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Middle-Class Entrepreneurship and the Effect of Social Capital

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  • Ordeñana, Xavier
  • Arteaga, Elizabeth

Abstract

This paper surveys Ecuadorian entrepreneurs to ascertain the differences between middle-class and upper-class entrepreneurs and identify the variables associated with the "success" of a business. The paper also explores the variables that can determine the probability of upward intergenerational mobility. The paper finds that, although the level of social capital among Ecuadorian entrepreneurs is weak, it positively affects the chances of being a dynamic entrepreneur.

Suggested Citation

  • Ordeñana, Xavier & Arteaga, Elizabeth, 2012. "Middle-Class Entrepreneurship and the Effect of Social Capital," IDB Publications (Working Papers) 4037, Inter-American Development Bank.
    • Handle: RePEc:idb:brikps:4037
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    References listed on IDEAS

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    1. Zoltan Acs & José Amorós, 2008. "Entrepreneurship and competitiveness dynamics in Latin America," Small Business Economics, Springer, vol. 31(3), pages 305-322, October.
    2. Acemoglu, Daron & Zilibotti, Fabrizio, 1997. "Was Prometheus Unbound by Chance? Risk, Diversification, and Growth," Journal of Political Economy, University of Chicago Press, vol. 105(4), pages 709-751, August.
    3. Bratkovic, Tina & Antoncic, Bostjan & Ruzzier, Mitja, 2009. "Strategic utilization of entrepreneur's resource-based social capital and small firm growth," Journal of Management & Organization, Cambridge University Press, vol. 15(4), pages 486-499, September.
    4. Xavier Ordeñana & Ramon Villa, 2012. "Mobility and Entrepreneurship in Ecuador: A Pseudo-Panel Approach," Research Department Publications 4783, Inter-American Development Bank, Research Department.
    5. Easterly, William, 2001. "The Middle Class Consensus and Economic Development," Journal of Economic Growth, Springer, vol. 6(4), pages 317-335, December.
    6. Matthias Doepke & Fabrizio Zilibotti, 2005. "Social Class and the Spirit of Capitalism," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 516-524, 04/05.
    7. Franco, Rolando & Hopenhayn, Martín & León B., Arturo, 2011. "Crece y cambia la clase media en América Latina: una puesta al día," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), April.
    8. Xavier Ordeñana & Ramón Villa, 2012. "Mobility and Entrepreneurship in Ecuador: A Pseudo-Panel Approach," IDB Publications (Working Papers) 73898, Inter-American Development Bank.
    9. Scott Shane, 2009. "Why encouraging more people to become entrepreneurs is bad public policy," Small Business Economics, Springer, vol. 33(2), pages 141-149, August.
    10. Jose Cuesta & Hugo Ñopo & Georgina Pizzolitto, 2011. "Using Pseudo‐Panels To Measure Income Mobility In Latin America," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 57(2), pages 224-246, June.
    11. Unger, Jens M. & Rauch, Andreas & Frese, Michael & Rosenbusch, Nina, 2011. "Human capital and entrepreneurial success: A meta-analytical review," Journal of Business Venturing, Elsevier, vol. 26(3), pages 341-358, May.
    12. Solimano, Andrés, 2008. "The middle class and the development process," Macroeconomía del Desarrollo 5432, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    13. Nicos Nicolaou & Scott Shane & Lynn Cherkas & Janice Hunkin & Tim D. Spector, 2008. "Is the Tendency to Engage in Entrepreneurship Genetic?," Management Science, INFORMS, vol. 54(1), pages 167-179, January.
    14. Ordeñana, Xavier & Villa, Ramón, 2012. "Mobility and Entrepreneurship in Ecuador: A Pseudo-Panel Approach," IDB Publications (Working Papers) 4027, Inter-American Development Bank.
    15. Homi Kharas, 2010. "The Emerging Middle Class in Developing Countries," OECD Development Centre Working Papers 285, OECD Publishing.
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    Citations

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    Cited by:

    1. Roxana Gutiérrez-Romero & Luciana Méndez-Errico, 2017. "Does Inequality Foster or Hinder the Growth of Entrepreneurship in the Long Run?," Research on Economic Inequality, in: Research on Economic Inequality, volume 25, pages 299-341, Emerald Group Publishing Limited.

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    More about this item

    Keywords

    Entrepreneurship; Middle classes; Social capital; income mobility; social mobility;
    All these keywords.

    JEL classification:

    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups

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