Introduction: Trust, Institutions, and Managing Entrepreneurial Relationships in Africa
This introductory chapter discusses the emergence of Africa as a destination for doing business and the widespread misunderstanding about the institutions that enable entrepreneurs, investors, and businesses to develop networks, relationships, and trust in Africa. It shows why the current reports and debates on the nature of institutions and how institutions shape entrepreneurial behaviour in Africa is inaccurate. It draws on institutional theories to argue that entrepreneurs draw on the logics of weak state and market institutions and the logics of cultural institutions to develop trust, networks, and relationships in order to do business. It also explains how the abductive approach enables the author to use literature and empirical evidence to present frameworks that extend existing knowledge in institutional theory, entrepreneurship and trust literature. Finally, it contributes to an understanding of the nature and role of institutions in trust development and entrepreneurship in Africa and other emerging economy contexts.
KeywordsTrust Institutional theory Networks Entrepreneurship Africa
- Accenture. 2010. Africa: The new frontier for growth. http://nstore.accenture.com/pdf/Accenture_Africa_The_New_Frontier_for_Growth.pdf. Online Access 13 Feb 2012.
- Acemoglu, D. 2003. Root causes: A historical approach to assessing the role of institutions in economic development. Finance and Development 40: 27–30.Google Scholar
- African Development Bank Group. 2013. Championing inclusive growth across Africa: Recognizing Africa’s informal sector, Tunis. https://www.afdb.org/en/blogs/afdb-championing-inclusive-growth-across-africa/post/recognizing-africas-informal-sector-11645.
- African Economic Outlook. 2017. Entrepreneurship and industrialisation, African Development Bank, OECD, United Nations Development Programme, Abidjan, Paris and New York.Google Scholar
- African Union Commission. 2018. African continental free trade area gathers strong impetus to boost economic growth, Press release N.XX/2018, Addis Ababa.Google Scholar
- Amoako, I.O. 2012. Trust in exporting relationships: The case of SMEs in Ghana. Published PhD thesis, Center for Economic and Enterprise Development Research (CEEDR) Middlesex University, London, http://eprints.mdx.ac.uk/12419/.
- Amoako, I.O., and F. Lyon. 2011. Interorganizational trust violations and repairs in a weak legal environment: The case of Ghanaian exporting SMEs. In Conference paper presented at the 27th European Group for Organisation Studies (EGOS) Conference, Gothenburg University, Sweden, July.Google Scholar
- Amoako, I. O., Akwei, C., & Damoah, I. S. (2018, forthcoming). “We know their house, family and work place”: Trust in entrepreneurs’ trade credit relationships in weak institutions. Journal of Small Business Management. https://doi.org/10.1111/JSBM.12488.
- BBC News. 2018. May in Africa: UK Prime Minister’s mission to woo continent after Brexit (28 August 2018). http://bbc.co.uk/news/world-Africa-45298656
- Blerk, H. 2018. IPSOS NEWS: African Lions: Africa’s rising middle class?, IPSOS, SA.Google Scholar
- Child, J., and Rodrigues. 2007. The process of SME internationalisation: British firms entering Brazil, E&G Economia e Gestao. Belo Horizonte 7 (14): 1–178.Google Scholar
- Curran, J., R.A. Blackburn, and J. Kitching. 1995. Small businesses, networking and networks: A literature review, policy survey and research agenda. Kingston upon Thames: Kingston University/Small Business Research Centre.Google Scholar
- Delloitte. 2014. The Delloitte consumer review Africa: A 21st century view. London: Delloitte.Google Scholar
- Denzin, N.K. 1978. The logic of naturalistic inquiry. In Sociological methods—A sourcebook, ed. N.K. Denzin, 54–73. New York: McGraw-Hill.Google Scholar
