Entrepreneurship at the Base of the Pyramid: The Moderating Role of Person-Facilitator Fit and Poverty Alleviation

Facilitating entrepreneurship through micro-credit, micro-franchise, and micro-consignment potentially helps to alleviate desperate poverty. However, the effectiveness of these facilitators have varied from positive outcomes of poverty alleviation to negative outcomes of increased debt. Therefore, we seek to understand: how and why are different facilitators of entrepreneurial activity at the Base of the Pyramid (BOP) relatively more effective at alleviating poverty? Building on the foundation of person-entrepreneurship fit, we introduce the construct of person-facilitator fit and develop propositions about how and why the fit between entrepreneurs and the different facilitators of entrepreneurship may influence poverty alleviation. Specifically, using a remediation perspective, we explicate how the demands-abilities and needs-supplies fit between an entrepreneur and the different facilitators of micro-credit, micro-franchise and micro-consignment moderates the likelihood of poverty alleviation and how person-facilitator fit moderates the magnitude of poverty alleviation over time. We offer theoretical and practical implications of our framework for different perspectives (remediation, reform, and revolution) on entrepreneurship and poverty alleviation.