Consumption and Entrepreneurship

Abstract: In many developing countries, buyer-seller exchange among the poor occurs mainly in unique, socially embedded environments that are essentially informal markets. This paper describes the findings of an in-depth, in-situ study of an informal-economy subsistence marketplace in South India. Using interviews with consumers and owners of survivalist micro-enterprises, we identify seven themes that characterize the subsistence marketplace context, buyer-seller interactions within them, and specific elements of exchange. This study‘s findings offer important insight toward policy that can help micro-enterprises of the informal economy become engines of economic growth in these countries. Read more.

Abstract: We study subsistence entrepreneurship, defined as entrepreneurial actions undertaken by individuals living in poverty. Subsistence entrepreneurs are important elements of the global economy. By virtue of being poor themselves and co-locating in the same community as their customers living in poverty, subsistence entrepreneurs create value for their customers more effectively than outside entities. We suggest that this marketing exchange (micro-level phenomenon) leads to the building of a community-level exchange system that is unique and inimitable (meso-level phenomenon). Viewing through the theoretical lens of social capital, we develop insights gleaned from qualitative interviews with subsistence entrepreneurs. Community marketing systems that arise out of micro-level interactions between subsistence entrepreneurs and their customers form the glue holding the so-called "informal economy" together in subsistence economies. Read more.

Abstract: The objective of this article is to develop micro-level behavioral insights at the intersection of poverty and the environment and derive macro-marketing implications. This micro-level behavioral perspective encompasses psychological and socio-cultural phenomena and emphasizes consumption and conservation. Construing the environment in a broad sense to encompass living circumstances, we conducted interviews to uncover the distinctive nature of environmental issues in subsistence marketplaces. Our findings emphasize the importance of different levels of spatial and psychological distance as well as a number of coping strategies that reflect individuals and communities sustaining themselves through survival, relatedness, and growth. We link distances and coping to efficacy and motivation to act, and derive implications for macro-level issues in marketing management, and public policy. Read more. 

Abstract: There are millions of “subsistence” entrepreneurs around the world, located primarily in developing countries, engaging in micro enterprise to eke out a survival living when other labor market options become unavailable. However, the vast majority of them are trapped in a “survival and maintenance” cycle.

This article focuses on a phenomenon involving a subset of subsistence entrepreneurs who do manage to thrive and grow their enterprise. We label the phenomenon “transformative subsistence entrepreneurship,” reflecting (1) significant positive change in their personal, social and economic well-being, and (2) significant positive influence on their immediate communities.

Drawing on 18 in-depth qualitative interviews, we show how the phenomenon plays out and how transformative subsistence entrepreneurs carry out vital marketing activities in their local exchange contexts, rising above substantial life challenges and end up improving the economic capacities of their communities as well. We contend that the contributions of a network of such transformative subsistence entrepreneurs, each seen at a micro enterprise level of analysis, can accumulate and coalesce to emerge as the backbone of the informal economy at a macroeconomic level. Read more.

Abstract: This article describes exploratory research on how consumers and small entrepreneurs navigate subsistence marketplaces, with particular emphasis on social networks, a central characteristic of these contexts. Existing studies have characterized subsistence contexts as 1-to-1 interactional marketplaces due to the prevalence of face-to-face interactions among consumers and sellers when evaluating products, making purchases, and operating small businesses.

This research uses survey methods to study these networks, paying particular attention to how individuals interact within them, the kind of information being shared, their influence on purchase decisions and business decisions, and finally, their impact on the marketplace skills of subsistence consumers and entrepreneurs. Consideration of both consumers and entrepreneurs provides perspective on the role of social networks from both sides of the business transaction. The article also discusses implications for business research and practice. Read more. 

Abstract: To function in the economic realm, two important resources that individuals need are finances and know-how. Whereas there has been considerable attention on microfinancing, we describe an educational program that focuses on enabling generic skills about the marketplace and complements these important efforts. We conducted research aimed at understanding lives and marketplaces in subsistence contexts in urban and rural parts of a state in South India.

We used the research as a basis for developing a consumer and entrepreneurial literacy educational program. This program uses the "know-why", or an understanding of marketplaces, as a basis for the know-how of being an informed buyer or seller. Despite the difficulties with abstract thinking that low-literate individuals experience, we enable deeper understanding of marketplaces by leveraging the social skills that participants bring to the program and relating educational content back to their lived experiences. Such understanding can enable individuals to place themselves on a path to lifelong learning. Implications of this work for research and practice in non-formal education are discussed. Read more.

Abstract: This chapter examines the marketplace activities of subsistence customers in South India. It presents a picture of the day-to-day behaviors and interactions of subsistence customers in terms of the products they purchase and their interactions with sellers and outlets. The method involved observations and in-depth interviews of a variety of buyers and sellers over several years in urban and rural South India. Needs, products, and market interactions, as well as typical budgets in subsistence contexts are described. These descriptions are used to derive broader characteristics of product and market interactions in terms of uncertainty, complexity, and lack of control; one-on-one interactions; transactional fluidity; and make or buy decisions. Read more.