The Impact Of Social Relations On Family Entrepreneurship From The Perspective Of Labor Factor Market Distortion

Promoting entrepreneurship and innovation is an inevitable choice for cultivating the engine of socio-economic development.Family entrepreneurship is not only affected by regional economic foundation and institutional environment,but also by informal institutions such as social capital.Studies have shown that social capital is a unique path to realizing entrepreneurship for Chinese households.Meanwhile,family entrepreneurship decisionmaking is closely related to the labor factor market.In the process of China’s gradual reform,the negative distortion of the labor factor market has become increasingly severe.Therefore,under the current situation of negatively distorted labor factor market prevailing in China,it is of great significance to study the role of social relations on the promotion of family entrepreneurship.From the perspective of labor factor market distortions,this paper studies the influence of social relations on the entrepreneurial decision-making of Chinese households.Based on data from the China Family Panel Studies in 2018,using the expenditure of family hospitality gift to measure family social relationship,this paper analyzes the relationship between social relationship and family entrepreneurship using Probit regression analysis,and finds that: First,social relations significantly promote family entrepreneurship.Second,by measuring the level of market distortion of labor factors in different regions of China,this paper finds that the promotion effect of social relations on family entrepreneurship is significantly enhanced in regions with relatively more severe market distortion.Thirdly,this paper divides family entrepreneurship into opportunistic and survival entrepreneurship according to entrepreneurial motivations.Results show that the labor factor market distortion strengthens the role of social relations in promoting the opportunistic entrepreneurship,but not affect that in the survival entrepreneurship.The conclusion of this paper shows that in the current stage of the new economic normal when the market mechanism is not complete,social relations as informal institutions play a beneficial and complementary role to the formal institutions,jointly promoting the development of family entrepreneurship.Based on the findings,this paper proposes relevant policy suggestions for guiding entrepreneurship development,including promoting building social relations between families and shaping the social environment for the development of social capital,so as to encourage families to start their own businesses and focus on the development of opportunistic entrepreneurship.