In particular, the authors focus on small communities to test more explicitly the
embeddedness of economic behaviour within a community’s social setting. The small
town focus is a maintained ( untested) hypothesis. Flora et al. ( 1997: 624–625) state
that ‘social capital thrives when individuals within a social system interact with one
another in multiple roles over a period of time’. Clearly, the probability of repeated
interaction is higher the smaller the town. Furthermore, mutual knowledge is more
feasible in smaller communities. This is important because one is constrained by the
available data to analyse one side’s assessment of the other side’s participation in
potentially reciprocal relationships. Also, with respect to business persons with multiple roles in small towns, Granovetter ( 1985: 507) argues that the persistence of large
numbers of small rms in the periphery may be better explained by the relatively
‘dense network of social relations overlaid on the business relations connecting rms’.
Density of acquaintanceship is also cited as important by Freudenberg ( 1986) .