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FAMILY BACKGROUND AND ENTREPRENEURIAL CAPACITY

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The survey clarifies the components of entrepreneurship capacity to understand the entrepreneurial readiness of different kinds of people in terms of family background. Often it can be heard that the entrepreneurial family background is most unfavorable for starting up own business because the members of an entrepreneurial family have that negative experiences of endless and economically precarious entrepreneurial work. It is proposed here that there are large background variations in entrepreneurial capacity in terms of family background. In this paper, entrepreneurship capacity and entrepreneurial intentions in regard to family background will be analyzed. The basic question is, do the family background matter in terms of entrepreneurial capacity. The common negative assumption will be proved untrue.
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Routamaa, V. & Rissanen, A-L. (2004). Family Background and Entrepreneurial Capacity, Proceedings of
49th ICSB World Conference, Johannesburg, South Africa.
!
Family Background and Entrepreneurial Capacity
Vesa Routamaa & Anna-Leena Rissanen
University of Vaasa
Abstract
The survey clarifies the components of entrepreneurship capacity to understand the entrepreneurial
readiness of different kinds of people in terms of family background. Often it can be heard that the
entrepreneurial family background is most unfavorable for starting up own business because the members
of an entrepreneurial family have that negative experiences of endless and economically precarious
entrepreneurial work. It is proposed here that there are large background variations in entrepreneurial
capacity in terms of family background. In this paper, entrepreneurship capacity and entrepreneurial
intentions in regard to family background will be analyzed. The basic question is, do the family background
matter in terms of entrepreneurial capacity. The common negative assumption will be proved untrue.
Introduction
The rapid changes in industry structure, globalization, technological development, and
increasing unemployment require more self-employment end entrepreneurship. In order
to develop entrepreneurial activity in any country and region, the entrepreneurial
readiness of different kinds of people in terms of the components of entrepreneurship
capacity should be identified. For example, a disputable assumption is that the family
background, i.e. occupational family context favors or unfavors starting up a business.
Often it can be heard that the entrepreneurial family background is most unfavorable for
starting up a business because the members of an entrepreneurial family have that
negative experiences of endless and economically unsecure entrepreneurial work.
Correspondingly, different, untestified assumptions concern the entrepreneurial attitudes
and capabilities of those coming from wage earner families in public or private sector, or
from decreasing agriculture sector. It is proposed here that there are large background
variations in entrepreneurial capacity in terms of family background. In this paper,
entrepreneurship capacity and entrepreneurial intentions in regard to family background
will be analyzed. The basic question is, does the family background matter in terms of
entrepreneurial capacity.
It is assumed that positive attitudes to entrepreneurship, entrepreneurship qualities, and
certain entrepreneurship ideals correlate positively with entrepreneurial intentions.
Entrepreneurial intentions correlate with starting up a business, although this relationship
is not strong. According to pilot surveys (e.g. Routamaa 2001), however, entrepreneurial
attitudes correlate slightly with entrepreneurial intentions whereas motivation correlates
more significantly with entrepreneurial intentions. Positive attitudes form the basis and
favourable climate for entrepreneurship but are rarely the basic reason or motive for it.
That is, only improving attitudes toward entrepreneurship is not enough but the whole
scale of entrepreneurial capacity must be taken into account. In order to really increase
entrepreneurial activity and start ups, strong efforts to improve entrepreneurial qualities
and especially motivation should be done.
Routamaa, V. & Rissanen, A-L. (2004). Family Background and Entrepreneurial Capacity, Proceedings of
49th ICSB World Conference, Johannesburg, South Africa.
!
Earlier studies
Discussion has addressed numerous background factors linked to entrepreneurship, for
example, previous employment (Ronstadt, 1988) and gender (Buttner and Rosen, 1989;
Kolvereid, Shane and Westhead, 1993). Unfortunately, only few studies have been
concentrated in family background (Crant, 1996; Gray, 2001), which in this paper is
hypothesized to have an impact on entrepreneurship.
