Relationship Between Risk-Taking and the Growth of Youth Owned Enterprises in Kenya
Keywords:
Risk-Taking, Growth, Youth Owned EnterprisesAbstract
Purpose: Youth businesses play a key role in poverty alleviation when run based on entrepreneurial orientation. However, these micro and small enterprises face a mix of achievement and frustration, with previous findings showing that three out of five companies fail within the first few long periods of activity, despite government efforts to improve the sector. This study aimed to examine the relationship between risk-taking and the growth of youth-owned enterprises in Kenya.
Methodology: The study is supported by expected utility theory. A cross-sectional survey methodology was utilized which incorporated qualitative and quantitative research methods. A stratified sampling technique was employed to obtain 397 SMEs from 55,300 SMEs registered by the seven selected counties in Kenya namely; Nairobi, Murang’a, Nakuru, Machakos, Mombasa, Kisii, and Isiolo counties. Data was analyzed using descriptive and regression analysis.
Results: The study findings demonstrate that risk-taking had a positive association with the growth of youth-owned enterprises in Kenya.
Conclusion: The study concluded that risk-taking helps youth-owned businesses in Kenya to expand. The study suggested that owners of youth businesses should focus on how to carry out a thorough risk assessment and oppose any risk related to financial, social, and psychological risk respectively.
References
Ayeni-Agbaje, A., & Osho, A. (2015). Commercial banks in Financing Small Scale Industries in Nigeria. European Journal of Accounting of Entrepreneurship, 5(2), 1-14
Bouazza, B., Ardjouman, D., & Abada, O. (2015). Establishing the Factors Affecting the Growth of Small and Medium-sized Enterprises in Algeria. International Journal of Social Science, 4(2), 101-115.
Bushe, B. (2019). The causes and impact of business failure among small to micro and medium enterprises in South Africa. Africa’s Public Service Delivery and Performance Review, 7(1), 1-26.
Chelimo, F. C. (2019). Effects of Tendering Process on Services Delivery in Road Construction Sector. A Case of Kerra (Doctoral dissertation, COHRED-JKUAT).
Ferrer, A., Maclay, A., Litvak, M., & Lerner, S. (2017). Revisiting the effects of anger on risk-taking: empirical and meta-analytic evidence for differences between males and females. J. Behave. Decision Making 30, 516–526.
Franklin, S. (2017). Kenya Economy Groans under Weight of its Jobless Youth. The Standard Digital, 25.
Gancarczyk, M., & Zabala-Iturriagagoitia, J. M. (2015). The process of the growth of small and medium-sized enterprises (SMEs). Journal of Entrepreneurship, Management and Innovation, 11(4), 3-24.
Herman, M., Critchley, D., & Duka, T. (2018). Risk-taking and impulsivity: the role of mood states and interception. Front. Psychol. 9, 1625.
Kahneman, D, & Tversky, A. (1979). Prospect theory: An analysis of decision under risk. Econometric, 47, 263-291.
Kenya National Youth Policy [KNYP]. (2018). Kenya National Youth Policy. Nairobi: KNYP.
Luce, D. & Raiffa, H. (1957). Games and decisions. New York: Wiley.
Mburu, R. M., Gichira, R., & Kyalo, T. (2017). Risk-taking and firm performance among family-owned enterprises in Nairobi county. The Strategic Journal of Business & Change Management, 4(3), 262-272.
Muthee, W., & Scholar, P. (2010). Hitting the target, missing the point: Youth policies and programs in Kenya. African Public Policy Scholar. Nairobi: Woodrow Wilson International Centre for Scholars.
Mutuma, L., (2015). Entrepreneurial Factors Influencing Performance of Youth Run Agro-Based Enterprises in Ngoliba Ward, Kiambu County, Kenya. The Strategic Journal of Business and Change Management, 2(99), 1458-1482.
Namusonge, G. S., Muturi, W., & Olaniran, O. (2016). The role of innovation on performance of firms on Nigerian Stock Exchange. European Journal of Research and reflection in Management sciences, 4(1), 40-50.
Schneider, L., Kauffman, S., and Ranieri, A. (2016). The effects of surrounding positive and negative experiences on risk-taking. Judgment Decision Making 11, 424–440.
Seymour, B., Maruyama, M., & De Martino, B. (2015). When is a loss a loss? Excitatory and inhibitory processes in loss-related decision-making. Curr. Opin. Behav. Sci. 5, 122–127.
Torois, K. K. (2014). The ethical decision making of bank managers’ and corporate financial performance in Kenya. Developing Country Studies, 4(25), 95-104.
Wanjau, K. N., Mung’atu, J., Gichira, R., & Wambugu, A. W. (2015). The relationship between proactiveness and performance of small and medium agro-processing enterprises in Kenya.
Yeboah, A. (2015). Determinants of SMEs Growth: An Empirical Perspective of SMEs in the Cape Coast Metropolis, Ghana. The Journal of Business in Developing Nations. 14(1)1-31.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2024 Robert Maina Mwangi, Patrick K. Ngugi, Ephantus Kihonge
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
