Sociology of Law: Theories and Concepts

Sociology of Law: Theories and Concepts Introduction The three classical thinkers of Sociology, Marx, Weber and Durkheim have one thing in common regarding the Sociology of Law; their theories were part and parcel of a more fundamental sociological perspective and theory of society. Marx will be the odd one among the three because, the work of Marx is on theoretical ground not evidently connected to the aspirations of sociology, but historically Marxs writings have informed a considerable body of sociological writings until this day. Marx made a contribution to social science by suggesting the instrumentalist theory of law in contributing to and justifying social inequality. Durkheims work orients around the key dimensions of social issues as involving both factual and normative dimensions of society. Whereas Weber is considered as the founding father par excellence of the modern sociology of law. When Weber observed that social life in the modern era had become more and more rationalized in a purposive-rational sense, he no only conte mplated the central role of economy, stat, and bureaucracy, but along with it also discussed the role of law as the basis of modern political authority. Weber specifically outlined the characteristics of a formally rationalized legal system that is primarily guided by the application of procedure. Sociology of Law The sociology of law is often described as a sub-discipline of sociology or an interdisciplinary approach within legal studies. While some socio-legal scholars see the sociology of law as necessarily belonging to the discipline of sociology, others see it as a field of research caught up in the disciplinary tensions and competitions between the two established disciplines of law and sociology. Yet, others regard it neither as a sub-discipline of sociology nor as a branch of legal studies and, instead, present it as a field of research on its own right within a broader social science tradition. For example, Roger Cotterrell describes the sociology of law without reference to mainstream sociology as the systematic, theoretically grounded, empirical study of law as a set of social practices or as an aspect or field of social experience. Irrespective of whether the sociology of law is defined as a sub-discipline of sociology, an approach within legal studies, or a field of research in its own right, it remains intellectually dependent mainly on mainstream sociology, and to lesser extent on other social sciences such as social anthropology, political science, social policy, criminology and psychology, i.e. it draws on social theories and employs social scientific methods to study law, legal institutions and legal behaviour. More specifically, the sociology of law consists of various sociological approaches to the study of law in society, which empirically examines and theorizes the interaction between law and legal institutions, on the one hand, and other (non-legal) social institutions and social factors, on the other. Areas of socio-legal inquiry include the social development of legal institutions, forms of social control, legal regulation, the interaction between legal cultures, the social construction of legal issues, legal profession, and the relation between law and social change. The sociology of law also benefits from and occasionally draws on research conducted within other fields such as comparative law, critical legal studies, jurisprudence, legal theory, law and economics and law and literature. The Classical Thinkers The roots of the sociology of law can be traced back to the works of sociologists and jurists of the turn of the previous century. The relationship between law and society was sociologically explored in the seminal works of both Max Weber and Emile Durkheim. The works of Karl Marx was not immediately influential in the development of the sociology of law as no direct historical path led from his thought to subsequent sociological schools of thought. Marxs work was later appropriated by critical sociologists who sought to break with the consensual thinking that they felt characterized much of mainstream sociology in the years after World War II. The writings on law by these classical sociologists are foundational to the entire sociology of law today. A number of other scholars, mainly jurists, also employed social scientific theories and methods in an attempt to develop sociological theories of law. Notably among these were Leon Petrazycki, Eugen Ehrlich and Georges Gurvitch. Marxs theory is not to be understood merely as a theory of the economy, for his analysis of capitalism is meant to provide the basis for an analysis of society. The economic organization of society is its material core from which all other social developments in matters of politics, culture, and law can be explained. This is summarized in Marxs famous dictum that the infrastructure of a society determines it superstructure. Thus, the division between the economic classes of owners and non-owners appears at the societal level as a class antagonism between the relatively small but powerful bourgeoisie and the relatively large but powerless proletariat. The bourgeoisie can articulate its economic power also at the political, cultural, and legal level because of its control over all important institutions of society, such as government, the legal system, art science, and education. The economic, according to Marx, only the destruction of capitalism in favor of a communist mode of product ion, whereby the workers collectively own and control the means of production, world ensure a successful revolution of society in to a more just social order. Marx did not develop a comprehensive perspective on law and his ideas on law are scattered throughout his writings. Marxs theory of the state provides the most useful entry into his perspective on law. Congruent with his materialist perspective, Marx asserts that the economic conditions of society determine what type of state will develop, which in a capitalist society implies that the state will be controlled by the bourgeoisie as an instrument to secure economic rights and to moderate class conflict. For him the capitalist state represents and secures the power of the dominant economic class which now also becomes the politically dominant class. Interestingly, Marx argues that the democratic republic, rather than being a more egalitarian form of the capitalistic state, for it totally disregards the property distinction that have arisen under capitalism. Marxs notion on law is instrumentalist, similar to that of his notion of state. He views the legal system in function of its role as an instrument of control serving bourgeois interests. Rather than abiding by a principle of the rule of law that holds that it is just for the law to be applied equally and fairly to all, Marx maintains that capitalist law actually enhances the conditions of inequality that mark capitalist society. Marx contends that the capitalist legal system contributes to inequality because capitalist law establishes and applies individualized rights of freedom, which benefit those who own while disfavoring