1.1 Introduction
Africa has recently achieved a remarkable economic expansion despite the global recession. Countries like Ethiopia, Ghana, Angola, Rwanda, Mozambique, and Zambia have enjoyed growth of between 7% and 9% year on year and have helped to triple the size of the African economy since 2000. Within the past decade, real income per person has jumped by 30% and about 350 million people are in the middle class and able to spend between $2 to $20 per day (Blerk 2018). The growth in Africa continues unabated as six of the 10 fastest growing economies in the world in 2018 are in the continent (World Economic Forum 2018). Currently, urbanisation is at 37% and Africa is comparable to China but is expected to be the fastest urbanising region in the world from 2020 to 2050. Africa is emerging as a magnet for investment, one that offers opportunities for growth for entrepreneurs, investors, businesses and other economies (BBC News 2018; Deloitte 2014). Africa has a population of 1.2 billion people and a gross domestic product (GDP) of US$2.6 trillion. On 21 March 2018, the African Continental Free Trade Area that offers Africans the right to move, work, invest, and reside anywhere in the continent was agreed by 44 countries, in Kigali, boosting prospects for entrepreneurship and economic development (African Union Commission 2018). Interestingly, entrepreneurs and their small and medium-sized enterprises (SMEs) are at the heart of the economic boom. SMEs create around 80% of the region’s employment, giving rise to demand for new goods and services (Africa Economic Outlook 2017). Not surprisingly, recently politicians, entrepreneurs, investors, and corporate executives have developed a keen interest in building networks and relationships with customers in the African continent, which is now regarded as an emerging market destination for businesses to invest, grow, and expand (BBC News 2018; George et al. 2016; Accenture 2010).
In spite of the considerable interest, entrepreneurs, investors, and corporate executives are deterred by the lack of trust in doing business in Africa due to widespread assumptions and reports in the West about the numerous weak institutional structures embedded in African economies (World Bank 2018; The Economist 2016; Bruton et al. 2010). Based on these assumptions and reports, strong institutions provide a sound economic environment and trust for entrepreneurship. As a result, in advanced economies with strong institutions, entrepreneurs have lower transaction costs and a strong trust to invest and innovate (North 1990). Conversely, in emerging economies with weak institutions, transaction costs are higher and so there is low trust to invest and innovate. According to these assumptions, economic and political institutional stability has led to the recent surge in entrepreneurship in Africa (World Bank 2018). Existing reports and conceptual developments on institutions and entrepreneurship have also mostly drawn on advanced Western economy contexts to focus on how state and market institutions could facilitate larger organisations’ investments. However, these arguments about the role of institutions, trust development, and entrepreneurship do not reflect entrepreneurship theory or practices in emerging economies (Peng et al. 2008; Smallbone and Welter 2013) where entrepreneurs as actors, draw on cultural indigenous institutions to develop trust in the absence of strong state and market institutions (Welter and Smallbone 2011; Amoako and Lyon 2014). Entrepreneurship incorporates the discovery, creation, and exploitation of opportunities and the success or failure of these activities is attributed to the individual entrepreneur (Gartner 1988; Shane and Venkataman 2000), and the formal and informal institutional factors that shape opportunities (Chell 2000). While strong institutions provide a sound economic environment and trust for entrepreneurs in developed economies, in emerging economies with weak formal institutions, cultural institutions substitute for the weak institutions to provide trust to entrepreneurs to encourage them to invest and innovate.
In a study in the four largest emerging economies—Brazil, Russia, India, and China—also known as the BRICs, Estrin and Pervezer (2011) found that in the midst of weak state institutions, informal institutions might substitute for and replace ineffective formal institutions leading to enhanced domestic and foreign investment. Similarly, African entrepreneurs draw on indigenous cultural institutions to develop trust in entrepreneurial relationships in order to exploit opportunities embedded in the weak formal institutional environments (Tillmar and Lindkvist 2007; Amoako and Lyon 2014).
Yet, there is a chronic dearth of knowledge about how entrepreneurs in Africa draw on indigenous cultural institutions which work side by side with institutions of the modern states in Africa (Jackson et al. 2008; George et al. 2016). This book responds to these gaps by showing how African entrepreneurs operate in the context of weak state institutions by relying on indigenous cultural institutions to develop trust in entrepreneurial relationships.
