Social factors can go a long way in promoting entrepreneurship. It was a very supportive community that actually turned the Industrial Revolution into a massive success in Europe. It can severely impact entrepreneurial behavior that contributes to the growth of entrepreneurship. The social structure in which people develop is shaped by their basic beliefs, values, and norms. The key elements of the social environment are:
1. Cultural Value:
Objectives Motivate Men to Action Entrepreneurship development requires proper objectives such as profitability and social status. Ambitious and capable men take risks and innovate if these objectives are strong. The strength of these objectives depends on the culture of the community. Entrepreneurs will be appreciated if the culture is economically or financially; Wealth accumulation will be appreciated. In less developed countries, people are not economically motivated.
Cash incentives have a relatively low attraction. There is ample opportunity for people to achieve social diversity through non-economic motives. Men with organizational skills, therefore, are not drawn to business. They use their talents to the economic end.
Education helps one to understand the outside world and has the basic knowledge and skills to deal with everyday problems. In any society, the educational system has an important role in promoting entrepreneurial values.
In India, the pre-20th century education system is based on religion. In this rigid setting, critical and questioning approaches to society were encouraged. Such education reinforced the caste system and the resulting industry. It promoted the idea that business was not a respected profession. Then, when the British came to India, they introduced an education system, to create writers and accountants for the East India Company, the basis of such an organization, as you can see, very anti-entrepreneurial.
India’s educational systems have not changed much today. The importance of keeping students on their feet, rather than their ability to stand up for the standard job.
3. Family Background:
This factor includes the size of the family, the type of family and the economic status of the family. A study by Hatimani revealed that the Zamindar family had access to political power and the emergence of high-level entrepreneurs.
A family background in manufacturing provided a source of industrial entrepreneurship. The family’s career and social status influenced the movement. There are some situations where very few people need to be brave. For example, in a community where the joint family organization is practiced, joint family members who gain wealth through their hard work are denied the opportunity to enjoy the fruits of their labor because they have to share their wealth with other members of the family.
4. Caste factor:
Every community has certain cultural practices and values that affect the actions of individuals. These practices and values have evolved over hundreds of years. For example, consider the caste system of the Hindus in India. It divides people into four categories based on caste. Brahmin (priest), Kshatriya (warrior), Vaishya (business) and Shudra (artisan): it also limits the social mobility of individuals.
The social mobility means freedom from one caste to another. The caste system does not allow a person born in a sutra to go to a higher caste. Thus, the commercial activities were the monopoly of the Vaishyas. While India has extensive trade relations with many foreign countries, members of the other three Hindu Varnas are not interested in trade. The dominance of certain ethnic groups in entrepreneurship is a global phenomenon.
5. Community attitude:
Related to this is the community’s attitude toward entrepreneurship. Some communities promote innovation and innovation, thus recognizing rewards such as entrepreneurial activities and profits. Still, others do not tolerate change, and under such circumstances, entrepreneurs cannot take root. Similarly, some communities have an inherent hatred for any money-making activity.
In Russia, in the nineteenth century, it was said that the upper classes did not want entrepreneurs. For them, cultivating the land means a better life. They believed that land belonged to God and that the produce of the land was nothing but God’s blessing. They went with the message that it is not right to earn.