Improving Entrepreneurial Competency in Low-Income Segments: The Impact of Entrepreneurial Development Agents
Micro-enterprises, with fewer than ten employees, are responsible for most new jobs in emerging economies. Unfortunately, low-income entrepreneurs frequently lack enough entrepreneurial competency to survive and expand. The research presented in this chap
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Rene´ Dı´az-Pichardo, Nicola´s Gutie´rrez and Juan Arriaga-Mu´zquiz
Abstract
Micro-enterprises, with fewer than ten employees, are responsible for most new jobs in emerging economies. Unfortunately, low-income entrepreneurs frequently lack enough entrepreneurial competency to survive and expand. The research presented in this chapter aims to evaluate the importance of entrepreneurial development agencies at the base of the pyramid. Structural equation modelling with survey data from enterprises participating in an entrepreneurship education process in Mexico provides evidence of the positive and significant impact of entrepreneurial development agencies on performance, with the mediating effect of market-product innovation and market orientation.
R. Díaz-Pichardo (&) Groupe ESC Troyes, Troyes, France e-mail: [email protected] N. Gutiérrez Economics Department, Universidad de las Américas Puebla, Puebla, Mexico e-mail: [email protected] J. Arriaga-Múzquiz Entrepreneurship, Innovation and Family Business, EGADE Business School-Tecnológico de Monterrey, San Pedro Garza García, Mexico e-mail: [email protected]
A. Lundström et al. (eds.), Social Entrepreneurship, International Studies in Entrepreneurship, DOI: 10.1007/978-3-319-01396-1_10, Springer International Publishing Switzerland 2014
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R. Dı´az-Pichardo et al.
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10.1
Introduction
Entrepreneurship development has been seen as a route to economic vitality, improved quality of life, and poverty reduction in emerging economies. Microenterprises, with fewer than ten employees, are responsible for most new jobs in these economies. Unfortunately, entrepreneurs in low-income segments frequently lack entrepreneurial competency and face severe difficulties in expanding. However, to date, the potential impact of entrepreneurship on subsistence economies has largely been ignored. Consequently, it is very important to analyse the entrepreneurship phenomenon in these economies, bearing in mind that what is known from the world’s developed economies may not apply to entrepreneurship on these environments (Bruton et al. 2008). Outside economic support, such as direct investment or government subventions, can create unwanted dependencies in local and regional development unless this external aid boosts a process of social inclusion and build human and social capital (Bhalla and Lapeyre 2004; Espinosa 2007; Lessof and Jowell 2000; West et al. 2008). The intervention of entrepreneurial development agencies (EDAs)— individuals or institutions from either the private or the public sector, which aim to help business organizations at the base of the pyramid (BOBOPs)—can improve entrepreneurial competency in order to enhance performance, and can play an important role in entrepreneurial development in emerging economies. EDAs can spark a process of social inclusion in low-income segments by building human and social capital through entrepreneurship education. BOBOPs are enterprises at the base of the pyramid owned by one or more entrepreneurs. They are
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