Moderating effect of intellectual capital on innovativeness in Latin American subsistence small businesses

Small businesses created as a way of subsisting are very important in Latin America in alleviating extreme poverty. These businesses possibly need to innovate to compete. Innovativeness is strongly linked with intellectual capital, but the limitations of subsistence small businesses weaken this link. In particular, human capital possibly affects innovativeness, but the effect can be mediated or moderated by other components of intellectual capital. This paper uses partial least squares to study the impact of the different dimensions of intellectual capital on innovativeness as a dynamic capability in small businesses in the timber industry in an area of Latin America, and, in particular, the mediation effect among them. The results show that human capital generates relational capital. The relational capital needs structural capital to improve the innovativeness of subsistence small businesses.