those who are without property. The formal equality that is granted in law by treating the various parties that are in contract with one another or with the state as equal contributes to sustain and develop the economic inequalities that exist among legal subjects. Legal doctrine justifies the practices of capitalist law on the basis of a notion of justice claime d to be universally valid but which in actuality serves the interests of only the dominant economic class. The ideology of capitalist law is ultimately accepted widely even among those members of society who are economically disadvantaged and thus additionally subject to the inequalities brought about by the legal system. For Max Weber, a so-called legal rational form as a type of domination within society, is not attributable to people but to abstract norms. He understood the body of coherent and calculable law in terms of a rational-legal authority. Such coherent and calculable law formed a precondition for modern political developments and the modern bureaucratic state and developed in parallel with the growth of capitalism. Central to the development of modern law is the formal rationalisation of law on the basis of general procedures that are applied equally and fairly to all. Weber specifically outlined the characteristics of a formally rationalized legal system that is primarily guided by the application of procedures. His analysis of law is an intrinsic part of his sociology, in terms of both its perspective of the study of society and its theoretical propositions on the conditions of modern society. Modern rationalised law is also codified and impersonal in its application to specific cases. In general, Webers standpoint can be described as an external approach to law that studies the empirical characteristics of law, as opposed to the internal perspective of the legal sciences and the moral approach of the philosophy of law. Weber developed his perspective on law as part of a more general sociology. In the systematic nature and comprehensive scope of its contribution, Webers analysis is rivaled only by that of Emile Durkheim, whose sociology of law was likewise part and parcel of a more fundamental sociological perspective and theory of society. Emile Durkheim wrote in The Division of Labour in Society, that as society becomes more complex, the body of civil law concerned primarily with restitution and compensation grows at the expense of criminal laws and penal sanctions. Over time, law has undergone a transformation from repressive law to restitutive law. Restitutive law operates in societies in which there is a high degree of individual variation and emphasis on personal rights and responsibilities. For Durkheim, law is an indicator of the mode of integration of a society, which can be mechanical, among identical parts, or organic, among differentiated parts such as in industrialized societies. Durkheim also argued that a sociology of law should be developed alongside, and in close connection with, a sociology of morals, studying the development of value systems reflected in law. At sociologys heart is a concern for morality. For Durkheim, society cannot exist without moral bonds, whether these are bonds of shared belief or of mutual commitment reflecting the interdependence of individuals or social groups. Moral ideas are neither innate in the individual nor to be deduced from abstract first principles. They are inspired by the empirical conditions of social lie in particular times and places. To understand those conditions and the forces that shape social development is rationally to appreciate moralitys demands. Morality provides the normative framework of stable social relationships. In modern society these relationships are primarily domestic, economic and occupational and political relationship of citizenship. Morality expresses the requirements of living together in particular environments; the domain of the moral begins where the domain of the social begins (Durkheim, 1961:60). For Durkheim, Moral ideas are the soul (lame) of the law(1909:150). Law ex presses what is fundamental in any societys morality. So the study of law like that of morality is central to sociology. Conclusion Among the three classic thinkers Marx did not focus on law to any degree of intellectual satisfaction, while the sociological contributions of Weber and Durkheim are not only influential but foundational to the sociology of law.

The Legitimate Authority Theory Essay -- social influence, authority, a

Obedience is a form of social influence in which a person yields to explicit instructions or orders from an authority figure. Already at an early age we are taught to obey authority figures within our social groups through influences such as parents, teachers or even religious establishments. The Agency Theory (Milgram 1963) supports the idea that a person will obey the Authority figure and work as an agent for this authority figure under the implied possibility of there being no consequences to their actions as either the authority figure will take on no liability or said authority figure has justified these action therefore they are acceptable. The strongest evidence supporting this theory was gained after researching WW2 German soldiers who were stationed at the labor and death camps. When asked why they committed these atrocities they simply responded â€Å"we were ordered to do this† (Mike Haralambos et al (2002) Psychology in Focus A Level). The Legitimate Authority theory (Milgram 1963) strongly links into the Agency theory. As stated beforehand one must recognize an individual or a collective of individuals as authority figures before acting on their behalf. This theory suggests that we obey those seen as authority figures as were are taught to do so from an early age. A legitimate authority figure can be individuals or organizations such as the government, the boss at work, a police officer or as demonstrated in Milgram’s study (1963) a scientist. The Gradual Commitment theory (Milgram 1963) expounds that an individual will willingly perform seemingly harmless, trivial tasks. Milgram’s participants were encouraged to obey the experimenter by the gradual steps they were directed to take. This was accomplished with increasi... ...rying out the orders. They were not supposed to take instructions by phone, let alone exceed the allowed dose. Works Cited Eysenck, M. and Flanagan, C. (2000) Psychology for AS level, Hove, Psychology Press Cox, E. (2008) AS Psychology, London, Philip Allan Updates Page 206 Mike Haralambos et al (2002) Psychology in Focus A Level, The Bath Press Page 144 The following studies were taken from this book: Hofling (1966) http://www.psychology4a.com/Social%20influence.htm November 11, 2013 http://aspsychologyblackpoolsixth.weebly.com/obedience.htmlNovember 11, 2013 http://aspsychology101.wordpress.com/social-psychology/November 11, 2013 http://atheism.about.com/od/warandmorality/a/jusadbellum_3.htmNovember 11, 2013 Coralie et.al 2013 www.coraliethirietpsychology.wordpress.com/2013/03/01/obedience-experiment-coralie-medisa-zahra-bryony-and-jesse/ 13 November 2013

How Do Gangs Affect Adolescent Behavior?