This chapter, and indeed this book, re-examines the nature of institutions and how institutions shape entrepreneurial activity and trust development in African economy contexts. In these contexts, like other emerging economy contexts, the personal networks of the entrepreneur and norms governing interpersonal relationships play a crucial role in firm strategy and performance (Peng et al. 2008). Thus, in emerging economies, trust in networks of mutually supportive and cooperative relationships is important for market entry and the entrepreneurial process in general (Child and Rodrigues 2007).
The present chapter contributes to an understanding of the role of state and market institutions, indigenous cultural institutions, trust, and the entrepreneur in entrepreneurship in Africa. The chapter draws on the notions of institutions and institutional logics and connects them with broader conversations in entrepreneurship and trust theories to explore how both structure and agency influence entrepreneurship. By drawing on the institutional logics approach, the chapter is able to show how entrepreneurs draw on the logics of indigenous cultural institutions to develop networks, relationships, and trust in response to the weak institutional environment. This chapter, and for that matter this book, seeks to answer the key question: ‘What are institutions and how do they influence trust development in entrepreneurial relationships in Africa?’
1.2 Definitions and Assumptions
The term ‘Institutions’ is defined as the ‘taken-for-granted assumptions which inform and shape the actions of individual actors … at the same time, these taken-for-granted assumptions are themselves the outcome of social actions’ (Burns and Scapens 2000, 8). Shane (2003) defines entrepreneurship as the ability to recognise and evaluate opportunity and mobilise resources to establish or grow a business in a given context. The entrepreneur refers to the individual who recognises and exploits opportunities to establish or grow a business in a given context. These two definitions integrate entrepreneurial action with context and the establishment or growth of a business. The author adopts a working definition of trust as ‘a set of positive expectations that is shared by parties in an exchange that things and people will not fail them in spite of the possibility of being let down’. This definition highlights trust as an expectation based on accepted cultural norms and interactions within specific contexts (Zucker 1986; Zaheer et al. 1998; Möllering 2006). Institutional logics is defined as the ‘socially constructed, historical patterns of cultural symbols and material practices, including assumptions, values, and beliefs by which individuals and organisations provide meaning to their daily activity, organize time and space and reproduce their lives and experiences’ (Thornton et al. 2012, 2). A logic provides a set of coherent organising principles for a particular sphere of life and yet logics often overlap such that actors draw on multiple logics within and across domains (Friedland and Alford 1991; Besharov and Smith 2014). In this book, the author focuses on how societal-level logics of state and indigenous cultural institutions and norms influence entrepreneurs’ decisions about trust development in entrepreneurial relationships in Africa. Drawing on the institutional logics approach, the following assumptions underpin this introductory chapter as well as this book.
First, the author assumes that trust has a significant impact on entrepreneurial behaviour and low levels of trust constrain entrepreneurship while high levels of trust enable entrepreneurship. Second, it is assumed that institutions and particularly societal-level institutional logics underpin trust development in entrepreneurship in a variety of ways due to factors such as geographic, historical, and cultural contexts in which entrepreneurs and organisations operate (see Besharov and Smith 2014). Third, the author assumes that societal-level institutional logics such as rules, legal institutions, cultural beliefs, norms, and practices shape entrepreneurs’ cognition and decision making (Vickers et al. 2017; North 1990; Scott 2013; Thornton et al. 2012; Friedland and Alford 1991). Fourth, the author assumes that institutional logics offer strategic resources that connect organisations’ strategy for trusting, networking, relationship building, and decision making (see Durand et al. 2013). Fifth, it is assumed that actors use logics to interpret and make sense of the world, although not always consciously, to support networking and trusting behaviour. At the same time, actors’ networking and trusting practices and behaviour can both reinforce and challenge the assumptions, values, beliefs, and rules considered appropriate in a particular sphere of social life (see Besharov and Smith 2014). Sixth, it is assumed that organisations embody multiple logics and actors confront, reflect, and draw on the multiple logics in their practices, at the same time some logics may dominate others making them irrelevant to organisational functioning (Thornton et al. 2012; Besharov and Smith 2014). Together these six assumptions inform the theorising in the book that aims to offer an understanding about how entrepreneurs draw on institutions to develop trust in networks and relationships in order to access resources in African contexts.
In this book the author uses the abductive approach to combine existing literature and empirical data from entrepreneurs owning and managing 50 internationally trading SMEs in Africa to present frameworks for gaining insights into how institutions shape trust development from the perspective of the African entrepreneur.
