Subsistence Entrepreneurs Research Articles

Entrepreneurial competencies influence subjective well-being of subsistence entrepreneurs: Examining the mediating role of business performance

ABSTRACT This article examines whether entrepreneurial competencies increase the subjective well-being of subsistence entrepreneurs. We anchor our study in the theoretical context of the theory of entrepreneurial competency and the capabilities lens combined with a resource-based view. We hypothesize that the business performance of subsistence enterprises mediates the impact of entrepreneurial competencies on the subjective well-being of subsistence entrepreneurs. We collected data from 1,346 subsistence entrepreneurs in India and analyzed it using PLS-SEM. Our results indicate that entrepreneurial competencies positively impact the business performance and subjective well-being of subsistence entrepreneurs. While nonfinancial performance mediates the relationship between entrepreneurial competencies and subjective well-being for subsistence entrepreneurs, financial performance does not. Further, the direct effect of entrepreneurial competencies on subjective well-being is significantly higher for male entrepreneurs, and the mediation effect through nonfinancial performance is significantly higher for female entrepreneurs. Our study contributes to subsistence entrepreneurship literature and has implications for policymakers.

Entrepreneurial Success Model: Evidence from Bagmati Province in Nepal

Entrepreneurial Success Model: Evidence from Bagmati Province in Nepal

DIGITAL PAYMENT PLATFORMS AND SUBSISTENCE ENTREPRENEURS: CHAMPIONING BEYOND THE PANDEMIC

ABSTRACT The COVID-19 pandemic brought forth many restrictions and changes in the lifestyle of people across the globe. There was a need for social distancing and contactless exchanges, which accelerated the uptake of services such as digital payment platforms (DPP). In this study, we examine how the adoption of these DPPs was accelerated during the pandemic. Our focus is subsistence entrepreneurs (SEs) who suffer double jeopardy of resource scarcity as well as institutional voids that hinder their technology adoption. We use the exploratory approach to delve into this under-studied area in IS research using constructivist grounded theory. Using data from the in-depth interviews of these subsistence entrepreneurs, we develop a framework of a process that entails not only adoption and persistent use but also the mechanisms for the spread of this technology amongst a section of society that is characterized by poverty, illiteracy, and socio-economic barriers.

Drivers, Barriers, and Facilitators of Entrepreneurship at BoP: Review, Conceptual Framework and Research Agenda

The extant review studies on the Base/bottom of the Pyramid (BoP) have paid inadequate attention to the producer and entrepreneur roles of the poor. This review article exclusively focused on BoP producers and subsistence entrepreneurs provides an overview of the current state of research on BoP producers and subsistence entrepreneurs. It encompasses 130 articles from 67 peer-reviewed academic journals and develops an organizing framework for classifying these articles. The conceptual model of entrepreneurship in poverty contexts presented in this article illustrates the drivers, barriers, facilitators and consequences of subsistence entrepreneurship. The conceptual model helps to highlight the relevance of contextually informed public support and advocates adopting a collaborative approach for addressing various challenges faced by BoP producers. We also discuss the implications of our article and provide directions for future research.

Subsistence small business entrepreneurs in Pakistan

ABSTRACT Subsistence small business entrepreneurs operate to fulfil the necessities of life but do so on a smaller scale with fewer resources and capital. In this paper, we will explore the domains of entrepreneurial ecosystems in Pakistan, to understand the support needed for subsistence entrepreneurs. Following a qualitative research approach, data are collected through in-depth interviews with subsistence entrepreneurs in Pakistan. This involves developing a systematic structure of knowledge sharing among other subsistence entrepreneurs in the community. We find that all entrepreneurs share their experience and knowledge with each other. This means that the concept of competition does not resonate in their setting; rather, the entrepreneurs use their personal knowledge augmentation to contribute to their community. This paper offers insights that contribute to the subsistence market of Pakistan and the future potential of entrepreneurs in the country.

Are Chinese Entrepreneurs Happier than Employees? Evidence Based on a National Workforce Survey in China.

