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Table of Contents.
Background
Problem statement
Research objectives
Literature review
Research hypothesis
References

2
3
3
3
6
6

Background

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When it comes to economic development, South Africa is not the only

country that is fascinating challenges. With high volumes of Graduates and
Unemployed youths, its quite clear that our beloved country South Africa is
in no state to cater for these high volumes of unemployed youths. Even more
the private sector cant accommodate all these newly unemployed
population. According to the South Africa Department of Trade and industry
2013:10, the core challenges affecting youth economic development are low
GDP growth, income inequality, low levels of youth economic participation,
lack of managerial and entrepreneurial skills, lack of access to micro-finance,
assets and business information. It for this reason that the South African
youth need to start considering entrepreneurship as a career option.
Entrepreneurship is defined by Davey,Plewa, and Struwig 2011 as a process
to create economic activity and development, by combining risk taking,
creativity

and

sound

2003,p.6.Entrepreneurship

management,
will

help

in

European

elevating

the

Commission,
high

rate

of

unemployment especially the youths. However not a lot of youths are

choosing Entrepreneurship as a career option. Entrepreneurship should have
formed as a basis in education in high school, thus introducing student to
Entrepreneurship as a career option.
This Literature review will address among others the factors influencing
youth entrepreneurship development, yet the focus will be more on the
effects that entrepreneurial education has on potential entrepreneurs and
existing entrepreneurs. This will explain that fact that Entrepreneurial
education should not only focus on pre-start-ups, but that it should also
benefit post creation stages of the business, Gibb 1987.The Literature will
reveal that even though businesses can be operated by individuals who did
not receive entrepreneurial training, these individuals will still lack the
managerial

and

financial

skills

they

wouldve

received

form

the

entrepreneurial training.

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The results from the GEM report will indicate that in support of the
Entrepreneurship intention stated by Linan and Chen 2009, individuals will
first respond to opportunities and then consider their own capabilities, which
South Africans indicated in the GEM report for 2013 that they had high levels
of perceived capabilities.
Lastly , this Literature review will show the benefits of entrepreneurial
education, how it can be applied and mostly students that were interviewed
in a study conducted by Linan, Cohard and Cantuche, 2011, and this review
will show the importance of Entrepreneurship education.

Problem statement
Based on the literature study done, it was evident that youth employment
internationally was at a high rate, more so in South Africa. Although youth
entrepreneurship has been supported by the South African government with
the establishment of among others the National Youth Development Agency,
Entrepreneurial education will teach students theoretical knowledge of
Entrepreneurship and give practical experience. In this study, Entrepreneurial
education will be assessed in order to understand fully the effects this will
have in the youths entrepreneurial journey, thus benefiting the South African
economy.

Research objectives.
1. To measure if Entrepreneurial education will create desire for the youth
of South Africa to consider Entrepreneurial education as a career
choice.
2. To determine

where

Entrepreneurial

entrepreneurship

education

and

to

intention

what

extent

is

will

result
it

of

affect

entrepreneurial intention.

Literature review

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The GEM report and the Department of Trade and Industry.

According to the South African Department of Trade and Industry 2013:10,

the core challenges facing South Africa youth economic development are low
GDP growth, income inequality, low levels of youth economic participation,
lack of managerial and entrepreneurial skills , lack of access to microfinance, assets and business information. Turton and Harrington 2012 state
that South Africa as an efficiency-Driven Economy displays negative
perception couldnt identify opportunities and also didnt believe that they
were capable of identifying opportunities to start a business and low
perceived capabilities, Gem report 2012. Yet in the Gem report 2013
indicated that South Africa had a great entrepreneurship rate, with an
average of 37.9%. It seems south Africans didnt Van Praag and Verloot 2007,
suggest that entrepreneurial activity positively affects economic outcomes
such as economic growth and innovation, and increasing economic efficiency
and job creation. According to Van Praag 1999, because entrepreneurs bring
about innovation, this will thus create what is called a creative destruction,
which is a new equilibrium, Oosterbeek, Van Praag and Ijsselstein 2010, thus
this will positively affect the economic outcomes, Van Praag and Versloot
2001.

