African Journal of Business Management Vol. 5(26), pp.

10707-10717, 28 October, 2011

Available online at http://www.academicjournals.org/AJBM
DOI: 10.5897/AJBM10.891
ISSN 1993-8233 ©2011 Academic Journals

Full Length Research Paper

Impact of some contextual factors on entrepreneurial

intention of university students
Parvaneh Gelard* and Korosh Emami Saleh
Islamic Azad University South Tehran Branch, Iran.
Accepted 14 December, 2010

Entrepreneurship has captured the attention of both scholars and policy makers during the last
decades. The main reason for this is the growing needs for entrepreneurs who accelerate economic
development through generating new ideas and converting them into profitable ventures.
Entrepreneurial activities are not only the incubators of technological innovation, but also provide
employment opportunities and increase competitiveness. Fostering entrepreneurship needs a two-fold
policy that should focus on both the current situation and future prospect of entrepreneurship. As
such, it is important to map out the future context of entrepreneurship. The purpose of this paper is to
fill this void by analyzing the impact of some contextual factors on the entrepreneurial intention of
university students. To fulfill this purpose, we have proposed a model, which shows some contextual
factors that affect entrepreneurial intention. In this model, the entrepreneurial intention is taken as a
function of structural, educational, formal networks and informal networks support. This model is
tested on a sample of 200 university students in Islamic Azad University, South Tehran Branch.

Key words: Entrepreneurial intention, student, university.

INTRODUCTION

In the last decade, there has been growing interest in recent years.
undertaking and intensifying actions to promote and Entrepreneurial intent has proven to be a primary
support the idea of entrepreneurship as an attractive predictor of future entrepreneurial behavior (Katz, 1988;
alternative to wage employment among students around Reynolds, 1995; Krueger et al., 2000). Therefore, investi-
the globe. There are several reasons for this tendency. gating what factors determine the entrepreneurial intent is
First, well-educated entrepreneurs are expected to create a crucial issue in entrepreneurship research. A common
ventures that grow faster than the enterprises of their theoretical framework for models explaining pre-start up
counterparts. The importance of education for the suc- processes is the theory of planned behavior that views
cessful performance of new ventures is well recognized behavioral intent as an immediate determinant of planned
both by management practitioners and by researchers behavior (Fishbein and Ajzen, 1975). In previous re-
(Kennedy and Drennan, 2001). Secondly, due to the searches, personal and environment-based determinants
restructuring processes in organizations, following the of entrepreneurial intent, such as personality traits,
intensified competition on the market worldwide, previous attitudes toward entrepreneurship, or social environment
advantages, such as job security or reward of loyalty, were extensively discussed (Begley et al., 1997;
connected with wage employment in established and, Brandsta¨tter, 1997; Davidsson, 1995; Franke, 2004;
mostly, large enterprises currently offer less appeal, thus Robinson, 1991; Segal, 2005). A central question that
increasing the desirability of self-employment (Kolvereid, arose was what factors determined entrepreneurial intent
1996; Franke, 2004). Finally, unemployment among among university students. The objective of this paper is
graduates in many countries has been growing during to examine the key factors influencing students‟ intent to
entrepreneurial activity. The previous studies in the
literature provided some alternative explanations to this
question, and it was observed that some scholars pri-
*Corresponding author. E-mail: [email protected]. marily focused on the effect of personality characteristics
10708 Afr. J. Bus. Manage.

on decision-making process (Bonnett and Furnham, continues along these lines.

