Understanding and Encouraging Entrepreneurship Internationally

By Peterson, Rein | Journal of Small Business Management, April 1988 | Go to article overview

Understanding and Encouraging Entrepreneurship Internationally


Peterson, Rein, Journal of Small Business Management


UNDERSTANDING AND ENCOURAGING ENTREPRENEURSHIP INTERNATIONALLY

Suddenly, all over the world, entrepreneurs are the good guys! Not the individuals who sit on their accumulated wealth, counting dividend checks, but those who create local jobs, commercialize technology, and build enterprises that become internationally competitive.

But entrepreneurship is proving to be as hard to transplant as its name is to spell. Even "true believers" debate about how to define it, understand it, and encourage it. As a result, in many countries, the encouragement of entrepreneurship is off to a sputtering start.(1) How much do we really understand about entrepreneurship internationally?

The Myth of Individual Action

Entrepreneurship's true believers often fail to appreciate the degree to which effective entrepreneurship is enmeshed with culture. United States ideology, which emphasizes individualism and a need for personal achievement, has dominated the conventional world view of what entrepreneurship is all about. But the cult of individualism is foreign to--and often unacceptable in--many countries of the world.

Gradually, it is becoming clear that each country/culture must develop its (1)See findings reported in Rein Peterson, Mari A. Peterson and Nancy B. Tieken, Encouraging Entrepreneurship Internationally (Dubuque, Iowa: Kendall/Hunt Publishing Co., 1988, forthcoming). Dr. Peterson is Director of Entrepreneurial Studies at York University, Toronto, Canada. This essay is based on two workshops he conducted as Paul T. Babson Professor (1985-1986) and as Senior Research Fellow, National Centre for Management Research and Development (1986-1987). own brand of entrepreneurship and raise its own champions to promote entrepreneurial behavior that fits the prevailing societal mores. Even more than national leaders and political change agents, entrepreneurs need to have a deep understanding of the socio-economic environment of which they are a part. Entrepreneurs act as boundary spanners and redefiners, and therefore need to be cultural specialists.

Much of what actually passes as U.S. individualism tends to be popular rhetoric. George C. Lodge describes two general ideological extremes--individualism and communitarianism.(2) He believes that each community and nation has over time arrived as an ideological balance that is a unique combination of the two opposing prototypes described below.

The First Prototype: Individualism . Individualism. The atomistic notion that the community is no more than the sum of the individuals in it. . Property rights. The best guarantee of individual rights lies in the sanctity of property rights. . Competition. The uses of property are best controlled by each individual proprietor competing in an open market to satisfy individual consumer decisions. (2)George C. Lodge, The New American Ideology (New York: Alfred Knopf, Inc., 1975). . Limited state. The less government the better. . Scientific specialization and fragmentation. If we attend to the parts, as experts and specialists, the whole will take care of itself.

The Second Prototype:

Communitarianism . Communitarianism. The community is more than the sum of the individuals in it; the community is organic, not atomistic. The survival and self-respect of individuals depends on the recognition of community needs. . Rights and duties of membership. These include the rights to survival, to income, to pensions, to health care. These rights supersede property rights--not only the fit have a right to survive. . Community needs. Clean air and water, safety, energy, jobs, competitive exports, etc., are more important than individual consumers' references. . Active state. An active, planning state is the arbiter of community needs. . Holism. Interdependence, as opposed to scientific specialization. The interrelatedness of all things is recognized. …

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