Household and Small Business Across the Disciplines

Households, which are seen as income pooling units (Wallerstein, Martin, Dickinson 1982), play a crucial role in the world-system analysis. Individuals enjoy income that accrues to their households, a unit embedded in a network of different social relationships among people, kin or not kin, living under the same roof or sharing some important living function. Thus, social relations are seen as ways of obtaining different types of income (wages, rent, profi t, social exchange, gifts) and ways of ensuring different welfare services. This conceptualization of the household fi ts in the world-systems analysis criticism of two main tenets of the linear model of modernization theory:

family businesses: a misunderstood subject Family businesses do not suit well mainstream thinking following the linear model of modernization and the segregation of disciplines.
First, there is a "modernist" objection, according to which family business is a residue of the past, the old subsistence economy of the patriarchal family.Second, there is an "economistic" objection, according to which it is a hybrid: neoclassical economics considers family business as a transient moment (startup) in the life cycle of the company, and a backward phase in the development of industrialization (an expression of family capitalism as opposed to managerial capitalism) (Berle and Means 1932).Accordingly, family business is thought to be weak for two main reasons.First, in order to get bigger it should attract external capital, which the family prefers to avoid lest they lose control; so it stays small.Second, the family fears the growth of managerial skills external to the original nucleus even when they are unable to reproduce their managerial capacities. 3 Both of these notions are today under attack from many points of view.As for the "economistic" objection, its weakest point is the underlying idea of a separation between the rational behavior of entrepreneurial logic, and the irrational "familistic" behavior.Action favoring the family is supposed to be detrimental to the company.In a brilliant work, Michel Bauer (1993) offers us a different picture of the entrepreneur.Small or big as he may be, he thinks with three heads: that of "homo oeconomicus" looking for profi t; that of "paterfamilias" caring for the welfare of his kin; and that of "homo politicus" aiming at consolidating the power he has created within his fi rm.The head of homo oeconomicus is not the only one to be rational.Each fi rm strives for an equilibrium state that is the result of different combinations of kin and power relations, which all contribute to the economic success of the business.
Thus, it may be true that a small family business can go bankrupt if brothers disagree on profi t reinvestment or on the style of leadership.However, it is also true that the family bond can last even in a big business, as when a single business grows bigger and become a part of a panoply of fi rms sociology deals with the rest, that is, social relations like those of the family (Wallerstein 1991:241). 1  Living in Italy, one cannot ignore the pervasiveness of the family and its infl uence on different spheres of social life.In this country-as Ginsborg (1994) says-the family is still one of the few shared values.But its transformation has been impressive.On the one hand, it has adapted to all of the changes that, since 1968, the youth and feminist movements brought about in law 2 and personal behavior.It became open and egalitarian (Barbagli 1990), and it has lived through the most important demographic revolutions, such as less children per marriage and more de facto families.On the other hand, the family has played more and more (and not less) economic roles.Its indirect role, as in wealth redistribution and in consumption, is acknowledged: a criticism is now brought against welfare policies that implicitly treat the family as a partner in personal care and assistance, and reduce the state expenditure by leaving the burden of assistance to the family (Saraceno 1998).Moreover, families invest in the future of their children, allowing them to live with their families much longer than in other countries, even after higher education until they can earn a living similar to their parents.'Households also play a direct role in the economy: just think about the family business.
In Italy, as in many European countries, the large majority of businesses are SMEs which normally means family businesses.They are a pivotal ingredient of the Third Italy (the Center Northeast ) and of the industrial districts, but they also exist all over the country.Most jobs are being created in SMEs, which therefore have become the target of many social programs aiming at self-employment, enterprise creation, or supporting existing businesses.However, such programs are not oriented to family support if they are industrial programs; and they are not oriented to entrepreneurial family support if they are social policies.This expresses a diffi cult conceptualization of family businesses.

1.
In this distinction there is also the implication that economics and politics deal with what is rational, and sociology with the rest, that is what is irrational.

