The Effect of Entrepreneurship Education on Entrepreneurial

Intention

Fadli

, Yasmin Chairunisa

Muchtar and Inneke Qamariah

Faculty of Economics and Business, Universitas Sumatera Utara, 9 Dr. Mansur Street, Medan, Indonesia

Keywords: Entrepreneurship Education, Entrepreneurial Intention.

Abstract: Unemployment problem is one of the most common problems in developing countries. Indonesia with

population of about 258.7 million possess unemployment rate of 5.61%. Meanwhile, neighboring country

like Singapore owns a lower unemployment rate of 2.1%. One way to cope with a high number of

unemployment is by creating entrepreneurship. With entrepreneurship, someone will be a job creator not a

job seeker, which will reduce the dependency level on employment providers. A joint effort from various

parties is needed to build a condition which allows the rapid growth of entrepreneurship. At the same time,

university as one of main pillars in generating the successor of the nation is also responsible in increasing

the number of entrepreneurships. There are a wide variety of entrepreneurial education compositions

formulated by the university to attract the interest of the students, which encourage them to choose

entrepreneurship as a career. This research aims to analyze the effect of entrepreneurship education on

entrepreneurial intention. Result shows that entrepreneurship education have a positive and significant effect

on entrepreneurial intention. In general, in order to increase the entrepreneurial intention, it should focus on

the improvement of entrepreneurship education.

1 INTRODUCTION

Unemployment problem is one of the most common

problems in developing countries. As well as

Indonesia with population of about 258.7 million

which possess unemployment rate of 5.61%.

Meanwhile, neighboring country like Singapore

owns a lower unemployment rate of 2.1%. A high

level of unemployment is raising concerns as it can

lead to more severe socio-economic problems.

One way to cope with a high number of

unemployment is by creating entrepreneurship. With

entrepreneurship, someone will be a job creator not a

job seeker, which will reduce the dependency level

on employment providers. Therefore, a joint effort

from various parties is needed to build a condition

which allows the rapid growth of entrepreneurship.

One of the government’s active roles in promoting

the growth of entrepreneurship is through Nascent

Enterpreneurship Program (Program Wirausaha

Pemula) and National Enterpreneurship Movement

(Gerakan Kewirausahaan Nasional) since 2013 by

the Ministry of Cooperatives and SMEs

(Departemen Koperasi dan UKM).

At the same time, university as one of main

pillars in generating the successor of the nation is

also responsible in increasing the number of

entrepreneurships. There are a wide variety of

entrepreneurial education compositions formulated

by the university to attract the interest of the

students, which encourage them to choose

entrepreneurship as a career. Izedonmi and Okafor

(2010) explored the education of Nigerian students,

found a positive effect towards intentions. It was

discovered that eventhough joinning in the

entreprenuerial education, it was not automatically

lead to the intentions of entrepreneurial.

In this context, therefore it is vital to investigate

the valuable contribution of higher education

towards the entrepreneurial intentions of students.

Hence, the objective of this paper is to investigate

the effect of entrepreneurship education on students’

entrepreneurial intentions.

The objective of this research is to analyze the

effect of entrepreneurship education on

entrepreneurial intention of University students in

Universitas Sumatera Utara.

1566

Fadli, ., Muchtar, Y. and Qamariah, I.

The Effect of Entrepreneurship Education on Entrepreneurial Intention.

DOI: 10.5220/0010089115661569

In Proceedings of the International Conference of Science, Technology, Engineering, Environmental and Ramiﬁcation Researches (ICOSTEERR 2018) - Research in Industry 4.0, pages

1566-1569

ISBN: 978-989-758-449-7

2 LITERATURE REVIEW

2.1 Entrepreneurship Education on

Entrepreneurial Intention

Entrepreneurial intention is a cognitive illustration

of an objective a person wants to achieve with a

greater effort. It includes the development of a plan

that someone seeks and utilizes to achieve their

goals (Tubbs & Ekeberg, 1991). Entrepreneurial

intention has been described as “a conscious state of

mind that directs attention (and therefore experience

and action) toward a speciﬁc object (goal) or

pathway to achieve it (means)” (Bird, 1989, p. 8).

In this regard Katz (2003), and Lautenschläger

and Haase (2011) disclosed that the popularity of

entrepreneurship as part of business education is

increasing at university and college level, and it is

becoming popular as well around the globe. Last few

decades, entrepreneurship has emerged as a widely

taught subject to the university graduates.

Spiteri and Maringe (2014) classified four

important elements that express the nature of

entrepreneurial education in universities in Europe:

pedagogy; assessment; content; and role model

lecturer. In another study, satisfaction of university

students in Indonesia was examined in terms of the

content of learning and teaching, methodology of

teaching and expected results with the

implementation of entrepreneurship education

(Abduh, Maritz, & Rushworth, 2012). Vukovic,

Kedmenec and Korent (2015) posited four different

ideas or stages of entrepreneurship education:

entrepreneurial awareness education; education for

newly business; entrepreneurial dynamism

education; and continue education for entrepreneurs.

Entrepreneurship education is designed to instill

the competency, skill, and value needed to recognize

the business opportunity, as well as organize and

establish a new business (Brown in Izedonmi and

Okafor, 2010). The competence obtained by the

students is not only limited to the competence to sell

product or service as in the mindset of the people

who consider entrepreneurs as traders. Based on a

research performed by Oguntimehin and Olaniran

(2017), entrepreneurship education is a significant

contributor to entrepreneurial intention.

Hypothesis 1A: Entrepreneurship Education has

a positive and significant effect on Entrepreneurial

Intention.

Figure 1: Research Framework.

