INSTITUTIONS AND ENTREPRENEURSHIP IN THE NORTH-EASTERN REGION OF INDIA

Abstract

Entrepreneurship activities in a country are defined by the context of its environment, while this environment is dictated by the interplay of its formal and informal institutions. This study, therefore, aims to establish an extensive review of the literature on the role of institutions on entrepreneurship activity in the North-Eastern States of India. The study further assesses the status of entrepreneurship in the region using MSMEs data from recent government reports. The study reveals that the status of entrepreneurship in the region does not reflect the dynamism of entrepreneurship happening in the rest of the country. The general reason for this is often believed as lack of capital, lack of infrastructure, networking and access to market, etc. However, these are not the only factors that hamper entrepreneurship growth and economic development in the region. Besides these factors, institutional problems hinder growth of entrepreneurship and economic development in the region. The uncertainty and risk created by Institutions have had negative impact on entrepreneurial community. Besides, potential entrepreneurs are discouraged by weak formal institutions and unsupportive informal institutions in the region. To promote entrepreneurship activity there must be congruence between formal and informal institutions