Students with entrepreneurial parents reported higher entrepreneurial intentions than
those without such role models (Crant, 1996). Miettinen (2001) has studied children's
images of entrepreneurial requirements and according to him, children coming from
entrepreneurial families appeared to be more positive and realistic in their view about
entrepreneurial prerequisites. Gray (2001) suggests that people from strongly supportive
families are already starting with resources and capabilities that will stand them in good
stead if they wish to pursue a career as an entrepreneur.
Havusela (1999) found that the wage earner culture of a municipality unfavor and
agrarian culture favour entrepreneurship in the region. It is true that farmers'
entrepreneurial attitudes are quite positive but their entrepreneurial qualities are lower
compared to other professional groups (Jokinen, Routamaa and Vesalainen 2000a,
2000b). In general, Jokinen et al. (2000a, 2000b) have found a more positive relationship
between entrepreneurial family background and entrepreneurial capabilities compared to
farming, private or public sector backgrounds. The transition from wage earner culture to
entrepreneurial culture requires boosting the entrepreneurial capabilities in general. For
example, Jordaan (2001: 292) concluded that 'the changing nature of agriculture in South
Africa provides both 'push' and 'pull' dynamics for agriculturist to engage in
entrepreneurial activities...A shift in focus from agricultural producer to agricultural
entrepreneur is imperative.' In these circumstances, more knowledge of entrepreneurial
capacity and prerequisites is needed in order to arrange appropriate, measures, education
and training.
Of course, there are many other background variables as mentioned above associated
with entrepreneurial capabilities (see e.g. Routamaa 2001; Routamaa, Rissanen &
Hautala 2004) that must be taken into account in efforts to develop entrepreneurial
activities. Entrepreneurs are not a homogeneous group (see e.g. Routamaa & Varamäki
1998) but their capability training must be taken care of (see Routamaa 1999, 2000a). In
all, the personality of a potential entrepreneur is a key issue in developing
entrepreneurship (see e.g. Routamaa 2000b; Routamaa & Rissanen 2004). In a global
context, local cultures should be also taken into account (cf. e.g. Ginn 2000; Hautala &
Routamaa 2001; Routamaa & Pollari 1998). The basic poverty of entrepreneurial
development efforts is a constricted view of the phenomenon (see e.g. Routamaa 2003),
due to lack of a wholistic, systemic approach (e.g. Routamaa 1999, 2000b).
Research Methodology
Sample. The sample consisted of 9 158 people of which 51 % were females and were 47
% males. The sex of 2 % of respondents was unknown. The sample represented a
Routamaa, V. & Rissanen, A-L. (2004). Family Background and Entrepreneurial Capacity, Proceedings of
49th ICSB World Conference, Johannesburg, South Africa.
!
working age between 18 and 55 years from different parts of Finland. Most of the
respondents (15 %) were 41-45 years old and least (10 %) were between 26 and 30 years.
The most common educational background of the male respondents was vocational
school (42 %) and for female respondents it was institute (29 %), while and the most
uncommon educational background for both genders was postgraduate studies, licentiate
or doctor (0,7 %). During the time the research was accomplished, the most of the
respondents had a full-day job (50 %), while only 5 % of females and 10 % of males
were working as entrepreneurs. Considering the family background, the parents of the
most respondents had agriculture or forestry as their main livelihood source (32 %). The
parents of 28 % had been working on the private sector and 25 % on the public sector,
while 15 % of the respondents game from entrepreneur-families.
Instrument. A survey of entrepreneurship capacity in terms of (1) attitudes towards
entrepreneurship, (2) different entrepreneurship qualities, (3) entrepreneurial ideals, (4)
entrepreneurship motivation, and (5) entrepreneurial intentions was performed as a part
of entrepreneurial development program (see Routamaa 1999, 2000). A scale of five
alternatives ranging from ‘strongly disagree’ to ‘strongly agree’ was applied when
suitable. In addition to the dimensions above the barriers to entrepreneurship were
inquired. The potential barriers concern economic risk, entrepreneurial role, the lack of
business ideas or knowledge, social risk, resources, social support, and personal traits.
