The Displaced, Uncomfortable Entrepreneur

Abstract

Given that personal initiative and enterprise are taken for granted in the United States, it is surprising that - as of 1975 - only 350,000 to 500,000 individuals per year actually start a new company. This study discusses the conditions and the kinds of personalities associated with people who become entrepreneurs, in contrast to others with the same education and opportunities who do not. The research finds that most entrepreneurs are DPs, displaced persons, who have been dislodged from a comfortable, safe situation. Some are literal DPs, such as political refugees, but most common are people fired from their jobs, or deprived of an opportunity to advance in their jobs. Another factor impacting entrepreneurial behavior is the perception that the individual has no future, or does not want to do her or his current job for the rest of her or his life. This tends to occur when individuals near the age of 40 or 50. Two categories of people are identified, who differ in terms of locus of control, i.e. the degree to which people feel they can affect the world around them. Some people are "external" and believe that their success is mostly impacted by outside forces, while others are "internal" and believe in their own influence on the course of events, which tends to help in entrepreneurial success. Other entrepreneurial conditions and characteristics identified by the study are: a need for independence; being able to imagine oneself in the role of an entrepreneur; having examples around of others who resemble one and have started businesses; and coming from an ethnic group that has traditionally been associated with entrepreneurial success. Apart from all those, having the necessary resources such as labor, materials, and facilities, is a necessary element. The analysis concludes by listing certain tactics for creating more entrepreneurs -- e.g., acquiring knowledge of conditions that induce potential entrepreneurs to take action, and using this knowledge to make new towns and regions more entrepreneurially active; and demonstrating to individuals that they do have internal control. (AT)

Keywords: Background (biographical), Behavior (individual), Psychological traits, Displaced workers, Locus of control, Motivation, Individual traits