Propensity for self-employment: Contrasting the USA and Mexico

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Journal of Small Business and Enterprise Development


Purpose – The paper aims to test the direct and mediating effects of a set of environmental (family self/employment background, social networks, legal system support, governmental support, and social norms) and individual (entrepreneurial self/efficacy and risk propensity) factors on the propensity for self/employment in the USA and Mexico. Design/methodology/approach – A survey was administrated among students in three universities in the USA and in two universities in Mexico. Factor, reliability, t/tests, and regression analyses were carried out. Mediation was assessed following Baron and Kenny. Findings – Most direct and mediating effects were higher for the USA than for Mexico. Entrepreneurial self/efficacy fully mediated several factor relationships in both countries. Results suggest a pattern of a strong formal institutions/individual nexus in the USA, and a strong informal institutions/individual nexus as well as a significant impact of the individual in Mexico. Research limitations/implications – The main weaknesses of this paper are the simple linear relationships used and the student sample. Nonetheless, the efforts carried out to develop this research and the set of factors considered point in the direction of the type of studies needed to further understanding of the phenomenon. Practical implications – The paper suggests that effectiveness of self/employment policy may improve by better matching knowledge about mental schemata, perceived resources, and perceived contexts by the target population with the incentive infrastructure supplied. Originality/value – The value of this paper is that it studies, using an eclectic theoretical framework, a relatively large set of individual and environmental factors impacting the propensity for self/employment in two different national contexts. © 2010, Emerald Group Publishing Limited

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