2.
In the '70s radical changes in family law followed the introduction of divorce and of the right to abortion.

3.
It is the famous Buddenbrook effect, that predicts that entrepreneurial capacities will not be developed beyond the third generation…

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Household and Small Business Across the Disciplines 530 run by various relatives (the company model originated in Veneto with the Benetton family, now found also in the rest of the country), or when consortia are created, as in food distribution, among separate family businesses.As for the "modernist" objection, thanks to the literature on industrial districts of the Center Northeast, one can say that the traditional views have received a powerful blow.The development of this industrialized area is attributed to a good integration between economic and social forces.The family business of sharecropper origin is considered as the model of the new fl exible post-fordist production. 4 This does not mean, however, that the old ideas are gone forever.Instead, they are back, with a vengeance.Rather than acknowledging the contribution of family businesses to development in general, the real issue has become understanding the differences that may exist between different socio-economic environments.Much has to be understood about the evolution of other local socio-economic systems, observed in other parts of the country like the South, which have points in common with, and differences from, the industrial districts.However, many studies have recently been undertaken on the semi-underground, gray economy and on local systems of small fi rms (Meldolesi 1998;Bàculo 1994;Meldolesi and Aniello 1998).They show how behind the vitality of fi rms systems invisible to a naked eye, but clear to an accustomed eye, 5 there is always a family business.This observation is not offered as a statement in passing-as do many works on SMEs which point at their family nature as a cause of weakness and an indicator of immaturity; instead, it is a systematic remark on the link between fi rms and terrain, and on the utilization of an effective potential of development, notwithstanding the fact that their actual productivity levels are lower than those in the Center North.

from "familism" to family strategies
What blocked an understanding of the relationship between family and business in the South was the thesis of "amoral familism" that Edward Banfi eld (1958) worked out in his famous study of a "backward community of the South" (that he called Montegrano), after WWII.The Southern family was said to behave according to an ethos that pushed it to "maximize material and immaterial advantage to the nuclear family and to suppose that everyone behaves in the same way," thus putting an obstacle to solidarity with the outside and to trust, which are the basic roots of entrepreneurship and democracy.
The fate of this thesis is rather odd.At the beginning, the picture of a disaggregated 6 South was rejected, and the psychological foundations of the theory were considered unable to explain the structural reasons for such a behavior (which was seen as rational in that village, as Pizzorno (1967) said, "thanks to its historical marginality there (was) nothing to do in Montegrano").Nowadays it has become the stereotype of the Southern society, and it is the basis on which Robert Putnam (1993) has built his theory of the absence of civicness and of the bad performance of Southern public administration, contrary to the good performance of local administration in the North East areas of the country, where family and social bonds gave way to a sense of civicness and trust.Even Enzo Mingione (1990), a scholar keen on the problematics of the informal economy, maintains that "familism" 7 is effi cient in the North (because of its links with the market) and "amoral" in the South because it has been absorbed inside "assistentialism." 8 Studies on the Southern family conducted in the tradition of network analysis have acquired great momentum showing the versatility of family 4. Becattini, Brusco, Dei Ottati and others in Cossentino, Pyke and Senderberger (1996).For a special attention to the topic of family and business in industrial districts see Pescarolo (1994).

5.
They are located in garages and backyards, and are not easily detected either by offi cial statistics nor by fi scal controls.
6. Mutti (1998) notes that the theses of Putnam are based on a blend of Banfi eld plus Gramsci; the latter' s ideas on the social disaggregation of the agrarian South (as opposed to the industrial North) had often been utilized to explain the underdevelopmento of the South.

7.
Note the frequent semantic sliding from family to familism.Actually, here one should always talk of family, better of families.See below.

8.
This term alludes to the way of getting consensus through money transfers that are provided to their own part, and not for work or productive activities, thus simply for assistance.

