Entrepreneurial Supply Potential in Poor Countries

Let’s explain the entrepreneurial supply potential in poor countries. The supply of an adequate number of cable & successful entrepreneurs is considered one of the leading determinants of growth, development & maturity for any country, big or small.

Entrepreneurship is a critical resource and a shortage of it was found to be a strategic bottleneck for development. Therefore, it is felt necessary to explore why it is scarce in many developing countries.

It is of no use to discuss the importance of a particular resource in the context of a particular country’s development if the potentiality for that resource is totally absent in that country.

Therefore, the point, of whether less developed countries have all the potential for their resource, seems to be relevant here to explore.

Scholars in the fields of social psychology and anthropology have tried to explain economic development by social, cultural, and psychological variables via entrepreneurship.

McClelland (1961) emphasized the relationship of achievement motivation or need for achievement (n Ach) to economic development via entrepreneurial activities, McClelland (1961; 64-65) wrote “the presumed mechanism by which n Achievement level translate itself into economic growth is the entrepreneurial class.

If the n Achievement level is high, there will presumably be more people who behave like entrepreneurs…But MCClelland (1961) also worked to find out what explains Achievement. McClelland was influenced by Winterbottom’s (1958) works where she explained then n Ach by child-rearing practices.

McClelland (1961) came to the conclusion that moderate child-rearing practices (neither too authoritarian nor too indulgent nor very early achievement demand) are optimal for production n Achievement which will, in turn, be translated into entrepreneurial activities leading to economic development.

Similarly, Hagen (1962) referred to the authoritarian child-rearing practices of societies which according to Hagen, create authoritarian personalities that are not conducive to the development of creative ideas in children’s minds.

Therefore, according to these theories, the countries where child-rearing prentices are authoritarian or not moderate, there is less chance of the people having higher achievement for which there will have less chance of creating entrepreneurial resources in the near future unless dramatic changes occur in their child-rearing practices, of course, McClelland (1965; 1966) himself has tried to find the solution to the above problem and found based on his experiments that achievement motivation can be developed through training.

No doubt this is a sign of hope although others have contradicted his model of creating entrepreneurial resources the achievement motivation training. But to come to the main point again, i.e. it is only the child-rearing practices, which explain n Achievement among people?

Then what about Japan where child-rearing practices, as reported in different works (such as Beardsley et ai, (1959) are not the same as what is required by Mclelland and Hagens model explaining n Ach or creativity? One scholar who worked much on Japanese motivation for development, De Vos (1973; 180-181) opposing McClelland’s model commented “McClelland over generalizes Western European and American psychological patterns as the only possible ones expressing need achievement,”

Entrepreneurial supply potential in poor countries

Therefore, although here McClelland’s n Achievement as an important variable for entrepreneurship and economic development is not disputed it is difficult to accept for certain that child-rearing practices explain an Ach universally.

But again, when McClelland (1961) and Steiner (1980) reported that the difference in levels of n Achievement e (plains that difference in the level of economic growth and less developed countries are so because they have a low level of n Achievement, the question then arises as to what is the cause of the low level of n Achievement or really is it that n Achievement is low in these countries?

The authors (McClelland 1961′ Tekiner 1980) measured n Achievement from the stories of children’s readers (of those countries) in which they considered the national attitude is reflected. But how far the -: methods followed by the authors for measuring n Achievement are valid has been questioned by some critics (Schatz, 1971; Redlich, 1963).

Again Tekiner (1980) argued that McClelland obtained n Achievement scores from children’s readers days from just after the Second World War which was a period of extreme situational stress for many countries which might have been reflected in the scores of those countries on n Ach.

Therefore, in this state of affairs, it is difficult to come to any conclusion whether these countries had or have the potential for n Ach or whether these countries had or have the potential for n Ach and entrepreneurship which could not be identified because the right socio-cultural advantages could not be identified to be translated into n Achievement as happened in the case of Japan where the ‘social sense of belonging (not the child-rearing practices for training self -reliance and individualism) was translated into their high achievement.

Or is (that this point will remain inexplicable and elusive like ‘Hunting the Heffainrnp’ where the elusive ‘Heffalump’ in Winnie-the-Pooh was said to be hounded by putting many indigenous trapping devices and everybody claims that he has hounded it and makes his own description about the Heffalump but nobody yet could succeed in capturing him.

However, one reasonable approach in this direction seems to be found in Jamieson’s (1978:80) suggestion where he emphasized that “the stock of ‘solutions’ to the economic problems faced by the controllers of the nation-state or the individual firm have to be found within the contest of the socio-culture! structure of their own society.”

Therefore, rather than emphasizing and judging the situation in the developing countries by the standards of some of the Western cultures such as child-rearing practices, etc., it is to be approached in the way as Dr. Jamieson (1978) suggested.