Further, push-and-pull factors, i.e., dissatisfaction and opportunity factors were also
inquired. Several background variables were asked about, too, for example, age, gender,
education, work experience, current professional status, and family background in terms
of the parents’ occupation.
Procedure. The Attitudes Towards Entrepreneurship were measured by six questions.
All the six questions were loaded in one factor in factor analysis, and the loadings were
varying between 0.533 and 0.685. This factor had high reliability (Alpha=0.7140).
The Entrepreneurial Qualities were measured by 14 questions, of which, five factors
(Varimax) were obtained. One question measuring the fear of taking risks was removed
because of double loading. The reliabilities (Alpha) of these factors were: Fear of Change
0.5727, Pleasing Others 0.6146, Opportunism 0.5387, Fatalism 0.6199 and Maverick
0.4149. The first quality, Fear of Change, is described in terms of "being slacken under
lot of insecurity", "having doubts about new things and believing that changes create only
new problems". The second quality, Pleasing Others, included items: "avoiding situations
where have to give presentations", "keeping the craziest ideas in one's own mind" and
"not wanting attention to one's different thoughts or ideas". The third quality,
Opportunism, contains principles such as "succeeding requires not irritating other
people", "pleasing those who have power" and "making sure that one's own plans fit to
those of others before accomplishing them". Fatalism-quality is described in terms of
"succeeding in life is a matter of destiny" and "things will be as they're meant to be". In
the last quality, Maverick, topics were: "one's destiny depends on one's own actions" and
"accomplishing ideas in spite of resistance of other people".
The Entrepreneurial Ideals were different entrepreneurial identities. Respondents could
Routamaa, V. & Rissanen, A-L. (2004). Family Background and Entrepreneurial Capacity, Proceedings of
49th ICSB World Conference, Johannesburg, South Africa.
!
rate the ideal from the perspective that which will suit to him/her best, a personal
interpretation about how one sees oneself as an entrepreneur. These ideals were for
example; "net-marketer", "shopkeeper", "part-time-entrepreneur" etc., in all 19 ideals
offered, see Table 1.
Efforts to Start up New Business were measured by items such as: "Looking for new
business ideas", "seeking patent for invention" etc.
Entrepreneurial Intentions were measured by items such as: The question of
entrepreneurial intentions consists of three dimensions which are: the intention of starting
up a firm, the intention of preparing to start one up, and the intention of being educated
for an entrepreneurial career. Entrepreneurial Intentions were measured by items such as:
"Going to start up business myself within a year", "starting up with a partner", "buying a
firm alone", "buying a firm with a partner", and "going to be a shareholder in a new
enterprise but not work there within next year".
Push and Pull Factors were measured by five questions. Reliabilities of both factors were
high (Push 0.8671, Pull 0.8653).
Needs that Could be Satisfied more likely in the career of entrepreneur than in the current
career were measured by eleven questions, of which two factors were obtained:
Motivation Factor (alpha= .8158) and Hygiene Factor (alpha=.8746). Hygiene Factor
includes statements: Compared to wage labour, working as an entrepreneur... "I would
get more respect in society", "I would be a team member and have better relations to co-
workers", "I would have better earnings", "I would have higher status and more power",
"I would more surely earn my livelihood" and "I would more certainly have enough free-
time". Motivation factor is described in terms of: compared to wage labour, working as
an entrepreneur... "I could develop and regenerate continuously", "I would be more
autonomous and independent", "I could better decide my working-hours" and "I could
better accomplish my innovativeness and creativity".
Finally, the Obstacles for Becoming an Entrepreneur, were measured by 26 items, from
which six factors were obtained: Fear of Failure (alpha=0.8398), Wrong State of Life
(alpha=0.7564), Lack of Knowledge (alpha=0.6945), Practical Obstacles (alpha=0.6845),
Personal Characteristics (alpha=0.5880) and Lack of Support (alpha=0.8779). Four
questions were removed because of low loadings, or loadings in several factors.