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Household and Small Business Across the Disciplines 532 strategies in economic activities (Piselli 1983;Gribaudi 1993).However, the message has not passed through to other disciplines.Paradoxically, the Center North family is seen as potential subject of a fl exible small business, while the Southern family continues to be only considered as the link of a mechanism of subordination to the "assistant" state, therefore as a cause of ineffi ciency and an obstacle to entrepreneurship.Such analyses need to be completely revised.The supposed weaknesses of the development basis of the South epitomizes the way in which the development potential of a large part of the world is assessed.We dare say that that what is happening in Southern Italy can be studied as a laboratory for potential alternative development paths.
First, the stereotype of familism is being opposed from within.Starting from internationally comparative studies on family values, Sciolla and Negri contest that entertaining an attachment for the family is tantamount to backwardness, since this feeling is the most widespread in countries like the USA and UK, relative to which Italy comes in a further order.Moreover, they show that the Italian South is not more familistic than the rest of the country, rather less so (Sciolla 1998;Negri and Sciolla 1997).There is interesting data on trust: it is mostly placed in the family, and the more so in the Center Northeast regions (similar fi ndings are reported in all analyses in this area).On the other hand, numerous studies show that there are no great differences between North and South regarding the evolution of roles between genders (toward more egalitarianism) and generations (toward greater democracy).What is different is trust in the state, which is lower in the Northeast, and higher in the South.
However, our purpose is not so much to rescue the category of familism (or of clientelism, both originating from particularism) and to understand what would be its better mix with universalism, as Mutti (1998: 106) 9 would suggest.This would lead us to reckon with abstract categories and self-contained models.The problem lies elsewhere.The family is a social bond that evolves according to strategies conditioned by what resources are available 10 .Being an evolving versatile social relationship, based on hierarchy and cooperation, it can reorient its own activities toward a democratic and developmental path.
In other words, our unit of analysis should be neither an abstract concept (familism) nor an institution (the family, with its boundaries and internal rules), but the strategies of cooperation among the people who belong to it and who in this way defi ne the environment of its activity.Not all kin work in the family business, and those who don't are less involved in its development strategies and in the redistribution 11 of its profi t.Not only kin work in the business, since there can be friends who nonetheless entertain egalitarian relationships, and employees that are considered "like kin." It is true that the South is a low trust area (Fukuyama 1995), and that intra-family relationships are more intense than external ones.However kin people do live in the common world.They may be students who want to learn new technologies, young women who quest for an equal role in society, and men and women who know how to do something and want to exploit their capacity.When these conditions coalesce with an entrepreneurial idea, the familial mobilization of economic and social resources can be impressive.Family businesses are born around craftsman abilities that were never lost, as activities for a third party (a commissioner), phases in a productive chain which is run by external or local commissioners, and are undertaken in particular moments of a life cycle (a birth, a marriage) and then pursued.In cases like these, an activity often starts as a joke (Bàculo 1994) and is later transformed into a real business, in a move analogous to that of kin "associated for love" (Turnaturi 1991) that gave rise to social movements for defense against the injustice they have suffered, and which later acted on the universalistic level of the promotion of new rights.It is a democratic process 9.
Mutti has done research on Abruzzi, a Southern region that is today considered developed, so much so that it no more received the incentives accorded by the European Structural Funds to underdeveloped areas.His thesis is that the local patron, Gaspari, developed a system of "open clientelism." 10.I have dealt with this in Stame (1990). 11.It is a modernist prejudice that according to which the family business is in danger from the appetites of absent but exacting kin.In our researches it is clear that there are kin who can aim at profi t redistribution because they work in the business, or because they could not work (the young, the old): i.e. out of a logic of production or of welfare.Those kin who do not contribute to the business cannot aim at sharing any advantage from it.

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Household and Small Business Across the Disciplines 534 of popular entrepreneurship that is assessing its place all over the South, in contrast to the widespread image of desolation and criminality.At the same time, it is true that for a long time dependence on public spending and the state' s redistributive system prevailed, and that many families utilized welfare state resources in such a way as to modify their previous situation (leaving heavy and less remunerated jobs that are now taken up by immigrants; subsidizing their children' s education in order to invest in a better and more secure position).But for this same reason, in the new frame of national and European welfare policies and reduction of transfer payments, the development of small entrepreneurship, mainly family based, can be seen as the only path to keep income levels felt to be adequate.