Since the early 1920s, researchers have closely studied the relations between the street gangs and violent crime froma variety of perspectives: criminological, sociological and psychological (Thomas, 2008). Whatever the underlying causes for gang membership, the resuls seems clear; members of street gangs admit to a far greater rate of serious crime, and to far more severe acts of of the same age, race, and socioeconomic background (Penly Hall, Thornberry & Lizotte, 2006) than non-gang members of the same age, race, and socioeconomic background (Battin-Pearson, Thornberry, Hawkins & Krohn, 1998).According to the Web site safetyouth. org (n. d. ) gang violence is certainly a cause for concern: Gang members are responsible for much of the serious violence in the United States . . . Teens that are gang members are much more likely than other teens to commit serious and violence crimes. For example, a survey in Denver found that while only 14% of teens were gang members, they were respon sible for committing 89% of the serious violent crimes. (n. p. ) Many researchers have come to the conclusion that gangs necessarily cause violence and deviant behavior.As a matter of policy then, it seems clear that the solution of a number of social ills is to break up, disrupt, or prevent the formations of gangs (Battin-Pearson, et al. , 1998). Yet, is this the solution? As George Thomas (2008) states, â€Å"The problem is complex, so the solutions cannot be complex† (p. 88). So what is the solution? According to the U. S. Department of Education (n. d. ), all factors of age, race, and socioeconomic background must be taken into consideration . . .

William Shakespeare s Julius Caesar Essay - 1609 Words

The topic of leadership in Shakespeare’s Julius Caesar has been discussed and argued ever since the play was written. The most prevalent discussion of leadership in the play revolves around Shakespeare’s tragic hero, Marcus Brutus, and the cause of his downfall. According to Shakespeare critic James Bundy, â€Å"Brutus... is a man whose affections sway more than his reason, in whom there is this tragic confederacy of passion and imagination against reason† (qtd. in Palmer 402). Ernest Shanzer, however, says that Brutus is â€Å"by no means devoid of political shrewdness and practical wisdom†, but he is a â€Å"bad judge of character† (Shanzer 1). Although both critics’ descriptions of Brutus have merit, Brutus’ shortcoming, as well as the success of the opposing leader, Mark Antony, is more accurately explained using the observations of Niccolo Machiavelli in The Prince. In this book Machiavelli outlines the characteristics of a s uccessful leader. When using The Prince as a lens to read Julius Caesar, the correlation between a leader’s Machiavellianism and their success becomes very apparent. Marcus Brutus is undoubtedly an honorable and respectable man, but his morality prevents him from adhering to Machiavelli’s principles. Due to his lack of princely virtues, Brutus is doomed to fail, while Antony, a much more Machiavellian prince, successfully seizes power. Niccolo Machiavelli’s The Prince is one of the most respected documents in existence regarding power, and for goodShow MoreRelatedWilliam Shakespeare s Julius Caesar1082 Words   |  5 Pages â€Å"Et tu, Brutà ©? Then fall Caesar† (III.i 179). The fatal stabs of the conspirators did not kill the all-mighty Julius Caesar, for the sharp butcher of Brutus pierced his heart and condemned his life to cessation. This dramatic, mood changing affair serves as the pivotal platform in William Shakespeare’s, Julius Caesar. It is a compelling novel that recounts the unjust murder of Julius Caesar, an ancient Roman general. Oblivious to this conspicuous foreshadowing, Caesar fails to distinguish his trueRead MoreWilliam Shakespeare s Julius Caesar Essay1833 Words   |  8 Pages INTRODUCTION The seemingly straightforward simplicity of â€Å"Julius Caesar† has made it a perennial favourite for almost 400 years. Despite its simplicity, almost Roman in nature, the play is rich both dramatically and thematically, and every generation since Shakespeare’s time has been able to identify with some political aspect of the play. The Victorians found a stoic, sympathetic character in Brutus and found Caesar unforgivably weak and tyrannical. 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Obesity Is A Major Problem - 1234 Words

Over the past four decades, the rate of obesity in America has been on the increasing end; two out of three Americans are either obese or overweight. The obesity epidemic has become a major problem in the United States which caused many serious effects on individual and society. It is an indiscriminate problem that negatively affect everyone from adults to children; which is a significant threat to the health of humanity that needs to be eliminated. First, we need to know what obesity is. According to Oxford Dictionary, Obesity is â€Å"The condition of being grossly fat or overweight† (â€Å"Definition of Obesity in English†). Obesity is a condition of excessive fat accumulation and unusual in a region of the body or the whole body†¦show more content†¦Other opinions are parents should not be blamed on the childhood obesity because the kid doesn’t eat only at home but also at school. Kids go out with their friends to eat at restaurants and fast food pla ces a lot so that could be another factor for obesity. Obesity is an individual’s free choice so it is the person’s responsibility for getting obese. Besides, Happy Meals make kids happy. Fast food sales are good for the economy. Processed foods give people more energy than fresh foods because it contains more carbohydrates. Fast food also saves time for people that are busy and doesn’t have time to get in the kitchen and cook. There are many factors that lead to obesity; most of them come from our daily habit and environmental factors. One chief cause of the main causes of obesity is America s unhealthy diet; the meal we eat everyday contains too many cheese, sugar, and meat; and we don’t have enough fruits and vegetables. The documentary Supersize Me mentioned of today s diet of mostly every US citizen; due to today’s busy life, many people and households choose fast food instead of making home meals. Fast food is also usually cheaper â€Å"Mo re food, less money†, but it will cause a disastrous consequence on people’s health. America’s eating habit is bad; but unfortunately, it isn’t easy to eat completely healthy since fresh food cost a lot more than fast food, and people nowadays get too busy to cook home meals. It is also

IMPACT OF MONEY SUPPLY ON THE ECONOMIC GROWTH OF NIGERIA