Factor Fear of Failure included items: Fear of.. "uncertainty of livelihood", "losing my
property", "running into debt", "adequate demand", "becoming imprinted as
unsuccessful" and "getting laughed at", Wrong State of Life included items:
"Entrepreneurship ties too much", "entrepreneurship does not offer enough free-time",
"entrepreneurship means loneliness", "current state of life is not suitable for being an
entrepreneur" and "it's not profitable to change my current work to entrepreneurship",
Lack of Knowledge included items: "Own knowledge is too narrow", "my expertise is
difficult to commercialize" and "lack of business idea", Practical Obstacles included
questions: "Not getting needed finance", "not finding suitable place" and "fear of lack of
Routamaa, V. & Rissanen, A-L. (2004). Family Background and Entrepreneurial Capacity, Proceedings of
49th ICSB World Conference, Johannesburg, South Africa.
!
skilled labour", Personal Characteristics was formed of items: "Low tolerance of
uncertainty", "lack of diligence" and "persistency and lack of service orientation", Lack
of Support included questions: "I do not get support from people close to me" and
"family does not support me.
Results
Several significant differences were found between the family background and
Entrepreneurial Attitudes, Qualities, Ideals, Efforts to Start Up New Business and
Entrepreneurial Intentions as well as Entrepreneurial Prerequisites (see Table 1, 2 and 3).
Table 1. The Relationships between Family Background and Entrepreneurial Attitudes,
Qualities, and Ideals (One-Way Anova).
Entrepreneur
Background
Agriculture
Background
Private
Sector
Public
sector
F-value
Attitudes
3.80
3.76
3.65
3.67
23.627 ***
Q1: Fear of change
3.57
3.35
3.56
3.46
36.549 ***
Q2: Invisible
3.45
3.07
3.30
3.32
61.011 ***
Q3: Opportunist
3.05
2.91
3.04
3.05
17.298 ***
Q4: Fatalist
3.44
3.34
3.46
3.34
9.400 ***
Q5: Maverick
3.69
3.53
3.62
3.60
14.378 ***
I1: Businessman
2.69
2.32
2.40
2.37
25.061 ***
I2: Innovator-entrepreneur
2.32
2.30
2.19
2.19
6.388 ***
I3: Manager-entrepreneur
2.89
2.45
2.53
2.57
34.216 ***
I4: Scientist-entrepreneur
2.05
1.88
1.91
2.01
10.220 ***
I5: Sole proprietor
3.25
3.07
3.06
3.10
5.904 ***
I6: Businessman in team
3.43
3.19
3.28
3.39
16.694 ***
I7: Part-time-entrepreneur
3.04
3.00
2.93
2.88
5.150 ***
I8: Subcontractor
2.97
2.89
2.87
2.75
8.781 ***
I9: Farmer/Forestry-entrepreneur
2.17
3.04
2.01
2.03
108.946 ***
I10: Franchising-entrepreneur
2.22
2.03
2.05
2.23
16.695 ***
I11: Co-operative entrepreneur
2.34
2.46
2.36
2.37
4.407 **
I12: Net-marketer
1.76
1.82
1.70
1.84
8.403 ***
I13: Handcraft-entrepreneur
2.95
3.05
2.89
2.85
10.151 ***
I14: Trainer/Consultant
2.90
2.51
2.69
2.70
26.407 ***
I15: Transportation/Machine contractor
2.27
2.29
2.05
1.97
29.248 ***
I16: Shopkeeper
2.96
2.62
2.71
2.73
16.669 ***
I17: Agent/Representative
2.23
2.07
2.04
2.11
6.896 ***
I18: Social service provider
2.64
2.63
2.42
2.76
22.194 ***
I19: Restaurant-entrepreneur
2.43
2.05
2.17
2.33
32.310 ***
Level of significance: *.05, **.01, ***.001
Routamaa, V. & Rissanen, A-L. (2004). Family Background and Entrepreneurial Capacity, Proceedings of
49th ICSB World Conference, Johannesburg, South Africa.
!
Table 2. The Relationships between Family Background and Efforts to Start Up New
Business and Entrepreneurial Intentions (One-Way Anova).
