The role of knowledge absorptive capacity on the relationship between cognitive social capital and entrepreneurial orientation

Abstract

Purpose The purpose of this paper is to study the effect of cognitive social capital (CSC) on firms’ entrepreneurial orientation (EO) and how knowledge absorptive capacity moderates this relationship. The purpose is aimed at completing the gap in the literature regarding determinants of EO linked with knowledge. Design/methodology/approach The empirical study was carried out on a sample of 292 Spanish firms in the agri-food industry. Partial least squares (SmartPLS software) was used to evaluate the measurement and structural models. Findings CSC has a curvilinear influence (U-shaped) on EO. In addition, this relationship is accentuated with higher knowledge absorptive capacity. Practical implications Managers should promote cognitively close networks and reinforce shared goals and culture with their contacts to maintain a high EO. Furthermore, managers should strengthen their knowledge absorptive capacity to boost innovativeness, risk taking and proactiveness derived from cognitive proximity with their contacts. Originality/value This study adds value to social capital literature by pointing out a curvilinear relationship (U-shaped) between CSC and EO, in contrast to studies focussed on other dimensions of social capital, which have obtained divergent results. Furthermore, this study reinforces the key contingent role of knowledge absorptive capacity. The study provides a valuable theoretical framework of EO determinants connecting the cognitive perspective of social capital theory with a dynamic capability view.