The Analysis of the Role of Social Capital in Risk-Taking and Entrepreneurship of Rural Youth (Case Study: Tonekabon County)

Abstract

Extended abstract 1. INTRODUCTION Rural entrepreneurship is considered as a new approach for empowerment and capacity building in rural areas in order to reduce the gap between urban-rural areas and providing economic equality, social, environmental and institutional equalities. The level and scope of the risk are associated with the large number of factors and one of the most prominent categories of them is The social capital enjoys such important role in comparison with other sorts of capital that in the absence of social capital, other sorts of capital lose their effectiveness. The present paper is an attempt to examine and explain the communicating pattern between pillars of social capital with risk taking of youth with the aim of sustainability of rural entrepreneurship in Tonekabon County. 2. THEORETICAL FRAMEWORK Entrepreneurship is a process in which the individual entrepreneur, according to his personality traits, consciously is to solve a problem and with innovative and creative spirit provides solutions, tools and/or plans and by accepting risks them tries to make them happen and finally strives to market his product and develop and underpin a new stream. Thus, rural entrepreneurs are seeking to identify new opportunities, innovation and creativity in agricultural and non-agricultural activities, land use and optimal, versatile and innovative use with the aim of rural development. Therefore, social capital is a source created in the business network or within individual network and has two basic pillars of trust and social network. In the meantime, one of the most important fundamental factors is social capital as it leads to creativity, innovative behaviors and the increase of judicious risk-taking and use of material interests. The communities that enjoy a variety of social networks and civic associations are in a much more robust situation in facing vulnerabilities and the disputes and can better control their risk sources. 3. METHODOLOGY The present study is applied and developmental in terms of purpose, descriptive-analytical in terms of the nature, and correlational in terms of type of research. The data was collected using documents and field studies. The instrument used in this study was a questionnaire survey. The validity of the instrument was assessed with the help of 15 experts and specialists in the field of planning and rural development in the area under question. The reliability of test was achieved using the factor analysis (K.M.O = 0.812) that confirms the high reliability of the tool. With utilizing Cochran formula and confidence coefficient of 95 percent the sample size of 365 young persons in rural was determined and the amount of Bartlett's test, i.e. 951.689, verified that the sample size was sufficient to conduct research and analysis. Samples of the study were selected using multistage cluster sampling and randomly from District, Rural District (or Dehestan) and Hamlet (or Abadi), respectively. Descriptive statistics were provided using SPSS software and the final analysis was conducted utilizing path analysis in LISREL8.5 software. 4. DISCUSSION Previous theories and researches suggest that one of the influencing factors in the risk taking of entrepreneurs is social capital. This paper strived to analyze and explain the impact of social capital indicators on risk-taking of rural youth in Tonekabon County to establish and develop entrepreneurship. The results of path analysis with the coefficient of 48 percent have shown that to some extent the risk-taking of the rural youth in the region is effected by social capital and also the elements of social capital not only have direct impact on the risk-taking, they have also indirect impact. In terms of efficacy, it can also be said that elements of social capital enjoy positive effects on the risk-taking of rural youth. Among the above-mentioned elements, the highest level of (direct and indirect) impact was related to Partnership with 0.22. Subsequently, there are Social trust with the 0.195, Place Attachment with 0.106 and solidarity and social bond with 0.10, respectively. 5. CONCLUSION The result confirms the fact that the greater the amount of social capital leads to more tendency towards entrepreneurship and risk-taking. As a result, communities with higher social capital can cause flourishing of new ideas in people with having positive impact on the transfer of information and this new idea leads to creativity and consequently higher risk-taking and entrepreneurship of the society. Besides, social capital reduces costs, improves information flow, increases confidence, stability and consistency in order to achieve common goals.