1991; Brockhaus, 1980; Johnson, 1990). Although the According to the theory of planned behavior, the indivi-
results varied across the studies, they often indicated a dual's attitudes have an impact on behavior via intention.
link between entrepreneurial intention and some persona- In particular, there are three fundamental attitudinal
lity factors, such as self-confidence, risk-taking ability, antecedents of intent: personal attitude toward outcomes
need for achievement, and locus of control. However, an of the behavior, perceived social norm, and perceived
extended range of cultural, social, economical, political, behavioral control (self-efficacy). They have proven to
demographical and technological factors surrounds a account for a large part of the variance in intentions
person. Therefore, personality traits cannot be isolated (Fishbein and Ajzen, 1975). In general, attitudes can be
from these contextual factors. The previous studies in the defined as "a learned predisposition to respond in a con-
literature indicated a link between education and entre- sistently favorable or unfavorable manner with respect to
preneurship (Galloway and Brown, 2002; Gorman and a given object" (Fishbein and Ajzen, 1975). They are
Hanlon, 1997; Henderson and Robertson, 2000; relatively less stable than personality traits and can be
Kolvereid and Moen, 1997); as such, getting an adequate changed both across time and across situations in virtue
education may foster the entrepreneurial intention of a of the individual's interaction with the environment
person. (Robinson et al., 1991). Educators and practitioners may
According to Garavan and O‟Cinneide (1994), there is influence entrepreneurial attitudes. In a new venture
clearly a major role and need for entrepreneurship educa- context, Robinson (1991) emphasized the necessity to
tion and training. Since the education offered by a distinguish between the general attitudes related to the
university mostly influences the career selection of broad psychological disposition of the individual and the
students, universities can be seen as potential sources of domain attitudes referring to the person's more specific
future entrepreneurs. Today, most universities are attitude toward entrepreneurship. The application of
spending significant amounts of money to design a viable specific attitudes increases the accuracy of the measure-
entrepreneurship education for their students. Harrison ment within the specified domain, thus improving the
and Leitch (1994) analyzed the evolution of entrepreneur- predictability of the behavioral intent. The importance of
ship education in a three-stage model. According to this attitudes, both in general and toward entrepreneurship, in
model, the first approach to entrepreneurial education is explaining people's aspirations to create a new venture
to view it as a sub-set of general management education. has been recognized and empirically confirmed in pre-
As a reaction to this approach, the second view differen- vious studies (Autio et al., 1997; Douglas, 1999; Krueger
tiates entrepreneurial education from the managements et al., 2000; Madl, 1997; Robinson, 1991). However, the
of large-scale organizations. The last stage provides a empirical findings employed to support the direction and
basis for the notion of the reintegration of management significance of the attitude-intent relationship is partly
education and entrepreneurship education (Harrison and inconsistent. The inconclusive evidence results primarily
Leitch, 1994). Recently, the nature of discussion on from a wide variation in the research context and in the
entrepreneurial education is shifting towards learning for measurement of both independent and dependent
entrepreneurship and not about entrepreneurship itself variables suitable for a university student‟s context.
(Cooper, 2004). Since it is difficult to find one best model Douglas (1999) has investigated the relationship
for all cases, the disagreement on the issue might between the intention to start one's own business and the
continue in the future as well. However, the concrete individual's attitudes toward income, independence, risk,
progress in entrepreneurial education during the last and work effort. The results of his empirical study suggest
decades show that these discussions are important for that individuals with a more positive attitude toward inde-
shaping future understandings. pendence (autonomy) and risk are characterized by a
higher willingness to become entrepreneurs. However,
people's attitudes to work efforts correlate negatively with
ENTREPRENEURIAL INTENT IN PREVIOUS the intent to be self-employed. He also found no signifi-
RESEARCH cant difference with regard to the attitude towards income
(money). Contrary to Douglas's findings, Wang and Wong
Early research on entrepreneurship and factors influen- (2004) reported a non-significant influence of risk-averse
cing the decision to start a new venture concentrated on attitude on entrepreneurial interest. Autio (1997) have
the personality characteristics of individuals such as need also provided an insight into the role of general attitudes
for achievement, risk-taking propensity, internal locus of in entrepreneurial career choice. They examine the
control, and/or innovativeness. A number of personality influence of attitudes toward achievement, autonomy,
factors have been recognized as relevant for entre- money, change and competitiveness upon entrepreneurial
preneurial intent and success (Brockhaus and Horwitz, conviction (the perceived ease of starting and running a
1986). As an alternative to the personality theories, since new venture) viewed as the primary determinant of
the 1990s, the attitude approach has become widely entrepreneurial intention. With the exception of competi-
used for the prediction of the likelihood to set up an tiveness, they found individuals‟ general attitudes to have
enterprise (Douglas, 1999; Robinson, 1991). This study a high moderating influence on entrepreneurial conviction.
 Gelard and Saleh 10709

