Essay: Factors Influencing Entrepreneurial Engagement In Emerging Economies.

Emphasizes on the factors that promote the entrepreneur in the emerging countries.

Entrepreneurship is a term which is simply defined as running a person’s own business. However, there is a wide difference between owning a business and being an entrepreneur and at the same time a single person can do both. A person’s attitude distinguishes entrepreneurship from just owning a business. Entrepreneurs play a major role in shaping the economy of any country. Entrepreneurs are the persons that possess the skills which are necessary to bring in the new ideas and innovations in to the market. Entrepreneurship in the emerging economies is promising because it creates job and as well opportunities of increasing the GDP of a country through the introduction of new innovations (Cie?lik, 2016). This study is based on investigating and critiquing an interview hosted on an e-corner, the forces that make a person to be an entrepreneur in the emerging economies and at the same time how the interview impacted me and my perspectives regarding career and project.

The emergence and consolidation of entrepreneurship in emerging economies involves a step by step process of discovery, evaluation and exploitation of the several opportunities that exist within the economies of the emerging economies (Westlund & Gawell, 2012). An individual’s analysis of recognition of the opportunities, evaluation and exploitation is jointly connected with the environmental and individual factors. From the perspective of social stratification, entrepreneurship is viewed as tool that mobilizes the society. Entrepreneurship is considered as a social ladder that helps the less educated individuals of the lower stratum to move up in the society. Whereas, there are countries that promote only the elites to and creates a problematic situation for the growth of the new entrepreneurs (Santos, 2012). The first process of developing a new business involves the creation of the opportunity or discovery of the opportunity. This discovery phase involves identification of the entrepreneurial opportunities present in the market. The second phase deals with the evaluation of the opportunities which is based on the future aspects of the business and the benefits arising from it. The evaluation of the benefits is more based on the first person perspective rather than the third person perspective. Factors at the individual level influence the individual engagement to a great extent into the entrepreneurship (Lim, Oh & De Clercq, 2016). Financial capital plays an instrumental and direct role in the entrepreneurial process. Having the excess financial capital might influence and motivate in the systematic search of the opportunities for the entrepreneurship. In particular, the household belonging from the low income group are the major levers for the social stratification. This is commonly seen in the developing countries that have people belonging from the low and high income groups (Martin, McNally & Kay, 2013). Another major rationale for an individual’s engagement in to the entrepreneurship are the skills and knowledge. The documents related to the entrepreneurship literature speak that human capital like education both enhances and increases an individual’s capability to enact and identify the opportunities. Education equips an individual with the ability to process information, better search and scanning capabilities (Morris et al., 2013). The provision of knowledge corridor along with the higher education provides the individuals with the capability to recognize and identify the wide range of the opportunities related with the entrepreneurship. The level of education also plays a major role in stimulating entrepreneurship among the individuals in the emerging countries because the alternative is few with respect to the availability of the human capital. Individuals with the high levels of education and income have the choice of either becoming the entrepreneurs or rent seekers (Lim, Oh & De Clercq, 2016).

Emerging Economies: Opportunities and Challenges

A three dimensional model conceptualized by Scott reveal a link between the human and financial capital and engagement in entrepreneurship. The regulatory dimension of the entrepreneurship reflects the regulation and the policies in relation to the protection of intellectual property. The second dimension is cognitive dimension that includes the extent to which the entrepreneurship related information is spread into the country. The third dimension relates to the normative dimension which reflects that the extent to which the individual of a country consider the entrepreneurship as a beneficial career choice (Scott, 2013). The regulatory dimension does not fall under the category proposed by Scott, however it includes the certain factors like the tax system and the legal system. This dimension influences the process of the entrepreneurship with respect to the various policy measures. The regulations that are entrepreneurship friendly effectively reduce and influence the barriers that exist within the entrepreneurial activities. However, it is noticed that countries which have the high levels of excessive bureaucracy, legal commitments and inefficient tax systems hampers the business environment to a large extent (BileiÅ, 2014). There are certain regulations that are favorable for reducing poverty in the emerging countries, but such policies are not conducive for the entrepreneurs because it includes excessive bureaucracy, tax burdens, volatile legislation, inefficient tax collection procedures, undelivered legal commitments, and regulatory challenges. There is the reason which inhibit and hinder an individual to pursue entrepreneurship and move to rather become an employee (Lim, Oh & De Clercq, 2016). The personality traits of an entrepreneur can be summarized as follows: Strong leadership qualities, high self-motivation, strong sense of integrity and ethics, do not fear to fail, have the capability to innovate new ideas products, knows what others in a team do not know, competitive spirit, understands the importance of a consolidated peer network (Minority Business Development Agency, 2018).