But unfortunately, research been done so far to explain the entrepreneurial behavior in developing countries from a socio-cultural viewpoint mostly tried again to judge the situation in the contest of some of the Western cultures’ standards rather than trying to find out what cultural factors or strengths of the concerned societies could actually explain favorably ‘the emergence of entrepreneurship and economic development.

Studies have tried to find out the factors responsible for the lack of entrepreneurial activities from the attitude of the societies towards the profession and the value systems etc. Gerschenkron (1953:6) maintained that “the theoretical formula is presumably simple: social approval of the entrepreneurial activity, significantly affects its value and quality.”

Similarly, Cochran (1967) observed in the case of Latin America that business positions carry very Meier, and Baldwin (1957) maintained that the traditional value system of the societies immunizes the importance of economic incentives. Higgins (1959) pointed out the extended family system of some societies which limits the incentive to enter into entrepreneurial activities as incomes are to be shared among the members of the extended family.

Linton (1952) raised the problem of nepotism and favoritism towards relatives etc., arising out of strong family ties. This prevents talented people from coming forward to take entrepreneurial jobs. Norman Aitken (1967) conducted a study on entrepreneurship and economic development comparing subjects of US, Indian and Chinese nativity on some social-psychological traits and concluded that the results of his study did not support the ‘McClelland and Hagen’ theory that there is a lack of entrepreneurial potential in those countries’ (suc.1 as India).

But his study supported the sociological observations made by different authors (Gersclienkron, 1953′ Meier and Baldwi, (1957) Higgins. 1959; Linton, (1952) Cochran, (1967) as mentioned above. Of course, it must be stated that his definition and measure of entrepreneurial potent 1 were not the same as that of McClelland.

But the sociological and cultural observations made by the authors regarding underdeveloped countries do not seem to be special phenomena for the underdeveloped countries. Instances of such societal attitudes are not rated even in economically developed countries.

McClelland (1961: 20) argued that if there is a correlation between the national rate of economic growth and prestige of business occupation in different countries then “why is it that Kosenbt age (1957) finds in the most economically advanced country in the world, the United States,’ that very few Cornell students want to enter the business, and many of those who plan such careers do so reluctantly?”

Similarly, Watkins (1973:67) remarked “one shade of meaning which the term ‘entrepreneur’ has in the U.K. is of a somewhat shady, almost criminal businessman…….” Extended family systems rather work as a great help for entrepreneurial activities (Timber, 1969).

Extended family systems as is reported in studies (Beardsley et al, 1959 have rather acted in boosting achievement-oriented activities in Japan. De Vos (1973) wrote that faunal}. net the individual is the traditional unit in Japan.

However, despite all these contradictory conclusions, it is not the intention here to reject the conclusions on socio-causal barriers totally, but these be accepted to be the fundamental or dominating causes, they may be taken as at best supplementary.

Another possible cause that McClelland (1961) also has mentioned in his book, although not with much emphasis, is political conditions such as foreign domination that prevailed in many less developed countries. The question of political instability may also be added to this.

Although the factor should not be generalized among the less developed countries, some have remained comparatively least developed and it is worth observing the situations in those countries. Bangladesh can be cited here as an instance.

Supposing that Bangladesh was affected economically, air least in the same way as her neighboring countries, by the foreign domination, then what happened to her, as is observed that, she could not make may reasonable progress in the economic field, at least proportionately as some of her neighbors did since independence from British rule.

The causes can be traced from Pupae’s (1969) study where the researcher concluded with examples that East Pakistanis (now Bangladesh) did not lack the psychological traits of risk-taking etc. for doing business but what they Jacked was a fair treatment in the economic field (not to speak of others) from Pakistani rulers who were mostly non-Bengalese. Economic domination and political instabilities are nonetheless responsible for the miseries of many such developing countries.

In conclusion, it can be said that rather than man judging the situations in the poor countries by the standards of some of the developed &mature economies, it is rather logical & rationale to assess in the context of their own level & strength of cultures about the factors that could really explain n Ach and entrepreneurship in those poor countries.

Possibly, the potential for Need for High Achievement and love for taking initiatives is not in dearth or there is any draught of these in the countries yet grouped as poor. We think a lack of political commitments & the absence of the creation of a healthy environment required for entrepreneurial growth are the limiting factors in the process of the adequate supply of a reasonable number of entrepreneurs.

Firm commitments of the power cliques, and aggressive efforts in creating an entrepreneurial environment besides provision for all essential common support services & assistance may speed up the supply of entrepreneurs in the poor countries.

You May Like Also:

Leave a Comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Scroll to Top
Scroll to Top