As one can judge from empirical evidence the three theories concerning recruitment of post-socialist entrepreneurs are far from being equally valid. Six logistic regression models were constructed in order to evaluate the explanatory power of the above-mentioned theories. In Model 1/a the parents’ occupational and educational status were the independent variables and the model fits well.
The mother’s occupation proved to be more important than that of the father.
Interestingly enough, in contrast to the statistics in the table, the model did not include the mother’s education since it proved to be not significant. In Model 1/b we modified and extended the circle of independent variables which represent the different aspects of long term historical heritage. Instead of the parents’ education, the ethnic background, the father’s property (i.e. size of land owned) and the number of father’s employees were included. We expected that these variables – especially the property and managerial power components – would contribute significantly to explaining entrepreneurial inclinations. These expectations proved to be false. Being insignificant, none of them were incorporated into the model. The model’s explanatory power is less than that of the previous one.
Table 1. Estimation of entrepreneurial inclination by long term and socialist heritage variables in 1988
Variable Model 1/a Model 1/b Model 2
CONSTANT -1.728 -1.1064 -0.6363
(48.3013) (83.3688) (5.3001)
FOCCU 0.6260 0.5424 *
(12.2492) (10.6445) *
MOCCU -0.7240 0.6530 *
(14.569) (14.6604)
FEDU 0.0758 * *
(10.0541)
MEDU # * *
ETHNIC * # *
FLAND * # *
FEMPLOY * # *
PARTY * * -0.4760
(3.9134)
Model Chi-Square 33.011 19.836 8.82
D. of Freedom 3 2 2
* Variable not included
# Variable not in the model because the parameter was not significant. Notes:
Logistic regression model with forward step algorithm. B values (Ward coefficient in brackets)
FEDU - Fathers’ education
(Years of father’s classes when the interviewee was 14 years old) FOCCU - Fathers’ occupation (1 if father was worker)
MOCCU - Mothers’ occupation (1 if mother was a housewife)
MEDU - Mothers’ education (Years of mother’s classes when the interviewee was 14 years old)
PARTY - Membership of HSWP or HSP LEADER - 1 if the int. was ever a leader
FEMPLOY - # fathers’ employees when the interviewee was 14 years old FLAND - size of fathers’ land when the interviewee was 14 years old
Source: Author’s own calculation, based on Tárki A Tdata-B90
Among the model-families, the socialist heritage model had the least explanatory power. Former party membership seemed to counter-indicate entrepreneurial inclination, while former leaders were more interested in entrepreneurial career patterns. There is a hidden counteraction between the two components. We know from cadre statistics that the overwhelming majority of the economic elite were party members. At lower levels of leadership, the proportion of party members was over the average and among the members of the economic elite the proportion of party members was as high as four-fifths, even in the late
‘80s. Neither party membership nor the former or present leadership position appears to explain too much about entrepreneurial inclination. Former leaders are a little more interested in becoming independent than the average, but party members are certainly not the main source of recruitment of entrepreneurs. There
Where doentrepreneurs come from?
were well known examples of such kinds of careers among top civil servants (a former prime minister became vice-president of an international bank, for example). Leaders and professionals were vastly over-represented among party members, but all in all the 800 000 strong political class of party members did not differ significantly from the average in terms of entrepreneurial potential.
This indicates, on the other hand, that the ideological obstacle of market institutionalization did not have much impact on them. Closer analysis could shed light on the inner distribution of the membership of the former ruling party.
A small number consistently refused market institutionalization and economic and social reforms, while the greater part supported the values behind economic reform more intensively than the average for non-party people. This can be explained through identifying the higher educational and occupational status of this stratum. There are good reasons to suppose that the ideological diversity of
“conservative” and “reform-minded” wings led to the splitting of the party before the free elections.
Table 2. Estimation of entrepreneurial inclination by occupation, gender, age, education and income in 1988
Variable Model 3/a Model 3/b
CONSTANT -2.5340 -1.6722
(121.9819) (20.2642)
PROFES # -0.8770
(5.4668)
WHITECOL # *
SWORKER 0.4245
(4.6215)
UNWORKER # *
GENDER * 1.1057
(39.0833)
AGE * -0.4880
(32.7665)
EDU * 0.3206
(12.9433)
RELIG * *
INCOM 0.6964
(33.9749)
SECONDEC 0.7744
(18.1504)
Model Chi-Square 61.76 100.757
D. of Freedom 3 4
* Variable not included
# Variable not in the model because the parameter was not significant Notes:
Logistic regression mode with forward step algorithm. B values (Ward coefficient in brackets)
PROFES - 1 if the int. was professional WHITECOL -1 if the int. was white-collar SWORKER - 1 if the int.was skilled worker UWORKER - 1 if the int.was unskilled worker RELIG - 1 if the int. was not believer
INCOME - Monthly net income (Thousand Forints) SECONDEC - Activity in second economy (1 if yes) GENDER - 1 male
AGE - Age of interviewee
EDU - Education of interviewee (Years of classes)
Source: Author’s own calculation, Tárki A, Tdata-B90
In Model 3/a we wanted to test a part of the third explanation. Here we took into account occupation, activity in the second economy and income. The second economy, as one could expect from the above discussion, had a positive and significant effect on entrepreneurial inclination. Income and having skilled worker status had a strong positive effect too.
In Model 3/b we took into account a wide range of synchronous variables, including occupation, education and demographic status. This model proved to be the most valid. Age, gender and education explain much more about entrepreneurial inclination than the rest of the variables. Even occupation proved to be a non-significant driver. All this means that the synchronous “here and now”
personal conditions are most important in explaining entrepreneurial inclination.
Where doentrepreneurs come from?