The Impact of South Africa’s Total Early-stage Entrepreneurial Activity Rate on Entrepreneurial Attitudes and Behavior
Mathew E Egu
Department of Business Administration and Finance, Global Humanistic University, Curacao, and Department of Business Administration and Management, Federal Polytechnic Idah, Kogi State, Nigeria.
Evelyn G Chiloane-Phetla
Department of Applied Management, University of South Africa, South Africa.
Keywords: Total early-stage entrepreneurial activity, Global entrepreneurship monitor, Small and medium enterprises, Multinational enterprises, Gross domestic product, Foreign direct investment.
Given that entrepreneurship scholars use various approaches to measure entrepreneurial success, which leads to inconsistent findings, in this study we investigate the impact that South Africa’s total early-stage entrepreneurial activity (TESEA) rate has on the entrepreneurial attitudes and behavior of South Africans and their reactions to different macroeconomic factors. Secondary datasets were elicited from the World Bank’s world development indicators and the Global Entrepreneurship Monitor (GEM) database from 2003–2014. Using a generalized linear model (GLM) poisson regression, we affirmed the statistical significance of these relationships, as well as enhanced the validity and reliability of the quantitative estimation procedure. We found that the TESEA rate is positively associated with a higher ease of doing business and entrepreneurial intention level. Furthermore, we found that when entrepreneurship is viewed as a good career choice, and given media visibility, the TESEA rate increases, and vice versa. It was also observed that the GDP per capita (which relies on efficiency, innovation and optimal utilization of market knowledge), as well as the level of economic freedom in South Africa, positively impacts the nation’s TESEA rate. Likewise, we found that the unemployment rate is positively associated with the TESEA rate of South Africa. South Africa’s TESEA rate is influenced by a combination of factors due to the dynamic nature of individual traits. However, the TESEA rate has a remarkable impact on South Africa’s entrepreneurial decision making. This implies that a targeted approach is more relevant when implementing both private and government policy initiatives.