LAUSR

This article examines the value and effect of social capital deriving from cross-ethnic business cooperation on social networks and society in the aftermath of war. The study contributes to a deeper understanding of the social function entrepreneurship conveys beyond its economic role. Based on Putnam’s bridging and bonding social capital theory and Granovetter’s theory on weak ties, the article studies ties between entrepreneurs originating from different ethnic groups in ethnically divided post-conflict societies. This study highlights the capacity of entrepreneurs to produce and generate social capital across ethnic lines. The field study includes surveys and interviews in Bosnia and Herzegovina, Kosovo, and North Macedonia. The results show that the majority of entrepreneurs cooperate and employ across ethnic lines. Cross-ethnic business relationships formed between entrepreneurs create benefits not only for entrepreneurs but also for building social capital across ethnic lines, thus forming valuable, yet depleted, social capital in post-conflict societies. Voluntary relationships between managers and business owners set a valuable model of weak ties facilitating associative behaviour among divided ethnic groups. Business exchange and relationships create social values that transcend a simple financial transaction. Value is in the form of friendship and trust, a reliance that maintains entrepreneurs’ relationships and contributes to the social capital.