Entrepreneurship in circumstances of global crisis or recession

Abstract

In literature, global crisis is referred to a risky unpredictable and unexpected event requiring proactive response (Doern et al, 2018). While Williams et al (2017) mentioned that global crisis is an unexpected process that weakens the normal operation or functioning of communities, organizations, societies and individuals. In this way, the focus of this paper is on impact of global crisis on entrepreneurship. Doern et al (2018) described that crisis either it was a global financial crisis that happened between 2007-2009, natural disasters like Hurricanes, earthquake, viruses and terrorism act destructively affected many sectors and specially entrepreneurship is substantively affected. Colombo et al (2016) also indicated that the global crisis changes the business context in terms of requiring entrepreneurs to proactively react to the crisis by modifying their business rules, regulations and strategies. Whereas, history is full of global crisis events affecting small and medium size enterprises and Young entrepreneurial ventures. Mostly it was economy global crisis that affected the entrepreneurial activities and it was in the end of 2007 and 2009 (2^nd quarter) in which the global economic crisis occur that destructively impact the large, medium as well as small enterprises (Sozinova et al, 2017). For instance, 30% bankruptcy cases of Finnish SMEs with higher number of cancellation of orders, layoffs and uncontrollable financial difficulties were faced by entrepreneurs (Soininen et al, 2012). Studies with the help of neo-classical model confirm that entrepreneurship and entrepreneurs are the main driver of economic growth of any country due to their contribution towards providing employment opportunities to youth, emergence of new creative products/services, stimulation of competitiveness and it is affected the most in case of global crisis (Stoica et al, 2020). In this way, global crisis where high unemployment rate and economic recession is common the attention of people towards entrepreneurship becomes crucial.