The Role of Small Businesses in the Economic Transformation of Eastern Europe: Real But Relatively Unimportant?

Abstract

RICHARD SCASE IS PROFESSOR OF Organisational Behaviour at the niversity of Kent at Canterbury, England. His research interests incorporate entrepreneurship and small business growth. He is currently analysing processes of organisational transformation in the emerging market economies of Central Europe. This paper discusses the role of small businesses in these economies. It argues for a distinction between proprietorship and entrepreneurship and suggests that there is little evidence of rational, growthoriented small business start-up in these countries. Instead, the paper claims that the small business sector consists of those who are motivated to carve out 'niches' of personal autonomy within uncertain economic conditions. It identifies those who constitute the key groupings of the emerging small business sector and argues that though representing real economic change, they are relatively unimportant in the economic transformation of Eastern Europe.