Social capital, structural holes and the formation of an industry network

This paper is of interest because of its comparison of social capital theory and structural hole theory in explaining network formation. The paper demonstrates, in the case of biotechnology start-ups, that network formation and industry growth are significantly influenced by the development and nurturing of social capital. The paper raises several important implications: structural hole theory may apply more to networks of market transactions than to networks of cooperative relationships, and that the study of the structure of interfirm collaborations over time requires an analysis of the network as a whole.