Entrepreneurial self-efficacy and firms' innovation behavior: The negative mediating role of social capital

In this study we examined the importance of entrepreneurs' internal and external social capital in the relationship between entrepreneurial self-efficacy (ESE) and firms' innovation behavior. We analyzed the data from 193 entrepreneurs in China, and the results showed that ESE positively affected firms' innovation behavior, and the entrepreneur's internal social capital played a negative mediating role in the relationship between ESE and the firm's innovation behavior. The findings both empirically support propositions of previous researchers about the negative effect of social capital in the relationship between ESE and innovation, and offer deeper insight into this. Possible explanations for our findings and future direction are also discussed.