Contemporary society is developing towards a knowledge society. This phrase is just one of many that describe the social, economic, political, and educational arrangement of the last few decades. The knowledge economy represents the dominant economic paradigm of the post-industrial society in the period from the 1980s, emphasizing “the role of knowledge creation and distribution as the primary driver in the process of economic growth, the distribution of income, the growing importance of knowledge-based networks among firms, and the interface between government business and citizens in the advanced economies" (Harris, 2001, 21). The change in the understanding of the concept of knowledge from knowledge derived from science and discovery to knowledge about service activities and the creative industry has shaped new conceptualizations of the economy such as the new/internet, weightless, cultural, creative or financially oriented economy, which today are often placed under the umbrella term “service economy" (Švarc, Dabić, 2017, 24). Today's understanding of the knowledge economy is based on new economic theories of growth arising from the increased interest in the study of growth in the golden age of economic growth in the 1950s and 1960s, when classical economic theories were not sufficient to explain rapid economic growth through investment in basic production functions (work and capital). In the knowledge economy, new technologies and innovations, especially in the ICT sector supported by university education play a key role in encouraging young people to engage in entrepreneurship. This engagement is crucial for techno-economic progress since young entrepreneurs contribute not only to production base and revitalization of industrial sectors in terms of production, manpower and business models, but also bring new and usually strategic technological knowledge in running business for expanding markets. In the context of economic theories that explain the emergence of the knowledge economy, it is necessary to take theories about post-industrial society in consideration. With this concept, Bell describes the key elements of the organization of work, goods and individual actions at times when the market for services exceeds the market for goods. With the transition from Fordism to postFordism, the market focuses on the creation of services more than the production of materials, goods are based on knowledge and information and as such can be used to create tangible devices and goods (Bell, 1999, 3; Powell, Snellman, 2004, 201 /2). Focused on the political dimension of social life and considering it as sphere of conflicts and different power relations, Touraine believes that the centers of power are located in "technocratic organizations"; and he sees science as the productive force of society, and universities as a source of change, rebellion and a new lifestyle (Touraine, 1971, 13-15). Following the theories of post-industrial society, Manuel Castells theorizes about a new type of computerized capitalism and a new organization of relations of production, experience and power (Castells, 2000, cited in Peračković, 2010, 96-98). The literature on knowledge society and the knowledge economy in the social sciences discusses forms of employment, job security and wage inequality. There is a discrepancy between the skills and knowledge that the workforce possesses and the requirements in the knowledge economy. New jobs give priority to educated individuals, so the phenomenon of "return to education" is developing, along with the appearance of various forms of redirection, training and lifelong education (Powell, Snellman, 2004, 212/13). Despite the fact that the importance of knowledge and intangible capital is recognized in economic development and social change, concrete ways of measuring its contribution have not yet been developed. Sociologists, social psychologists, historians and anthropologists consider entrepreneurship as a complex phenomenon deeply rooted in society and culture. The development of the sociology of entrepreneurship as a special sociological discipline is related to the concrete expansion of the phenomenon of entrepreneurship conditioned by the change from collective to private ownership, the development of the economy, but also to the general development of society from industrial to post-industrial. Entrepreneurship is mentioned in different ways and forms in the early works of sociological classics such as Weber, Durkheim and Marx, and it is in the work of the economist Schumpeter that the sociology of entrepreneurship takes its first outlines as a separate discipline (Ruef, Lounsbury, 2007, 10; Martinelli, 1994, 476-477). The turning point in the social understanding of entrepreneurship began with Schultz's emphasis that entrepreneurial ability is not only a human privilege, but can be developed through education. As such it is not only related to business ventures, but also to entrepreneurial activity and initiatives in everyday life (Schultz, 1975, 835). In this sense, the concept of entrepreneurial competence is defined, which can be developed through the education system and socialization within an environment that values entrepreneurial culture. Entrepreneurship is a way of thinking that is preceded by an assessment of the level of possible prosperity and the level of risk, that is, reflection that makes it a deliberate action (Krueger, Reilly, Carsrud, 2000, 411). Research on entrepreneurial intentions is directly related to entrepreneurial activity, but also to research on the individual characteristics of an individual entrepreneur. Consideration of entrepreneurial intentions is a valuable area in sociology, given that high entrepreneurial activity is associated with a low rate of unemployment, inequality and poverty. By investing in entrepreneurial education, it is possible to influence a higher level of entrepreneurial activity (Al Mamun et al., 2016, 119; Turker, Sonmez Selcuk, 2008, 142/143). The research on entrepreneurial intentions combines the previously studied areas of entrepreneurial personality