Entreprenuership and Culture

Topics: Joseph Schumpeter, Entrepreneurship, Culture Pages: 6 (1714 words) Published: March 28, 2011
ShareWORLD Open University Malawi

Faculty:Faculty of Conservation, the Environment & Social Development.

Department:Department of Management.

Programme:Managing Rural and Community Development


Course Code:EPS 302

Assignment no 2:Discuss the impact of culture on entrepreneurial activities in Malawi.

Submitted to:Mr. O. Soko (Lecturer)

From:Frank Charles Kasonga
BSc (Managing Rural & Community Development year 3)

Intake:January-Blantyre Campus

Due Date:25th March 2011

Date Submitted:25th March 2011


Societies vary in their ability to create and sustain entrepreneurial activity (Carter & Wilton, 2006; Price 2002). While various explanations have been offered to account for these societal differences, an ever-growing body of literature posits that cultural attributes are one of the primary determinants of a nation's level of economic (Porter, 1990) and entrepreneurial development (Hisrish 2009). National culture impacts levels of entrepreneurship both through the cultural values that are part of that society (Hofstede, 1980) and through the institutions that are representative of that culture (Ahlstrom & Bruton, 2002; Dickson, 2004). Malawi being a multi cultural country has experienced different effects of culture on the development of entrepreneurial activities. In order to more fully understand the relationship between culture and entrepreneurial activities, this paper examines the impact of culture on entrepreneurial activities.

According to Hoselitz (1952) entrepreneurship involved uncertainty bearing, coordination of productive resources, introduction of innovations and the provision of capital. In the 20th century, economist Joseph Schumpeter (1883-1950) focused on how the entrepreneur's drive for innovation and improvement creates upheaval and change. Schumpeter viewed entrepreneurship as a force of "creative destruction." The entrepreneur carries out "new combinations," thereby helping render old industries obsolete. Established ways of doing business are destroyed by the creation of new and better ways to do them. We can therefore safely conclude that entrepreneurship activities include the art of creativity also known as innovations, ability to organise resources, and above all uncertainty bearing (Hisrich 2009) . The will to venture into business with belief because you do not know the outcomes is what distinguishes successful entrepreneurs to unsuccessful ones. The fact remains that this ability is not inherent but rather it is shaped by culture hence different cultural backgrounds have different impact on people’s ability to engage into entrepreneurship.

Hofstede defines culture as "the collective programming of the mind which distinguishes the members of one group or category of people from another"(1991). The mental programming referred to by Hofstede consists of shared values, beliefs and norms. These mental constructs influence how people socialized within a particular culture perceive events; they also help to determine what behaviours are considered appropriate or inappropriate in various social situations. Since the mental programming is shared, i.e. developed through years of socialization within a culture, it results in relatively predictable responses to commonly experienced social situations or contexts. These characteristic patterns of behaviour create differences between cultures that may be observed and the influence of cultural differences on social processes such as entrepreneurship may be predicted if the underlying social values and norms are known. Hofstede’s definition and observation anchors very well with the Malawian context in which we have different cultural values that program and shape people differently. In Malawi cultural differences are the result of regional, ethnic, social class, religious, gender, and language variations. Values are held to be a...
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