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Stratification, Entrepreneurial Choice and Income Growth: The Moderating Role of Subnational Marketization in an Emerging Economy

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  • Yiyi Su
  • Shaker A. Zahra
  • Di Fan

Abstract

In this study, we examine the moderating role of subnational institutions (marketization) in the relationship between social stratification, on the one hand, and entrepreneurial choice and income growth, on the other. Our analyses, using data from 5,581 individual-wave observations from nine provincial regions in rural China, across six data collection waves, show that: (1) lower-class status is conducive to self-employment, while being from the upper class encourages individuals to become employers; (2) compared to their middle-class counterparts, both upper- and lower-class entrepreneurs enjoy higher levels of income growth; and (3) when subnational marketization is high, the positive effect of being upper class on selecting entrepreneurship as a career is weakened, but the effect on income growth among entrepreneurs is strengthened. We discuss the implications of our findings for theory and future research.

Suggested Citation

  • Yiyi Su & Shaker A. Zahra & Di Fan, 2022. "Stratification, Entrepreneurial Choice and Income Growth: The Moderating Role of Subnational Marketization in an Emerging Economy," Entrepreneurship Theory and Practice, , vol. 46(6), pages 1597-1625, November.
    • Handle: RePEc:sae:entthe:v:46:y:2022:i:6:p:1597-1625
    DOI: 10.1177/1042258721998942
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