The Effect of Social Capital on Middle-Class Entrepreneurship in Ecuador

Resumen

Suggests that while the extent of the role entrepreneurship plays in developing a country remains debatable, in countries like Ecuador, it can play a significant role in improving economic performance. Both middle- and upper-class entrepreneurs face similar problems, although middle-class entrepreneurs have more difficulties in financing. They both face difficulties in networking to get more customers, suppliers, and partners and trust themselves and family or friends more than third-party investors. This leaves room for public support in the form of government agencies that promote entrepreneurship. Most businesses remain small and have little chance of significant growth. Social capital—mainly in the form of family and friends—remains crucial in determining the dynamism of a business, and government agencies, including export promotion agencies such as the recently created Pro Ecuador, can play a role in supporting entrepreneurs by improving their access to financing options, better technology, and a larger network.