Network Triads: Transitivity, Referral and Venture Capital Decisions in China and Russia

34 Pages Posted: 4 Apr 2005

See all articles by Bat Batjargal

Bat Batjargal

Harvard University - Davis Center

Date Written: February 2005

Abstract

This article examines effects of dyadic ties and interpersonal trust on referrals and investment decisions of venture capitalists in the Chinese and Russian contexts. The study uses the postulate of transitivity of social network theory as a conceptual framework. The findings reveal that referee-venture capitalist tie, referee-entrepreneur tie, and interpersonal trust between referee and venture capitalist have positive effects on referrals and investment decisions of venture capitalists. The institutional, social and cultural differences between China and Russia have minimal effects on referrals. Interpersonal trust has positive effects on investment decisions in Russia.

Keywords: Transitivity, triads, referral, venture capital, China, Russia

JEL Classification: G24, D85, M13, P27

Suggested Citation

Batjargal, Bat, Network Triads: Transitivity, Referral and Venture Capital Decisions in China and Russia (February 2005). Available at SSRN: https://ssrn.com/abstract=682545 or http://dx.doi.org/10.2139/ssrn.682545

Bat Batjargal (Contact Author)

Harvard University - Davis Center ( email )

Cambridge, MA 02138
United States

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