Local entrepreneurship: a development model based on community interaction field theory.

ABSTRACT

Local entrepreneurship shows great potential as an economic development strategy for rural communities with stagnating or declining economies. However, nascent entrepreneurs often lack knowledge of ways to actualize their ideas, and communities often lack the social infrastructure to help entrepreneurs achieve success. Educational programs supporting entrepreneurship can play a vital role in rural community economic development. The Nebraska Enhancing, Developing and Growing Entrepreneurs (EDGE) educational program is community based, with organizing principles derived primarily from community interaction field theory. More than 1,600 nascent and active entrepreneurs have participated in EDGE since 1993. The authors draw on community interaction field theory and eight community case studies to explore an action model for delivery of an educational program of locality-based entrepreneurship. The EDGE model has implications for the delivery of long-range community development programs.

Keywords: rural community development, community leadership, economic development, entrepreneurship, interaction field theory

INTRODUCTION

Presentations at a recent national conference on rural America (1) asserted that problems experienced by rural communities are exacerbated by lack of a comprehensive national policy to address the problems. At the present time, rural policy exists only as numerous unconnected programs scattered across a number of government agencies and a "farm bill" that purports to address rural issues but applies primarily to agriculture. Thus, if rural communities want to tackle joblessness, shifting populations, insufficient income and social amenities, deteriorating infrastructure, and lack of leadership, direction and resources must come from the states--and primarily from within communities.

Research shows that if residents of small communities can get themselves motivated, self-development strategies offer great potential for improving local economic vitality. Self-development projects demonstrate the following characteristics: (1) involvement in the effort by local organizations; (2) substantial investment of local resources; and (3) local control of the programs or resulting enterprises (Green et al., 1990). Of the generally recognized strategies of economic development, the strategy that has strong potential for helping local economies is the creation of new business enterprises, or what is more commonly known as entrepreneurship (Shaffer, 1989). Entrepreneurship recirculates resources locally and multiplies benefits for the local community. Unlike businesses recruited to locate in the community that demand financial incentives and tax and regulatory concessions but have no strong local ties, local entrepreneurs generally have a commitment to the community (McNamara et al., 1995). Local entrepreneurial ventures can also develop the local social structure necessary for problem solving.

In many communities a social structure to promote and support entrepreneurship, as well as other local improvement efforts, is missing (Bryant, 1989). Nascent entrepreneurs often lack the knowledge necessary to actualize their ideas (Gnyawali & Fogel, 1994). Therefore, an educational program that teaches nascent entrepreneurs to start and operate a business, as well as mobilize and join the leadership and resources of the community, can provide the needed impetus (Bryant, 1989).