E1: Looking for new business ideas
2.22
1.87
1.80
32.048 ***
E2: Trying to produce own product
1.91
1.68
1.70
22.517 ***
E3: Developing new product or service
2.04
1.76
1.74
22.697 ***
E4: Looking for co-operation partner
1.91
1.67
1.66
16.183 ***
E5: Seeking patent for invention
1.38
1.28
1.32
5.774 ***
E6: Learning business know-how
2.08
1.79
1.73
26.175 ***
E7: Starting studies of enterprising
1.82
1.57
1.61
19.609 ***
E8: Participating for a starting-up business
education
1.78
1.58
1.62
10.379 ***
E9: Learning entrepreneurship by working for
someone else
1.80
1.59
1.62
7.140 ***
Going to start up business by myself within a
year
1.82
1.62
1.52
11.062 ***
Going to start up business together with a
partner within a year
1.78
1.57
1.57
5.792 ***
Going to buy already existing firm /business
by myself within a year
1.58
1.37
1.30
13.396 ***
Going to buy already existing enterprise/
business together with a partner within a year
1.55
1.38
1.40
4.646 **
Going to be a shareholder in a new enterprise
but not work there within next year
1.55
1.42
1.39
5.204 ***
Level of significance: *.05, **.01, ***.001
Table 3. The Relationships between Family Background and push and pull factors,
hygiene & motivation, and obstacles (One-Way Anova).
Push
2.8425
2.8961
2.9572
2.9151
1.932
Pull
2.4829
2.2924
2.1959
2.1160
21.351 ***
Hygiene factor
2.4922
2.4226
2.4611
2.5206
3.396 *
Motivation factor
3.3285
3.1141
3.2269
3.2176
9.985 ***
O1: fear of failure
2.4597
2.6609
2.5959
2.6344
14.500 ***
O2: wrong state of life
2.3160
2.4868
2.5356
2.5708
19.995 ***
O3: lack of knowledge
2.3179
2.5821
2.4804
2.5366
18.379 ***
O4: practical obstacles
1.9112
2.1018
2.0277
2.0845
13.403 ***
O5: personal characteristics
1.8185
1.9494
1.9129
1.9245
6.240 ***
O6: lack of support
1.7168
2.0300
1.8305
1.8018
26.228 ***
Level of significance: *.05, **.01, ***.001
Post-hoc test in Table 4 and in Table 5 shows the significant differences between groups.
Every item had significant difference thus they are not separately reported. Only the basic
lines are reported in the text below.
In Attitudes overall, the respondents from entrepreneur or agriculture families had higher
ratings than respondents from private or public sector families.
Routamaa, V. & Rissanen, A-L. (2004). Family Background and Entrepreneurial Capacity, Proceedings of
49th ICSB World Conference, Johannesburg, South Africa.
!
Table 4. Comparison of different Family Backgrounds in case of Attitudes, Qualities,
Ideals and Efforts. (Post-hoc test: Tukey HSD)
Attitudes towards entrepreneurship
Entrepreneur, Agriculture > Private sector, Public sector
Quality 1: Fear of change
Entrepreneur > Agriculture, Public Sector
Private sector, Public sector > Agriculture
Private sector > Public sector
Quality 2: Invisible
Entrepreneur > Agriculture, Private sector, Public sector
Private sector, Public sector > Agriculture
Quality 3: Opportunist
Entrepreneur, Private sector, Public sector > Agriculture
Quality 4: Fatalist
Entrepreneur, Private sector > Agriculture, Public sector
Quality 5: Maverick
Entrepreneur > Agriculture, Private sector, Public sector
Private sector, Public sector > Agriculture
Identity 1: Businessman
Entrepreneur > Agriculture, Private sector, Public sector
Identity 2: Innovator-entrepreneur
Entrepreneur, Agriculture > Private sector, Public sector
Identity 3: Manager-entrepreneur
Entrepreneur > Agriculture, Private sector, Public sector
Public sector > Agriculture
Identity 4: Scientist-entrepreneur
Entrepreneur, Public sector > Agriculture, Private sector
Identity 5: Sole proprietor
Entrepreneur > Agriculture, Private sector, Public sector
