May 2014.
Miller, D., & Friesen, P. H. (1978). Archetypes of Strategy Formulation. Management Science, 24(9), 921–933. https://doi.org/10.1287/mnsc.24.9.921
Morris, M. H., Kuratko, D. F., & Covin, J. G. (2010). Entrepreneurial Development within Organizations. Corporate Entrepreneurship and Innovation.
Pham, T., & Talavera, O. (2018). Discrimination, Social Capital, and Financial Constraints: The Case of Viet Nam. World Development, 102, 228–242. https://doi.org/10.1016/j.worlddev.2017.10.005
Putnam, R. D. (2000). Bowling Alone: America’s Declining Social Capital. Culture and Politics, 6(1), 223–234. https://doi.org/10.1007/978-1-349-62965-7_12
Robb, A. M., & Robinson, D. T. (2014). The capital structure decisions of new firms. Review of Financial Studies, 27(1), 153–179. https://doi.org/10.1093/rfs/hhs072
Shan, P., Song, M., & Ju, X. (2016). Entrepreneurial orientation and performance: Is innovation speed a missing link? Journal of Business Research, 69(2), 683–690. https://doi.org/10.1016/j.jbusres.2015.08.032
Stiglitz, J., & Weiss, A. (1981). Credit Rationing in Markets with Imperfect Competition. In American Economic Review (Vol. 71, Issue 3, pp. 393–410). http://web.a.ebscohost.com/ehost/pdfviewer/pdfviewer?vid=1&sid=15b16e6d-4805-4cfd-8881-1e6e69de115d%40sessionmgr4007
Suliyanto. (2011). Ekonometrika Terapan. Andi.
Tirole, J. (2010). The theory of corporate finance. The Theory of Corporate Finance, 1–644. https://doi.org/10.2307/2325273
Trailer, J. W., Hill, R. C., & Murphy, G. B. (1996). Measuring performance in entrepreneurship research. Journal of Business Research, 36(1), 15–23. https://doi.org/10.1016/0148-2963(95)00159-X
Yu, L., & Nilsson, J. (2018). Social capital and the financing performance of farmer cooperatives in Fujian Province, China. Agribusiness, 34(4), 847–864. https://doi.org/10.1002/agr.21560
