Edinburgh Napier University

  Principal Topics:
There is a growing concern that entrepreneurial behaviour has to be understood in the context in which it occurs. This includes the institutional context in which the entrepreneur operates (Welter and Smallbone, 2011; Martinelli, 2004). The marked paucity of literature which focuses on women entrepreneurship in the context of challenging environments advances the need to explore institutional perspectives shaping trust relationships in Nigeria and Pakistan. While scholarly interests have drawn focus to the historical in attention of women’s entrepreneurial activities, there remains a myriad of uncharted territories demanding to be explored. For instance, although women entrepreneurs in Nigeria and Pakistan share similar features and problems, there exist diverse experiences different from that of developed countries. However, there remains a need to understand the specific institutional environment. This is pertinent in light of the uniqueness of Nigeria and Pakistan where formal institutions are weak, with limited use of formal contracts and state support (Fafchamps, 2004; Amoako and Lyon, 2014).Such conditions make entrepreneurship difficult for Nigerian and Pakistani women. We have reasons to believe that the emergence of less formalised institutions which operate parallel to the formal ones, help both Nigerian and Pakistani women to build their economies through entrepreneurial activity. This indicates a need to provide a more encompassing contextual explanation of how institutional factors influence the extent of women entrepreneurship in Nigeria and Pakistan. Hence, an analysis of context contributes to an understanding of the socio-cultural influences which may provide opportunities or limitation to entrepreneurial activities. Accordingly, trust is undoubtedly a prerequisite for entrepreneurship to exist. However, a lack of congruence in defining trust has led to several interpretations of this construct. Rousseau et al. (1998) view trust as a psychological state which includes the intention to accept vulnerabilities based on the positive expectations of the other party, while Putnam (1993) defines trust as an emergent property of the social system. This suggests that individuals trust because of the social norms within which their actions are embedded. Zucker (1986) on the other hand, draws attention to the institutional basis of trust as it supports the monitoring and sanctioning of social behaviour. As such, trust may be shaped by the institutional environment in which the actors are embedded. In this study, we adopt the stance that trust reduces the expectation of opportunistic behaviour among women entrepreneurs (Bromiley and Cummings, 1995; McEvily et al.2003) and is an essential lubricant to entrepreneurship (Welter, 2012).This view highlights an element of risk in the face of uncertainty which is further exacerbated as a result of formal institutional void (Puffer et al., 2010; Bruton and Ahlstrom, 2003).Typically, Western institutions are characterised on the basis of trust in their regulatory agencies and judiciary; as there is a greater stability in institutions which govern business relationships (Zaheer et Zaheer, 2005; Lane, 1997). Hence, despite the lack of formal support taken for granted in western economies, women entrepreneurs in Nigeria and Pakistan may have found ways to strengthen entrepreneurial activities by building on trust based relationships. This study therefore has practical implications for enhancing women entrepreneurship by contributing to the ongoing theoretical understanding of trust and institutional perspectives in entrepreneurship from an African and Asian context. Research questions: 3 core questions The structure and organisation of this study would be focused around three core questions: RQ1: How do institutions shape female entrepreneurial activity? RQ2: What are the types of trust needed by female entrepreneurs? RQ3: What are the parallel institutions which have replaced the formal institutions?
Methods/Key Propositions:
We adopted an interpretivist approach in response to calls for more qualitative research on entrepreneurship (Welter, 2012; Jack, 2010). The empirical component focused on a multiple case study of 12 female entrepreneurs (7 Nigerian and 5 Pakistani women) drawn through a purposive and theoretical sampling in line with the research questions (Marshall and Rossman, 1999).Our choice of 12 female entrepreneurs was aimed at comparing perceptions and experiences as it relates to their particular environment. Data was collected using iterations of semi-structured interviews held at the workplaces and homes of the respondents. These iterations have helped in exploring emergent themes such the development of trust relationships and the perceptions of institutions. These themes enabled the interpretation of various aspects of the research questions; by unearthing similarities and differences across data (Boyatzis, 1998). The consideration for limiting bias was minimised through documentary analysis, observing market relationships and informal discussions (Lyon and Porter, 2009).
Results/Implications:
Taken more broadly, this study seeks to examine the interplay between formal and informal institutions as a focal characteristic of developing countries. For instance the nature of institutional influences throws light on gender variations, as women may have less access to sources of capital and informal networks (Aidis et al.2007).Given the weak formal institutions, women entrepreneurs in Nigeria and Pakistan were keen on building socially embedded relationships built on trust with their trading partners. Within the remit of this paper, we have evidence that demonstrates the role of context and embeddedness in women and entrepreneurship. For instance, our case studies revealed that Nigerian women entrepreneurs were supported by strong religious ties while Pakistani women relied more on ties based on family and kinship. As a consequence, our study provides insights towards understanding trust and women entrepreneurs in challenging contexts.