The rest of this chapter is organised as follows. The next section summarises the literature on institutions, trust, and entrepreneurial relationships. The aims of the book, the author’s motivation for writing the book, the context of the study, the methodology, the target audience, and the book’s outline contents then follow.
1.3 Overview of Institutions, Trust and Entrepreneurial Relationships
Institutions are very important as they influence the nature and level of entrepreneurship and trust in any country or region (North 1990; Welter and Smallbone 2011). Institutions provide the incentive structures that define entrepreneurial opportunities in any given context (North 1990; Scott 2013). Some commentators therefore argue that the differences in institutions remain a key factor in explaining the variations in wealth and prosperity across different economies and countries (Acemoglu 2003). Institutions also enhance networks, social relationships, and social capital by promoting greater interactions, the free flow of information, and the formation of associations all of which increase the level of trust (Putnam 1993). Thus, networks and relationships are socially constructed and defined by institutions and culture in particular (Curran et al. 1995). Entrepreneurs develop trust and cooperation to exploit opportunities embedded in institutional environments through developing a variety of social and business networks and relationships (North 1990; Sarason et al. 2006; Granovetter 1985).
Trust plays two important roles in enterprise development and in entrepreneurial relationships. It reduces uncertainty through providing information and provides a coordination mechanism that helps to reduce opportunistic behaviour, and both of these functions help to reduce transaction costs (Welter et al. 2004). Hence, trust serves as a defining factor that enhances enterprise development and the building of networks and relationships between firms at both national and international levels (Welter and Smallbone 2011; Zain and Ng 2006).
The literature suggests that trust exists in two main forms namely personal trust and institutional trust (see Welter and Smallbone 2011). Personal trust is formed based on the initial knowledge of the exchange partner and may depend on the characteristics of a group such as ethnic, kinship, social bonds, and from emotional bonds between friends, family members, and other social groups (Welter and Smallbone 2006). On the other hand, the state, political, social, and cultural environments provide institutional trust (Zucker 1986; Scott 2013; Welter and Smallbone 2011). Hence in developed economies with strong institutions, trust can be based on, for example, the legal systems that are used to enforce contracts with individuals and partner firms.
However, in emerging economies like Africa the weak legal systems fail to enhance contract enforcement and institutional trust is low (Zaheer and Kamal 2011). Personal trust then becomes more important in emerging economy environments where formal sanctioning mechanisms are absent or fail. Furthermore, in cases where an exchange partner is not satisfied with the institutional arrangements or is unfamiliar with them, personal trust may complement institutional trust (Granovetter 1985; Welter and Smallbone 2006).
Trust remains a complex concept because its development processes are embedded in institutional contexts, particularly cultural institutions that shape trust development processes, perceptions of trust violations, and trust repair processes based on norms and expectations (Dietz et al. 2010; Bachmann et al. 2015). The challenge is that where there is a greater divergence of cultural backgrounds, trust development becomes complex. The cultural difference or ‘psychic distance’ (Child et al. 2002) between two parties in cross-cultural relationships can constrain trust development due to the inability to draw on common norms and expectations. As a result, actors from different cultures (Dietz et al. 2010) may have dissimilar trust expectations and different behavioural rules in conflict situations (Zaheer and Kamal 2011; Ren and Gray 2009). However, in general, existing studies have not paid much attention to the need to investigate trust development in different cultural contexts (Wu et al. 2014; Li 2016).
In the context of SMEs in emerging economies and Africa, given the absence of strong states and market support institutions, and the small sizes of economic transactions, informal contracts enforced based on trust in personalised relationships, networks, and indigenous institutions such as religion, family/kinship, and trade associations may be critically important and preferred (McMillan and Woodruff 2002; Amoako and Lyon 2014). However, this may differ in the context of larger organisations in which the size of economic transactions may require more detailed agreements and enforcement regimes based on intermediary institutions like the judiciary/courts and other regulatory bodies.
In summary, Africa has enjoyed significant economic growth recently and has become an increasingly important destination for investors and entrepreneurs to do business. However, the states and market institutions are less developed and entrepreneurs and their smaller businesses that are driving the economic boom rely mostly on indigenous cultural institutions, personal relationships, and networks to develop trust in order to do business (Amoako and Lyon 2014). There is therefore a need to understand how entrepreneurs draw on the logics of cultural-specific institutions to develop trust in entrepreneurial networks and relationships in the context of institutional weaknesses (see Jackson et al. 2008; George et al. 2016). This book attempts to bridge this gap by answering the core research question: What are institutions and how do they influence trust development in entrepreneurial relationships in Africa?
