Social Capital And Entrepreneurship

Entrepreneurship plays a vital role in the growth of economic.Individual entrepreneurial behavior may be affected by many factors,such as human capital,social capital,social-economic environment.What role does social capital related to family background play in the decision-making? Based on the perspective of family background,this paper studies into the relationship between social capital and entrepreneurial behavior,focusing on the family’s entrepreneurial background and political background.Due to the resource related to the relatives’ occupation,one may receive much assistance in his entrepreneurship,including information,experience,social network,and so on,which will help to stimulate entrepreneurial interest,identify and grasp entrepreneurial opportunities,and accumulate business resources.However,given the different circumstances in the urban and rural areas,relatives working as civil servants may play different roles in different areas.Utilizing the data from China Household Income Projects(CHIP2013),this paper conducts an empirical study on the impact of social capital related to the family on entrepreneurial behavior.This paper takes the number of relatives who are entrepreneurs and government staff as explanatory variables.According to the results of the regression with the Probit model,the main conclusions are listed below.Firstly,the number of relatives who are entrepreneurs shows a positive effect on one’s entrepreneurship.Secondly,there is a difference in the impact of relatives who work as government staff between the urban and the rural,which shows a positive impact on the rural and a negative impact on the urban.Thirdly,with a further definition of entrepreneurship,which can be divided into company-building and self-employment,the two special jobs of relatives play different roles in them.When dividing the relatives by the same household,the paper finds that the relatives in the same household show a greater impact on entrepreneurship.Finally,trust and financial constraints may be the channels that the family background works on entrepreneurship.Based on the conclusions above,this paper puts forward several suggestions for guiding the development of entrepreneurship,including social environment,the exchange of information,financing and supporting,etc.,to encourage entrepreneurship and accelerate the transformation of entrepreneurial types.