Factors affecting entrepreneurial Growth

1. Economic Factors
2. Non Economic Factors

1. ECONOMIC FACTORS

a. Capital and Credit Access – Lack of availability of

capital and raising costs or limited the availability of
credit.
b. Labour – Unskilled and low productive labour
c. Raw materials – In absence of raw material no enterprise
can be established and in absence of enterprises the
entrepreneurs do not emerge.
d. Excessive and arbitrary taxation – The excessive and
arbitrary system of taxation affects enterprises.

2. NON ECONOMIC FACTORS

i. Social Factors
a. Emotional Block- Entrepreneurship involves risks,
besides financial risks, it involves emotional risk.
b. Cultural valves- cultural values prevent persons from
setting -up their own ventures in non-entrepreneurial
societies.
c. Regulatory factors and defective administrative – Entry
regulations to market, defined registration requirement,
reporting and disclosure norms act as barrier.
 d. Defective Tax Structure – High level of taxes tends to
distort economic activity and reduces profit margin.
ii. Personal factors
a. Difficulty and ambiguity- some people are very
compulsive and become upset if the order of their physical
life is violated.
b. Impatience in solving problems- Finding quick solutions
to problems prevents people from setting-up the enterprise
thus acts as a barrier to entrepreneurship.
 UNIT-II
MOTIVATION
MOTIVES INFLUENCING AN ENTREPRENEUR
The factors motivating entrepreneurs are classified
into internal and external factors
INTERNAL FACTORS
1. Desire to do something new
2. Become independent
3. Achieve what one want to have in life
4. Be recognized for one’s contribution
5. One’s educational background
6. One’s occupational background and experience in
the relevant field
EXTERNAL FACTORS
1. Government assistance and support
2. Availability of labour and raw materials
3. Encouragement from big business houses
4. Promising demand for the product
Entrepreneurs are also motivated to start business
enterprises due to the following factors
1. Ambitious factors
2. Compelling factors
3. Facilitating factors

From the above interpretations and inferences about the

motives forms six factors
1. Self-actualization
2. Nature of work
3. Autonomy and power motive
4. Status motive
5. Affiliation motive
6. Deontic(duty) motive
ACHIEVEMENT MOTIVATION
• Achievement plays an important role in making an
entrepreneur successful. Hence there is the need for
achievement motivation for developing
entrepreneurship in an economy.
• Training program is carried out in Kakinada
experiment in such a way that it could help the
trainees improve imagination and motivate them.

The Training included the following

• The individuals strived to attain concrete and
regular feedback.
• The participants sought models of achievement to
emulate.
• The participants thought of success and
accordingly set plans and goals.
• The participants were encouraged to think and talk
to themselves in a positive manner.