The major factors that influence entrepreneurship include culture, political environment, economic environment, availability of resources, and the skill set and psychological orientation of the entrepreneur.
Cultural Factors Influencing Entrepreneurship:
Culture refers to the customary practices and beliefs that have a significant impact on the basic values, perceptions, preferences, and behaviors of people.
Culture and entrepreneurship intervene in many ways:
People traditionally engaged in businesses have a pro business attitude and disdain working as employees.
Many people fall outside the establishment and remain unsuited for the traditional job market due to a strong culture of independence or other reasons.
People engaged in jobs and other services pressure their children to find secure jobs and crush their entrepreneurship spirit at a very early age.
Political Environment Influencing Entrepreneurship:
The following are some of the ways in which the political environment influences entrepreneurship:
Unstable political conditions where government policies change frequently discourage business, as investors fear for the safety of their investments.
Government support to economic development through infrastructure development, facilitation, industrial parks, and the like all encourage entrepreneurship.
High taxes that cut into the returns usually discourage entrepreneurs. On the other hand, tax holidays to encourage business attract start-ups.
Availability of Resources as a Major Factor that Affects Entrepreneurship
Capital remains indispensable to start an enterprise. The availability of capital allows the entrepreneur to bring together other factors and use them to produce goods or services.
The importance of human assets or employees can never be underestimated. No enterprise succeeds without skilled and committed workforce.
The very existence of the business depends on the availability of raw materials to process.
How Entrepreneurial Skill Sets and Psychological Orientation Affects Entrepreneurship
hard work and persistence
ability to manage and minimize risk
ability to draw up a comprehensive business plan, and having a contingency plan ready
a strong need-orientation that provides the inclination to achieve things