Chapter

Overcoming Adversity in Entrepreneurship-led Growth:

Suma Athreye

in Entrepreneurship, Innovation, and Economic Development

Published in print April 2011 | ISBN: 9780199596515
Published online September 2011 | e-ISBN: 9780191729133 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780199596515.003.0011

Series: WIDER Studies in Development Economics

Overcoming Adversity in Entrepreneurship-led Growth:

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This chapter tackles the puzzle of how entrepreneurs succeeded in innovating in an often deeply adverse environment, characterized by overregulation, high cost of doing business, weak enforcement of property rights, poor capital market, and underdeveloped markets. This chapter argues that remarkably, Indian software firms found a way around such obstacles by creatively choosing appropriate business models and capitalizing on abundant and cheap high-skilled labour. Adversity promoted creativity in the case of Indian software firms. The chapter discusses a wide range of business models, but the main model was the outsourcing model, where Indian software firms provided services for international clients and used this process to develop their own capabilities. The chapter also finds that the very success of the software industry was a source of improvement in the institutional environment. Changes in the policy and institutional environment for innovation were brought about not by government taking the lead, but through institutional entrepreneurship.

Keywords: software firms; India; institutional entrepreneurship; outsourcing; innovation

Chapter.  8489 words. 

Subjects: Economic Development and Growth

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