Autio (1997) additionally confirmed a positive impact of Nonetheless, they reported a non significant influence of
attitude toward entrepreneurship on entrepreneurial shame of failure and relevance of work in a society.
conviction. In a survey of university business students, Finally, they found a negative relationship between
Krueger (2000) found support for the theory of planned value of innovation and intent, that is, individuals who
behavior. Personal attitudes toward the act (that is, believed innovation was highly regarded were less likely
entrepreneurship) and self-efficiency, in particular, act as to want to start a company. Franke (2003) demonstrated
significant predictors of entrepreneurial intention. How- that the student's entrepreneurial intent is also directly
ever, they report a non-significant impact of the remaining affected by perceived entrepreneurship related barriers
attitudinal variable (that is, perceived social norm) on and support factors. Specifically, students perceived
entrepreneurial intent. In their analysis of the entrepre- support actions are more favorable for entrepreneurship
neurial aspirations of business students at two to be the stronger in their entrepreneurial intention. When
universities in German-speaking countries and one of the students realize a hostile environment for business
leading USA academic institutions, Franke (2004) found founders (for example, credit conditions) as being too
a strong positive relationship between the attitude toward restrictive, they are less likely to become entrepreneurs
self-employment and the intention to become an entre- irrespective of their attitude toward self-employment. In
preneur. In a survey of students of technical disciplines at another study, Franke (2004) examined the influence of
the Massachusetts Institute of Technology, Franke (2003) the university environment on entrepreneurial intent.
examined the impact of personal dispositions and deter- Results of their study suggest that the lower level of
minants of entrepreneurial intention. They reveal that the students‟ founding intention follows from a negative
attitude toward entrepreneurship is the most important of appraisal of the university's activities to provide students
perceived environmental conditions for setting up a new with the knowledge required to start a business and to
venture on entrepreneurial intention. Another stream of support the process of new venture creation actively. The
studies in the entrepreneurship discipline focuses on study of Turker et al. (2005) also considered the impacts
environment conditions as determinants of people's of both internal (motivation and self-confidence) and
aspiration to start a company. The environment can pro- external factors (perceived level of education, oppor-
vide an explanation as to why the relationship between tunities, and support) on entrepreneurial propensity of
personal-related factors and entrepreneurial intent is not university students. The study found that two internal
always deterministic in nature (Franke, 2003). Aldrich and factors and perceived level of support were statistically
Zimmer (1986) have also stressed that individuals cannot significant factors.
be viewed as atomized decision-makers who operate as
autonomous entities. Likewise, they have proposed
preventive attitudes on entrepreneurship, and if not STRUCTURAL MODEL
approached, the entrepreneurs will be isolated
(Robinson, 1991). Therefore, it is reasonable to focus on According to Bird (1988), intentionality can be defined as
the entrepreneurial process as an embedded process in a state of mind directing a person's attention, experience
a social, cultural and economic context. Previous and action towards a specific goal or a path to achieve
research that recognized the importance of external something. Therefore, entrepreneurial action can also be
influence factors for an individual's interest to become an classified as an intentional behavior, or intention is a
entrepreneur concentrated particularly on a person's predictor of planned entrepreneurial behavior (Krueger,
social networks, on the image of entrepreneurs in the 1993). Shapero (1982) indicated that the entrepreneurial
society, on socio-cultural norms, and on barriers to intention stems from the perception of feasibility and
entrepreneurship (Autio et al., 1997; Begley et al., 1997; desirability of a person, and this path is affected by the
Franke, 2003). cultural and social context. Therefore, based on previous
However, empirical studies linking the external researches, we proposed a structural model to analyze
conditions for entrepreneurship and the Individuals' the entrepreneurial intention of university students which
career choice also provided inconsistent results. Raijman is shown in Figure 1.
(2001) examined the role of social networks, in which The first dimension of the model is educational support.
individuals are embedded in predicting entrepreneurial It is obvious that professional education in universities is
intent. His results confirmed that having close relatives an efficient way of obtaining necessary knowledge about
who are entrepreneurs increased the willingness to be entrepreneurship. Although, Wang and Wong (2004) in
self-employed. Begleyl (1997) analyzed the impact of four their study said “the entrepreneurial dreams of many
socio-cultural conditions of entrepreneurship, that is, students are mainly hindered by inadequate preparation
importance of work, value of innovation, shame of failure, focused on their personality characteristics, they also
and status of entrepreneurship in a society, on business pointed out the fact that the entrepreneurial dreams of
students' interest in becoming an entrepreneur in seven many students are hindered by inadequate prepa-
different countries. The social status of entrepreneurship ration;"...their business knowledge is insufficient, and
emerged as a good predictor of entrepreneurial interest. more importantly, they are not prepared to take risk to
10710 Afr. J. Bus. Manage.

