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“Factors affecting
entrepreneurship –
individual and
environmental factors”
– raw materials
– intermediate goods
1. Individual factor
2. Psychological factor
3. Environmental factor
4. Socio-cultural factor
Individual factors-
Psychological factors-
Independence
Challenge
Dream desire
Family background
Market opportunity
Idea driven
Profit making
Environmental factors-
A complex and varying combination of financial, institutional, cultural,
and personality factors determine the nature and degree of
entrepreneurial activity at any time. At any point of time, the
entrepreneurs derive meanings from environment prevailing at that
time and try to adapt and change the environment to suit their needs.
Political environment-
Political environment affects the entrepreneurial growth and
accelerates the process of business activity. Law and order is of high
priority, followed by government policies in regard to the promotion of
entrepreneurship, followed by incentives, encouragement and right
institutional structure will go a long way in fostering entrepreneurship.
Economic environment-
Entrepreneurial growth and development is also governed by economic
environment. It encompasses the wide spectrum of items, namely,
land, availability of raw material, skilled labor, infrastructure,
machinery, capital and so on.
Technological environment-
Technology represents the application of scientific knowledge for
practical purposes. Technological advancement has become a catalytic
agent in the promotion of entrepreneurship growth of industrial and
allied services. It creates resources and brings in cultural changes as
well as quality of life. Technological advancement continues to give
fillip to entrepreneurship in multi facet manner, affecting the life of the
entrepreneurs as well as the common man.
Legal environment-
There are various rules and regulations applicable to different groups
of industries, for various purposes. That may be regarding registration,
licensing, pollution, location, acquisition, payment of wages and labor
related laws, pollution and environmental rules, laws relating to
organization, product, patent, resource and taxes.