Most studies consider entrepreneurship in Chinese a happier career choice, while the adverse effects of entrepreneurship on wellbeing have been overlooked. In this research, the effect of career choice on job-related wellbeing is explored using multiple indicators. Differences in the career choices of employees and entrepreneurs are examined in the first section of the study, and the motives for entrepreneurship are studied in the second section. Job-related wellbeing is regarded as consisting of job satisfaction, subjective wellbeing, and physical wellbeing. The data were obtained using the Chinese Labor-Force Dynamic Survey, and the sample consisted of 6108 employees and 2075 entrepreneurs from 29 provinces and cities in China. T-test, chi square test, and ordinal logistic regression were conducted. The analysis in the first section reveals significant differences in job-related wellbeing between employees and entrepreneurs along with differences in autonomy and perceived equity. Entrepreneurs are found to be less satisfied and unhappier than employees. The heterogeneity of the motives for entrepreneurship is highlighted in the second part, and its significant role in the wellbeing of entrepreneurs is explored. Subsistence entrepreneurs have been found to constitute up to 64% of all entrepreneurs. Subsistence entrepreneurship is negatively associated with job satisfaction and subjective wellbeing.

Consumer well‐being and social responsibility of subsistence entrepreneurs in subsistence marketplace

AbstractBusiness malpractices, such as the sale of overpriced, underweight and adulterated foodstuffs and essential commodities, can pose serious threats to subsistence consumers' wellbeing, given they are more vulnerable than their affluent counterparts. Drawing on 40 interviews with subsistence entrepreneurs in Bangladesh and Sri Lanka, our findings provide insights into the interplay between religiosity and social responsibility of entrepreneurs. We further explore how socio‐economic conditions and local embeddedness—two important characteristics of individuals in subsistence marketplaces—moderate the relationship between religiosity and social responsibility of entrepreneurs, providing implications for consumer welfare at the macro‐level. Our research makes a distinctive contribution to three streams of literature relating to social responsibility, subsistence marketplaces, and consumer affairs, with specific policy implications.

Training effects on subsistence entrepreneurs’ hope and goal attainment

Purpose The purpose of this paper is to explore the extent to which hope and perceived goal attainment can be developed in subsistence entrepreneurs through the right training tools. Design/methodology/approach A longitudinal study of a subsistence entrepreneurship training program in three Central American countries was carried out. Participants were divided on the basis of their exposure to training (yes, no), and of the type of training received (none, business plan, business model). The authors carried out three assessments (just before the program, six months and one year after the program) of participants’ business goals and their hope of attaining them. Information was analyzed using linear regression. Findings Participants exposed to training reported significant increases in perceived goal attainment and in their hope levels. Training based on the business plan affected hope agency in the short term, as predicted by the logic of causation theory. Training based on the business canvas affected hope pathways, as predicted by the logic of effectuation theory. Research limitations/implications Given the data collection process (a non-random sample and selection of participants), the findings are not generalizable without stringent procedures and further replication. Practical implications If hope is a reliable predictor of goal attainment, it should be promoted and measured. Given the limited means of gathering data and making reliable projections that most entrepreneurs endure, the business canvas’ contribution to entrepreneurs’ “emotional equipment” ceteris paribus should be more valuable for subsistence entrepreneurs. Originality/value This is the first study comparing the short- and long-term effects of two entrepreneurial learning devices on entrepreneurs’ hope and business goal attainment.

Performance and environmental sustainability orientations in the informal economy of a least developed country

Purpose The purpose of this paper is to investigate the extent to which performance and environmental sustainability orientations (ESOs) are developed, as well as their association, in a typical impoverished community: the informal economy of an African least developed country (LDC). Design/methodology/approach Based on a literature review and a pre-study on the spot, a questionnaire was developed before being completed by 140 informal food vendors – that is, “subsistence entrepreneurs” – in Tanzania. t-Tests, correlation analyses and regression analyses were carried out to approach the formulated hypotheses. Findings The results showed that a significant distinction can be made between basic and advanced performance. In addition, the respondents showed significantly higher levels of awareness of ESO practices that are intangible and are not fully within their control than the so-called personal tangible ESO practices. However, performance was minimally affected by ESOs. Originality/value While firm performance and environmental sustainability have been shortlisted on agendas outside academia (e.g. international development organisations) as a means to develop LDCs, the scientific community is lagging behind with regard to these two. This paper is one step forward in unravelling how performance and ESOs occur in LDCs.