Figure 1. Structural model.

realize their dreams." Therefore, academic institutions are more likely to start a business. As the researches
might play critical roles in the encouragement of young show factors such as tax regulation, business regulation,
people to choose an entrepreneurial career. However, legal system and labor regulation affect entrepreneurial
they are sometimes accused of being too academic and intention (Stephan, 2010; Dreisler, 2003, Storey, 2008).
encouraging entrepreneurship insufficiently (Gibb, 1993, Thus, it is hypothesized that:
1996). In order to overcome this insufficiency, most
universities have offered entrepreneurship courses or H2: Entrepreneurial intention relates with perceived
programs at the undergraduate and graduate levels. structural support.
Some studies analyzed how these entrepreneurial
interests of universities affected the entrepreneurial The third and fourth factors in the model are formal and
inclination of students. The study of Gorman and Hanlon informal network. According to Leonard-Barton (1984),
(1997) showed that entrepreneurial attributes can be owner-managers acknowledge the significance of
positively influenced by educational programs. In their networks: „entrepreneurship is both constrained and
study, Kolvereid and Moen (1997) also indicated a link facilitated by linkages between the resources and oppor-
between education in entrepreneurship and tunities that are created via the social network of the
entrepreneurial behavior. Based on the discussion in the entrepreneur‟. Entrepreneurs build successful business
foregoing, an hypothesis was developed for this study: by maximizing the opportunities and social networks that
are crucial for business owners (Birley et al., 1990;
H1: Entrepreneurial intention of university students relates Lawton-Smith et al., 1991; Rothwell and Dodgson, 1991).
with perceived educational support. Networks can be defined „as the composite of the
relationships in which small firms are embedded, which
The second factor in the model is structural support. In serve to link or connect small firms to the environments in
this study, we are living in a broader context of social, which they exist and conduct their businesses‟ (Shaw
cultural, economical, political and technological factors. and Conway, 2000). Our understanding of entrepre-
The current context of entrepreneurship is mainly shaped neurial behavior has been more influenced by the content
by economical and political mechanisms, which are of network flows, especially those related to identifying
governed by the actors in the public, private and non- entrepreneurial opportunities. Networks provided a way
governmental sectors. In such a system, there can be to link information to entrepreneurial performance, as a
some opportunities or threats for entrepreneurs. For critical explanatory variable (Aldrich and Zimmer, 1986).
instance, if there are some barriers to entry into the In this way, issues related to the distinction between ma-
market, people might show a lower tendency for entre- nagerial versus entrepreneurial competence, the reasons
preneurship. However, if they find the given conditions why certain ethnic groups engaged in similar businesses,
adequate and favorable, it might be expected that they and contradiction of common trait profiles leading to
 Gelard and Saleh 10711

