Can entrepreneurship be developed within deprived communities?

Posted on 6 January 2012
DylanJonesEvans

Professor Dylan Jones-Evans, Director of Enterprise and Innovation at the University of Wales Global Academy

Can entrepreneurship be developed within deprived communities?

That is the main subject of a recent paper by Professor Dylan Jones-Evans, Director of Enterprise and Innovation at the University of Wales.

Co-authored with Dr Piers Thompson of Cardiff Metropolitan University and Dr Caleb Kwong of Essex Business School, the article "Entrepreneurship in Deprived Urban communities - the case of Wales " has recently been published in the Entrepreneurship Research Journal (ERJ) from the Berkeley Electronic Press.

Utilising data from the Global Entrepreneurship Monitor (GEM) in conjunction with the Welsh Index of Multiple Deprivation (WIMD), the paper analyses the relationship between early stage entrepreneurial activity, entrepreneurial attitudes and attributes, with the different domains of deprivation.

The paper found some evidence that those living in the most deprived communities were less likely to be involved in early stage entrepreneurship although most of this could be accounted for by the individual characteristics of those living in these areas.

Professor Jones-Evans explained that a key finding is that a lack of existing businesses or public services appears to play little role in dissuading prospective entrepreneurs.

“The analysis of the data suggests that there is no need to establish a critical mass of businesses to encourage new business starts within the deprived areas of Wales, as the attraction of low competition appears to play a role in encouraging new business.

“In addition, the fact that individual characteristics of those living in these areas are important suggests that policies to help under-represented groups within these communities may be more appropriate than general business advice and support to overcome help firms grow in weaker economic conditions.”

Another key problem identified is the lack of suitable role models within deprived communities, due to a large extent by a lack of tradition of entrepreneurship.

However, according to Professor Jones-Evans, this could be overcome through appropriate policy interventions such as the provision of forums for interaction between entrepreneurs and the public. He said:

“Encouraging greater interaction between entrepreneurs and those living in deprived communities would enable individuals being to be made aware of the possibilities open to them rather than being dissuaded by the lack of economic activity present in their area.

“This could be supported by the provision of training programmes to provide general enterprise skills which would not only help develop entrepreneurs but ensure that a greater number of the population are provided with the broad range of entrepreneurial skills suitable for working in local small firms”.

A full copy of the paper is available at http://www.bepress.com/erj/vol2/iss1/2  

/ENDS

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