3 METHOD AND RESULT

The type of research conducted is causal associative

(causality). The population in this research is 4279

students from Faculty of Economics and Business,

Faculty of Public Health, Faculty of Engineering

batch 2015 and 2016 in University of Sumatera

Utara that had already received entrepreneurship

courses. As these faculties have an entrepreneurship

curriculum and the students are willing to be

entrepreneurs. Samples are selected by utilizing the

simple random sampling. A simple random sample

is a subset of a statistical population in which each

member of the subset has an equal probability of

being chosen.

The dimensions of Entrepreneurship Education

are (1) Subject, (2) Education Facilities, (3) Practice,

and (4) Lecturers Competence. And the indicators

are business management, finance, human resources

and innovation, laboratory, books and journals,

business plan, observation and product

innovation/process, teaching method, and

experience.

The dimensions of Entrepreneurial Intention to

capture behaviour intention towards starting

business are (1) Preparation to develop product or

services, (2) Preparation to develop teamwork, (3)

Preparation to look for a building or equipment, (4)

Business plan, and (5) Financial Investment.

The samples were taken with slovin method by

the formula as followed:

N =

= 97,71

In this research the number of the samples are

rounded up to 100 university students.

Here is the table of distribution of samples of

faculties and batches:

Entrepreneurship

Education

Entrepreneurial

Intention

The Effect of Entrepreneurship Education on Entrepreneurial Intention

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Table 1: Sample Based on Proportion of Faculties and

Batches.

Faculties 2015 2016 Total

Faculty of Public Health 12 7 19

Faculty of Economics and

Business

24 25 49

Faculty of Engineering 15 17 32

Total 51 49 100

Source: Processed Data (2018)

This research used two types of data resources,

which are: (1) Distribution of Questionnaires, and

(2) Documentations Studies. Simple linear

regression analysis is used as data analysis technique

to discover the influence of the independent

variables which is Entrepreneurship Education to the

dependent variable that is Entrepreneurial Intentions

in University Students. Also, this research is using

descriptive statistical analysis method and depth

interview as data analysis techniques.

Table 2: Operational Definition.

Variable Operational Definition

Entrepreneurship

Education

Entrepreneurship education is a

program to increase the

awareness and understanding

of entrepreneurship as a

process as well as to increase

students’ awareness of

Entrepreneurship as a career

possibility.

Entrepreneurial

Intention

Entrepreneurial intention is a

cognitive illustration of an

objective a person wants to

achieve with a greater effort.

Table 3: The Result of Simple Linear Regression

Analysis.

No Variables Coefficients t-Values

Sign

ifica

1 Constant 5.510 3.300 0.00

2 Entrepreneurs

Education

0.217 7.989 0.00

= 0.394

4 (F-Statistic =

63.825)

0.00

It is found the Simple Regression Analysis

Model is:

Y = 5.510 + 0.217EE + e

Table 4.10 shows partially Entrepreneurship

Education (Sig. = 0.000 < 0.05) is significantly

affecting Entrepreneurial Intention.

The coefficient determination of this research is

0.394, which means that Entrepreneurship Education

contributed 39.4% to explain Entrepreneurial

Intention. While the remaining of 60.6% is

explained by other variables.

Table 4: Summary of Hypothesis Tests.

Hypothesis

No.

Statement Decision

Entrepreneurship Education

has a positive and

significant effect on

Entrepreneurial Intention.

Supported

Entrepreneurship education have positive and

significant impact on entrepreneurial intention

among university students. It may explain the

improvement of entrepreneurship education will

generate the entrepreneurial intention. University

students are inspired to be entrepreneur through the

best quality of curriculum, lecturer and the

availability of laboratory facilities in the faculty. As

stated by Wennberg and Berglund (2008) most

program of university have tried to increase the

awareness of students to focus on develop new

ventures. Yet, it remains big question what is

specific educations program are most effective to

increase entrepreneurial intention. However,

Universitas Sumatera Utara has develop strong

foundation to instill the entrepreneurial mindset

among the students through various entrepreneurial

program.

According to Liñán & Chen (2009),

entrepreneurial intention has a very important role

when deciding to start a business venturing, as

evidenced by a significant number of scientific

papers dealing with this issue. In order for a person

to become an entrepreneur, he/she must first show a

certain degree of entrepreneurial intent (Bird, 1988).

The existence of entrepreneurial intention is a

reliable predictor of entrepreneurial behavior and

entrepreneurship (Koe, 2016).

Although we have focused in university

education, the entrepreneurial education may not be

only related to development process of becoming an

entrepreneur or tied to the specifics stages of starting

a business. It even has crucial contribution to

economic development, spirit to start their own

business and many more.

ICOSTEERR 2018 - International Conference of Science, Technology, Engineering, Environmental and Ramiﬁcation Researches

1568

We also found that students engaged in practice

base methods of teaching for entrepreneurship

programs such as the entrepreneurship week,

business consultancy program and student

entrepreneurship center have higher intentions to

start their own businesses in the future. However,

there is no significant difference between students

from business program and non-business program in

terms of entrepreneurial intention. It is quite

surprising since the degree of entrepreneurship

education contents are higher for business program

students than non-business program.

4 CONCLUSIONS

The conclusion of this research is entrepreneurship

education have a positive and significant effect on

entrepreneurial intention. In general, in order to

increase the entrepreneurial intention, it should focus

on the improvement of entrepreneurship education.

ACKNOWLEDGEMENTS

The authors would like to express the gratitude to

Universitas Sumatera Utara for the financial support

for this research. That support has given us a great

opportunity to present this paper in the ICOSTEERR

2018. Moreover, we would like to gratefully

acknowledge the contribution of research reviewers,

Faculty of Economics and Business, and all the

research team members for the completion of this

paper.

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