How to circumvent adversity? Refugee-entrepreneurs' resilience in the face of substantial and persistent adversity

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People face adverse events in a variety of forms. Some individuals are resilient to adverse events in that they are able to maintain positive functioning while others experience considerable disruption. In explaining heterogeneity in resilience, research has emphasized people's resource endowments and pre-adversity organizing prior to the adverse events as well as people's cognitive and behavioral responses to such events. Therefore, for most resilience studies, adversity is an event. Although it is critically important to understand resilience to these short- to medium-term adverse events, there is a need to understand resilience over an extended period. In this regard, we focus on Palestine refugees who were born in refugee camps and as adults have known nothing other than being a refugee. When it comes to substantial and persistent adversity, entrepreneurial action likely plays a central role in resilience to such adversity. To explore these relationships, we conducted an extensive data-collection effort over 15 months on refugee entrepreneurs (in refugee camps and not in camps), including 110 interviews. We find the importance of direct, indirect, and recursive relationships among actions (i.e., entrepreneurial action and integration activities), multiple identities, and resilience outcomes under conditions of substantial and persistent adversity. Furthermore, we find important differences between refugee entrepreneurs who live in refugee camps and those who live outside these camps—differences in affiliation, language use, and social capital development—which enable those refugee entrepreneurs living outside the refugee camps to achieve resilience outcomes not accessible to those living inside the camps. Overall, this study makes a number of contributions to the entrepreneurship literature. First, research has investigated resilience in terms of resources, endowments, and capabilities before an adverse event. The implicit assumptions in this research are that capabilities matter and that adversity has a beginning and subsides over time. In this study, we focus on resilience outcomes in the context of refugees facing substantial adversity over a substantial period and extend the capability argument of resilience in the following ways: (1) the “social” capability for resilience, not as an endowment but created through activities that build a social basis for resilience outcomes, (2) social integration activities are initiated and facilitated by engaging in entrepreneurial action with non-similar others, and (3) resilience outcomes help individuals both engage in integration activities and build a social capability of resilience. Therefore, in the context of substantial and persistent adversity, refugee entrepreneurs need to act in order to build (rather than simply deploy) their social capability for resilience outcomes. Second, resilience has been explored as either a process or as an outcome. In this study, we find that resilience outcomes are both a consequence and an antecedent of entrepreneurial action—a mutually dependent relationship. Specifically, we find the dimensions of resilience outcomes to include proactive problem solving, moral gains as a broader purpose in life, self-reliance, realistic optimism, and multiple sources of belonging. What is interesting is that these outcomes are also important inputs to entrepreneurial action and the resilience process. Finally, there has been an important stream of research on the role of identity in recovery from adversity. We find that refugee entrepreneurs' actions provide a basis for changing the mix of their multiple identities. Therefore, we enrich the entrepreneurship identity literature through the insight that in this persistently adverse context, the relationship between entrepreneurial action and identity is not one way and static but bidirectional and dynamic. Furthermore, over and above refugee entrepreneurs' prosocial motivation of compassion, we find a new form of prosocial motivation for entrepreneurial action—the motivation to promote solidarity: “You are not alone; we are in this together as part of a broader purpose in life.” • The motivation of entrepreneurial action in highly constrained environments. • Antecedents and consequences of entrepreneurs’ resilience outcomes in the face of substantial and persistent adversity; • The nature, management, and integration of multiple identities by refugees running a covert business; • How entrepreneurial action is a means for achieving resilience outcomes without having to address the underlying source of adversity.