- Dietz, G., N. Gillespie, and G.T. Chao. 2010. Unravelling the complexities of trust and culture. In Organizational trust: A cultural perspective, ed. M.N.K. Saunders, D. Skinner, G. Dietz, N. Gillespie, and R.J. Lewicki. Cambridge: Cambridge University Press.Google Scholar
- Durand, R., B. Szostak, J. Jourdan, and P. Thornton. 2013. Institutional logics as strategic resources. In Institutional logics in action, part A (Research in the sociology of organizations, volume 39 part A), eds. Lounsbury, M., Boxenbaum, E., 165–201. Bingley: Emerald Group Publishing Limited.Google Scholar
- Estrin, S., and M. Pervezer. 2011. The role of informal institutions in corporate governance: Brazil, Russia, India, and China compared Asia Pacific. Journal of Management 28 (1): 41.Google Scholar
- Friedland, R., and R.R. Alford. 1991. Bringing society back in: Symbols, practices, and institutional contradictions. In The new institutionalism in organizational analysis, ed. W.W. Powell and P.J. DiMaggio. Chicago: University of Chicago Press.Google Scholar
- Heine, B., and D. Nurse. 2000. An introduction in African languages. Cambridge: Cambridge University Press.Google Scholar
- Lituchy, T.R., B.J. Punnet, and B.B. Puplampu. 2013. Management in Africa: Macro and micro perspectives. London: Routledge.Google Scholar
- Mashanda, T. 2017. Rethinking the term sub Saharan Africa, The Herald, Harare. http://www.herald.co.zw/rethinking-the-term-sub-saharan-africa/.
- Möllering, G. 2006. Trust: Reason, routine, reflexivity. Amsterdam: Elsevier.Google Scholar
- Putnam, R.P. 1993. Making democracy work: Civic traditions in modern Italy. Princeton: Princeton University Press.Google Scholar
- Scott, W.R. 2013. Institutions and organizations: ideas, interests and identities. 4th ed. Thousand Oaks: Sage.Google Scholar
- Shane, S., and S. Venkataraman. 2000. The promise of entrepreneurship as a field of research. Academy of Management Review 25 (1): 217–226.Google Scholar
- Smallbone, D., and F. Welter. 2013. Entrepreneurship in emerging market economies: Contemporary issues and perspectives. International Small Business Journal 0 (0): 1–4.Google Scholar
- The Economist. 2016. Special Report: Business in Africa, 1.2 billion opportunities. http://www.economist.com/news/special-report/21696792-commodity-boommay-beover-andbarriers-doing-business are-everywhere-africas.
- Thornton, P.H. 2004. Markets from culture: Institutional logics and organizational decisions in higher education publishing. Stanford: Stanford University Press.Google Scholar
- Vickers, I., F. Lyon, L. Sepulveda, and C. McMullin. 2017. Public service innovation and multiple institutional logics: The case of hybrid social enterprises providers of health and wellbeing. Social Policy 48: 1755–1768.Google Scholar
- Welter, F., T. Kautonen, and M. Stoycheva. 2004. Trust in enterprise development, business relationships and business environment – A literature review. In Entrepreneurial strategies and trust: Structure and evolution of entrepreneurial behaviour in low trust and high trust environments in East and West Europe, part 1a review, ed. H.H. Hohmann and F. Welter, 13–25. Bremen: Forschungsstelle Osteuropa.Google Scholar
- World Bank Doing Business. 2018. Database accessed, May 2018. http://www.doingbusiness.org.
- World Economic Forum. 2018. These will be Africa’s fastest growing economies in 2018. http://www.we.forum.org/agenda/2018/01/what-does02018-hold-for-african-economies.
- Yanga, M.L., and I.O. Amoako. 2013. Legitimizing dishonesty in organizations: A survey of managers in four Sub-Sahara African countries. In (Dis)Honesty in management, Advanced series in management, ed. Tiia Vissak and Maaja Vadi, vol. 10, 243–268. Bingley: Emerald Group Publishing Limited.CrossRefGoogle Scholar
- Yin, R. K. 2016. Qualitative research from start to finish, 2nd ed., 386 pp. New York: The Guilford Press. ISBN: 978-1-4625-1797-8.Google Scholar
- Zucker, L.G. 1986. Production of trust. Institutional sources of economic structure, 1840–1920. Research in Organisation Behaviour 8: 53–11.Google Scholar