THE IMPACT OF MONEY SUPPLY ON THE ECONOMIC GROWTH OF NIGERIA CHAPTER ONE INTRODUCTION 1.1 BACKGROUND OF THE STUDY In the critical observation of the recent Nigerian economic position, there has been a great divergence between the rate at which money is supplied and the exact impact it has on the general price level, which results in inflation and deflation on one hand, and the output growth (productivity) on the other hand. Although, it had occurred to our mind that Nigerian monetary policy continues to aim at achieving single digit inflation, a stable Naira, increase in domestic production and a stock of foreign exchange reserves equivalent of at least six months of current imports, the Central Bank of Nigeria (CBN)†¦show more content†¦Otherwise, we had found the repeated cases in which people seem to have so little money that they were unable or certainly reluctant to buy everything that could be produced. 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Entrepreneurship and Small Business Management Research Report free essay sample

Another possible connotation for the SMEs is the small manufacturing enterprises. Small and medium enterprises, both in size and shape, are not uniform across the globe. This asymmetry comes in the way of any effort of their integration. The way they are defined depends on the stage of economic development and the broad policy purposes for which the definition is used. According to a World Bank study, there are said to be more than 60 definitions of small and medium industries used in 75 countries surveyed. The most commonly used definitions relate to either size of employment and/ or quantum of capital investment/ fixed assets. As the process of economic development leads to changes in industrial sector shares in GDP and the contribution of sub-sectors within industry, the definition is extended to include not only manufacturing industries but all enterprises which fall within or below the defined cut-off point. In the ASEAN (Association of Southeast Asian Nations) countries in general, the definition is restricted to SMIs in the manufacturing sector only, whereas in the OECD group, the definition is broadened to include all Small and Medium Enterprises. Though employment and turnover are also used to define small industries, as these indicators are implicit in the requirement for registration under the Factories Act. Therefore, the contribution of SME sector to the GDP in different countries is not on comparable parameters. Still, in both developed and developing economies, they were accorded special status, specific dispensations and particular attention. Definition of Small Medium Enterprise in the Context of Bangladesh Despite the fact that a large number of SMEs in Bangladesh operate in the informal sector, they are perceived as the leading vehicle for growth of the national economy, encompassing a multiplier effect on employment, GDP growth as well as having a significant impact on poverty alleviation. a. For manufacturing activities enterprises shall be categorized using the following definition (fixed investment implies exclusion of land and building, and valuation on the basis of current replacement cost only):  ¦ Small enterprise: An enterprise should be treated as small if, in today’s market prices, the replacement cost of plant, machinery and other parts/components, fixtures, support utility, and associated technical services by way of capitalized costs (of turn-key consultancy services, for example), etc, excluding land and building, were to be up to Tk. 15 million; Medium enterprise: An enterprise would be treated as medium if, in today’s market prices, the replacement cost of plant, machinery, and other parts/components, fixtures, support utility, and associated technical services (such as turn-key consultancy), etc, excluding land and building, were to be up to Tk. 100 million; b. For non-manufacturing activities (such as trading or other services), the Taskf orce defines:  ¦ Small enterprise: An enterprise should be treated as small if it has less than 25 workers, in full-time equivalents;  ¦ Medium enterprise: An enterprise would be treated as medium if it has between 25 and 100 employees; SMEs have undergone significant structural changes over time in terms of product composition, degree of capitalization and market penetration in order to adjust to changes in technology, market demand and market access brought by globalization and market liberalization. However the environment remains inadequate to foster their position, scale up, integrate and compete in the regional and global markets. Despite the odds, SMEs in all sectors manage to overcome these challenges and operate efficiently, with resilience and using great adaptive and innovative capacities. These are the engines of change to unlock the potential of SMEs’ development towards sustainable development and inclusive growth. Bangladesh has taken up the social entrepreneurship model and innovative entrepreneurs are venturing into trade. Overall Condition of SME in Bangladesh In the context of Bangladesh, the development of Small and Medium Enterprises (SMEs) can be considered as a vital instrument for poverty alleviation and ensure the rapid industrialization. Different countries and organizations define SME differently. The Government of Bangladesh has categorized SME into two broad classes – Manufacturing enterprise Manufacturing enterprises can be divided into two categories. Small enterprise: an enterprise would be treated as small if, in current market prices, the replacement cost of plant, machinery and other parts/components, fixtures, support utility, and associated technical services by way of capitalized costs (of turn-key consultancy services, for example), etc, excluding land and building, were to up to Tk. 15 million. Medium enterprise: an enterprise would be treated as medium if, in current market prices, the replacement cost of plant, machinery and other parts/components, fixtures, support utility, and associated technical services by way of capitalized costs (of turn-key consultancy services, for example), etc, excluding land and building, were to up to Tk. 100 million. Non-manufacturing activities (such as trading or other services) Non-manufacturing activities can be divided into two categories. Small enterprise: an enterprise should be treated as small if it has less than 25 workers, in full-time equivalents; Medium enterprise: an enterprise should be treated as small if it has between 25 and 100 employees. According to Bangladesh Bureau of Statistics different enterprises are defined as; No. of employees Micro 0-9 Small 10-49 Medium 50-99 Large Above 99 Research Paper Analysis Based on the topic ‘small business’ in the context of any country other than Bangladesh but matches with the Bangladesh context, we have searched and selected the following three research papers. Paper-1 The owner/manager’s mentality and the financial performance of SMEs Paper-2 Strategy development by small scale industries in India Paper-3 Is entrepreneurial competency and