Entrepreneurial processes in an apparently uniform context: a study of rural farmers in Sri Lanka

Abstract

Entrepreneurial Processes in an Apparently Uniform Context: A Study of Rural Farmers in Sri Lanka The primary focus of this research is the role of entrepreneurship in the economic success of rural farmers in Sri Lanka. The vilage in which this research takes place was created (administratively) from a cleared jungle, and populated in 1984 by similarly-endowed individuals not generally known to each other, thus controlling a significant number of success-influencing socio-economic variables (arising from past generations). This study, therefore, represents a "unique natural experiment" as it focuses on the "entrepreneurial process" and demonstrates how differentiation arises. A Multiple Embedded Case-Study strategy is adopted: the selected vilage provides the socio-economic and physical boundaries, and the farmers and their income generating processes are sub-cases. Successful inhabitants are identified through the folk definition of economic success: in terms of both social and economic values. Qualitative field methods are supplemented by quantifiable evidence. Research questions are answered by contrasting the socio-economic value-extraction processes of the successful farmers with the routine paddy-based socio-economic activities of the unsuccessful farmers. The environment in which inhabitants operate is constrained by limited resources and various other biophysical and socio-economic factors. The pressure exerted by these environmental constraints restricts the farmers' choices of action and forces the economically-unsuccessful farmers to form a cycle of routine socio-economic activities. This routinely 'vicious cycle' is production-oriented paddy-farming and culminates in consumption activities. The eventual result is often crop-failure and consequently economic failure brought about by ineffcient and ineffective resource use. This pattern shows a significant degree of uniformity. In contrast a variety of opportunities are perceived and capitalized on by entrepreneurs. The task of the entrepreneur, within the same environment, is to extract value by spotting these opportunities and match them with available or mobilised resources, resulting in capital-accumulation and wealth-creation. The findings illustrate how entrepreneurial and managerial value extraction strategies, in a limited resource context, complement each other and demonstrate that the managerial function is an integral component of entrepreneurship. By distinguishing amongst the different tasks of the entrepreneurial and managerial functions, the findings also confirm that these two functions are interdependent elements in influencing economic success. The thesis findings also indicate that certain entrepreneurship and strategic management principles, which have been proven applicable for the affuent Western world, are also relevant to small-scale rural farmers in the third world context who might be expected to struggle in abject poverty in order to scrape an existence. The findings also contribute a new dimension to the entrepreneurship literature, by explaining how "pluriactivity" is being adopted as an entrepreneurial value-extraction strategy, demonstrating how the terms "pluriactivity" and "diversification" can be utilised in relation not only to entrepreneurship and management but also to the economic growth of farmers.