Impact of Entrepreneurial Incentive and Education on Start-ups in Nigeria

CHAPTER ONE

INTRODUCTION

Background of the study

Human motivation/incentive is a vast area having origins in a variety of educational disciplines, including psychology, sociology, education, political science, and economics (Carter, 2006). Those purposeful initiatives to guide or promote entrepreneurship activity are referred to as entrepreneurial stimulation (Schumpeter, 1942). Motivation is an internal condition that motivates individuals to do certain actions in order to attain specified goals and commitments (Carter, 2006). Okpara (2007), on the other hand, suggested that success in general is dependent on high stimulation, and the same is true in entrepreneurial activity. In other words, a lack of incentive to achieve more than is required for survival saps an individual’s motivation to pursue more important objectives (Aiyedun& Fusch, 2004). Entrepreneurial Stimulation (ES) is a process that engages and inspires a person to put up more effort in order to attain a set of objectives. Entrepreneurial stimulation, in other words, refers to the factors or urges that influence the direction, intensity, and persistence of an entrepreneur’s behavior.

Unemployment in Nigeria has been on the rise for a long time, badly impacting Nigerians both personally and economically. The impact of the COVID-19 epidemic has exacerbated the situation, as many companies/employers continue to lay off their employees. The unemployment rate has grown to 27.1 percent, with underemployment at 28.6 percent, according to the latest National Bureau of Statistics (NBS) Quarter 2 report for 2020. (NBS, 2020). When you multiply this by the projected national labor force of 80.2 million, you get 21.7 million jobless Nigerians. Previously, the World Bank (2018) said that if the rising unemployment rate is not promptly reversed, the result would be an increase in the frequency of crimes and criminality, such as mass killings, insurgency, militancy, armed robbery, kidnappings, and drug misuse, among other things. As a result, encouraging or pushing individuals to be entrepreneurs and start new enterprises is critical for their emancipation and the global economy’s long-term viability. Some aspects, however, have been highlighted as motivating influences for beginning a firm. Entrepreneurs are driven by a mix of “pull” and “push” incentives, according to Parker, Kumar, and Thareja (2006). Business idea development, opportunity availability, entrepreneurial attitude, necessity-based incentive, and drive for accomplishment are some of these elements. However, little is known regarding the impact of educational qualifications on entrepreneurial activity participation. Education is critical in the formation of well-informed and talented citizens who can successfully contribute to social and economic progress. It is critical to ensure that education is linked to the practical skills required for economic development. The Nigerian economy is mostly informal, with little opportunities for educated people to enter official jobs. Because of the large number of educated people entering the labor field, this compounds unemployment difficulties. What makes matters worse is that many of the graduates lack the necessary skills to pursue business (Olakunori & Kayode 2002). Because of this gap in the educational system, the Nigerian Universities Commission (NUC) decided to make Entrepreneurship Studies mandatory in higher education. Entrepreneurship education complements a graduate’s core field and encourages them to launch their own firm. Entrepreneurship education is a kind of education that aims to prepare people to establish their own enterprises. As a result, entrepreneurship education provides students with the required skills and knowledge to start a successful firm.

A start-up is a business founded by an entrepreneur with the goal of finding, developing, and validating a scalable business model. According to Olakunori, Dishon, Ibidunni, and Ogbari (2002), a start-up is a business that is in its early stages of operation. The term “start-up” is often used to describe young, inventive businesses with a strong desire to expand, often operating in the face of significant uncertainty, such as an unproven technology or a novel business model (Bryant, Allen, & Haley) (2006). Although the term “start-up” was coined after a large number of businesses that perform the majority of their business via the internet were discovered, there are start-ups that are neither web-based nor technology-based.

 Statement of the problem

According to Okpara and Wynn (2007), the failure rate of small businesses in developing nations is greater than in industrialized ones. Entrepreneurial strategy obstacles, according to Carter and Jones-Evans (2006), include a lack of financial resources, marketing issues, and client concentration, management and human resources, a lack of processes and controls, and technological capabilities. There are few studies on entrepreneurship and business management, particularly in Africa, where the majority of entrepreneurial businesses are tiny and conducted in the informal sector. Entrepreneurs in Africa face challenges in developing and maintaining effective organizational arrangements, particularly as their businesses transition from the informal to the formal sector, face external threats such as new technology, fluctuation in the political and macroeconomic environment, succession, or face regional or global competition. In Nigeria, Okpara and Wyn (2007), Adam(1999) said that researchers have pointed out that starting a commercial operation is risky, and that small-business owners’ chances of succeeding beyond five years are not guaranteed. Entrepreneurs will face dangers such as a lack of adequate management skills, technological know-how, and legislation to protect them from market competition, as well as a shortage of funding and credit availability to operate their businesses. In Nigeria, the laws governing lending in certain financial institutions are unfavorable to entrepreneurs, leaving them with little choice but to take out loans with high interest rates, putting their firms at danger of failing and compounding other challenges they face. Entrepreneurs and small- and medium-sized businesses in Nigeria confront challenges such as a lack of managerial skills, financial resources, poor location, rules and regulations, and poor economic circumstances. They make bad decisions as a consequence of a lack of knowledge, formality, and expertise in using, analyzing, and affording new technology advancements that bring breakthroughs.

Objective of the study

The primary objective of the study is as follows

1.        To evaluate the influence of education on the success of an entrepreneurial start-ups.

2.        To explore strategies for achieving successful entrepreneurship in Nigeria.

3.        To examine the effective execution of measures to achieve start-ups result in Nigeria.

4.        To examine if there is governmental support for entrepreneurial start-ups

Research Questions

The following questions have been prepared for the study

1)        What are the influence of education on the success of an entrepreneurial start-ups?

2)        What are the strategies for achieving successful entrepreneurship in Nigeria?

3)        How effective is the execution of measures to achieve start-ups result in Nigeria?

4)        is there governmental support for entrepreneurial start-ups in Nigeria?

Significance of the study

This study focuses on  impact of entrepreneurial incentive and education on start-ups in Nigeria. Hence the study is significant as it will validate the need for government to support entrepreneurs .

The study will be significant to the academic community as it will contribute to the existing literature.

Scope of the study

This study will evaluate the influence of education on the success of an entrepreneurial start-ups. The study will also explore strategies for achieving successful entrepreneurship in Nigeria. The study will further examine the effective execution of measures to achieve start-ups result in Nigeria. Lastly the study will  examine if there is governmental support for entrepreneurial start-ups. Hence the study is delimited to some selected entrepreneurs in Port Harcourt, Rivers state.

Limitation of the study

for the researcher.This study was constrained by a number of factors which are as follows:

just like any other research, ranging from unavailability of needed accurate materials on the topic under study, inability to get data

Financial constraint , was faced by  the researcher ,in getting relevant materials  and  in printing and collation of questionnaires

Time factor: time factor pose another constraint since having to shuttle between writing of the research and also engaging in other academic work making it uneasy

Definition of terms

Entrepreneurial incentive: a motivational force, which encourages an entrepreneur to take a right decision and act upon it.

Start-ups:  the action or process of setting something in motion.