Culture determines the likelihood of unhappy employees becoming entrepreneurs

A new study by a team of researchers from Xi’an Jiaotong-Liverpool University (XJTLU) and Shanghai University in China has found that the level of entrepreneurial intention among dissatisfied employees is greatly affected by their cultural context. 

Dr Jie Li, of XJTLU’s International Business School Suzhou, says studies in the past have shown a positive correlation between job dissatisfaction and entrepreneurial intent, but focusing on only job satisfaction doesn’t tell the whole story. 

“In our study, we found that cultural context plays a big role,” he says. “In societies that support and value entrepreneurial ventures, as well as countries where people are more likely to take risks and are more comfortable with change, there’s a far stronger link between job satisfaction and the intention to start a business.” 

In countries where the opposite is true – low legitimacy of entrepreneurial ventures and a higher rate of uncertainty avoidance – job dissatisfaction rarely translates to entrepreneurship. 

For example, in Japan, which has both a high rate of uncertainty avoidance and low entrepreneurial legitimacy, there are very low rates of entrepreneurial intent. Conversely, people in Colombia have relatively low uncertainty avoidance, have a higher regard for entrepreneurial ventures, and have high entrepreneurial intent rates. 

Wage slaves

Dr Li was inspired, in part, by jokes about, and self-deprecation of, office workers in China. “They call themselves ‘wage slaves,” continues Dr Li. “Although they are expressing that they’re dissatisfied with their jobs, most of them just complain and continue to stay in their current organisations.” 

Thus, Dr Li wanted to investigate what factors could influence those dissatisfied employees’ decisions to start their own business. He read the Global Entrepreneurship Monitor (GEM) reports and found that entrepreneurial adoption rates vary significantly across countries, so he wanted to explore what macro factors could explain this phenomenon.

The sample for this study was drawn from two international databases: the APS GEM 2013 and the GLOBE project. The latter employs a large group of investigators from all over the world and investigates the relationship between culture and leadership. 

GEM collects annual survey data from at least 2,000 randomly selected adults from each participating country. Many participants are employees – and haven’t declared entrepreneurial intentions – when they participate in this survey. GEM teams collect participants’ attitudes towards entrepreneurial activities. Participants respond regarding their attitudes towards their job environments and work lives only. However, the 2013 Adult Population Survey (APS) from GEM contains job satisfaction measurement, which is why he used this data source. 

Support and legitimacy

Entrepreneurship is an integral part of economic growth, and Dr Li explains that understanding the societal barriers to starting new businesses is crucial. 

“To boost start-up activities, policymakers should first stimulate the public’s entrepreneurship intention. Whether people have the passion and willingness to start a business depends on two factors: their desire for entrepreneurship and the social environment for entrepreneurship and innovation. Owing to the powerful and absolute role played by entrepreneurial legitimacy, improving the legitimacy of entrepreneurship is an effective way,” concludes Dr Li.