different outcomes could be better explained (Brockhaus when we refer to informal network, we mean family
and Horwitz, 1986; Gartner, 1988). In 1986, Aldrich and members, friends and parents. We believe that formal
Zimmer argued that the entrepreneur is embedded in a and informal networks help entrepreneurs to establish a
social network that plays a critical role in the entrepreneu- business, and these networks affect entrepreneurial
rial process. In the broadest terms, social networks are intention. Thus, we have the following hypotheses:
defined by a set of actors (individuals or organizations)
and a set of linkages between the actors (Brass, 1992). H3: Entrepreneurial intention relates with informal
Research on the growth of small firms (McGhee et al., network.
1995) confirms the importance of entrepreneurial teams H4: Entrepreneurial intention relates with formal network.
which „expand the organization‟s network of contacts and
provide the balance of expertise required to profit from
certain types of cooperative activity‟ (Birley and Stockley, METHODOLOGY
2000: 289). Entrepreneurs with good cultural and social
Sample and method
networks can attract more capital and are more likely to
be successful than those with limited networks (Shaw, The population of this study comprised students from Islamic Azad
1998). Some linkages are planned, some are accidental University, South Tehran Branch. We chose a sample of 200 stu-
and others are with organized groups, such as Chambers dents from Accounting-Management College. This university has
of Commerce, that help enhance entrepreneurial scope. six colleges. Out of these colleges, we chose Accounting-
Johannisson (2000) provides an „actor-centred‟ definition: Management College because students of this college have passed
management and entrepreneurship training. The youngest students
in the sample are 20 years old and the oldest are about 45 years of
“Networks are interconnected, dyadic relationships in age. The students are 27 years old on average. However, the other
which various ties can be analyzed in terms of content. qualifications are shown in Table 1.
First, information ties provide business information;
secondly, exchange ties extend access to resources; and
Measurement
thirdly, influence ties legitimate the entrepreneur’s
activities and create barriers to entry”. In the study we have five variables. We measured all variables on
a five point Likert-scale with the levels 1 = “strongly disagree” to 9 =
According to Curran et al. (1993), networks usually con- “strongly agree”. In previous research, entrepreneurial intention was
sist of small firms, owner managers, support agencies, measured in different ways. An individual‟s preference for self-
voluntary association and other bodies through which employment and a time dimension of his career path has been
participants engage in activities “which bring the networks taken into account (Das and Irene, 2006). In this study,
entrepreneurial intention was measured through a statement of “I
into existence and sustain it through time”. Findings from plan to establish my own business in the foreseeable future after
OECD Issues paper (2000) have highlighted that graduation”. We measured educational support with three questions
entrepreneurs have progressively learnt to use different (Cronbach‟s alpha is 0.67), Structural support with four questions
types of networks, which serve different complimentary (Cronbach‟s alpha is 0.66), formal network with five questions
purposes. The following broad categories of networks (Cronbach‟s alpha is 0.69) and informal network with four questions
(Cronbach‟s alpha is 0.75). All items used in this study are listed in
have been identified: institutional networks, business
Table 2. It should be noted that we have 17 questions in the
networks, informal networks, formal networks, scientific questionnaire.
and technical networks, profession networks, user
networks, friendship networks, and recreation networks
(Conway, 1997). RESULTS AND ANALYSES
Networks are based on social relationships, family,
friends, neighbors, as well as customers, vendors and The hypotheses were tested by regression analysis. We
creditors. Birley et al. (1990) note: „entrepreneurs, at an have two variables in each regression. We ran regression
early stage of enterprise development, rely heavily on the models for each independent variable with dependent
informal network of friends, family members and social variable in each regression. Table 3 summarizes the
contacts from the local neighborhood to gather relevant results of the statistical analysis for correlation. ANOVA
data‟. Gradually, entrepreneurs extend their networks to and regression coefficients (Tables 4, 5, 6, 7, 8, 9, 10 and
include bankers, accountants, lawyers, suppliers, 11) show that entrepreneurial intention of university stu-
government agencies, customers and consultants. This dents relates with perceived educational support (p<0.01,
extended network is a formal network. Entrepreneur Pearson Correlation = 0.195, y = 0.258x + 6.1) and
network is a complex relationship that entrepreneurs perceived structural support (p<0.01, Pearson Correlation
participate in. This relationship may be obtained through =0.129, y=0.229x + 6.241). More so, we find that
being a member in formal organizations or may be entrepreneurial intention relates with formal network
obtained through informal organizations such as parents, (p<0.01, Pearson Correlation = 0.266, y = 0.45x + 4.287),
family members and friends. In this study, when we refer but does not have a relation with informal network
to formal network, we mean government agencies, ban- (p>0.01). The results show that H1, H2 and H4 are in
kers, lawyers, consultants and insurance companies; and support of the analyses, but H3 is not.
10712 Afr. J. Bus. Manage.

