LAUSR

In most developing economies, micro and small enterprises (MSE) and self-employment provide the majority of employment and the main source of income. However, MSE’s potentials often remain exploited and there are high rates of churning. To better understand the limited success of entrepreneurship in developing economies, this paper looks at how entrepreneurs have and use agency and how this relates to their entrepreneurial success. Empirically, we use life history interviews with micro-entrepreneurs in Kampala, Uganda. Conceptually, we draw on Amartya Sen’s Capability Approach, which in regard to agency, emphasizes people’s ambitions, reflected choices, and the various factors that influence how people derive options and agency from available resources. Our results suggest a stronger differentiation of entrepreneurs beyond the ‘necessity vs. opportunity’ dichotomy. This concerns entrepreneurs’ motivations and ambitions, their collective transformative potential and the question of which choices under which restrictions should be conceived of as entrepreneurial agency. Most of the entrepreneurs have and make choices beyond economic survival; self-employment is not just a last resort. It depends on business opportunities not as drivers but as occasions; it may rest on innovative means to access common businesses (rather than on innovative businesses); and it may be directed at sufficiency rather than growth.