DO UNDERGRADUATES HAVE WHAT IT TAKES TO BE ENTREPRENEURS AND MANAGERS OF SMALL BUSINESSES IN NIGERIA? AN INQUIRY INTO STUDENTS’ PERSONAL ENTREPRENEURIAL CHARACTERISITICS Afolabi O. O., Sanni M.  , Egbetokun A. A., Dada A. D., , Jesuleye O. A. and Siyanbola W. O.  Corresponding Author National Centre for Technology Management (NACETEM), Federal Ministry of Science & Technology (FMST), Obafemi Awolowo University, Ile-Ife, Nigeria Paper presented at the 3 rd SMU EDGE Conference in Singapore between 9 th and 11 th of July,2008
Although entrepreneurship is of serious importance to the Nigerian economy, this paper argues that graduate entrepreneurship makes only a limited contribution to employment in the nation.
Statistics show, for example, that between 1994 and 2003, the Nigerian labour market grew by about 58% while the employment opportunities increased by only 20% between the same period (Ajetomobi and Ayanwale, 2005).
The existence of such a huge gap could be an indication that the tendency of graduates starting their own businesses after graduation is rather low.
Multi-stage sampling method was adopted in selecting a representative sample for this study.
A total of 7560 students from a total of 25 tertiary institutions comprising 13 (20% of total) Universities, 9 (18% of total) Polytechnics and 3 (38% of total) Colleges of Education (Technical) were sampled in this study.
Altogether, these amount to approximately 20% of all tertiary institutions in Nigeria at the time of this study, as reported by the Joint Admissions and Matriculations Board in 2005.
Entrepreneurial interest (EI) was captured via a simple binary variable having a value of 1 if the respondent answered “Yes” to the question “Are you interested in starting your own business?” and 0 otherwise.
The Personal Entrepreneurial Characteristics (PEC) of students was captured by six variables:
Contrary to expectation, the risk taking propensity did not differ significantly between the two categories of students.
These findings are particularly surprising as they suggest, first, that non-entrepreneurial-minded students in Nigeria are better at goal-setting than their entrepreneurial-minded counterparts; and then, that a higher level of risk-aversion is not necessarily associated with non-entrepreneurial-minded students.
In the latter case, previous research elsewhere has suggested that students generally tend to be risk-averse (Wang and Wong, 2004; Cunningham et al, 1995).
A significant relationship was found between EI and the PEC variables, except risk taking.
To explore the extent to which PEC influenced the EI of students, a binary logistic regression analysis was carried out.
Again, risk taking turned out to be the only variable that exerts a non-significant influence on EI.
In spite of the significance level of five out of six of the PEC variables, the outcome of the analysis shows that the proportion of variation in EI which could be explained by PEC was rather low. (R 2 = 0.042).
Given the necessity of country- or region-specific studies on entrepreneurship, this study is particularly useful.
It is, arguably, the first entrepreneurial study of this magnitude in Nigeria and provides baseline information for researchers and policy makers who need to better understand the dynamics of entrepreneurship among the youth.
The fact that the PEC variables were significantly correlated with EI is clearly an indication that they are very important and thus should be well entrenched in entrepreneurial education in all tertiary institutions.
A particularly key institutional weaknesses identified in the course of this study was expressed in the inadequacy of government support to young and aspiring entrepreneurs.
These imply the need for effective training and funding initiatives. Advocacy in favour of entrepreneurship may also pay off in the long run, seeing that the students already possess a good level of entrepreneurial characteristics.