Table 1. Sample description.

Valid Cumulative
Valid Frequency Percent Mean Minimum Maximum
percent percent
Sex Male 94 47.0 47.0 47.0
Female 106 53.0 53.0 100.0
Total 200 100.0 100.0 147.0

Marital status Single 147 73.5 73.5 73.5

27 20 45
Married 53 26.5 26.5 100.0
Total 200 100.0 100.0 173.5

Age Valid 200

Missing 0

Table 2. Study‟s items.

S/No. Item Construct Cronbach’s alpha

1 The education in university encourages me to develop creative
ideas for being an entrepreneur Educational
0.67
2 My university provides the necessary knowledge about entrepreneurship support
3 My university develops my entrepreneurial skills and abilities

4 In Iran, the government encourages entrepreneurs to establish a firm

5 State laws (rules and regulations) are adverse to running a business Structural
0.66
6 Tax regulation gives facilities to entrepreneurs support
7 Iran economy provides many opportunities for entrepreneurs

8 If I decide to become an entrepreneur, my parents will support me

9 If I decide to become an entrepreneur, my family members will support me
10 If I decide to become an entrepreneur, I will consult my family members Informal 0.75
11 If I decide to become an entrepreneur, my friends will support me network
12 If I decide to become an entrepreneur, my families will give me emotional support

13 To start entrepreneurship activities, I will get benefit from experience consultant

14 To start entrepreneurship activities, I will get benefit from country entrepreneurs
network
15 To establish business plan, I will get benefit from agencies related to Formal 0.69
entrepreneurship activities network
16 To start entrepreneurship activities, I will get benefit from customer and supplier
network

Limitations has been a common problem for almost all studies in the
literature and currently, there is no other accurate way to
The current study is subject to some limitations. Firstly, measure the tendency for entrepreneurship. As such, the
similar to the previous studies in the literature, the study statements of respondents about their entrepreneurial
focused on intentionality. It is clear that intentions may intention were taken as a reliable source of information.
not turn into actual behaviors in the future. However, it might be more useful to measure this variable
Therefore, even if one respondent stated a high entre- through multiple items in order to reduce measurement
preneurial intention in the survey, he/she might choose a error in further studies. The second limitation might
completely different career path in the future. In fact, it appear on a possible difference between “perceptions”
 Gelard and Saleh 10713

Table3. Summary of results of the statistical analyses for correlation.

Educational support Structural support Informal network Formal network Entrepreneurial intention
Educational Support Pearson correlation 1 0.181* -0.046 0.240** 0.195**
Sig. (2-tailed) 0.010 0.522 0.001 0.006
N 200 200 200 200 200

Structural Support Pearson correlation 0.181* 1 0.001 0.012 0.129

Sig. (2-tailed) 0.010 0.993 0.869 0.001
N 200 200 200 200 200

Informal Network Pearson correlation -0.046 0.001 1 0.216** 0.083

Sig. (2-tailed) 0.522 0.993 0.002 0.240
N 200 200 200 200 200

Formal Network Pearson correlation 0.240** 0.012 0.216** 1 0.266**

Sig. (2-tailed) 0.001 0.869 0.002 0.000
N 200 200 200 200 200
** **
Entrepreneurial Intention Pearson correlation 0.195 0.129 0.083 0.266 1
Sig. (2-tailed) 0.006 0.001 0.240 0.000
N 200 200 200 200 200
*Correlation is significant at the 0.05 level (2-tailed), **Correlation is significant at the 0.01 level (2-tailed).

