ENTREPRENEURSHIP

Entrepreneurship

Entrepreneurship

The Scope of Entrepreneurship

One of the earliest and best sociological treatises on modernization of a society is Sir Henry Sumner Maine's Ancient Law, published in 1861. It traces the main line of modernization as a trend “from status to contract”. In underdeveloped societies man's experience and destiny are predetermined by ascribed statuses - his birth and other events beyond his control. Tribal Africa, caste-dominated India, as well as feudal Europe are thus described as status-dominated, i.e. underdeveloped societies. These ascribed statuses determine nearly all activities and affiliations, whether religious or secular, including occupational pursuit, business associates, mate, and home, style of life, and power and influence in the larger community (Neile, 2001: 54).

The modernization of a society, according to Sir Henry, comes about as an ever increasing number of actions and life histories become dependent upon freely negotiated contracts rather than on predetermined statuses. In a developed society the individual himself can decide and negotiate his entry into a church, an occupation, a trade relation, a marriage, a neighbourhood, a political body, etc. Modernization thus means lifting restriction imposed by status and opening opportunities for negotiating contracts.

The history of the Northern Hemisphere from the time of the French and American revolutions is very much a history of the movement from status to contract. It was this movement that opened the gates for an entrepreneurship which no longer became dependent on royal privilege and permission. When the modern entrepreneur organizes production and approaches the market he enters into freely negotiated contracts with employees, suppliers, buyers, and shareholders. The right to contract is as essential to him as the air he breathes.

At present the right to contract is no longer expanding, except, perhaps, for women. The remnants of the status society in terms of sex roles have been the last to go. It is interesting to note that at a time when this last area moves from status to contract, many other areas have moved from old-type contracts to new forms.

A most important modification of contract in affluent societies has given voluntary associations the right to enter into agreements that are binding upon their members. The individual labourer and the individual employer have to abide by the contract made between the labour union and a federation of firms. Thus, some effective right to contract and to control one's own destiny has been taken from the individual and become vested in his organizations. Parallel trends, although less formal and codified, can be ascertained for farm groups, consumers' cooperatives, and other voluntary organizations. These groups also make enforceable contracts on behalf of their members. Sometimes the other party to the contract is an employer, sometimes it is the state itself, acting as cosponsor of a welfare program (Raymond and Liang, 2004: 69).

An old-fashioned contract was achieved by shopping around for the best deal and by competitive bidding. Contracts made by large, powerful organizations acting on behalf of their members in collective bargaining cannot be of this ...