traits and the context of entrepreneurship into ways of forming individual ideas for an entrepreneurial venture in a certain context (Bird, 1988, 442; Dohse, Walter, 2012, 2). It is young people who are the social group from which the largest number of new entrepreneurs originate (Solesvik, 2016, 2). In this dissertation, entrepreneurial intentions are defined as the expressed desire (intention) of an individual to start his or her own business (entrepreneurial venture), and are the result of numerous individual and contextual factors. Several authors articulate them as the result of the influence of regional dimensions and consider them as shaped by various socio-cultural but also individual, cognitive factors (Franco, Haase, Lautenschläger, 2010, 269). Entrepreneurial intentions are mainly researched within Ajzen's theory of planned behavior, according to which intentions depend on the realization of three necessary prerequisites: assessment of the desirability of a certain behavior, beliefs about the expectations of important reference groups about a certain behavior, and the perceived ability of an individual to perform that behavior (Ajzen, 1991, 180; Kibler, Kautonen, Fink, 2014, 997). The social capital of young people is defined in this paper as one of the factors that shape entrepreneurial intentions. Social capital is just one of the types of capital defined by Pierre Bourdieu who believes that capital is in a constant process in the social environment, and that as such it can be economic, cultural, symbolic or social (Bourdieu, 1980). Social capital represents an investment in social relations, which for the expected result has a more successful operation on the market (Lin, 2001, 19). Social interactions determine the volume of an individual's social capital, and the size and range of networks effectively influence his ability to others (Bourdieu, 1986, 242). Coleman clearly defines the difference between human and social capital, where the former refers to individuals, while the latter is contained in interactions and connections between individuals, that is, in social relations (Coleman, 1990, cited in Westlund, 2006, 1). Social capital is also defined by Putnam as a multidimensional concept that is determined by the density and overlap of cooperation networks characterized by a certain level of trust, reciprocity and respect for common norms (Putnam, 2003, 179). When shaping social capital within the example of entrepreneurship, it is not possible to ignore the social and economic context. Therefore, the concept of embeddedness of entrepreneurship in the local context should prove to be one of the constructive elements of students' entrepreneurial intentions (Kibler, Kautonen, Fink, 2014, 996; Halinen, Törnroos, 1998, 189). The mentioned concept implies understanding and exploiting the structure in building one's own connections and maintaining the same importance of the structure and the resulting relationships (Jack, Anderson, 2002, 471). Uzzi takes a structural approach to the concept of embeddedness and combines organizational theory with social network theory. Individuals in economic exchange do not only act according to current goals and market requirements, but build long-term relationships that positively affect learning, risk-taking, investing and general market behavior at the individual and group level. By doing this, the individual maximizes his opportunities on the market. The effect of an individual's embeddedness in economic (entrepreneurial) success depends on the type of connections he has developed, and it is necessary to remain aware of how an excessive level of embeddedness in only one network and one context can negatively affect the individual's ability to adapt and grow in new directions (Uzzi, 1996, 693-694). Social interactions are part of the cognitive aspect of social capital, and they can be for "bonding" between close actors or "bridging" between slightly more distant actors (Vuković et al., 2017, 1/2). In the context of entrepreneurship, they mainly refer to networking with individuals from the immediate environment, from the same geographical area and with similar socio-demographic characteristics (age, education) (Giannetti, Simonov, 2009, 681). With that they can be divided into "strong ties " with family and close friends, and on "weak ties" with other actors in society (Granovetter, 1985, 481/482). The strength of a relationship between individuals is determined by the amount of time, emotional intensity, intimacy and reciprocity. The results of sociograms and modeling of networks between individuals indicate that individual networks are spread more often through weak ties than through strong ones, and this can be linked to the concept of social capital (Granovetter, 1973, 348-353). Strong ties are family ties and ties with close friends, and each individual relies on them in a moment of uncertainty or when making an important decision (Granovetter, 1985, 203/204; Chen, He, 2011, 149). Weak ties refer to acquaintances and others with whom the individual shares a weaker relationship intensity and spends less time (Granovetter, 1973, 356). Embedded in the described socio-economic context are young people, who, especially in uncertain economies, such as Croatia's, strive to develop their own knowledge and competences with the aim of achieving self-employment and overcoming system problems (Tholen, 2001, 64). Youth entrepreneurship develops as a consequence of the shortcomings of the economic system, the reduction of the number of jobs, employment insecurity. According to leading European strategies, it represents a way of strengthening the economies of countries through the increase in innovation and self-employment of young people (OECD, 2017, 3). When researching youth entrepreneurship, it is necessary to take into account macrosociological circumstances (situation in the social environment, social stratification, social status of entrepreneurship, construction of gender roles on the labor market, etc.) and microsociological elements (family structure, individual readiness, etc.) (Pavić, 