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Intention of Business Graduate and Undergraduate to Become Entrepreneur A Study from Pakistan

Intention of Business Graduate and Undergraduate to Become Entrepreneur A Study from Pakistan

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Published by Shaheer Rizvi

The purpose of this paper is to evaluate the impact of personal and contextual factors on entrepreneurial intention of business graduates and undergraduates in Pakistan. Survey information from 114 students from department of management sciences, The Islamia University Bahawalpur was collected through self administrative questionnaires. Regression analysis, correlation, ANOVA, and descriptive statistics were employed to get results. The results indicate that students have moderate intention to become entrepreneurs. Personal experience and family business background are positive predictors; gender has no significant impact, increase in age reduces the likelihood to start a business. Interestingly, students who have studied Entrepreneurship as a course are less enthusiastic to be self employed compared to who have not studied. There are many obstacles like social, capital, government, and environmental which are responsible of this behavior. Policy makers, universities and practitioners should reduce the hurdles and provide role models and appreciating environment to increase the entrepreneurial intention.

The purpose of this paper is to evaluate the impact of personal and contextual factors on entrepreneurial intention of business graduates and undergraduates in Pakistan. Survey information from 114 students from department of management sciences, The Islamia University Bahawalpur was collected through self administrative questionnaires. Regression analysis, correlation, ANOVA, and descriptive statistics were employed to get results. The results indicate that students have moderate intention to become entrepreneurs. Personal experience and family business background are positive predictors; gender has no significant impact, increase in age reduces the likelihood to start a business. Interestingly, students who have studied Entrepreneurship as a course are less enthusiastic to be self employed compared to who have not studied. There are many obstacles like social, capital, government, and environmental which are responsible of this behavior. Policy makers, universities and practitioners should reduce the hurdles and provide role models and appreciating environment to increase the entrepreneurial intention.

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Published by: Shaheer Rizvi on Jan 27, 2013
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09/17/2013

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 J. Basic. Appl. Sci. Res.
, 3(1)718-725, 2013© 2013, TextRoad Publication
ISSN 2090-4304
 Journal of Basic and AppliedScientific Research
 
www.textroad.com
 
Corresponding Author:
Owais Shafique, Department of Management Sciences, The Islamia University of Bahawalpur,Pakistan. E-mail: owais.shafiq@gmail.com
Intention of Business Graduate and Undergraduate to Become Entrepreneur:A Study from Pakistan
Muhammad Asif Tanveer
1
, Owais Shafique
2
, Sahaab Akbar
2
, Shaheer Rizvi
2
1
Lecturer, Department of Management Sciences, the Islamia University Bahawalpur, Pakistan
2
Department of Management Sciences, the Islamia University of Bahawalpur, Pakistan
ABSTRACT
The purpose of this paper is to evaluate the impact of personal and contextual factors on entrepreneurial intention of business graduates and undergraduates in Pakistan. Survey information from 114 students from department of management sciences, The Islamia University Bahawalpur was collected through self administrative questionnaires.Regression analysis, correlation, ANOVA, and descriptive statistics were employed to get results. The resultsindicate that students have moderate intention to become entrepreneurs. Personal experience and family businessbackground are positive predictors; gender has no significant impact, increase in age reduces the likelihood to start abusiness. Interestingly, students who have studied Entrepreneurship as a course are less enthusiastic to be self employed compared to who have not studied. There are many obstacles like social, capital, government, andenvironmental which are responsible of this behavior. Policy makers, universities and practitioners should reducethe hurdles and provide role models and appreciating environment to increase the entrepreneurial intention.
KEYWORDS:
Gender, Family Background, Entrepreneurship education, Experience,
INTRODUCTION
Entrepreneur is an individual who introduce some ideas or adding some value in existing ideas and products.He is a creator, risk taker, opportunity seeker, wealth maximize, as well as who brings the change in theenvironment by using technology, employees and resources in most effective way (Kuratko, 2007).Entrepreneurship has got immense importance, and it is immensely discuss topic at different forums like in media,books, politics, and academia. There is consensus on the importance of entrepreneurship for growth, employment,and economic development of country (Shane and Venkataraman, 2000; Gartner, 2001; Gaspar, 2007). By keepingin view, an immense importance of entrepreneurship, it is questions of interest that how, who, when, and whyentrepreneurship will be chosen. We can answers all these questions by measuring intention of students.During last few decades, entrepreneurial intention has become leading construct inside the entrepreneurshipliterature (Drennan et al, 2005). Increasing numbers of Business graduates across the world, with fear of losing jobsand present status quo, raise the questions whether it is a choice or necessary to get self employment (Reynolds et al,2002; Pietrobelli et al, 2004). It is more source of concern for developing countries as compared to developedcountries. Entrepreneurial orientations and intentions are widely studied in developed countries compared todeveloping countries, and also there are large differences in the context of student settings. In developing countries,intention to become own boss may come from the desire to overcome economic misery (Tang et al, 2007).By understanding the importance of entrepreneurship for the economic growth and to strengthen the economyof Pakistan, as well as to get knowledge and information regarding the student’s perception about entrepreneurialintention is an area of interest for this study. This study will enable us to find out link of different assumptions. Firstassumption that entrepreneurship education has positive impact on business graduates to take it as a career choice.Second assumption is that business graduates get proper knowledge, understanding and training for business- theydevelop the ability to make right decision and get business success. Thirdly, we will be able to make comparison of developed and developing countries students’ intention for entrepreneurship. Fourthly, the findings of this study willalso reveal the role of socio-cultural differences that affect on the intention of business graduate in Pakistan. Finally,Pakistan is facing problems of unemployment and economic depression, new entrepreneurs are necessary foremployment and generating revenues for nation.
Common characteristics of Students of Public universities in Pakistan
Graduates and Undergraduates of business education are the participant of this study. There are two basic typesof entrepreneurship, independent entrepreneurship and internal entrepreneurship (Jia, 2010). In independent
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Tanveer
 
