Unequal growth and social capital in clothes-making enterprises in Peru: 1980-2015.

Abstract

Why do some small companies in the clothing industry fail to grow while others succeed is the conundrum that this study sets out to solve. It does so by identifying and explaining four cases of enterprises with varying performance levels. On the understanding that there are structural and historical conditions that correspond to trends, these cases are explained and the question is answered. Based on the evidence, the article finds that the prevailing inequality is due to the greater or lesser presence of social capital - resources that come from networks and which are accessed through relationships - and to institutional and structural conditions that slow growth. Added to this are the differing responses of enterprises to the negative effects of poor-quality institutions. Following the approach of Nahapiet and Ghoshal, the study explains how an actor can develop certain range of capacities for participating in networks, before stalling as a result of a diversity of conditions.

Keywords

• Social capital
• Informality, Cloth
• Peru and emerging markets