Economics and Rural Development, Volume 1, Number 1

Role of Social Capital in Rural Entrepreneurship

Voldemārs Strīķis, Modrīte Pelše, Jānis Leikučs
Latvia University of Agriculture

Abstract

After establishment many enterprises make no progress. Studies show that entrepreneurship is influenced not only by traditional economic resources, but also by social capital. In the paper connections between the characteristics of social capital of entrepreneurs and the characteristics of economical success of activities have been ascertained. The calculations are based on the results of the survey conducted in Zemgale region in 2004. The following features have been chosen as indicators of farmers’ economic success: area of agricultural land, changes in the land area during the last 10 years, use of the EU financial assistance within the SAPARD Fund, the present standard of living of farmers’ families and respondents’ opinion on the viability of their farms in the future. Input data shows that membership of farmers in organizations, associations and cooperatives of agricultural type, as well as trust in the institutions, which have an impact on the economic development of farms are especially important elements of social capital. These elements of social capital demonstrate very close correlation with general indicators of economic development.

Keyword(s): social capital, rural entrepreneurship


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Economics and Rural Development ISSN 1822-3346 / eISSN 2345-0347

This journal is published under the terms of the Creative Commons Attribution-Noncommercial 3.0 Unported License. Responsible editors: Prof. Dr Vilija Alekneviciene, Dr Gunita Mazure.