Abstract
Drawing on the perspective of entrepre-neurial resourcefulness, we investigate how relational social ties in microfinance facilitate value-oriented innovative behavior through self-reliant financial boot-strapping. We also examine how joint bootstrapping interacts with self-reliant financial bootstrapping to influence value-oriented innovative behavior among micro-entrepreneurs. We apply both symmetrical (PLS-SEM) and asymmetrical (fsQCA) approaches to a sample of 292 micro-entrepreneurs engaged in microfinance in Mexico, a developing mixed-market economy. The PLS-SEM results demonstrate that self-reliant financial bootstrapping is an effective mechanism through which relational social ties positively impact value-oriented innovative behavior. Additionally , the positive role of self-reliant financial bootstrap-ping in value-oriented innovative behavior is more significant when micro-entrepreneurs have a low level of joint bootstrapping. These findings are reinforced by the fsQCA results, which show that value-oriented innovative behavior arises from various configurations of relational social ties, self-reliant financial bootstrap-ping, joint bootstrapping, and democratic and financial factors. Our findings offer important theoretical and practical implications. Plain English Summary Micro-entrepreneurs in low-and middle-income countries frequently use microfinance to gather the necessary funds to initiate and expand their businesses. Our study shows that, in addition to financial resources, the social connections micro-entrepreneurs form within microfinance are beneficial to their entrepreneurial endeavors. This is because these connections allow micro-entrepreneurs to better manage and utilize their self-reliant resources, e.g., using personal income, withholding their own salary, and delaying payment of taxes, in ways that enhance their innovative behaviour. Notably , however, our findings also show that if micro-entrepreneurs excessively share and co-use resources with business partners within microfinance, the benefit of using self-reliant resources for innovative behaviour can decrease. Our findings highlight the importance of creating policies tailored for micro-entrepreneurs, which can support them to better utilize their network connections to promote innovative behavior.