small business and family in the south of italy
The recent studies on the Southern local systems we have mentioned above focus on development processes based on small business, organized in districts, or systems of diffused industrialization.The family origin of businesses can be easily forecasted in those sectors where tacit knowledge exists, where the fi rm can grow out of an artisanal activity (garment, textile, shoemaking, furniture) or of trade (pedlars, petty trade), catching opportunities for large scale production (the "made in Italy"), and of forward and backward linkages.But it can manifest itself also in new and technologically innovative sectors, if the family supports the children' s training in higher level studies.
Here the relationship with the past is complex indeed.All diffused industrial areas have been wiped out by the heavy industrialization of the 1950s and 1960s (Becattini, 1998).The destruction of a fabric of small family businesses gave way to a quest for a secure job in the big fi rm or in the state, feeding clientelistic and assistantial-like behavior.Facing the actual crisis of those relationships that is felt everywhere owing to a change in external (the end of the cold war, the strengthening of Europe) as well as internal (the need for reducing defi cit spending) pressures, it is possible that a new tendency toward autonomous work and enterprise creation would increase.The latter could only stem from solidarity among members of the family, better or less trained, who are still responsive to traditional social values of hard-working, responsibility and thrift.It would be an alternative to the assistant-ism of the recent past, utilizing older virtues in a process of political recovery of the civil society.
Of course, the process we are talking about would take into account local differences.In these studies are often distinguished: • areas in the "bone," 12 inland areas, where strong peasant and catholic traditions persist: Everybody feels concerned when the family starts up a business.• areas in the "fl esh," in the valleys, along the coast or the motorways, more open to external pressures: family and business adapt to each other in changeable ways.• areas in the historical centers (big as Naples, small as Bitonto), where a low cultural level exists, together with strong traditions, but the social and productive fabric are intertwined, and an atmosphere reigns that is favourable to business.
Local variations account for the degree to which the family role approaches these standards.First, there is a core nucleus composed of kin (people related by kin, not necessarily all the members of a nuclear family, nor of an extended one) lacking which there would be no initiative.It is a favorable environment, with tighter and looser links, from friends to kin, within which there is trust and collaborative relationships.Its determination prevails over the external environment, often scarcely favorable to business (either out of criminal activity or of bureaucratic ineffi ciency).
Second, the family facilitates self-fi nancing.Banks do not lend money to those who cannot offer warranty, and are not able to assess the potential of new initiatives.Therefore, the family network feels the duty of giving those who decide to start a business money or real goods.Naturally, this accounts for the quantity of resources that can be mobilized which sometimes is scarce.
Third, the family contributes to work.Family members divide tasks according to their competence; and if the latter is lacking, children are invited to get it by training.Among the new generations this division does not take place along gender lines since young women who want to work in 12. "Bone" and "fl esh" was a very infl uential distinction drawn by Manlio Rossi Doria in his studies of Southern agriculture in the post WWII.His studies on the different agricultural areas are still illuminating for an understanding of the actual situation.

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Household and Small Business Across the Disciplines 536 the business get the same type of training as their male counterparts.The situation is different from the older generations where the mother often takes up the tasks of administration or quality control, while the father acts as the technical and managerial entrepreneur.Among family members there is generally an egalitarian relationship and a democratic atmosphere.This is normal when relatives are of the same generation, but even when there are two generations an authoritarian leadership of the old generation is rare.The organization of labor among relatives gives rise to some peculiarities.Flexibility is the rule.Family members work when they are asked to and with no attention to time.Kin collaboration is different from other associations or employment.For the entrepreneurial family work time and family time may even overlap, 13 in any case their distinction is not as sharp as that of other families who get together only in leisure time.Gains are shared according to needs, not to productivity, even if it is not rare that a relative can get a salary.Profi ts are often reinvested, although there are different behavioral models according to areas.As for the selection of personnel, in some cases employing family members may lead to the detriment of the required competence, which pushes for their training.But there could be a reverse side of the story, that family members who have got used to role rotation, would become interchangeable.This is close to the idea of most contemporary approaches to training, which insist on hands-on training, a tenet that the entrepreneurial family has always considered important.
Lastly, family businesses are distinctive for their confl ict management.First, in these businesses there is very little employer-employee confl ict.Employees work side by side with family members, who sometimes work more than they do, and cannot think of the boss' family as that of a rentier.A largely shared idea is that the employees also "belong to the family," mostly owing to the contiguity that they work in.If at times the working hours are longer than established by contract (if a contract exists!), at other times the employees are allowed time off for family reasons.Not to mention the fact that where the industrial fabric is not strong, having a job is considered an advantage not to be lost lightheartedly.All this speaks for the social force of the family business and the atmosphere favorable to it in these areas.Moreover, within the core nucleus of the fi rm, to be a family member is a factor of confl ict moderation: "with kin in the end things get right," and family businesses resist better moments of crisis which would have brought about bankruptcy and divisions in other businesses. 14Of course, breaking bonds and leaving home are not infrequent: the boundaries of the entrepreneurial family are constantly redefi ned.