2008, 88). The economic crisis at the beginning of the 21st century in the Republic of Croatia has had consequences that are manifested on young people mainly through the increasing unemployment rates and a large proportion of young people in the NEET category. The European Union, and thus Croatia, is introducing a whole series of incentive measures that direct young people towards selfemployment, i.e. starting their own business (Botrić, 2019, 96; Zrilić, Širola, 2013, 95). Youth entrepreneurship in modern society manifests itself through various forms of entrepreneurial infrastructure programs: entrepreneurial centers, zones and incubators. Regional development agencies, technology-innovation centers, business-innovation centers, free zones and scientifictechnological centers are also appearing in Croatia (Lupić, Bujan, 2017, 66; Zrilić, Širola, 2013, 106). Specific data for Croatia in 2020 indicate that the population that is not involved in any form of entrepreneurship in Croatia has a more positive attitude towards entrepreneurship than in the rest of the geographical region, but at the same time a greater fear of failure. Likewise, Croatia is at the top of the European Union in terms of expressed entrepreneurial intentions - in first place in 2018 and 2020, and in 2019 in second place in Europe. The specificity of Croatian entrepreneurial activity is also reflected in emphasized regional differences. Although they are stable according to the latest GEM report, as a result of the COVID-19 pandemic, there are patterns of changes in the intensity of activity by region. In 2020, all regions showed an increase in the number of newly established business ventures (Singer et al., 2021, 10). The aim of this dissertation was to analyze the entrepreneurial intentions of students as a social phenomenon and to determine how applicable the concept of the embeddedness of economic actions in a certain local (socio-cultural-economic) context is to the research of entrepreneurial intentions. In this context, the aim of the research was to determine the importance of the influence of social capital and its elements on the entrepreneurial intentions of students in Zagreb and Split. In accordance with the goals and main thesis of the research, two basic hypotheses about the influence of social capital and the local economic context on the entrepreneurial intentions of students and six special hypotheses that focused on specific indicators of the influence on the formation of entrepreneurial intentions were set. The research was conducted with a mixed methodological approach, using the qualitative method of semi-structured interviews with young entrepreneurs from Split and Zagreb, and the quantitative method of a survey among students of the University of Zagreb and the University of Split. The aim of the interview was to collect data on the context of the activities of entrepreneurs in the two largest Croatian cities and the experiences of young entrepreneurs as an indicator of entrepreneurship in a certain local context. The experiences of young entrepreneurs gathered through interviews were also used as a guide when designing the survey questionnaire. The interview sample included 20 young entrepreneurs, 10 with established businesses in Zagreb and 10 in Split. Participants were recruited using the snowball sampling method. The interviews were conducted in the period from January to March 2020. The quantitative part of the research was conducted using the survey method, using the online survey through the Survey Monkey web platform. Although the research design predicted the implementation of the survey using the paper-pencil technique, due to the COVID-19 pandemic, most or all of the classes at the faculties included in the sample were conducted online, and due to the specific structure of the sample, the survey had to be conducted online. The survey questionnaire sample is a non-probabilistic quota research sample consisting of students in their final year of graduate university studies at the Universities of Zagreb and Split. The sample is aimed at faculties from specific fields of science, technical and social-humanistic fields, and economics separately. The survey was conducted in the period from February to April 2021. Young entrepreneurs highlighted the need for freedom and independence as the basic motivation for starting their own business. Given that more than two-thirds of the surveyed students consider starting their own business as a desirable way to enter the labor market, we conclude that the assessment of the desirability of youth entrepreneurship among students in both Zagreb and Split is extremely high, which satisfies Ajzen's first precondition on the assessment of desirability of certain behavior in the context of individual activity. Local social capital as a feature of the community (Westlund, Bolton, 2003, 80) did not prove to be crucial, given that there are no differences between Zagreb and Split students in considering the possibility of employment after graduation. Students from both cities believe that this will not be too big of a problem. The biggest differences are present between students of different fields, which points to a greater embeddedness of students in the current educational context, and that students in their final years of study shaped their attitudes through information gathered through formal education. At the same time, students of the Faculties of Humanities and Social Sciences do not show a high level of information about entrepreneurship and entrepreneurial practices, while students of the Faculties of Economics and Faculty of Electrical Engineering and Computing in Zagreb and Faculty of Electrical Engineering, Mechanical Engineering and Naval Architecture in Split have more knowledge about existing incentive policies as well as entrepreneurial practices in their environment. The research indicated statistically significant differences in students' perception of the level of appreciation of innovation and creativity, whereby students from Zagreb believe that it is more appreciated in