- 1.
A balanced approach to the study of entrepreneurship that recognises the role of state and market institutions while not underestimating indigenous cultural institutions, the entrepreneur, social capital, networking norms and trust, and the characteristics of the firm, all of which are very important to the entrepreneurial process.
- 2.
A re-conceptualisation of our understanding of the role of institutions in entrepreneurship in Africa and other emerging economies. It highlights the importance of indigenous cultural institutions that provide the logics to promote trust development, networking, and relationship building in entrepreneurship in the context of weak formal institutions.
- 3.
A cross-cultural understanding of common African indigenous institutions and particularly cultural-specific logics that shape trust development in entrepreneurial relationships. Understanding these institutions is important due to their potential to give rise to differences in expectations, explanations, and attributions for African entrepreneurial behaviour within relationships.
- 4.
An awareness through example and discussion of how African entrepreneurs, as actors, develop and manage entrepreneurial relationships across cultures. It shows that entrepreneurs use the logics of weak state and market institutions, as well as those of local cultural institutions to develop trust in networks and relationships strategically in order to operate successfully in the contexts of weak state and market institutions in Africa.
- 5.
A holistic view of trust focusing on the trustor (entrepreneur), trustee (partner entrepreneur or firm), their relationships, and the institutional contexts in which they operate. Such an holistic approach is currently lacking in trust research.
- 6.
An understanding of the processes of trust development, interpretations of trust violation, and trust repair strategies, and how these processes are shaped by the logics of weak state and market institutions, indigenous cultural institutions particularly traditional legal systems, family/kinship, religion, gift giving, punctuality, trade associations, and industry norms in an African context. These institutions are important for understanding trust in African economies and across African cultures, the acceptable levels of trust violation and effective trust repair mechanisms in a relationship, and the cultural and market values that are important in trust repair processes.
- 7.
An insight into the impact of trust violations on the entrepreneur. It shows that trust violations can lead to varying negative financial, psychological, and social costs to entrepreneurs and yet the literature has not paid attention to these issues.
- 8.
An understanding of the wider implications of institutions and the importance for entrepreneurs, businesses and investors to understand local contexts and the institutional logics that enable trust to develop in entrepreneurship. It also shows the need to reform weak state and market institutions while recognising, supporting, and considering local cultural institutions that support entrepreneurship. Furthermore, it emphasises basing national and international interventions on relevant local knowledge and practices in order to avoid misplaced development programmes instigated by donors and governments.
1.3.1 Motivation
The origin and development of this book is traced back over the past nine years during which the author researched, presented papers, and published on entrepreneurial trust and relationships building in Africa. It draws on the author’s published PhD thesis that explored qualitative empirical data from 24 internationally trading entrepreneurs owning and managing SMEs in agriculture, services, and manufacturing sectors in Ghana (Amoako 2012). The thesis aimed to explore the role of trust in SME internationalisation in Ghana. The inspiration to expand the study to cover more countries in Africa originated from the author’s conversations with publishers, fellow researchers, and entrepreneurs from Africa during international conferences, events, and research projects.
The author collected another set of empirical data from 26 entrepreneurs owning and managing internationally trading SMEs in Africa. The second set of empirical data was collected from entrepreneurs and managers, to gain insights into how institutional logics shape trust development and entrepreneurial relationship building in the region referred to by some entities as Sub-Saharan Africa.
1.3.2 Context
The economies of the so-called Sub-Saharan African countries are dominated by SMEs many of which operate in the informal sector that contributes about 55% of GDP and 80% of the labour force. The sector offers opportunities to vulnerable people, including women and the young (AfDB 2013). Yet, the term Sub-Saharan Africa is geographically confusing as four countries extend into the Sahara, but Djibouti, which is south of the Sahara is excluded from the list. To add to the confusion, different entities have assigned different countries to Sub-Saharan Africa. For example, the United Nations Development Programme (UNDP) lists 46 of Africa’s 56 countries while the World Bank lists 48 countries. Critics therefore argue that the term is derogatory and used to stereotype Black Africa without being openly racist. After all there is no sub-Europe, sub-Asia, or sub-America so why Sub-Saharan Africa (Mashanda 2017)? Given the vagueness of the term, the confusion over the number of countries that constitute Sub-Saharan Africa, and the allegations of racist connotations of the term, the author uses the term Africa to refer to the countries in West, East, Central and Southern Africa. This book therefore does not include data from North Africa which is largely Arab and Berber but instead focuses on West Africa with predominantly Congo/Bantu, East Africa with largely Nilotic/Sudanic/Bantu, and South Africa with Bantu/Khoikhoi/Khiosan (Lituchy et al. 2013).
