Academic journal article Business: Theory and Practice

Psychological Factors of Innovativeness among Nomadic Micro-Entrepreneurs for Achieving Business Growth

Academic journal article Business: Theory and Practice

Psychological Factors of Innovativeness among Nomadic Micro-Entrepreneurs for Achieving Business Growth

Article excerpt

Introduction

In recent years, Micro Entrepreneurs (MEs) have been the subject of extensive research in the fields like economics, management, and finance (Grimm, Paffhausen 2015). Micro Entrepreneurs start a business with their own capacity to change their financial condition (Chandy, Narasimhan 2011). They play a significant role within developed and developing countries in initiating macroeconomic growth from the local community (Grimm, Paffhausen 2015; Sen 2011) that own and operate a business with five employees or less (OECD 2005). For most of the people who are from the lower income strata, micro-entrepreneurship is considered as a means to attain a satisfactory living (Chandy, Narasimhan 2011). In the developing countries, MEs have a more dynamic role in shaping peoples' lives and, on average, account for half of all economic activity (Porta, Shleifer 2008). Such economic activities have proved to enhance the wellbeing of the society in context of Bangladesh (Rahman et al. 2015a).

In developing countries like Malaysia, the economic activity mostly depends on MEs that help to create employment and expansion of income among marginalized people (Nawai, Shariff 2011). According to Selamat et al. (2011), MEs business in Malaysia has developed as a means to respond to poverty reduction, generating income, and a tool for survival. Although MEs are very small in size compare to the other companies, they are very large in number and contribute in the national GDP to a greater extent (Rahman et al. 2014, 2015b). In fact, based on the data retrieved from the Department of Statistics Malaysia (2014), a total of 645,136 SMEs (Small and Medium Enterprises) are operating their businesses in Malaysia which the majority of SMEs (77 per cent) were MEs establishments followed by small establishments (20 per cent) and medium-sized establishments (three per cent). It indicates that there are about 496755 MEs in Malaysia. As a result, SME contribution to GDP increased from 29.6% in 2005 to 35.9% in 2014 and also contributed 65% of total employment and 17.8% of total exports (SME Corporation Malaysia, 2016) indicating significant role of SMEs in the economic growth of Malaysia.

In view of the fact that MEs play an important role in the economic development of Malaysia, it is important to identify how MEs can achieve business growth through innovativeness. To attain business growth, the most noteworthy issue of concern is the psychological factors of MEs. Some previous studies found that personal characteristics have a relationship with the business growth of MEs (Jamak et al. 2012). Despite the importance of personal characteristics and its effects on the business growth of MEs, the focus of most past studies in Malaysia was mostly limited to the adoption of Information, Communication and Technology (ICT), financial assistance, and technical efficiency in SMEs (Nawai, Shariff 2011; Radam et al. 2008). So far, the innovativeness of MEs and its components that affect growth have been neglected, especially the ones that focuses on understanding the fine-grained issues pertaining to the psychological factors that affect innovativeness among ME entrepreneurs. Examining this untapped area will enhance the understanding of measure that can be undertaken to further develop MEs in Malaysia.

Therefore, the objective of this paper is to explore the psychological factors of innovativeness that drives nomadic micro entrepreneurs' (MEs) in enhancing their business growth in Malaysia. To be more specific, the scope of this study is to focus on the psychological factors of innovativeness among the nomadic entrepreneurs those who regularly change the location of their business, as, such study found to be rare in the extant literature. The result of this study will contribute to understand the required psychological factors of innovativeness that shoves the business growth of the nomadic micro entrepreneurs' (MEs) and in shaping the Malaysian business market. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.