Living the African Dream: How Subsistence Entrepreneurs Move to Middle-Class Consumer Markets in Developing and Emerging Countries

The subsistence marketplaces literature has generated many insights on how the marketplaces of the poor function. One important issue that has remained understudied is how microentrepreneurs who start their career in poverty manage to break the status quo of subsistence marketplaces and obtain a stable position in the middle classes of developing and emerging countries. This article therefore investigates the business trajectories of entrepreneurs who have entered middle-class markets. The study shows that business development from lower-income to middle-class consumer markets is a stepwise process. Microentrepreneurs begin by serving relatives and acquaintances from their homes, then serve customers that they meet out on the street, and then upgrade their value propositions to target middle-class customers. Some of them further increase their businesses by entering business markets. From a strategic marketing perspective, the authors analyze the changes in resources and stakeholders that underlie the upgrades of the value propositions. The results provide implications for policy makers to create new jobs, generate tax revenues by formalizing businesses, and foster social mobility in emerging markets.

Digital subsistence entrepreneurs on Facebook

Digital entrepreneurs are usually presented as young, urban, well-educated individuals working for innovative start-ups. In sharp contrast with this “hipster” view, this research identifies digital subsistence entrepreneurs as a new type of entrepreneurs that recently appeared in developed countries. To do so, it investigates buy-and-sell activities on Facebook groups using a multi-method approach involving in-depth interviews, netnography, and participatory observation. The findings indicate that digital subsistence entrepreneurs' activities pertain to survival entrepreneurship rather than transformative entrepreneurship. Nonetheless, they satisfy more than purely financial needs, also providing hedonic (spending time with family, creating), relational (meeting new people) and symbolic benefits (raising self-esteem, redefining roles at home and in society). This research also shows that subsistence entrepreneurs' rebirth in developed countries is founded on the structural, cognitive and relational forms of social capital that are grounded in peer-to-peer platforms digital features. It thus offers interesting contributions and implications for public policy makers engaged in the regulation of the sharing economy.

Satisfaction level and competitiveness in subsistence small businesses

PurposeSubsistence small businesses (SSBs) do not seek the maximum benefit; they only seek a benefit that enough satisfies their basic needs. In consequence, a dual behaviour of companies is expected and possibly the competitiveness of these companies is different. The purpose of this paper is to study the dual behaviour of SSBs and the differences about their competitive advantages.Design/methodology/approachData were obtained by conducting surveys with owners and managers of wood processing companies located in a region of Misiones (Argentina). The results were checked by interviews in 2012 and 2015. The research uses principal component analysis and K-means to classify the different behaviour and MANOVA analysis to study the relationships.FindingsThe findings suggest two types of SSBs and show that competitive advantages are different into two groups of companies.Research limitations/implicationsThe data used refer to a certain period of time, with interviews in next periods. Sample is in a particular region and sector and generalisations should be done carefully. The variables are measured with subjective questions.Practical implicationsThe findings suggest instruments to change the strategy of unsatisfied SSBs to grow.Social implicationsThe growth of SSBs is very important in poorest areas. The paper suggest governments’ politics that facilitate a stable environment for improving competitiveness of SSBs.Originality/valueSSBs are very important in developing countries, but they are not sufficiently studied. The research shows the importance of satisfying principle in the competitiveness of subsistence entrepreneurs.

