Small business networks and local ties in Turkey

Abstract

The literature on small firms has given a new importance to entrepreneurial arid business networks in recent years; it is emphasized that networks strengthen the innovative flexibility and competitiveness of small firms. This paper, however, argues that the networks amongst entrepreneurs are not always innovative and may even bring some impediments to business development. The empirical evidence of the study is based on extensive interviews with 216 small firms in Turkey. The sample is drawn from four different sectors and three medium-sized cities. This research shows that the networks amongst the Turkish small firms are governed by traditional values, sectarian affiliations, family and social environment, rather than long-term business partnerships. This character of networks acts as an inertial force over technological and managerial improvements in small firms.

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