What Are the Triggering Motives for Entrepreneurs in Egypt? A Case Study of Business Administration Post Graduates Students in Egypt.

Author:ElKhouly, Sayed ElSayed
 
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INTRODUCTION

Small and medium sized enterprises (SMEs) play an important role in the Egyptian economy. Entrepreneurship is intensely associated with SMEs. The Egyptian government has created numerous development plans that are endorsing entrepreneurship as a way of opposing the high level of youth unemployment. The Egyptian government understands the significance of entrepreneurial activity for the economic growth of the country.

Entrepreneurship

Gartner (1988) defined entrepreneurship as the formation of organizations. He also stated that what distinguishes entrepreneurs from non-entrepreneurs is that entrepreneurs create organizations, however non-entrepreneurs do not.

According to Bygrave and Zacharakis (2010), an entrepreneur is a person who recognizes an opportunity and creates an organization to hunt it. Also, they stated that the entrepreneurial process involves all the functions, activities and actions related with identifying opportunities and creating organizations to pursue them.

Moreover, Gartner (1988) has discussed the study of behavioral methods entrepreneurship where an entrepreneur is seen as a set of activities involved in organization creation, while an entrepreneur has a specific set of personality traits and characteristics.

Bygrave and Zacharakis (2010) have stated that entrepreneurs are leading a revolution that is renovating and restarting economies worldwide. They also mentioned that entrepreneurship is the core of free enterprise because the birth of new companies gives a market economy its power. Innovative and evolving businesses form a very large amount of original products and services that renovate the way we work and live.

Moore (1993) claimed that businesses don't grow in a "vacuum" and that there is a relationally embedded nature of how companies interact with suppliers, customers and financiers.

Adly and Khatib (2014) have discussed the entrepreneurial processes as personal, sociological and external environment factors that produce a new enterprise. An individual gets an idea for a new business through either a careful exploration or a chance meeting. Whether he chooses to pursue that idea depends on features such as his other career plans, family, friends, the state of the economy and the readiness of means.

In this research paper, we will cover the main research and works that elaborate on the factors and motives that trigger entrepreneurs, in addition to the status of entrepreneurship in Egypt. Also, this paper will tackle the relationship between the educational background of potential entrepreneurs and the triggering motives for entrepreneurs in Egypt.

LITERATURE REVIEW

Multiple studies have tried to pinpoint what is entrepreneurship and what are the related entrepreneurial qualities, personalities, likings and behaviors, in addition to the triggering factors that motivate entrepreneurs.

Motivational Factors for Entrepreneurship

Liang and Dunn (2007) have stated that the triggering factors are the ones that stimulate an entrepreneur to start a business. They identified the triggering factors as factors in the persons or in their perception of the situation which drive them towards the entrepreneurial process

Shaver and Scott (1991) have mentioned that individuals are motivated by pursuing greater financial prizes or accomplishing higher satisfaction when engaging in new venture establishment.

Also, Liang and Dunn (2007) have stated in their research that there are common themes to describe entrepreneurs including: high accomplishment motive, exploit oriented, internal locus of control, flexibility towards uncertainty, modest risk taking, readiness to commit, cheerfulness, opportunistic, creativity, independence and firmness.

Moreover, Liang and Dunn (2007) have stated that there exist few empirical studies that clarify why entrepreneurs choose to create their own companies in economic theory. They mentioned that the decision to form a new venture should include internal motives related to individuals' self-awareness and external drivers like changes in job or family circumstances and economy, in addition to indirect inspiration, that are not directly related to business or individual problems.

Audretsch (1997) has discussed and explored how the economic environment has influenced persons' choices in new venture creation by looking at the variations in market forces, changes in occupation and fluctuating organizational structures.

Longenecker, Moore, Petty and Palich (2006) stated that the majority of entrepreneurs usually expect financial compensations, self-righteousness, social acknowledgment and economic self-security.

Hunger, Korsching and Van Auken (2002) suggested three elementary motivations for beginning a new company: (1) opportunity-triggered, (2) internally-motivated and (3) externally-motivated. They mentioned that for the opportunity-triggered, the creators firstly revealed a feasible business opportunity and decided to start a new venture to take benefit of this chance. However, the internally-motivated creators firstly decided to start a new company to fulfill their own satisfaction then looked for that project to excel. They claimed that the previous two occasions designated how an entrepreneur was "pulled" into beginning a new venture due to the appeal of new venture creation.

On the other hand, Hunger, Korsching and Van Auken (2002) identified external environments as the main factor that triggered the externally-motivated individuals towards the process of new venture creation by pushing the originators to start a new venture to preserve a certain lifestyle.

Robichaud, McGraw and Roger (2001) found that motivational factors of entrepreneurs can be classified into four groups: (1) extrinsic rewards, (2) intrinsic rewards (3) independence/freedom and (4) family security during their conducted study examining entrepreneurs from the USA & Canada to conclude what motivation types drive business achievement.

Similarly, Benzing, Chu and Kara (2009) obtained four motivational factors for entrepreneurs in Turkey, such as (1) independence factor, (2) income factor, (3) security factor and (4) intrinsic factor.

In the same context, Benzing, Chu and Szabo (2005) in their analysis of entrepreneurs in Romania stated that job security and income needs were stronger motivators than self-actualization and individual needs. However, Swierczek and Ha (2003) in their study of Vietnamese small business holders found that challenge and accomplishment were more significant motivators than essential needs and security.

The current research paper here is trying to identify similar triggering motives for entrepreneurs in Egypt based on the four factors obtained by Benzing, Chu and Kara (2009) in a survey of Turkish entrepreneurs.

Entrepreneurship in Egypt

In Egypt, the Global Entrepreneurship Monitor (GEM) report was developed through the support of Hala Hattab (2008, 2010 and 2012), professor at the British University in Cairo. The report includes numerous important influences and indicators to analyze the business development and level of...

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