business success relationship contingent upon business environment? A study of Malaysian SMEs Of the three now we will analyze each paper and explain ‘the problem of research’, ‘methodology’ and ‘findings’. The owner/manager’s mentality and the financial performance of SMEs Problem of the Research Despite the fact that the mentality of owner/managers is an important aspect of their personality characteristics no prior study has made any attempt to examine its possible impact on enterprise performance during various stages of growth. Therefore, based on a questionnaire survey conducted in Sri Lanka, this study attempts to examine this aspect of small to medium enterprises (SMEs). Methodology Based on a review of the literature, a conceptual model was constructed as the initial step in this research for visualizing and testing the relationship between owner/managers’ personality styles, operational approaches and financial performance. The model was then extended to reflect the relationship between owner/manager’s mentality styles and financial performance over all stages of enterprise growth. [pic] Figure: Basic relationship between owner/manager’s mentality and enterprise performance Findings The results of the study show that there is a strong relationship between owner/managers’ mentality and financial performance of their enterprises. Moreover, when owner/managers of these enterprises become more entrepreneurial minded in the introductory and decline stages their performance tends to be higher. However, this relationship is not seen to be significant in the growth and maturity stages. Strategy development by small scale industries in India Problem of the Research In the present scenario of e-globalization, small scale industries (SSIs) are considered engine for economic growth all over the world. After markets globalization, SSIs are facing many pressures and constraints to sustain their competitiveness. The purpose of this paper is to examine various issues in context of Indian SSIs such as nature of pressures and constraints, competitive priorities, competencies development, areas of investment, and their relationship with performance. Methodology For collecting data, a questionnaire-based survey was conducted. In total, 75 valid responses were received. Statistical analysis of data acquired from survey is done by reliability test, t-test, and correlation analysis. Figure: Framework for study Findings Cost reduction, quality improvement, and delivery in time have emerged as major challenges for SSIs. Market research, welfare of employees, and research and development are found as major areas for investment. Use of information technology, training of employees, and research and development has significant relationship with performance. Is entrepreneurial competency and business success relationship contingent upon business environment? A study of Malaysian SMEs Problem of the Research The purpose of this article is to evaluate the effect of entrepreneurial competencies and the moderating effect of business environment on business success in small and medium sized enterprises (SMEs) in Malaysia. Methodology A sample of 212 Malaysian SME owner-founders participated in this study. The structural equation modeling (SEM) procedure was used to test the proposed model. Figure: Theoretical framework Findings The results showed that entrepreneurial competencies were strong predictors of business success in SMEs in Malaysia. It was also found that the association between entrepreneurial competencies and business success was more strongly evident in hostile and dynamic environments than in more benign and stable environments. It was suggested that understanding business success through the lens of entrepreneurial competencies is important because it provides entrepreneurs with knowledge about the way they should operate their business and encourages them to be conscious of the potential positive or negative impacts of their own behavior. Self-report was used as the source of all data. This approach, even though criticized by some, was deemed necessary because of difficulties associated with the independent assessment of each of these variables. Nevertheless, future studies should identify ways to obtain competency data from multiple informants to minimize the possibility of response bias. We have selected the first research paper out of three to apply it here in the context of Bangladesh. The findings of this particular study can be useful to SMEs in any country as they show how the mentality of owner/managers is likely to affect the financial performance of their enterprises differently during different stages of growth. Of the three now we will analyze the 1st research paper which we have selected to apply in the context of Bangladesh. The owner/manager’s mentality and the financial performance of SMEs 1. Introduction Small and medium enterprises (SMEs) play an important role in the economies of both developed and developing countries. This role, however, depends on the financial performance of each enterprise (Neck, 1987). Financial performance, in turn, depends on numerous factors both internal and external to the enterprise. Among them, the personality characteristics of those who manage the enterprise are universally regarded as one of the most powerful set of factors having either positive or negative impact on its financial performance. However, although the mentality of owner/managers is an important aspect of their personality characteristics no prior study has made any attempt to examine its possible impact on the financial performance of their businesses. Moreover, even the studies that focused on the relationship between personality characteristics and financial performance have confined their investigations to a single period of time. Nevertheless, the literature shows that usually financial performance of enterprises varies dramatically during different stages of growth (Penrose, 1963). Similarly, the impact of mentality styles of owner/managers on financial performance of their enterprises may also vary from stage to stage depending on the nature of those factors. 