NASCENT ENTREPRENEURS IN CARIBBEAN SMALL ISLAND DEVELOPING STATES: OPPORTUNITY VERSUS NECESSITY

Nascent entrepreneurship is important for economic growth and development because it often involves new firm creation and innovation. Besides the perceived ability to become an entrepreneur, determined by one’s human, social and financial capital, individuals must have a willingness to become self-employed as exhibited by their entrepreneurial motivation. A distinction is made between opportunity or “pull” entrepreneurs who set up a business to take advantage of an identified opportunity and necessity or “push” entrepreneurs who are forced to start a business to escape unemployment or poverty. This paper investigates nascent entrepreneurship in a selection of Small Island Developing States of the Caribbean (SIDS), along with differences between nascent opportunity and necessity entrepreneurs. We use the 2012 Global Entrepreneurship Monitor (GEM) Adult Population Survey (APS) for Barbados, Jamaica and Trinidad and Tobago. Probit regressions are used and comparisons between opportunity and necessity driven entrepreneurs are made. The findings indicate that both socio-economic and perceptual factors affect nascent entrepreneurship and do so differently among opportunity and necessity entrepreneurs with important policy implications for encouraging new firm creation.