Identity 6: Businessman in team
Entrepreneur, Public sector > Agriculture, Private sector
Private sector > Agriculture
Identity 7: Part-time-entrepreneur
Entrepreneur, Agriculture > Public sector
Identity 8: Subcontractor
Entrepreneur, Agriculture, Private sector > Public sector
Identity 9: Farmer/Forestry-entrepreneur
Agriculture > Entrepreneur, Private sector, Public sector
Identity 10: Franchising-entrepreneur
Entrepreneur, Public sector > Agriculture, Private sector
Identity 11: Co-operative entrepreneur
Agriculture > Entrepreneur, Private sector
Identity 12: Net-marketer
Agriculture, Public sector > Private sector
Identity 13: Handcraft-entrepreneur
Agriculture > Private sector, Public sector
Identity 14: Trainer/Consultant
Entrepreneur > Agriculture, Private sector, Public sector
Private sector, Public sector > Agriculture
Identity 15: Transportation/Machine
contractor
Entrepreneur, Agriculture > Private sector, Public sector
Identity 16: Shopkeeper
Entrepreneur > Agriculture, Private sector, Public sector
Public sector > Agriculture
Identity 17: Agent/Representative
Entrepreneur > Agriculture, Private sector, Public sector
Identity 18: Social services provider
Entrepreneur, Agriculture > Private sector
Public sector > Agriculture, Private sector
Identity 19: Restaurant-entrepreneur
Entrepreneur, Public sector > Agriculture, Private sector
Private sector > Agriculture
Effort 1: Looking for new business ideas
Entrepreneur > Agriculture, Private sector, Public sector
Agriculture > Public sector
Effort 2: Trying to produce own product
Entrepreneur, Agriculture > Private sector, Public sector
Effort 3: Developing new product or service
Entrepreneur > Agriculture, Private sector, Public sector
Agriculture > Private sector, Public sector
Effort 4: Looking for co-operation partner
Entrepreneur > Agriculture, Private sector, Public sector
Agriculture > Private sector, Public sector
Effort 5: Seeking patent for invention
Entrepreneur, Agriculture > Private sector
Effort 6: Learning business know-how
Entrepreneur > Agriculture, Private sector, Public sector
Effort 7: Starting studies of entrepreneurship
Entrepreneur > Agriculture, Private sector, Public sector
Effort 8: Participating for a starting-up
business education
Entrepreneur > Agriculture, Private sector, Public sector
Effort 9: Learning entrepreneurship by
working for someone else
Entrepreneur > Agriculture, Private sector, Public sector
Routamaa, V. & Rissanen, A-L. (2004). Family Background and Entrepreneurial Capacity, Proceedings of
49th ICSB World Conference, Johannesburg, South Africa.
!
In Pull factors overall, respondents with entrepreneurial background had higher ratings
than respondents from agricultural, private sector or public sector backgrounds.
Furthermore, respondents from agricultural background had higher ratings than
respondents with public sector background.
Respondents from public sectors' background appraised Hygiene factors overall higher
than respondents with agricultural background.
In Motivation factor respondents from entrepreneurial background appraised these
qualities higher than respondents with agricultural or public sectors background.
Furthermore, respondents with background of private and public sectors had higher
ratings than respondents with agricultural background.
Overall, when looking at the post-hoc table the respondents with entrepreneurial
background had the most positive ratings towards entrepreneurship when compared to
others. Respondents from public sectors seem to have most often less positive ratings
towards entrepreneurship.