et al.,
2013
 
entrepreneurship, individual or team start their own business- meanwhile, internal entrepreneurship refers to bestarting new business in existing company. University students majorly belong to independent entrepreneurship.Students have some common as well as different characteristics toward entrepreneurship. At university level,ages of the students remain between 18-25, that is best for creativity and innovation. As, they are more creative andinnovative, and also fewer responsibility than any other age, they likely have better chances to start a business (LiYuetao , 2010). Higher education enhances the entrepreneurial skills and professional knowledge of students (WangXiaofang, 2010).University students of Pakistan are unable to identify opportunities in the market, hardly few of them tasteentrepreneurial experience, and have limited understanding of society- are some of problems and issues with thesestudents (Weiming, 2010). In Pakistan, during study period, almost all the students are supported by their family;therefore all the students are proletariat. They are not having any capital, property, and loaning facilities (Jia, 2010).
Entrepreneurial Intention and Students
Intention is direction and desire of an individual to start a firm rather to do a job (Bird, 1998). Entrepreneurshipis an international activity, and venture creation and intention have strong association with each other (Henley,2007). Entrepreneurial intention is the search of information which can be used to create a firm (Wong & Choo,2009). Entrepreneurial intention is the judgment and assessment of one’s ability about the creation of own firm.Intention is the best the predictor to set the behavior of entrepreneur- it is also the first step in order to understandand implement the process of entrepreneurship (Van Gelderen et al., 2008). Intention has strong influence to shapethe entrepreneurial behavior. It is outcome of attitude toward behavior, subjective and social norms, and control overbehavior and all these factors are important predictors of inclination and intention of student towards self-employment- more importantly some external factors like education and personality traits can affect them (Souitariset al, 2007; Pihie, 2009).In literature, there are many different models and conceptual frameworks on entrepreneurial intention andinclination (Shapero and Sokol, 1982; Davidsson, 1995; Audet, 2000). But, we found only few differences in theapproaches used in by these models (Krueger et al, 2000; Peterman and Kennedy, 2003). Most of these are revolvedaround the studies like Azjen’s (1987, 1991) theory of planned behavior, Bandura’s (1986, 1997) self-efficacy andsocial learning theory, and Shapero and Sokol’s (1982) model of intention.Azjen’s (1987, 1991) theory of planned behavior points out three predictor of intention- degree of perceivedcontrol behavior, subjective norms and attitude towards behavior. Perceived control behavior is the level of individual perception about him to perform his behavior. The greater extent of perceived control behavior will makeintention stronger to perform his behavior (Autio et al, 1997). Perceived control behavior is another term of self efficacy and measure the same thing (Davidson, 1995;Bandura, 1997; Byabashaija and Katono, 2011). SubjectiveNorms is the extent of expectation and pressure from family, friends, society and others, while performing hisbehavior. But, this pressure and expectation vary with society (Audet, 2004). Attitude toward behavior is theindication of student’ affiliation with his behavior and also shows the attachment of his behavior in ups and downs(Byabashaija and Katono, 2011). According to Shapero (1975) entrepreneurial intention is originate from the insightof feasibility, desirability and propensity to exploit the opportunities.Self employment is the situation for the individuals to choose one in choosing a career- whether to do job insomewhere or to become your own boss (Kolvereid and Isaken, 2006). Attitude and intention towards theentrepreneurship is the major predictor for future entrepreneurship (Jackson & Rodkey, 1994). There are mix resultsabout the impact of entrepreneurship education on self-employment especially among universities students (Collinset al, 2006). The reasons behind these students will choose entrepreneurship at some specific time, not immediate-moreover, entrepreneurial intention also varies with the passage of time. Similarly, there are also some positive andnegative factors responsible for this behavior (Linan et al, 2005).
Role of education on student’s entrepreneurial intention:
Entrepreneurial education can enhance the intention of students to become entrepreneur (Frank & Luthje, 2004). Lack of managerial skills is the biggest reason in thefailure and success of entrepreneurs and education is very effective tool to enhance and enrich the managerialcapabilities. According to Wilson et al (2007) entrepreneurial education is helpful to cater intention and developnecessary knowledge, skills, and information of resources identification allocation, and opportunity recognition andexploitation to face challenges and difficulties. Entrepreneurship education provide opportunity to learn and getexperience through creative and innovative activities, business plan development, learning from some successfulentrepreneurs, getting some role models, developing social networks, and running stimulated or real small business(Segal et al, 2005). It is evident that entrepreneurial training and entrepreneurship courses have affirmative influencefor entrepreneurship as a career choice (Dyer, 1994). Entrepreneurship education is an important element forentrepreneurial attitude and intention for upcoming entrepreneur (Souitaris
et al.
2007, Wilson et al, 2007).
