Varieties of necessity entrepreneurship—new insights from sub-Saharan Africa
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Peer-reviewed
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Abstract
Necessity entrepreneurship (NE) describes the process of venturing a business out of need when alternative options are seemingly absent. Whereas prior research typically understands NE to be a homogenous construct, recent theorizing suggests the possibility of NE heterogeneity. In this paper we employ Sen’s capability approach to elicit NE variety. Using data gathered from 820 households in rural Tanzania, our cluster analysis generates four distinct types of NE that vary significantly regarding their entrepreneurial activities, determinants and outcomes. Our findings demonstrate the relevance of life satisfaction and reveal the role of choice in NE. Our study thereby advances a nuanced perspective of NE.
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Keywords
necessity entrepreneurship, tanzania, resource endowments, life satisfaction, capability approach, cluster analysis, endogenous switching regression
Journal Title
Entrepreneurship: Theory and Practice
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1042-2587
1540-6520
1540-6520
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Publisher
Wiley