2. Statement of the problem This study attempts to examine whether there exists a relationship between the mentality of owner/managers and the financial performance of their enterprises and, if so, whether it varies between different growth stages of an enterprise. In attempting to examine the above relationship, this study concentrates on two distinctive mentality styles of owner/managers: entrepreneurial mentality and administrative mentality. Since no similar research has been reported in the past this study takes its own independent approach and presents its analysis and findings as a novel addition to the small business literature. Moreover, the findings of this study can be useful to SMEs in Bangladesh as they show how the mentality styles of owner/managers is likely to affect the financial performance of their enterprises differently during different stages of growth. . Literature Review The literature in this area suggests that owner/managers’ personalities, particularly their personal values, influence the strategies they adopt in operating their businesses and, in turn, the financial performance of those businesses (Bamberger, 1983; Thompson and Strickland, 1986; O’Farrell and Hitchins, 1988; Kotey and Meredith, 1997). A lthough personal values differ among individuals, people with similar personal values can be grouped together to form a personal value type. Accordingly, Kotey and Meredith (1997) have identified two distinct personal values as â€Å"entrepreneurial† and â€Å"conservative†. According to them and several other researchers, successful owner/managers are those associated with the personal value type referred to as entrepreneurial (Kotey and Meredith, 1997; Rockeach, 1973; England, 1975; Cunningham and Lischeron, 1991; Selver, 1988; DeCarlo and Lyon, 1980; Birch, 1987). Research has also indicated that entrepreneurs and managers have different goals and decision-making styles (Carland and Carland, 1992; Richard, 1989; Smith et al. 1988). According to Schumpeter (1934), the key ingredient of entrepreneurship lies in the individual’s innovativeness, which is also referred to as creativity, or discovery. Entrepreneurship, in this view, is regarded as â€Å"the opportunity-seeking style of management that sparks innovation† (Patterson, 1985). Several researchers have recognized creativity and innovati on as conditions inherent in the role of entrepreneurship (Olson, 1985; Timmons, 1978) which separate entrepreneurs from managers (Carland and Carland, 1991; Carland et al. , 1988; Swayne and Tucker, 1973; Timmons, 1978). Intuition is also widely recognized as another important entrepreneurial quality. It refers to the ability of an individual to recognize an opportunity and make the appropriate decision on time. Iacocca (1984) defines this as a feel for the problem and an ability to make a decision when others are still looking for facts. As suggested by Mill (1984), however, risk-bearing is the key factor in distinguishing an entrepreneur from a manager. A distinctly higher need for achievement is often said to be associated with entrepreneurs (McClelland, 1965). According to McClelland and Winter (1969), a manager tends to be high in need for power and lower in need for achievement. Evidence also suggests that entrepreneurs are higher in achievement motivation than are managers (Begley and Boyd, 1987; Carland and Carland, 1991). The successful entrepreneur is also described as having strong drives for independence with an exceptional belief in himself (or herself) and his (her) abilities (Roscoe, 1973). According to Lachman (1980), entrepreneurs have unique personal values and attitudes towards work and life, such as honesty, duty, responsibility and ethical behavior. They attach greater importance to these values and attitudes in operating their organizations. Being consistent with these values, self-esteem, which is closely associated with individualism, is also referred to as a noticeable attribute of entrepreneurs (Cunningham and Lischeron, 1991). Moreover, as noted by Fiedler (1966), entrepreneurs are described as leaders of people who have the ability to adapt their leadership style to the needs of people. Similarly, alertness to opportunities is widely recognized as another distinctive characteristic of entrepreneurs. It allows existing businesses to develop and diversify their activities in other areas. Thus, entrepreneurs are believed to be more flexible than administrators with regard to making timely changes to their operational and management systems. A firm’s stage of growth has long been postulated as a contingency factor of major importance for strategic planning. It has been suggested that the effectiveness of a firm’s strategic planning process is contingent on its stage of growth (Hofer, 1975; Vozikis and Glueck, 1980; Robinson et al. , 1984). Based on the results of a survey conducted on a sample of small businesses in the USA, Eggers and Leahy (1995) have reported that different managerial skills are needed in each stage for optimum performance and therefore owner/managers need to change their management style according to the demands of firm growth. 4. Conceptual Model From a review of the above literature, a conceptual model (Figure 1) was constructed as the initial step in this study for visualizing and testing the relationship between owner/managers† personality styles, operational approaches and financial performance. The model was then extended, as shown in Figure 2, to reflect the relationship between owner/manager’s mentality styles and financial performance over all stages of firm growth. Based on the existing literature and the authors† own understanding of the nature of owner/managers, the owner/manager’s role is divided into two distinct categories as â€Å"entrepreneur† and â€Å"administrator†, and the state of mind associated with each role is referred to as â€Å"entrepreneurial mentality† and â€Å"administrative mentality†. It is hypothesized that these two mentality styles influence the firm’s managerial policies, strategies and decisions, which ultimately determine its financial performance. Figure 2 is based on the commonly held view that a business enterprise during its life cycle goes through four different stages of growth – introduction, growth, maturity, and decline (Gorchels, 2000). The curve shown in the diagram represents the level of sales revenue for a typical firm. During the introductory stage, the firm earns slow revenue while spending for advertising and recouping product planning and development costs. If the firm becomes successful in its operations, it will then enter a growth stage with accelerating sales. The maturity stage is marked by a leveling of sales. The decline stage is a period of continuous declining of sales. Figure 2 also portrays the possible impact of owner/manager’s mentality on the firm’s performance in revenue generation throughout these four stages. [pic] Figure 1: Basic relationship between owner/manager’s mentality and enterprise performance [pic] Figure 2: Relationship between owner/manager’s mentality and enterprise performance during all stages of firm’s growth . Questions and Hypotheses H1: There is a strong relationship between owner/managers’ mentality and financial performance of their enterprises. Moreover, owner/managers with an entrepreneurial mentality have achieved higher performance in sales than their counterparts with an administrative mentality. H2: When owner/managers of these enterprises become more entrepreneurial minded in the introductory and decline stages their performance tends to be higher. 