Problem

Shortage of entrepreneurial ability

Other Names:
Unconfident potential entrepreneurs
Inexperienced industrial leaders
Missing entrepreneur skills
Lacking industrial imagination
Unfeasible industrial images
Insufficient development brokers
Unregulated entrepreneurs
Ineffective entrepreneurship
Nature:
The general lack of indigenous leadership in the initial stages of the industrialization process may be due in part to the very newness of the factory system and its various concomitants. In addition to such initial difficulties there may be major impediments rooted in the social structure itself, in the rigidity of the social system and in the values a particular society attaches to different kinds of economic activity. In pre-industrial societies, the greater part of the population usually consists of peasant groups whose traditional outlook, closed family economy and general cultural background are not the best training ground for industrial leadership. The source of potential industrial leadership, therefore, may be limited to the numerically small upper classes. Even in this group, however, entrepreneurial ability is not purely a function of the education and wealth that its members may have, for in most cases their standards of values and ways of life do not dispose them towards industrial undertakings.
Claim:
So long as the role of businessman (whether that of merchant or that of industrial entrepreneur) is defined not as a goal that is legitimate in itself but as a means of advancement to other classes enjoying higher prestige, business may be deprived of indispensable incentives towards permanent careers and long-range undertakings. A preference for short-term commercial operations or for speculative enterprises rather than long-term industrial undertakings is common among merchants in many under-developed areas.
Counter Claim:
It is a myth that developing countries lack entrepreneurs. The entrepreneurs are different from those in developed countries: unregistered taxi and mini-bus operators, street-market traders, water vendors, money changers, informal credit brokers, growers of illegal crops, smugglers, etc.
Reduced By:
Informal sector
Problem Type:
D: Detailed problems
Date of last update
16.02.1997 – 00:00 CET
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