Africa is the second largest continent in the world with a land mass covering over 30 million square kilometres (George et al. 2016). There are 55 countries recognised by the African Union and United Nations (UN) in Africa. Western, Eastern, Central, and Southern Africa are made up of 47 countries that lie south of the Sahara Desert and have a total area of 23.6 million square kilometres. The four regions put together are therefore larger than the United States, Canada, and the European Union put together. Europeans agreed the Partition of Africa, which began with the Berlin Conference in 1884–1885 without recourse to ethnic affiliations. All the countries in the four regions were colonised, albeit briefly in the case of Ethiopia and Liberia. Currently all the countries are characterised by weak formal institutions even though some countries have relatively stronger institutions than others (Africa Economic Outlook 2017). The countries are also culturally diverse with unusually high levels of and large variations in ethnic diversity, cultures, and languages. As a result, even though the precise number is unknown, there are about 2000 distinct languages spoken in Africa (Heine and Nurse 2000). Given the many complex cultures and sub-cultures across Africa, the analysis and discussions focus on a number of key common institutions and institutional logics that are critically important in developing and managing entrepreneurial relationships across cultures in the continent. Additional context specific institutions and institutional logics may pertain to particular countries, industries, sectors, and markets and there is a need for further research to identify those that are critical for the development of trust and entrepreneurial trust building in the different contexts. The book therefore serves as the beginning of a research agenda that calls for further research into how entrepreneurs draw on indigenous institutions to develop trust in entrepreneurial relationships and indigenous management practices in African contexts.
1.4 Methodology
The author employs an abductive approach to combine deductive and inductive reasoning with theory development and theory construction. The abductive approach refers to the systematic combination of theoretical and empirical findings in order to refine or generate a theory. In this approach, the researcher goes back and forth between the theoretical framework, data sources, and analysis to systematically generate new theory (Tavory and Timmermans 2014). The abductive approach enabled the author to use existing literature and theories, observations, and semi-structured interviews from multiple cases to nurture theory development without being constrained by predefined methodological paradigms (Denzin 1978; Tavory and Timmermans 2014). The multiple case studies allowed the researcher to draw on multiple sources (Yin 2016) to study how entrepreneurs as actors develop trust and the role of institutions and entrepreneurial relationships in the context of SMEs operating in Africa. As a result, in every chapter, the author proposes frameworks and models based on iterative interactions between the existing literature and empirical evidence based on multiple cases to provide insights into trust, institutions, and managing entrepreneurial relationships in Africa; and this approach helps to refine existing theories on the subjects. The frameworks and models proposed are therefore starting points for further research. The existing literature includes studies from the wider literature and the author’s published PhD thesis (Amoako 2012) as well as jointly published book chapter, conference papers and journal articles (Amoako and Lyon 2011; Yanga and Amoako 2013; Amoako and Lyon 2014; Amoako and Matlay 2015; Damoah et al. 2018; Amoako et al. 2018).
Chapters 2 and 3 focus on frameworks mostly developed from existing literature on institutions, entrepreneurship and trust in interorganisational relationships. Chapters 4 and 5 draw on the literature and empirical data collected between 2010 and 2017 from participant observation and semi-structured interviews with 50 entrepreneurs owning and managing SMEs in Africa to identify and discuss indigenous cultural-specific logics that influence the development of trust and management of entrepreneurial relationships in Africa respectively. SMEs reflect the impact of local institutions on trust development better than larger organisations. Given the size of the informal economy in Africa, 10 of the firms involved in the study are selected purposefully from the informal sector. The author used purposive sampling techniques to select the participants for the study Africa including Ghana, focusing on internationally trading entrepreneurs owning and managing smaller business that employ not more than 100 people based on the definition of SMEs in Ghana.