6. Methodology/Approach Based on the existing literature of the nature of owner/managers, the wner/manager’s role is divided into two distinct categories as â€Å"entrepreneur† and â€Å"administrator†, and the state of mind associated with each role is referred to as â€Å"entrepreneurial mentality† and â€Å"administrative mentality†. It is hypothesized that these two mentality styles influence the firm’s managerial policies, strategies and decisions, which ultimately determine its financial performance. To empirically test the impact of owner/managers’ mentality on financial performance of firms as portrayed in the conceptual model in Figures 1 and 2, a questionnaire survey will be conducted on a sample of SMEs in Bangladesh. The questionnaire is prepared in English and will be either mailed or personally distributed to each of the owners of the 60 firms selected for the survey. We will follow the qualitative approach for our research. Qualitative research studies are focused on differences in quality, rather than differences in quantity. Results are in words or pictures rather than numbers. Qualitative studies usually have fewer participants than quantitative studies because the depth of the data collection does not allow for large numbers of participants. For our purpose we have selected a sample size of 60 small business owners. It is common knowledge particularly in developing countries that many owner/managers of small businesses are often reluctant to disclose the amounts of their profits or sales revenue to external parties. Therefore, for the purpose of identifying the level of financial performance in each sample firm, the respondents in our survey will be asked to select one of five given situations that described the changes in sales revenue over the last three operating years. The five situations given are: (1) substantial increase; (2) slight increase; (3) no significant change; (4) slight decrease; and (5) substantial decrease. When represented in a questionnaire it will represent a 5-point likert scale. Similarly, in order to gain an understanding of the current stage of growth in each firm, the respondents will be asked to use their knowledge of the firm’s historical development and personal judgement and identify the development or growth stage applicable to their firms from the four stages specified in the questionnaire – introductory stage, growth stage, maturity state, and declining stage. Based on a review of existing literature, ten major qualities or attributes of entrepreneurs were identified for the purpose of distinguishing owner/managers with an entrepreneurial mentality from those with an administrative mentality. These qualities include innovation and creativity, intuition, risk-taking, distinctly higher need for achievement, independence, exceptionally high self confidence, unique personal values and attitudes towards work and life, self-esteem, individuality, adaptability of leadership style to the needs of people, alertness to new opportunities, and flexibility. On the basis of these entrepreneurial qualities, ten questions will be included in our survey questionnaire for the purpose of identifying the nature of each owner/manager’s mentality. For each question, two alternative answers will be provided to the respondents requesting them to indicate their choice. One of these two answers or alternatives is designed to signify one of the entrepreneurial qualities cited above. When a respondent selects this particular alternative he (she) would be counted as an owner/manager with entrepreneurial mentality. Similarly, if the respondent selects the other alternative he (she) would be counted as an owner/manager with administrative mentality. This qualitative approach will provide a depth and richness of data not possible with quantitative data. Although there are fewer participants, we will generally know more details about each participant. 7. Data Analysis: Following the procedure described in the previous section, the mentality points of owner/managers were calculated on the basis of their responses given to the ten questions included in the questionnaire. The results are presented in the table below. Since the total number of points applicable were 10, owner/managers with a score higher than 5 were identified as those possessing a greater degree of entrepreneurial mentality and a lesser degree of administrative mentality. The opposite was true for those who received a lower-than-average score. Of the total number of 60 owner/managers, nearly 83. 3 percent were identified as more entrepreneurial minded as against 16. 7 percent of those with a greater degree of administrative mentality. Table 1: Frequency distribution of mentality points Mentality points scale |Number of owner/managers | |1 |0 | |2 |0 | |3 |0 | |4 |5 | |5 |5 | |6 |10 | |7 |15 | |8 |13 | |9 |9 | |10 |3 | Total 60 ** 1-5 refers administrative mentality 1-10 refers entrepreneurial mentality The average mentality score was found to be 7. One interesting observation is that almost all of the respondents said no when they were asked whether they value achievement over money. That is the reason why not so many of the respondents scored a perfect 10 in terms of mentality points (only three individuals scored a perfect 10). It also provides an interesting insight into the socio-economic condition and the mind-set of small business owners. It gives hint to the fact that money is the primary motivating factor for most small business owners in Bangladesh. The survey results also indicate a significant relationship between owner/managers† mentality and performance in sales. 28. 6 percent of owner/managers with an administrative mentality reported a slight increase in sales while 71. 4 percent owner/managers with an entrepreneurial mentality reported a substantial increase in sales. Thus, these results show that owner/managers with an entrepreneurial mentality have achieved higher performance in sales than their counterparts with an administrative mentality. For the purpose of examining whether the owner/manager’s mentality affected the sales performance differently in different stages of growth, the data acquired from questionnaire survey was further processed according to the stages of growth. The â€Å"substantial† and â€Å"slight† increase/decrease groups have been combined to form two main groups as â€Å"Increase in sales† and â€Å"Decrease in sales†. After processing survey data and reviewing individual opinion of owners/managers, there appears to be a strong relationship between owner/manager’s mentality style and enterprise performance in all stages of firm growth. However, this relationship is significant only in the introductory and decline stages. This suggests that when owner/managers become more entrepreneurial minded in their strategies, decisions and actions operating performance tends to be higher in the introductory and decline stages. In the growth and maturity stages, however, this relationship is not seen to be so important. In other words, during these two stages there is no significant difference between entrepreneurial minded owner/managers and administrative minded owner/managers with regard to the impact of their mentality on enterprise performance. It may be that since firms obviously have higher revenues and profits during growth and maturity stages the difference in the owner/managers’ mentality styles cannot make a significant difference in performance during these two stages. 