Table 5. Comparison of different Family Backgrounds in case of Intentions, Pull-factor,
Motivation and Hygiene Factors, and Obstacles. (Post-hoc test: Tukey HSD)
Intention 1: Going to start up business by
myself within a year
Entrepreneur, Agriculture > Private sector, Public sector
Intention 2: Going to start up business
together with a partner within a year
Entrepreneur > Agriculture, Private sector, Public sector
Intention 3: Going to buy already existing
enterprise/business by myself within a year
Entrepreneur > Agriculture, Private sector, Public sector
Agriculture > Public sector
Pull-factor
Entrepreneur > Agriculture, Private sector, Public sector
Agriculture > Public sector
Hygiene factor
Public sector > Agriculture
Motivation factor
Entrepreneur > Agriculture, Public sector
Private sector, Public sector > Agriculture
Obstacle 1: fear of failure
Agriculture, Private sector, Public sector > Entrepreneur
Obstacle 2: wrong state of life
Agriculture, Private sector, Public sector > Entrepreneur
Public sector > Agriculture
Obstacle 3: lack of knowhow
Agriculture, Private sector, Public sector > Entrepreneur
Agriculture > Private sector
Obstacle 4: practical obstacles
Agriculture, Private sector, Public sector > Entrepreneur
Agriculture > Private sector
Obstacle 5: personal characteristics
Agriculture, Private sector, Public sector > Entrepreneur
Obstacle 6: lack of support
Agriculture, Private sector > Entrepreneur
Agriculture > Private sector, Public sector
Routamaa, V. & Rissanen, A-L. (2004). Family Background and Entrepreneurial Capacity, Proceedings of
49th ICSB World Conference, Johannesburg, South Africa.
!
Conclusions
Entrepreneurship qualities seem to be quite a decisive factor when an individual is faced
with the choice of an entrepreneurial career. A clear-cut entrepreneurial identity makes it
easier to choose an entrepreneurial career if one is in two minds about starting up a
business. However, there is a gap between the ’ideal’ and actualising it if the other
entrepreneurial capacity factors are not favourable. Entrepreneurial motivation is quite
decisive in the case of a free choice between an entrepreneur and a wage earner. All these
factors form a chain, which can lead to an entrepreneurial career in the context of push-
and-pull factors as well as barriers to entrepreneurship. The more positive the dimensions
of capacity in the chain, the more probable the entrepreneurial career. In Finland, the
weakest link in the chain is entrepreneurial motivation; the security factor is the most
important motive in general. This generally explains the weak position of
entrepreneurship in Finland. This is largely due to the excessive social security and high
taxes and labour costs. Enterprising is not experienced rewarding. Maybe also the strong
uncertainty avoidance culture, typical of Finland is partly behind the dominating security
factor (see e.g. Routamaa & Pollari 1998). It seems that family background also quite
much predicts the entrepreneurial capacity. People originating from entrepreneurial
family, farmer family, wage earner family in public sector, or wage earners in private
sector quite much differentiate from each others.
Possible implications
Based on the research results obtained here, it is possible to forecast entrepreneurial
capacity and intentions of different people in terms of family background.
Entrepreneurship profiles revealed, for example, what kind of facilities, ideals, barriers,
and motives people have. This knowledge helps to direct the development efforts to
promote entrepreneurship and to make it possible to carry out better planned ‘specified
development activities and training’.
In the light of these results, it seems that having a public sector background is a drag on
when thinking about the career as entrepreneur, and also the background of private sector
can be regarded as some kind of obstacle. Thus entrepreneurial education should be
recommended especially to those people who are likely to have more negative attitudes
and capacity towards entrepreneurship. Of course, aiming at fast results, those coming
from entrepreneurial family are most thankful target group. After identifying the
attitudes, push, pull and motivational factors of each person or group, the education or
training for entrepreneurship can be modified so as to gain better results.
The politicians and educators should encourage people of different backgrounds to
become entrepreneurs and remove disincentives to start-up decision (cf. Routamaa 2003).
Transitions all over the world require more self-employment and intrapreneurship.
Routamaa, V. & Rissanen, A-L. (2004). Family Background and Entrepreneurial Capacity, Proceedings of
49th ICSB World Conference, Johannesburg, South Africa.
!
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Routamaa, V. & Work Group (1999). A New, More Entrepreneurial Generation: A Development Plan for Entrepreneurship 2000-2006. Decade of Entrepreneurship. http://www.uwasa.fi/ktt/johtaminen/index2.htm
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