Business models sustaining subsistence economies: evidence from India

PurposeThe purpose of this paper is to analyse interventions of various forms of organisations operating with the objective of connecting subsistence entrepreneurs (SEs) with the formal economy. This work also attempts to understand and analyse the transformational role played by these organisations. Finally, the paper aims to arrive at a conceptual framework for organisations interested in playing a transformational role.Design/methodology/approachThe paper deals with subsistence entrepreneurship and business models for subsistence economies. It draws from case studies of six organisations operating with the objective to connect subsistence entrepreneurs with formal economy. Each case chosen is unique with respect to the organisational form it takes to achieve the objective. However, a lot of similarity can be seen in the components of the business model adopted by these organisations.FindingsOrganisations which emerge keeping the context of rural producers in mind survive and support SEs in the long run. SEs need not always get converted into transformational entrepreneurs. However, with the help of organisations which collectivise SEs, they can interact with formal economy. Such organisations help large numbers of SEs to sustain and possibly move out of subsistence status over a period of time. These organisations have to fill the voids left by government or market institutions so as to create enabling conditions for SEs to thrive. Despite the efforts of the organisations, it is not possible for all SEs to move out of their subsistence status and existence in informal markets. However, it is possible in case of some SEs at least, as the institutional support gives them more certainty in incomes.Research limitations/ implicationsThe paper does not take a business model adopted by government institution for the purpose of analysis.Practical implicationsThe paper offers practical suggestions for organisations interested in collectivising SEs with the aim to improve their returns from market transactions.Originality/valueThe paper offers a conceptual framework to enrich the understanding of role played by organisations working towards collectivising SEs. It adds to the debate of subsistence entrepreneurship and transformational entrepreneurship. It elaborates the elements of social capital created by these organisations at the meso level. Finally, it re-emphasises the strengths of informal economy to support the customer value proposition for formal markets.

The Performance of Subsistence Entrepreneurs in Tanzania’s Informal Economy

Many scholars have found difficulties with the applicability of Western entrepreneurship typologies in non-Western contexts. Hence, this paper takes a step back by revealing what does apply as opposed to what does not apply. First, this paper investigates what the performance of entrepreneurs in Tanzania's informal economy consists of. Second, it examines which demographic and social factors predict that performance. Based on a literature review and a pre-study, a main study with questionnaires was completed by 152 informal food vendors —that is, subsistence entrepreneurs, in southern Tanzania. Next, correlation, factor, reliability and regression analyses were performed to test the hypotheses. Based on a factor analysis, a distinction is made between basic performance and advanced performance. The results show that advanced performance is positively influenced by experience and age; but other factors, such as the entrepreneur's gender, education and support from family, have no effect.

THE PERFORMANCE OF SUBSISTENCE ENTREPRENEURS IN TANZANIA’S INFORMAL ECONOMY

Many scholars have found difficulties with the applicability of Western entrepreneurship typologies in non-Western contexts. Hence, this paper “takes a step back” by revealing what does apply as opposed to what does not apply. First, this paper investigates what the performance of subsistence entrepreneurs in Tanzania’s informal economy consists of. Second, it examines which demographic and social factors predict that performance. Based on a literature review and a pre-study, a main study with questionnaires was completed by 152 informal food vendors — that is, “subsistence entrepreneurs”, in southern Tanzania. Next, correlation, factor, reliability and regression analyses were performed to test the hypotheses. Based on a factor analysis, a distinction is made between basic performance and advanced performance. The results show that advanced performance is positively influenced by experience and age; but other factors, such as the subsistence entrepreneur’s gender, education and support from family, have no effect.

Does one size fit all? A look at entrepreneurial motivation and entrepreneurial orientation in the informal economy of Tanzania

Purpose The purpose of this paper is to investigate the impact of entrepreneurial motivation and entrepreneurial orientation in Tanzania’s informal economy. The development of personal wealth is used to measure the performance of subsistence entrepreneurs in the mama lishe sector. Design/methodology/approach On the basis of a literature review and a qualitative pre-study involving 27 interviewees, a questionnaire was completed by 152 subsistence entrepreneurs who are known as the mama lishe. Subsequently, a correlation analysis, a factor analysis, and regression analyses were performed to test the hypotheses. Findings On the basis of a factor analysis, a distinction is made between the development of basic personal wealth and the development of advanced personal wealth. Entrepreneurial motivation and entrepreneurial orientation, as constructed by studies in western countries, have little effect on both forms of personal wealth. Instead, the owner’s age, as an indicator of entrepreneurial experience, is a relatively strong predictor for the development of personal wealth. Originality/value By examining the determinants of the performance of subsistence entrepreneurs in an African least developed country (LDC), this study shows that the western definitions of entrepreneurial motivation and entrepreneurial orientation are not directly applicable in this context. By using performance measures such as the development of personal wealth, this study supports the perspective that entrepreneurs in the informal economy of an LDC operate under a different paradigm than their counterparts in the industrialized nations of the west. Accordingly, it is concluded that one size does not fit all.

