Social Media Business Networks and SME Performance: A Rural-Urban Comparative Analysis

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    Abstract

    Social media business networks provide Small- and Medium-sized Enterprises (SMEs) with a modern platform to network, resulting in improved business performance. However, rural SMEs are less likely to access these networks and often underperform urban counterparts. This paper provides a rural-urban comparative analysis of business performance across SMEs for both members and non-members of social media business networks. Empirically, the analysis draws on data of over 13,000 SMEs from the 2015-UK Government’s Small Business Survey. Inverse Probability Weighting is used to control for selection bias of firms selecting into a location and business network and for variations in business characteristics. The results reveal that rural SMEs that are members of social media business networks tend to register higher turnover and seek to grow sales compared to rural and urban SMEs that are non-members. For turnover, rural firms that are members of these business networks perform as well as urban SMEs that are members. However, for sales growth, they underperform urban counterparts. Therefore, the development of SMEs’ performance in rural areas requires enhanced online business support environments, improved digital infrastructure and connectivity, the creation of online co-working spaces, and increased digital and technological skills.
    Original languageEnglish
    Pages (from-to)1892-1913
    Number of pages22
    JournalGrowth and Change
    Volume52
    Issue number3
    Early online date14 Jun 2021
    DOIs
    Publication statusPublished - Sep 2021

    Bibliographical note

    This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.

    ASJC Scopus subject areas

    • Global and Planetary Change

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