Original Research

Human–social capital and market access factors influencing agro-processing participation by small-scale agripreneurs: The moderating effects of transaction costs

Lesibana M.V. Thindisa, Boris Urban
Acta Commercii | Vol 18, No 1 | a500 | DOI: https://doi.org/10.4102/ac.v18i1.500 | © 2018 Lesibana M.V. Thindisa, Boris Urban | This work is licensed under CC Attribution 4.0
Submitted: 03 April 2017 | Published: 29 March 2018

About the author(s)

Lesibana M.V. Thindisa, Graduate School of Business Administration, University of the Witwatersrand, South Africa
Boris Urban, Graduate School of Business Administration, University of the Witwatersrand, South Africa


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Abstract

Orientation: Participating in the agriculture and agro-processing chain has the potential to enhance the competitive advantage of small-scale agricultural enterprises in South Africa.
Research purpose: The study empirically investigated the extent to which agro-processing participation is determined by human and social capital factors, while accounting for the moderating effects of transaction costs.
Motivation of the study: Research is required that examines levels of human and social capital of small-scale agripreneurs, as these act as major constraints towards improved competitiveness of agribusinesses.
Design: To test the study hypotheses, a structured questionnaire was administered to 166 small-scale agripreneurs at farmer gatherings across regions in South Africa.
Findings: Based on the survey results, both human and social capital factors showed a positive and significant influence on agro-processing participation. The findings further highlight the importance of market access and transaction costs to small-scale agripreneurs.
Practical implications: Policy-makers need to be aware of how human capital factors such as previous education and experience impact participation in agro-processing activities and help to mitigate transaction costs.
Contribution: Study findings are highly relevant to South Africa as agro-processing and value-adding activities are not always scale dependent, and hence, a focus on human and social capital is valuable.

Keywords

human capital; social capital; small-scale agripreneurs; transaction costs; South Africa

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