family aid to the firm
Having analyzed many small businesses 15 -born spontaneously, supported by the state, evolving by merging or partition-and having realized that most of them have a family base, and that they may be viable endeavors contributing to the development of the South, I think it is necessary to defi ne what is a family business, and what can be considered as its strengths and weaknesses.
The family contributes to business in two main dimensions: horizontally, by the collaboration of people in the same generation; vertically, by socializing people in a family tradition.But family business dynamics are more complex than that.I came to two main observations: • family members may collaborate in essential tasks, but are not required to collaborate in every task; what makes the difference is the way that various forms of collaboration combine.Hence, understanding the strategies and forms of collaboration is important.• the push to entrepreneurship can be felt even inside families that have traditionally been far from business, thus enlarging the social base of business.Actually, family business is by no means synonymous with family capitalism.Small family businesses are born and die all the time, in a dynamic way.Family capitalism refers to the prevalence of the 13.There are many similarities with the families of industrial workers in a family capitalism township studied by Tamara Hareven (1986).
14.It is true that the family has a collective interest in the good performance of the family business, but there may be confl ict if some family member resists the overlapping of family and business roles.In these cases the way out can be a different combination of roles: some links are strengthened, other ones are loosened.
15.I refer here to a series of researches I am currently conducting in Puglia on family businesses born spontaneously, or supported by public incentives.

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Household and Small Business Across the Disciplines 538 family in the control of companies.This can be obtained when family businesses have overcome the diffi culties of succession.
I have then worked out a typology of family businesses that accounts for different types of collaboration (family aid), and of the presence or absence of a family tradition in the business.
In the fi rst place, it should be noticed that the concept of aid I have utilized is in a way similar to that of income pooling in world-systems analysis.
In the latter, it is believed that different forms of income, stemming from market relationships or social exchange, are pooled in the household.In the same way, we think that the aid that the family brings to the creation and consolidation of the fi rm can have different forms.As in the world-systems analysis the household is believed to work out different strategies in order to earn its living; here we think that family aid can be offered in different ways and combinations.In both cases the result is a mix of different resources, and the research problem is to fi nd out what types of aid prevail or what mix is more favorable in which situation.
Three types of aid can be distinguished: cultural, fi nancial, and working.They refer to different rationalities of the entrepreneur (see Bauer 1993) and are derived from different disciplinary realms: my contention is that all of them exist, although not always simultanously.
Cultural aid is what supports the decision to get into business (from early socialization to a new strategy for training) as well as helps overcome the diffi culties.Families which have a tradition in business socialize their children to risk taking or being "one' s own boss."Also, salesmen, craftsmen, or employees use their technical knowledge to "stand alone."Cultural aid and business traditions do not always overlap.There can also be cultural aid from families with a productive tradition in a different sector.There can also be a longing for business among those who have a specifi c competence, like the workers who want to be self-employed.Therefore, the family can not only provide the tacit knowledge that the theorists of industrial districts talk about, but also a series of shared values that it gets from outside and puts to work in its own business.Conversely, members of an entrepreneurial family can feel a motivation to change, to try their way.
So far we talked about the aid provided by a culture that is favorable to business, be it coming from the family or present in a tacit way in the social environment.But one should also consider the opposite case: when one has decided to go into business, it is possible for him or her to mobilize new collaborative forces that are able to change the values present in society from unfavorable to favorable to business.In this case, business creates the entrepreneurial family, and the favorable culture.
Financial aid is what contributes to investments or to the temporary need for cash: a loan without interest if a bank credit is not available, a piece of land, a building or an apartment for the fi rm if it would be diffi cult to fi nd one on the market, etc.
Working aid is what supports the organization of the fi rm, the day to day activities, all of the forms of collaboration in the management of the business, either in the division of tasks that are on the same level (planning and design, production, quality control, administration, sales, etc.) and are often divided among kin of the same generation (brother and sisters, inlaws, cousins) or in the hierarchical positions that are divided between the old generation as the boss and the younger generation who are being trained.It also includes the overtime work offered when production has to be rapidly fi nished, when working rhythms are quicker than normal, or shifting roles etc. are required.
How is this distinction helpful?We can see that different families (with different cultures and levels of income) can at the same time support the entrepreneurial activity of some of their kin, offering one or more types of aid.Many family businesses cannot count on cultural or fi nancial help, but only on working help (as when it is a worker that stands alone, or when a new business is created with public money and needs only a small sum of cofi nancing). 16On the other hand, cultural aid can be offered even in the absence of other types of help, and is equally crucial for the formation of the business.