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 J. Basic. Appl. Sci. Res.
, 3(1)718-725, 2013
Role of Family Background on student’s entrepreneurial intention
: Family backgrounds of student also fosterthe attitude and intention for entrepreneurship. There is considerable amount of literature is available about the roleof family background on intention, and findings show that most of entrepreneurs come from mother or fatherbusiness experience (Dyer, 1992; Crant, 1996). As, attitude to adopt entrepreneurship relates with learning andinfluence of external factors like demographic, cultural, social and financial assistance- previous exposure andexperience of family business have influence to take on entrepreneurship (Krueger,1993). Drennan et al (2005)found that desirability and feasibility of venture creation increase with family business background. The studentswhose parents are self-employed show highest inclination to run their own business and lowest to do job.Entrepreneurial intention is positively relates with family background of business and also familiarity with real lifebusiness (Peterman and Kennedy, 2003; Kirkwood, 2007).
The role of gender
is also an influential factor in Entrepreneurial intention of student (Veciana et al, 2005). It isinvestigated that men have more desire and chances to become entrepreneur as compared to female (Wang & Wong,2004; Ahmad et al, 2010). Women face more difficulties and challenges, especially to arrange necessary financialobligations (Fay & Williams, 1993; Becker-Blease & Sohl, 2007). It is also confirmed women have very lowsuccess ratio, profitability and sales (Brush
et al.
2006; Welter
et al.
2006).
Entrepreneurial education
can enhance the intention of students to become entrepreneur (Frank & Luthje, 2004).Lack of managerial skills is the biggest reason in the failure and success of entrepreneurs and education is veryeffective tool to enhance and enrich the managerial capabilities. It is also evident that entrepreneurial training andentrepreneurship courses have affirmative influence for entrepreneurship as a career choice (Dyer, 1994).Entrepreneurship education is an important element for entrepreneurial attitude and intention for upcomingentrepreneur (Souitaris
et al.
2007, Wilson et al, 2007).
Family backgrounds
of student also foster the attitude and intention for entrepreneurship. There is considerableamount of literature is available about the role of family background on intention, and findings show that most of entrepreneurs come from mother or father business experience (Dyer, 1992; Crant, 1996). As, attitude to adoptentrepreneurship relates with learning and influence of external factors like demographic, cultural, social andfinancial assistance- previous exposure and experience of family business have influence to take on entrepreneurship(Krueger,1993). Drennan et al (2005) found that desirability and feasibility of venture creation increase with familybusiness background. The students whose parents are self-employed show highest inclination to run their ownbusiness and lowest to do job. Students have family background of business and also familiar with real life business-show positive relations to be an entrepreneur (Peterman and Kennedy, 2003; Kirkwood, 2007).
The Role of Universities in Promoting Entrepreneurship:
In recent past, All over the world, Entrepreneurialeducation has got rapid growth (Raichaudhuri 2005). As, it is successful formula for creation of employment- topromote entrepreneurship, educational system becomes more enthusiastic to play an important role in the society bycreating entrepreneurs (Kuratko 2005; Venkatachalam and Waqif 2005). Now days, universities and othereducational institutions are playing leading role to nurture the entrepreneurial knowledge and skills which will befruitful for their future professional life (Nurmi and Paasio 2007; Keat et al, 2011). In empirical investigation, itreveals that teaching and learning environment of university has direct impact on student intention to acceptentrepreneurship as a career (Autio et al, 1997). If students have relevant entrepreneurial knowledge and skills, theydo not have positive approach toward entrepreneurship- have fear about it, they will not adopt it. Regarding this,universities should develop entrepreneurial culture and environment and provide some relevant models of entrepreneurial success in order to enhance the inclination of students towards entrepreneurship (Alberti, Sciascia etal. 2004; Fayolle and Degeorge 2006).
METHODOLOGY
The study conducted in department of management science, the Islamia university Bahawalpur. The targetstudents of the study were both undergraduates and graduates. Information got from clerical staff of departmentshowed that 810 students are studying in the department. The research used random probability sampling method.With the approval and collaboration of lecturers and faculty, there were 150 questionnaires distributed and 114returned. In the study, there were 51% male and 49% female and average age of students was 23. Understanding andknowledge of entrepreneurship subject measured by inquiring students a question whether they have studiedEntrepreneurship subject in the classroom or not- 70% students have studied and 30% out of them have not studied.About prior business experience, students asked about any form of business experience 55 students pointed out thatthey have some experience about experience and most of them have run their own business for one week whilestudying entrepreneurship subject. Only 22% students said that they are having family business background. Thedata was collected through structured questionnaires and each question is designed by five points strongly disagree
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