Supporting self-employment and small-scale entrepreneurship: potential programs to improve livelihoods for vulnerable workers

AbstractThis paper provides a review of the profiles of the subsistence entrepreneurs and their constraints, and the landscape of current entrepreneurship programs and the evidence on impacts, and discusses the potential role of public policies for the livelihoods of subsistence entrepreneurs. Worldwide over a half of workers are self-employed, but a significant fraction of these self-employed jobs are of low productivity subsistence entrepreneurs. The focus of the entrepreneurship programs to support these self-employed in poverty is to improve their livelihoods rather than promoting cutting-edge innovation and business growth. Evidence of successful programs is limited and program designs often seem ill suited to the needs and characteristics of these subsistence entrepreneurs. Given the market failures faced by subsistence entrepreneurs, interventions that complement safety net programs with well-targeted support to promote productive self-employment may hold some promise.Jel codes: O12, O16, J24

The Contextual Value of Social Capital for Subsistence Entrepreneur Mobility

Close-knit relationships are a distinctive facet of subsistence living, in which survival mode entrepreneurship is a way of life. These relationships fuel “bonding social capital” within informal economies as people rely on others to work, consume, and cope with scarce resources. At the same time, policy agendas encourage business growth and social mobility by shifting informal microenterprises into the formal economy. However, success in formalized contexts requires a different form of social capital—that is, “bridging social capital” with people outside one's immediate social network and across institutional structures. Yet policy programs often stop short of addressing how subsistence entrepreneurs manage the inherent tensions across these forms of social capital. As such, this study unpacks the contextual value of social capital using data collected with street vendors in an urban Latin American setting. The analysis identifies four entrepreneurial paths pursued by street vendors and articulates the relative value of bonding and bridging social capital across different economic and social positions. The findings advance insights for a community-centric public policy approach and offer guidance for segmentation and value proposition development within subsistence entrepreneurship programs.

Transformative Subsistence Entrepreneurship

There are millions of “subsistence” entrepreneurs around the world, located primarily in developing countries, engaging in micro enterprise to eke out a survival living when other labor market options become unavailable. However, the vast majority of them are trapped in a “survival and maintenance” cycle. This article focuses on a phenomenon involving a subset of subsistence entrepreneurs who do manage to thrive and grow their enterprise. We label the phenomenon “transformative subsistence entrepreneurship,” reflecting (1) significant positive change in their personal, social and economic well-being, and (2) significant positive influence on their immediate communities. Drawing on 18 in-depth qualitative interviews, we show how the phenomenon plays out and how transformative subsistence entrepreneurs carry out vital marketing activities in their local exchange contexts, rising above substantial life challenges and end up improving the economic capacities of their communities as well. We contend that the contributions of a network of such transformative subsistence entrepreneurs, each seen at a micro enterprise level of analysis, can accumulate and coalesce to emerge as the backbone of the informal economy at a macroeconomic level.

Subsistence Entrepreneurship, Value Creation, and Community Exchange Systems

We study subsistence entrepreneurship, defined as entrepreneurial actions undertaken by individuals living in poverty. Subsistence entrepreneurs are important elements of the global economy. By virtue of being poor themselves and co-locating in the same community as their customers living in poverty, subsistence entrepreneurs create value for their customers more effectively than outside entities. We suggest that this marketing exchange (micro-level phenomenon) leads to the building of a community-level exchange system that is unique and inimitable (meso-level phenomenon). Viewing through the theoretical lens of social capital, we develop insights gleaned from qualitative interviews with subsistence entrepreneurs. Community marketing systems that arise out of micro-level interactions between subsistence entrepreneurs and their customers form the glue holding the so-called “informal economy” together in subsistence economies.