their environment. However, as these are not the indicators of the influence of prevailing type of economy, the hypothesis that claims that the level of development and the prevailing type of economy affects the differences in entrepreneurial intentions of students (H2) is not confirmed. In addition to assessing the desirability of starting one's own business in an economic context, the social capital of individuals also represents an investment in social relations and interactions (Lin, 2001, 19). Therefore, the attitude of reference groups shapes the intentions to start a business. In accordance with the hypothesis that students attach more importance to strong ties with individuals in their immediate environment than to weak ties in the economic context in which they operate (H1), when forming entrepreneurial intentions, Granovetter's "strong" and "weak" ties were highlighted and investigated through attitudes about entrepreneurial endeavors and readiness for financial and emotional support. More than 50% of the surveyed students give great importance to the opinion of others about the decision to start their own business, where 46.5% expect parental support and 57.4% support from their extended family. The results confirmed this research hypothesis. A hypothesis was set that the students are familiar with the economic conditions of their own local context and the possibilities of developing an entrepreneurial venture in it (H3). Uzzi made a concrete distinction between arm's length ties and those that connect individuals with the wider entrepreneurial culture (Uzzi, 1997; 1999). In accordance with this, the results indicate that students of the University of Zagreb and Split follow the activities of successful companies and entrepreneurs to some extent, with the students of the Faculties of Humanities and Social Sciences are doing this the least often. Likewise, students mostly repeated the names of Croatian entrepreneurs and companies they were familiar with, especially Mate Rimac (over 85%). On the other hand, young entrepreneurs are much more informed and networked with other entrepreneurs. They point out that the Croatian market is small and that, especially within the same profession, but also more widely, almost everyone knows each other. We conclude that students are still more focused on their connections in the immediate vicinity (Uzzi, 1997; 1999), while already successful entrepreneurs have extended their networks to the wider operation of their business, which partially confirms the hypothesis of familiarity with the conditions of the local context. The hypotheses according to which students express dissatisfaction with entrepreneurship education at their faculty (H4) and show a high degree of mistrust in institutions (H5) were confirmed. The final hypothesis about students’ dissatisfaction with the entrepreneurial climate in their local context (H6) was partially confirmed, considering that students are the least trustworthy towards the Church, political parties and Internet portals, and the most towards the faculty where they study. The majority of students (92.5%) believe that formal education did not provide them with sufficient prior knowledge to start their own business, and almost half of the respondents consider it a very important prerequisite for the same. Pointing out the lack of practical knowledge and opportunities for networking as the basic shortcomings of formal higher education, students confirm the answers of young entrepreneurs, who pointed out exactly the same problems that they had to compensate for either by working through the Student Service, or by employment in an existing company after college. As the last prerequisite for the formation of the intention, Ajzen states the assessment of the ability to perform the set task, in this case starting a business. The GET2 test of entrepreneurial tendencies (Caird, 2013) is used to assess an individual's entrepreneurial tendencies, that is, his ability to design and manage projects (Cromie, Callaghan, 1997, 68). The GET2 test is in accordance with Schumpeter's thesis about the innovative and creative individual (Schumpeter, 1934, 88) and in this research it gives us an insight into the psychological characteristics of students and places them on the spectrum from a low entrepreneurial individual to a highly entrepreneurial individual. Considering the results in which the majority (70.2%) of students are in the category of medium entrepreneurial individual, we conclude that Croatian students, regardless of the city of study, possess some of the entrepreneurial characteristics and could be entrepreneurial under favorable conditions. The contribution of the research in this dissertation is manifested through the contextualization of young people in the current entrepreneurial climate in the Republic of Croatia and employment opportunities in the existing labor market. As the Global Entrepreneurship Monitor for 2020 showed, there is a more positive climate towards entrepreneurship than in the rest of the region among those who are not involved in any form of entrepreneurship in Croatia, and an increase in the total number of entrepreneurial activities (Singer et al., 2021, 10). Taking this into account, as well as the fact that young people are often among the most at-risk on the labor market, and often among the largest fraction in the unemployment statistics (Pavić, 2008, 88), the conducted research positioned the young people of Zagreb and Split as moderately entrepreneurially oriented. The present differences between students who are formally educated to start their own business (Faculties of Economics) and others point to a discrepancy between the education system and the labor market, where there has been an increase in the number of companies from different fields, especially during the COVID-19 pandemic. Entrepreneurship as a social phenomenon in the Croatian context can be further explored taking into account all the influences articulated in this paper (social networks of the individual, "embeddedness" in the context, trust in institutions).