family business and social mobility
Considering the second point outlined above, that is, the cultural background of the entrepreneurial family, one can distinguish family businesses 16.Many observations on this topic have been done doing research on a program of aid to young entrepreneurs, in which the state offers a strong fi nancial incentive.The surprise has been that even in this case family aid, of any kind, was crucial (See the unpublished report "Famiglia e impresa: l'esperienza della legge 44/86").

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Household and Small Business Across the Disciplines 540 according to whether or not a family tradition exists, in the same or other production sectors.We found the following four situations: • "dynasty": when aid comes from a family already operating in the same productive sector • "atmosphere": when aid comes from a family who is in business in a different productive sector • "aspiration": when aid comes from a family that has no previous experience in business • "indifference," when no other member of the family is collaborating in any way.
Our fi eld work in different Southern localities, industrial systems or districts, or on SMEs selected by sector or type of government aid shows that "dynasty" and "aspiration" are more common, whereas "atmosphere" is less common, and "indifference" is very rare.This means that the family bond is crucial to the working of the business.But that it is by no means a symptom of social immobility.
If we now relate the three types of aid with the four situations, we can see that there is no correlation between type of aid and family experience.In "dynasty," cultural or fi nancial help may not be necessary, and sharing tasks for overcoming exceptional situations may be crucial.In the same way, in "aspiration," working labor may not be prevalent.Sometimes what is crucial is a worker' s wish to change, to become his own boss, to "make sacrifi ces" in order to send a son or daughter to a technical college.The more interesting situations are those on the brink.
As for the situations of "indifference," one should not get confused.If it is not the family that helps, it is mainly a group of friends: collaboration is not lacking.One should also note that these businesses are often women' s businesses, through which women wanted to open their independent way and break from an unbearable family tradition.

conclusion
We have reported a series of observations on the recent evolution of diffused entrepreneurship in the South.They can be summed up as follows.A thrust toward self employment and entrepreneurship comes from many different environments: traditional entrepreneurial families, public and pri-vate employees, craftsmen, salesmen.In most cases, behind this thrust there is family collaboration.
Contrary to the stereotype of "familism," the family nature of this new entrepreneurship may account for its democratic outlook.First, as for access to business, everybody can draw from some form of family aid.Moreover, it is not true, as some authors maintain, that family businesses are an obstacle to social mobility, as they suppose that only those who have entrepreneurial family backing can succeed.We have observed that there are situations other than that of the "dynasty."On the contrary, the fact that many family businesses are born and survive, even if they are not "dynastic," is the sign of a new social mobility.This means that social mobility is a collective fact.It cannot be studied on an individual basis (father/son).A multiple series of factors shared by the group have to be taken into account.
Second, as for the business management, the relationships among kin are generally egalitarian and oriented toward acknowledgement of reciprocal competence.Many businesses are run by a core nucleus of relatives belonging to the same generation, who pooled together similar training resources.Even when the parents are still operating they mostly play a role coherent with their experience, and rarely behave as a patriarch.For these reasons, it is possible to look at these realities as an embryo of a new democratic movement toward industrialization.