The Role of the Entrepreneurs in Rural Development - New Zealand -Tourism

Contents

Introduction

Defining an Entrepreneur

The characteristics and the environmental context of entrepreneurship

Examples of rural entrepreneurs in New Zealand

Prosperity through tourism entrepreneurship in rural New Zealand
Whalewatching in Kaikoura
Roadside spectacle in Tirau

Issues related to the entrepreneur in the rural environment

Conclusion

Bibliography:

Introduction

Many rural areas around the world face economic challenges, partly due to their peripheral locations and also because of their declining economies. With the rise of globalisation and urbanisation, many people who lived in rural areas before, have decided to move to urban centres, either for the better infrastructure that cities have, or in search of the employment opportunities that industries in cities offer. Furthermore, this means that many rural regions and towns are facing dislocation and decline (Stolte 2000:111).

One response to the decline of traditional rural industries, such as agriculture and mining, has been the emergence of tourism orientated entrepreneurial activities (Stolte 2000:111). Indeed, many people indigenous to rural areas see tourism as a chance for them to stay and live in their region or town, without reducing their standard of living.

The motives of the entrepreneurs in rural areas are various; meaning that not all of them become entrepreneurs because they are concerned about unemployment. Moreover many entrepreneurs see rural tourism as an opportunity to live a certain lifestyle, and many even move from urban areas to rural areas seeking the opportunity to develop ideas and fulfil their dreams.

The main purpose of this essay is to examine the role of entrepreneurs in rural development, and moreover, to investigate how the ‘entrepreneur’ impacts on the rural environment, in order to define the entrepreneurs’ role in the rural development. This will be partly accomplished through the incorporation of examples of entrepreneurs involved in rural tourism in New Zealand, and also by making reference to relevant entrepreneurial theory.

Defining an Entrepreneur

Before looking at the role that entrepreneurs play in rural development, there is a need to define the term ‘entrepreneur’. In taking a look at the literature concerning entrepreneurs, the key term seems to be innovation, and to quote Pettitt (2001), “the role of the entrepreneur appears central to the whole innovative activity”. The term innovation incorporates the idea of creating something new, or recognizing the potential for changing relationships (Frederick and Carswell 2001:14). Moreover, Frederick and Carswell (2001:14) even define entrepreneurship as the commercialisation of innovations.

Many opportunities and so-called innovations also contain a certain element of risk. This is reflected in the root of the word ‘entrepreneur’ from the French: entre meaning ‘between’ and pendre meaning ‘to take’. Furthermore, Richard Cantillan who coined the word in the 18th Century, referred it to those who ‘take on the risk between buyer and seller ‘(Bolton and Thompson 2000:4).

To conceptualise the term a modern context, the GEM (Global Entrepreneurship Monitor) defines an entrepreneur as follows:

“An entrepreneur is a person attempting to create a new business enterprise either through spotting a new opportunity or out of necessity, job loss or redundancy”. (Frederick and Carswell 2001:14)

The characteristics and the environmental context of entrepreneurship

As mentioned before, innovativity is closely linked with entrepreneurship. In addition, this means it is also closely related to the characteristics of an entrepreneur. In referring to the literature, Littunen (2000:295) says that, the entrepreneur must have the ability to produce solutions in new situations. Taking the key elements of the entrepreneurship into account (seeTable1) it is apparent that entrepreneurs impact on the environment surrounding where they operate, as their strong elements are going to confront others.

Table1: Key elements of entrepreneurship

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Source: Morrison et al. (1999:15)

Because entrepreneurs are strongly characterized by seeking success, Morrison et al. (1999:29-30) argue that entrepreneurs can be regarded as first among equals in the process of wealth creation, and because of this, also create wealth for others. In addition, Bridge et al. (1998:24) quote Schumpeter (1934), who identifies that entrepreneurs not only create wealth for others, but also employment. Schumpeter adds that the success of entrepreneurs results from their ability and ambition, rather than from ownership of land or capital. Following from this recognition, it can be interpreted that the entrepreneur can play a key role in influencing the surrounding environment, especially in terms of development.

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