How small business owners navigate stress for improved performance: Building psychological capital through peer interactions

This study explores whether small business owners’ personal networks can enhance business performance by offering psychological benefits to owners, particularly, in navigating stress-inducing challenges inherent in small business ownership. Our argument centers on how peer interactions within these networks promote small business owners’ development of psychological capital, ultimately, leading to improved business performance. Drawing on social support, community psychology, and social comparison theories, we propose a model with two pathways. Structural equation modeling of survey data from the Aba industrial district in Nigeria strongly supports our model. The study advances small business literature by demonstrating the significance of personal networks in facilitating the development of internal resources, offering a new perspective on the value of these networks beyond their often-discussed role in facilitating access to external resources.