The original empirical data dominates Chaps. 6, 7, and 8 and was collected and used for the author’s PhD thesis. The data was collected from 2010 to 2012 through participant observation and repeated face-to-face semi-structured interviews with 24 internationally trading entrepreneurs owning and managing SMEs across the agriculture, manufacturing, and services sectors in Ghana. However, for the purpose this book, more data was collected from 26 entrepreneurs and managers operating SMEs (firms employing less than 100 people) in agriculture, manufacturing, and services sectors in the informal and formal sectors across Gambia, Nigeria, Cameroon, Rwanda, Malawi, Zimbabwe, Congo DR, Kenya, Uganda, Tanzania, and Malawi. The author used a snowballing technique and conducted 20 face-to-face semi-structured interviews, mostly in workplaces, with the help of research assistants while Skype interviews were used for the remaining six semi-structured interviews since the entrepreneurs could not be reached physically. The semi-structured interviews in the various countries investigated the processes through which entrepreneurs developed trust and the role of formal and indigenous institutions in the process.
The book uses interpretivism to interpret empirical data. The interpretivist approach is based on the view that reality is socially constructed. In this approach, the perceptions and experiences of the research participants allow the researcher to construct and view the world, and therefore understanding the context of research is critically important (Willis 2007). Given that trust development in entrepreneurial relationships is shaped by institutional logics and particularly culture (Smallbone and Welter 2006; Saunders et al. 2010), the interpretivist approach enabled the author to gain insights into the meanings that entrepreneurs ascribe to how Africa’s complex human institutions shape their decision-making processes in the process. The author used thematic analysis to organise the empirical data and to gain insights into the meanings of entrepreneurs’ decisions and actions relating to trust development and how the process is embedded in institutional contexts (Braun and Clarke 2006; Granovetter 1985). The identified themes are presented based on interpretivist approaches.
Using abductive reasoning, the current literature was confronted to confirm or refute the case stories, and while certain concepts are confirmed others are refuted and new concepts identified which then led to the search for more literature to find a fit for the case themes. The levels of analysis focus on the individual entrepreneur, his or her personal and business relationships, state and cultural institutions and norms, as well as characteristics of SMEs that shape the trust development decisions of the entrepreneur. Logics allow for theorising the fragmented and contradicted nature of culture at different levels of analysis such as individual, organisational, and in specific contexts in which individuals operate (Thornton 2004).
This book targets a diverse audience: academics and students involved in entrepreneurship, trust, international business, marketing and cross-cultural management education and research across the world. The author is also optimistic that it will be useful to entrepreneurs themselves as it offers an understanding of the importance of entrepreneurial agency, networks, trust, and how local contexts influence strategy and entrepreneurship. It should also be useful to policy makers and the donor community who aim to promote sustainable development through relationships and collaborations in entrepreneurship, as well as the SME sector in Africa and other emerging economies. While acknowledging the challenges of writing for such a diverse audience, the author endeavours to pitch the discussion and arguments at an accessible level, even though some complexities and academic jargon may still be present throughout the book. The references at the end of each chapter present resources for further inquiry for those who may wish to extend their knowledge.
The introduction highlights why understanding trust, institutions, and managing entrepreneurial relationships in Africa is important. The rest of the book is divided into four main parts. Part I contains Chaps. 2 and 3. Chapter 2 examines the theory of institutions and entrepreneurship while Chap. 3 focuses on institutions, entrepreneurship, and interorganisational trust theory. Part II comprises Chaps. 4 and 5 and identifies a number of formal and cultural-specific institutions that influence trust development and the management of entrepreneurial relationships in Africa. Chapter 4 identifies African indigenous institutions and logics that underpin the development and management of personal and business relationships, while Chap. 5 focuses on how logics of weak state and market institutions and cultural-specific institutions in Africa—influence the development and management of personal and business relationships in Africa. Part III is made up of Chaps. 6, 7, and 8 and presents an in-depth analysis of the development of trust, perceptions, and interpretations of trust violations, and trust repair processes in an African context—Ghana. Chapter 6 highlights how the types of trust are developed in entrepreneurial relationships. Chapter 7 considers entrepreneurial perceptions and interpretations of trust violations in an African context while Chap. 8 examines entrepreneurial trust repair processes in an African context. In these chapters, the emphasis is on how the African entrepreneur operates in the context of weak formal institutions by drawing on indigenous institutions to develop trust in relationships in order to establish and grow businesses. Chapter 9, which make up Part IV, concludes the book by summarising the key issues in the previous chapters and discussing the implications for theory, practice, and policy. In the next chapter, Chap. 2, the author reviews the literature on institutions and entrepreneurship.