An interview of Michael Dearing was conducted on e-Corner of Stanford University by Bob Sutton. Michael Dearing has experience of working in eBay for 6 years, has propelled several companies to gain a competitive name. He has established a company called Harrison Metal and is currently an associate professor in Stanford d school (Stanford eCorner, 2018). This spells that he is an experienced man that possess the knowledge of the entrepreneurship. His interview has impacted my thinking of starting a startup to a great extent. Especially his suggestions that velocity is the most important thing that matters for the startups that want to make a name in a competitive market. He has laid an emphasis on the output per person and has criticized the laziness that often grabs the startups. I think that incorporating these two great observations in to my life can both enhance and shape my career and will give a right track to my aspirations. I will instead of becoming an employee of a company will focus on becoming an entrepreneur, where I can innovate products and bring new ideas to life. However, he also mentioned that although capitalism is to some extent not favorable for a democratic nation but as a whole capitalism can be considered as a driving engine of our civilization.

Conclusion

Therefore, from the above discussion it can be concluded that, entrepreneurs are formed due to the inner desire of doing innovating something different or a product which will to some extent revolutionize the way the society behaves. Entrepreneurs are not just build in a day; it needs favorable environment that nurtures the fertile brains. There are several factors that both influence a person to become an entrepreneur or just an employee in an emerging economy. In an emerging economy, an individual need to first discover, evaluate and exploit the opportunities that promote entrepreneurship. However, hurdles and hindrances like elongated bureaucracy, taxation system, volatile laws, delayed delivery of the legal commitments seldom reduce the capability of an entrepreneurship and reduce the number of entrepreneurs in a country. Entrepreneurship, on the other hand are a wide range of qualities that an entrepreneur must possess.

References

BileiÅ, M. (2014). Public sector control as a factor in entrepreneurial policy: the case of Lithuania. Entrepreneurship and Sustainability Issues, 1(3), 151-161.

Cie?lik, J. (2016). Entrepreneurship in Emerging Economies: Enhancing Its Contribution to Socio-economic Development. Springer.

Lim, D. S., Oh, C. H., & De Clercq, D. (2016). Engagement in entrepreneurship in emerging economies: Interactive effects of individual-level factors and institutional conditions. International Business Review, 25(4), 933-945.

Martin, B. C., McNally, J. J., & Kay, M. J. (2013). Examining the formation of human capital in entrepreneurship: A meta-analysis of entrepreneurship education outcomes. Journal of Business Venturing, 28(2), 211-224.

Minority Business Development Agency. (2018). 8 traits of successful entrepreneurs--Do you have what it takes?. Minority Business Development Agency. Retrieved 24 January 2018, from https://www.mbda.gov/news/blog/2010/07/8-traits-successful-entrepreneurs-do-you-have-what-it-takes

Morris, M. H., Webb, J. W., Fu, J., & Singhal, S. (2013). A Competency?Based Perspective on Entrepreneurship Education: Conceptual and Empirical Insights. Journal of Small Business Management, 51(3), 352-369.

Santos, F. M. (2012). A positive theory of social entrepreneurship. Journal of business ethics, 111(3), 335-351.

Scott, W. R. (2013). Institutions and organizations: Ideas, interests, and identities. Sage Publications.

Stanford eCorner. (2018). The Basic Hygiene of Management | Stanford eCorner. Stanford eCorner. Retrieved 24 January 2018, from https://ecorner.stanford.edu/podcast/the-basic-hygiene-of-management/

Westlund, H., & Gawell, M. (2012). Building social capital for social entrepreneurship. Annals of Public and Cooperative Economics, 83(1), 101-116.