Poverty, Disadvantage, and the Promise of Enterprise - by Michael H Morris & Susana C Santos (Hardcover)

About the Book

Book Synopsis

Can entrepreneurship serve as a pathway out of poverty? Are the poor able to create ventures that can improve their economic circumstances and enhance their lives? Poverty, Disadvantage and the Promise of Enterprise: A Capabilities Perspective argue that "it depends". To understand the poverty and entrepreneurship interface, we must first understand poverty. Using a lens of disadvantage theory and the capabilities framework, the book explores the implications of poverty's complex, multi-dimensional nature when one is trying to start and grow a business. Four key liabilities directly impact the opportunities these individuals are able to recognize, the types of ventures they create, how the businesses perform, and the impacts on the well-being of the entrepreneur. Because of these liabilities, these ventures tend to fall into what the authors call the commodity trap, where they struggle with low sales volumes and marginal profits. However, the trap is avoidable, and, with the right kinds of support, the performance of these ventures can be meaningfully improved. Key design elements of a successful intervention approach, together with an alternative perspective on the roles of community-based entrepreneurial ecosystems and public policy, are introduced. Emphasis is also placed on the critical roles of faith, hustle, and the fears of both failure and success.

Review Quotes

"Poverty, Disadvantage, and the Promise of Enterprise: A Capabilities Perspective makes an important and novel contribution to the broad field of entrepreneurship studies. It's a very welcome corrective to the prevailing focus on high tech, high growth ventures, focusing on everyday entrepreneurship within constrained environments."

There have been great books providing an understanding of the nature of poverty. There have been great books providing an understanding of entrepreneurship. Morris and Santos deliver an initial and powerful riposte that marries an understanding of the experience of poverty with the nuance of entrepreneurship in impoverished contexts. The authors take a human development approach in describing why ventures for the poor matter despite the liabilities of the poor and the typical commodity trap of entrepreneurs in poverty. Leveraging this foundation, Morris and Santos then describe the stepwise process for developing as an entrepreneur in poverty and how institutions can support entrepreneurs in helping them progress from fragile to stable and impactful ventures.

There's no need to encourage the world's poor to open businesses, most already have, and their tiny ventures are what keeps them alive. What if it were possible to move more of those survivalist firms up the business ladder toward profitability and employing labor? How might that work? Asking these questions, two business academics, Michael H. Morris and Susana C. Santos, finally take seriously the business ventures of the poor, a topic shamefully ignored by business research for decades. What is more, taking those questions seriously, Morris and Santos fill a desperately needed niche in the extensive social science literature on poor people's self-employment. This literature lacked a technical analysis of the business-building process among poor people. Now that Morris and Santos have provided exactly that, everyone interested in world poverty and its alleviation needs to read this important and humane book.

About the Author

Michael H. Morris is professor of entrepreneurship & social innovation at the University of Notre Dame's Keough School of Global Development.

Susana C. Santos is associate professor of entrepreneurship in the Jim Moran College of Entrepreneurship at Florida State University.