Original Research

Institutional obstacles to South African entrepreneurship

Fred Ahwireng-Obeng, Desmond Piaray
South African Journal of Business Management | Vol 30, No 3 | a758 | DOI: https://doi.org/10.4102/sajbm.v30i3.758 | © 2018 Fred Ahwireng-Obeng, Desmond Piaray | This work is licensed under CC Attribution 4.0
Submitted: 12 October 2018 | Published: 30 September 1999

About the author(s)

Fred Ahwireng-Obeng, Graduate School of Business Administration, University of the Witwatersrand, South Africa
Desmond Piaray, Graduate School of Business Administration, University of the Witwatersrand, South Africa

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Abstract

Institutional risk factors exert a powerful negative influence on entrepreneurial investment decisions in South Africa. This conclusion emerges from a study of South African manufacturing and service sectors based on a previous one conducted on a world-wide scale by the World Bank in 1997. The South African study examines six institutional variables by sector-type and market-access and finds that entrepreneurs of young, small and non-exporting firms particularly perceive these institutional obstacles as a real problem most of the time. This observation compares closely with the World Bank's report on sub-Saharan Africa. There are several implications for the finding. Despite far-reaching institutional reforms much more will be required if South Africa's transition to a democratic polity and open, liberal economy is to yield the widely-expected post-apartheid dividends of rapid economic growth, high levels of employment and more equitable distribution of income and wealth. In the present circumstances, the country's prospective role as a growth-pole for Southern African regional development and the propelling force of an African renaissance is unlikely to materialise.

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Crossref Citations

1. Influence of the Institutional Environment on Entrepreneurial Intentions in an Emerging Economy
Boris Urban
The International Journal of Entrepreneurship and Innovation  vol: 14  issue: 3  first page: 179  year: 2013  
doi: 10.5367/ijei.2013.0122