With the deepening of China's economic reform, SMEs are starting to gain tremendous economic momentum and play an increasingly irreplaceable role in China's century-long bid for economic resurgence. Using a micro-macro link approach, this study investigates the effects of managerial value of reciprocity on both social capital and firm performance in China's rural SMEs. A structural equation modelling method was used to test hypotheses. Data from 177 SMEs in China provide supporting evidence that there exists a micro-macro link from managerial value of reciprocity, to social capital (trust) and to firm performance (both overall performance and competitiveness improvement).
- Managerial value of reciprocity
- Rural SMEs
- Social capital
- Transaction cost economics