Subsistence Entrepreneurship, Value Creation, and Community Exchange Systems

Abstract

We study subsistence entrepreneurship, defined as entrepreneurial actions undertaken by individuals living in poverty. Subsistence entrepreneurs are important elements of the global economy. By virtue of being poor themselves and co-locating in the same community as their customers living in poverty, subsistence entrepreneurs create value for their customers more effectively than outside entities. We suggest that this marketing exchange (micro-level phenomenon) leads to the building of a communitylevel exchange system that is unique and inimitable (meso-level phenomenon). Viewing through the theoretical lens of social capital, we develop insights gleaned from qualitative interviews with subsistence entrepreneurs. Community marketing systems that arise out of micro-level interactions between subsistence entrepreneurs and their customers form the glue holding the so-called ''informal economy'' together in subsistence economies.

Entrepreneurship and local economic resilience: the impact of institutional hysteresis in peripheral places

“…The continuous effort of local stakeholders to promote entrepreneurship and a culture of enterprise has resulted in an increased business startup rate compared to other SCR localities (see Table 1). However, the nature of the entrepreneurial activity in Doncaster is both highly localised and underproductive, verging on what Viswanathan et al (2014) refer to as 'subsistence entrepreneurship', and therefore has limited impact on economic growth. As one of the stakeholders interviewed highlighted: 'There's not the aspiration to grow those businesses into fifteen, twenty, twenty five employee businesses.…”

Framing hybrid exchanges in subsistence contexts

“…This is largely owing to the difficulties in accounting for informal exchange practices (Sheth, 2011;Viswanathan et al, 2014). Consequently, existing research majorly focuses on the role of subsistence actors as consumers of internationally marketed products (Sheth, 2011).…”

“…Consequently, this paper considers embeddedness, a common theme in subsistence market exchange research (Viswanathan, Sridharan and Richie, 2010;Viswanathan, Rosa and Ruth, 2010;Viswanathan et al, 2012Viswanathan et al, , 2014 as useful to MNCs in gaining the insider knowledge necessary to operate in these markets (Schuster and Holtbrügge, 2012). Within the international marketing literature, embeddedness emerges in discussions around networks and linkages forged to enable firms to gain entry into, and integrate within, new markets (Elg et al, 2008;Boso et al, 2013;Gao et al, 2016).…”

“…Framing hybrid exchanges most difficult to access (Acquaah, 2007;Boso et al, 2013) by "outside-in firms" (after Viswanathan et al, 2014). It becomes pertinent therefore for outside-in firms to broaden their networks to include local communities if they are to gain access to, and leverage insider information; and disseminate information about their offerings (Viswanathan, Sridharan and Richie, 2010;Viswanathan, Rosa and Ruth, 2010;Boso et al, 2013).…”

Step-Change: Micro-Entrepreneurs’ Entry into the Middle-Class Market

“…From a marketing perspective, this article conceptualizes the step-change as a process of resource accumulation to create a new value proposition that enables the entrepreneur to enter a new middle-class target market. We draw on stakeholder literature (Mitchell, Agle, & Wood, 1997) to add relational dimensions of legitimacy, power and urgency to the relational aspects such as interpersonal relationships and affective commitments that are frequently studied in the subsistence marketplace literature (e.g., Viswanathan, Echambadi, Venugopal, & Sridharan, 2014). The step-change process can be conceived of as a specific case of marketing's contribution to social mobility.…”