A Study on FACTORS

influencing ENTREPRENEURS

HIP

Entrepreneurship is considered as one of the important factors

contributing to the economic development of a country.

The word ‘Entrepreneur’ is derived from the French word

‘Entreprendre’ and the meaning is ‘to undertake’.

Characteristics of Entrepreneurship are decision making, risk taking,

building organizations, innovation, mobilization of resources etc,.

Economic development is aided by entrepreneurship in many ways :

employment generation, innovation, risk bearer, fair regional

development, increase in national income, reduction in concentration of

economic power and betterment in standard of living.

Entrepreneurship and economic growth are positively related both

interns of theory and practice.

INTRODUCTION

India is ranked second in the world in Entrepreneurial activity by

2010.

India now stands ninth in the Global Entrepreneurship Monitor survey

of 28 Entrepreneurial countries.

The first phase of entrepreneurship in India from Aryans by innovative

new crafts and occupations, new handicrafts, breeding of cattle and

cultivating land.

Second phase pre-Independence Era communities were known as

Banias they laid the foundation of entrepreneurship by trade and

commerce at initial stage and started manufacturing centers.

In the Post independence era India identified the need for

industrialization and the first industrial policy resolution act was

implemented for industrial and entrepreneurial development.

Sno Year Author Definition

1 1734 Richard Cantillon

Entrepreneurship as self-employment of any sort. Entrepreneurs buy at certain prices in the present and sell at uncertain prices in the future. The entrepreneur is a bearer of uncertainty

2 1803 Jean Baptiste Say

An entrepreneur is an economic agent who unites all means of production- land of one, the labour of another and the capital of yet another and thus produces a product. By selling the product in the market he pays rent of land, wages to labour, interest on capital and what remains is his profit. He shifts economic resources out of an area of lower and into an area of higher productivity and greater yield

3 1921 Knight Entrepreneurs attempt to predict and act upon change within markets. The entrepreneur bears the uncertainty of market dynamics

4 1949 Cole A purposeful activity to initiate, maintain and aggrandize a profit-oriented business

5 1959 Penrose Entrepreneurial activity involves identifying opportunities within the economic system.

6 1961 David McClelland

An entrepreneur is a person with a high need for achievement [N-Ach]. He is energetic and a moderate risk taker

7 1964 Peter Drucker An entrepreneur searches for change, responds to it and exploits opportunities. Innovation is a specific tool of an entrepreneur hence an effective entrepreneur converts a source into a resource

8 1971 Kilby Emphasizes the role of an imitator entrepreneur who does not innovate but imitates technologies innovated by others. Are very important in developing economies

9 1985 Peter F Drucker

Entrepreneurship comprises of three underlying dimensions as innovation, risk taking and proactiveness.

10 1990 Stevenson and Jarillo

Entrepreneurship is a process by which individuals –either on their own or within organizations– pursue opportunities

11 2000 Shane & Venkataraman

The field of entrepreneurship involves the study of sources of opportunities; the processes of discovery, evaluation, and exploitation of opportunities; and the set of individuals who discover, evaluate, and exploit them.

12 2001 Weeks & Seiler Entrepreneurship refers to business formation and business ownership by individuals or group of individuals through the establishment of a company

13 2001 Alvarez and Busenitz

Entrepreneurial opportunities exist because different agents have differing ideas on the relative value of resources or when resources are turned from inputs into outputs. The theory of the entrepreneur focuses on the heterogeneity of beliefs about the value of resources

14 2003 Ireland, Hitt, &Sirmon

Entrepreneurship is a context dependent social process through which individuals and teams create wealth by bringing together unique packages of resources to exploit Market place opportunities.

15 2003 Commission of the European Communities

Entrepreneurship is the mindset and process to create and develop economic activity by blending risk-taking, creativity and/or innovation with sound management, within a new or an existing organisation.

16 2005 B. Oviatt and P. McDougall

Entrepreneurship as the discovery, enactment, evaluation, and exploitation of opportunities . . . to create future goods and services.

17 2005 Reynolds The entrepreneurial function- can be conceptualized as the discovery of opportunities and the subsequent creation of new economic activity, often via the creation of a new organization.