8. Conclusion: The main conclusion of this study is that there is a strong relationship between owner/managers’ mentality and financial performance of their enterprises. Moreover, it can also be concluded that when owner/managers of SMEs are more entrepreneurial minded in the introductory and decline stages their performance tends to be higher. This suggests that owner/managers need to become more entrepreneurial oriented in their strategies, decisions and actions in order to achieve better performance in the introductory and decline stages. However, this relationship is not seen to be significant in the growth and maturity stages. It may be that a combination of both entrepreneurial and administrative mentalities is needed for achieving high performance in the growth and maturity stages. However, the validity of these results cannot be verified as no comparative studies have been reported in the literature. It should be noted that the above conclusions should be treated with caution as the results of our investigation have been constrained by a number of limitations. Primarily, some of the questions and alternative answers provided in our survey questionnaire for identifying the two styles of mentality may have conveyed different meanings to different respondents. Similarly, the small sample size does not permit generalization of results to all manufacturing firms in the SME sector. In addition, the results of this study were subject to the limitations commonly associated with all mail surveys in respect of the reliability and accuracy of information. Despite the above limitations, this research was unique in several respects and would provide some useful insights to many owner/managers in the SME sector. Since the survey was confined to only 60 SMEs in a single country it would be useful to replicate it using larger samples under different country settings. In doing so, it is important to devote a special attention to the few limitations noted above. References http://www. made-from-india. com/article_detail. php? artid=326 Dunn, Karen; Mondal, Abdul Hye Report on the review of the Decent Work Country Programme: Bangladesh 2006-2009 / ILO Regional Office for Asia and the Pacific. Bangkok: ILO, 2010, vi, 80 p. National Policy Review Forum 2003, Industrial Policy, Privatization and SME International Journal of Business and Management: Performance Evaluation of SMEs of Bangladesh, Vol. 4, No. 7. July 2009 The owner/manager’s mentality and the financial performance of SMEs Journal of Small Business and Enterprise Development Vol. 15 No. 1, 2008. pp. 150-161. Emerald Group Publishing Limited- 1462-6004 DOI 10. 1108/14626000810850892 Strategy development by small scale industries in India Industrial Management Data Systems Vol. 110 No. 7, 2010. pp. 1073-1093 Emerald Group Publishing Limited- 0263-5577 DOI 10. 1108/02635571011069112 Is entrepreneurial competency and business success relationship contingent upon business environment? A study of Malaysian SMEs International Journal of Entrepreneurial Behavior Research Vol. 16 No. 3, 2010. pp. 182-203 Emerald Group Publishing Limited- 1355-2554 DOI 10. 1108/13552551011042780 Bamberger, I. 1983), â€Å"Value systems, strategies and performance of small and medium-sized firms†, International Small Business Journal, Vol. 1 No. 4, pp. 25-39. Beam, H. H. and Thomas, A. C. (1989), â€Å"Could you succeed in small business? † , Business Horizons, Vol. 32 No. 5, pp. 65-9. Begley, T. and Boyd, D. (1987), â€Å"A comparison of entrepreneurs and managers of small business firms†, Journal of Management, Vol. 13 No. 1, pp. 99-108. Birch, D. L. (1987), â€Å"Yankee Doodle Dandy†, Inc. , 9, July, pp. 33-6. Carland, J. A. and Carland, J. W. (1991), â€Å"An empirical investigation into the distinctions between male and female entrepreneurs and managers†, International Small Business Journal, Vol. 9 No. 3, pp. 62-72. Carland, J. W. and Carland, J. A. 1992), â€Å"Managers, small business owners and entrepreneurs: the cognitive dimension†, Journal of Business and Entrepreneurship, Vol. 4 No. 2, pp. 55-62. Carland, J. W. , Hoy, F. and Carland, J. A. (1988), â€Å"Who is an entrepreneur? † American Journal of Small Business, Vol. 12 No. 4, pp. 33-9. Chushokigyo, C. (1981), Chushokigoyo Shoroppo, The Agency for Small and Medium Enterprises, Tokyo. Cunningham, J. B. and Lischeron, J. (1991), â€Å"Defining entrepreneurship†, Journal of Small Business Management, Vol. 29 No. 1, pp. 45-61. DeCarlo, J. F. and Lyon, P. R. (1980), â€Å"Towards a contingency theory of entrepreneurship†, Journal of Small Business Management, Vol. 18 No. 3, pp. 37-42. Eggers, J. H. nd Leahy, K. T. (1995), â€Å"Entrepreneurial leadership†, Business Quarterly, Vol. 39 Appendix This research is conducted for academic purposes only. So please do not hesitate to answer. Your information will be kept confidential. ? Please select one of the five situations given below that describes the changes in sales revenue of your company over the last three operating years. ? Please identify the development or growth stage applicable to your company from the four stages specified below. Measurement of Mentality 1. Do you use innovation and creativity in making decision? Yes No 2. Do you rely on intuition while making decisions? Yes No 3. Do you take calculated risk while making decisions? Yes No 4. 6. Do you value your achievement as the owner over money? Yes No 5. Do you have confidence in your ability to succeed? Yes No 6. Do your decisions reflect your personal values and attitude towards work? Yes No 7. Do your decisions reflect your individuality and self-esteem? Yes No 8. Do you adapt your leadership style to the needs of your workers? Yes No 9. Are you always alert to new opportunities? Yes No 10. Do you prefer to be independent while making decisions? Yes No 2 3 4 5 Substantial slight no significant slight substantial increase increase change decrease decrease 1 2 3 4 Introductory stage growth stage maturity stage decline stage Thank you for your cooperation. Performance/ Competitiveness 1. Business cost 2. Market Pressures 3. Constraints Strategy development 1. Competitive priorities 2. Competency 3. Investment in different areas Business environment