Table 4. ANOVAb

Model Sum of squares df Mean square F Sig.

a
1 Regression 30.143 1 30.143 7.809 0.006
Residual 764.337 198 3.860
Total 794.480 199
a
Predictors: (Constant), educational support, b. Dependent Variable: entrepreneurial intention

Table 5. Coefficientsa

Unstandardized coefficients Standardized coefficients

Model t Sig.
B Std. Error Beta
1 (Constant) 6.100 0.438 13.934 0.000
educational support 0.258 0.092 0.195 2.794 0.006
a
Dependent variable: entrepreneurial intention.
10714 Afr. J. Bus. Manage.

Table 6. ANOVAb

Model Sum of squares df Mean square F Sig.

a
1 Regression 13.192 1 13.192 3.343 0.001
Residual 781.288 198 3.946
Total 794.480 199
a
Predictors: (Constant), structural support, b. Dependent Variable: entrepreneurial intention.

Table7. Coefficientsa

Unstandardized coefficients Standardized coefficients

Model t Sig.
B Std. Error Beta
1 (Constant) 6.241 0.575 10.857 0.000
structural support 0.229 0.125 0.129 1.828 0.001
a
Dependent variable: entrepreneurial intention.

Table 8. ANOVAb

Model Sum of squares df Mean square F Sig.

1 Regression 5.524 1 5.524 1.386 0.240a
Residual 788.956 198 3.985
Total 794.480 199
a. Predictors: (Constant), informal network, b. Dependent Variable: entrepreneurial intention

Table 9. Coefficientsa

Unstandardized coefficients Standardized coefficients

Model t Sig.
B Std. Error Beta
1 (Constant) 6.424 0.724 8.869 0.000
informal network 0.122 0.103 0.083 1.177 0.240
a
Dependent variable: entrepreneurial intention.

Table 10. ANOVAb

Model Sum of squares df Mean square F Sig.

a
1 Regression 56.340 1 56.340 15.113 0.000
Residual 738.140 198 3.728
Total 794.480 199
a
Predictors: (Constant), formal network, b. Dependent Variable: entrepreneurial intention.

Table 11. Coefficientsa

Unstandardized coefficients Standardized coefficients

Model t Sig.
B Std. Error Beta
1 (Constant) 4.287 0.777 5.520 0.000
formal network 0.450 0.116 0.266 3.887 0.000
a
Dependent variable: entrepreneurial intention.
 Gelard and Saleh 10715