18 2005 Jhonson An entrepreneur tries to detect opportunity gap by innovating new product or improve existing product to earn profit

19 2006 P. Davidsson, F. Delmar and J. Wiklund

Entrepreneurship as “the creation of new economic activity” that occurs both through the creation of new ventures and new economic activity of established firms

20 2008 Nain Ahmed and Richard Seymour

Entrepreneurship is the phenomenon associated with the entrepreneurial activity, is the enterprising human action in pursuit of the generation of value, through the creation or expansion of economic activity, by identifying and exploiting new products, processes or markets

21 2009 Rindova Entrepreneurship is the efforts to bring about new economic, social, institutional, and Cultural environments through the actions of an individual or group of individuals.

22 2013 Ronald May An Entrepreneur is someone who commercializes his or her innovation.

Review of Literature:

In the article “The evolving domain of entrepreneurship research” it was

identified that entrepreneurship domain has to be covered by researchers at

various levels of socio economic and socio cultural environment.

In the article “Structural interventions for favorable socio-cultural

influences on Indian Entrepreneurs” from that the socio-cultural influence

on the personality and general behavior of people in india is strong”.

In the article “ Women entrepreneurs in India(A case study of Andhra

Pradesh) that social, cultural and economic factors affects the

entrepreneurs.

In the article “Entrepreneurship : Concepts, theory and perspective” says

that personality and cultural background are more focus on the process and

also on the theories.

In the article “ Kenya culture and their impact on Entrepreneurship” that

Max Weber was the first emphasized the influence of culture on

entrepreneurship in 20th century.

In the article “ Global Entrepreneur” that entrepreneurs hunt for best

manufacturing locations because political and economic barriers.

In the article “ Motivation, challenges and success factors of

entrepreneurs an empirical evidence” that self confidence and a high

degree of commitment are the success factors and raising of funds and

hiring and retaining of the workforce are challenges for entrepreneurs.

In the article “ Socio-cultural Environment for Entrepreneurship

Development in Bangladesh” that the Hoftede's cultural factors are impact

on the Bangladesh culture.

Article/Publication

Title of the Article Findings

European journal of

business and management

The impact of socio cultural environment on Entrepreneurial emergence: A Theoretical analysis of Nigerian society

They categorized these factors into 2 levels and they made that there is a positive relation between both socio cultural factors and the Entrepreneurship.

SAGE Publications

Socio cultural factors and Entrepreneurial activity: An overview

Social factors include social networks and social capital where as cultural factors include many taken from theories.

Asian social science

Attributes, environmental factors and women Entrepreneurial activity: A Literature Review

These concentrated on both individual and economic activities and some of the social factors and theories relating to these aspects.

Indian culture and Heritage

secondary course

Socio-cultural issues in contemporary India

Caste based discrimination, gender discrimination and literacy rate are the factors effecting socio cultural values in India.

A study by National

Knowledge Commission

Entrepreneurship in India Social factors as social norms, family values, networks and social value of entrepreneurs play a role. Gender as one factor, family background, age and levels of work experience are others.

Factors influencing entrepreneurshipThere are several factors that influence an Entrepreneur in an

economy. Those factors can be identified from definitions of authors

from the evolution of the entrepreneurship and from the review of

literature. The factors that are identified from the definitions are listed

below…Economic factors Socio-cultural factors

Uncertainty Creativity

Pursue opportunities Change agent

Profit oriented Discover, evaluate and exploit opportunities

Arbitrageur New combinations

Risk taker Innovation

Value adding

Creating wealth

Attaining rewards

Creation of new business

From the review of literature on entrepreneurship some socio cultural

factors influencing entrepreneurship were indentified and are listed as

in below table….

Socio-Cultural factors from Review of

literature

Beliefs Family background

Values Language

Attitudes Norms

Habits Religion

Lifestyle Caste

Family values Race

Education Gender discrimination

personality Tradition

The identified factors from definitions and review of literature

were factorized and the study was made to find the socio cultural

factors that influence an entrepreneurship in the developing countries

like India. From these factors the framework will be developed and

models that relate to the Indian economy were to be presented in the

later review…

Economic factors from Review of literature

Financial stability Competition

Technical knowledge Uncertainty

Self employment Profit orientation

Risk bearer Market information

Proactiveness Demand and supply rlationship

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