There are many factors leading a person to become an entrepreneur combined into "internal and external factors (pull and push)" playing a dominants role.
One view that some people are pulled into self-employment by the promise of independence, flexibility and the allure of success.
While others are pulled into self-employment by retrenchments, lack of job opportunities, family reasons and barriers in the labor market.
Psychological factors.
The most prominent of these are the need for >>>achievement, internal locus of control, risk taking propensity and innovation. Some people are endowed with a deep need for success. This kind of people will want to have a new life through their personal responsibility for finding solutions to problems which finally benefits them and nation at large. They choose more risky alternatives (risk-taking propensity), whether low, moderate or high to start entrepreneurial activities.
Sociological factors.
These influence a person after he/she has made interaction with a society. Sociologists believe tat an individual who does not belong to a particular group/tribe, he/she lives is likely to be an entrepreneur since that person is free from the restrictions of that society.
e.g. Some society regards some jobs as pity and curse although they pay or orient someone to entrepreneurship.
Once someone leaves his/her own society, therefore is able to do things unconventionally including starting entrepreneurial activities.
Children who grow up in families engaging in business are more likely to start their own businesses or entrepreneurial activities than others. Parents and other outstanding people around them serve as role models to their children and other relatives. Such business life orients them to the world of business as they grow up.
Socioeconomic factors.
These includes education and management experience, those who study entrepreneurship are likely to start their own businesses than those who don't. Education itself is a powerful socializing experience and can contribute immensely towards shaping attitudes, knowledge and skills that lead an individual to successful conceive, start and develop business.
It's also been observed that people with managerial experience are likely to start their own businesses and become successful. The managerial experience offers an opportunity to develop managerial competencies, confidence, networks, exposure, o business opportunities, business environment, and people's skills which are useful in starting up and running a business successfully.
People who are employed in small firms are more likely to start their own business and succeeds than those who work in large corporations or public sectors.
The reasons being;
>>>Those who intend to start their own business choose to work and learn from small business.
>>>Small business is easy to manage or supervise.
>>>They are always convinced that if the owner-manager (whom they perceive equally or less capable) can run his/her business successful, why cant them do it likewise or even better?
Environmental factors.
Here includes Access to external support, availability of employment opportunities and wage levels, availability of markets and political ideology. Most potential entrepreneurs lack the resources such as finance and assets which propels an individual to start entrepreneurial activities.
In many cases, formal earning/salaries for employees is not enough to make their living sustainable. This context creates pressure on those who are unable to sustain themselves to find an alternative means to do so with their life. In many cases, the only way for them is to engage in entrepreneurial activities.
It's also true that business feeds on markets. When there is ample demand, people are motivated to start something to respond to. This can be demonstrated by the sudden emerging of petty businesses wherever a train or a bus breakdown in any places including rural areas.
The presence of favorable political, policy and regulatory framework in forming and running business attract individual and groups of people to start and run businesses. People always get attracted by this environment as they believe to be protected by the formal system.
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