and “reality”. Obviously, there is always a risk that the start up a business is high. This also means that Iranian
perceptions of students in the outside world might be people who have entrepreneurial intention do not start
different from that of reality. For instance, the studies their business because of fear of failure. This could be
which aim to show such realities may indicate that the because of the non-governmental support and
universities which are successful to stimulate entrepre- uncertainty of the environment. The researches show that
neurship or financial system support entrepreneurs because of high inflation inside the country (economic,
sufficiently. Another limitation is that some factors in the political and business boycott), there is no suitable
model were broadly defined and measured in the survey. environment for entrepreneurial activities. Also, market
For instance, educational support factor was measured regulations, employee protection, labor regulations and
through three broad statements, which assessed the tax regulations must be viewed by those who are
education support for stimulating “creative ideas”, responsible in the field of entrepreneurship accusation.
providing “knowledge about entrepreneurship”, and So, to foster a better environment for entrepreneurs in
developing “entrepreneurial skills and abilities”. The main Iran, we suggest:
reason of such broadness is to increase the generalizabi-
lity of the model and make it available for the use of new 1. Reduction of state corporate income taxes.
studies in different contexts. 2. Access to micro loans and seed funds.
3. Provision of information about start-up.
CONCLUSIONS AND SUGGESTIONS 4. Highlighting entrepreneurs as role models.
5. Facilitating networking services.
The study shows that if a university provides adequate 6. Reducing red-tape and paperwork burden.
knowledge and inspiration for entrepreneurship, the
possibility of choosing an entrepreneurial career might The third factor of the model is informal support. How-
increase among student. It is obvious that this result ever, the result of analysis indicated that entrepreneurial
confirms the key role of education in the development of intention was not associated with this dimension. In fact,
entrepreneurial intention. Therefore, in the light of the this result is quite surprising because it might be
current study, it might be stated that entrepreneurship expected that social ties are significant for a person living
can be fostered as a result of a learning process. This in a collectivist culture, like Iran. Since people are more
result is not only interesting from the theoretical point of integrated into the society, family members, friends and
view, but it is also a challenge for the educators and informal network might influence a career selection
policy-makers. Since entrepreneurial activities are decision in a young person, but the results of this
becoming vital to the economic development of a country, research show that the students for the entrepreneurial
both of these groups might focus on the design of more activities do not get support from parents and families.
effective educational policies. Although there is no We find that entrepreneurial intention relates with
consensus on the content and structure of entrepreneur- formal network. The first question that arises in the minds
ship education, the findings of the current study showed of student entrepreneurs is “which organization will help
that universities should, at least, “encourage the me to start my business” (the question that many of the
development of creative ideas for being an entrepreneur”, university students ask their masters). It means that
“provide the necessary knowledge about entrepreneur- many university students are trying to find a protective
ship”, and “develop the entrepreneurial skills”. The organization to get some informational and financial
researches have shown that starting entrepreneurship support. The researches show that entrepreneurship net-
courses in governmental universities in Iran does not works play some major roles in entrepreneurial activities.
have enough effectiveness. So the reason for this dissa- The networks are used as strategic alliances for specific
tisfaction must be understood. The second factor, which purposes, including: managing business, accessing
also emerged significant in the survey, is structural resources, idea developing, creating motivation in doing
support. The analysis also showed that structural entrepreneurial activities and cultivate social support.
support might affect entrepreneurial intention of university This research shows that for students to find entrepre-
students. Entrepreneurship researches in many countries neurial opportunities, they should get benefit from formal
show that in the majority of these countries, governments networks. These networks include: entrepreneurial
support entrepreneurship in some ways. This consulting agencies, banks, insurance companies and
entrepreneurship support means that governments the society of graduated students. Since formal networks
design and program those policies, whose aims are to have specific roles to play to increase student
increase the number of entrepreneurs and small entrepreneurial intentions, we suggest the following:
businesses, and support them in their activities.
According to GEM (2009), Iranian entrepreneurial 1. Create entrepreneurship center in the university.
intention is higher than the average of GEM (21.39%), 2. Create web site to access education, consulting and
but the grade of Iran is 25 among 42 countries; although, informational services.
fear of failure rate as one of the negative factors to 3. Connect new entrepreneur students to experienced
10716 Afr. J. Bus. Manage.

entrepreneurs inside and outside the university. Dreisler T (2003). Promoting entrepreneurship changing attitudes or
behavior? J. Bus. Enterp. Dev. 10(4): 383-392
Franke N, Lu thje C (2004). “Entrepreneurial intentions of business
students: a benchmarking study”. Int. J. Innov. Technol. Manage.,
Future research 1(3): 269-88
Fishbein M, Ajzen I (1975). Belief, Attitude, Intention and Behavior: An
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subjects: Galloway L, Brown W (2002). “Entrepreneurship education at university:
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programs on individuals (for example, entrepreneurial entrepreneurship education, enterprise education and education for
intentions or record of accomplishment), or venture small business management: a ten-year literature review”. Int. Small
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