Entrepreneurship education.

According to Matlay and Storey 2003, individuals who choose the path of
entrepreneurship will be influenced by pull and push factors that will also
influence their chosen business. Furthermore, Kuratko 2003 claims that
entrepreneurship can be taught by business educators, before, during and
after commencement of entrepreneurial activities. This will give birth to
Graduate entrepreneurship, which is when a graduate creates a business in
his career orientation, Rwigema and Venter 2004. This brings focus to
Entrepreneurial education as a way to empower students to create their own
businesses. According to Olufunso 2010, entrepreneurial education would
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increase students skills and knowledge and will thus inform them of
business practices such as identifying opportunities, risk taking and
creativity. However as stated by Matlay 2008, Johannison 1991, argues that
entrepreneurship education cant be confined to the classroom as those skills
arent enough to equip students, Rae 1997. This was further supported by
research done by Davey, Plewa and Struwig 2011, students indicated that
they would appreciate Universities putting them in contact with networks
needed to start a business and also offer workshops and projects focusing on
entrepreneurship, Davey et al 2011. Entrepreneurship education should
include pre-start-up and post-creation stages, Gibb1987, thus making people
aware of the entrepreneurial career option, Linan et al 2011. This is exactly
what is being done business schools, they offer theory and practical
approaches, and students are taught by analyzing entrepreneurial challenges
and solutions based on realistic case and field studies, Timmons 2003,
Petereman and Kennedy 2003.
According to Matlay 2008, after completing the entrepreneurial education,
business graduates have a greater likelihood to become entrepreneurs or
efficient managers in small businesses and also research that was done by
Matlay 2008 shows that the businesses operated by business graduates was
higher than that operated by non-graduates, Matlay 2008.Matlay and Carey
2007 also indicated in their research done to evaluate the impact of
entrepreneurship education on entrepreneurial careers shows that most
entrepreneurship graduates were sole traders a year graduating, owners of
micro-businesses, this research showed that none of the graduates was
unemployed, Matlay 2008.

Entrepreneurial intention.

It must be stated that entrepreneurial education works together with

entrepreneurial intention. Research has shown that theres been a gap
between entrepreneurial education and entrepreneurial activity; this is where
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entrepreneurial intention fits in, Zhang et al 2014. Entrepreneurial intention

is thus defined by Krueger 1993 in a study done by Zhang,Duysters and
Cloodt 2014 as the commitment to start a business, which is determined by
the individuals attitude and traits, Ajzen 1991;Krueger,Reilly and Carsrud
2000.

Although Wu and Wu 2008 argue that entrepreneurial intention

indirectly affects entrepreneurial education and some studies have found no

difference in entrepreneurial intention of students that got entrepreneurial
education and those that did not, Zhang et al 2014. However research has
shown that entrepreneurial intention has a direct impact on entrepreneurial
education, Zhang et al 2014.

SEE and TPB theories.

Scholars have introduced the Shapero and Sokol 1982 theory which states
that entrepreneurial process that is centered around intentionality, Bird
1988, Zhang et al 2014. The Theory of Planned Behavior (TPB), is made up of
attitudes towards behavior, subjective norms and self-efficacy, Zhang et al
2014. This supports the notion that entrepreneurship is premeditated, David
2014,

and

that

entrepreneurial

intention

is

conceived

right

before

entrepreneurial behavior, David 2014. Thus it can be concluded that

entrepreneurial intention will be one of the results of entrepreneurial
education. A study conducted in the Great University of Zimbabwe indicated
that entrepreneurial education is done to promote entrepreneurial culture,
increase the spirit among graduates, increase students awareness and
interest in entrepreneurship, David 2014. Based on the empirical research
done by Linan et al 2011, entrepreneurial training needs to consider
increasing entrepreneurial intention, and to also teach about the role of
entrepreneurship and the development of start-up, Linan et al 2011.

Research Hypotheses.
Quantitative test using sampled data will be used to address the research
problem along with objectives in order to test the following hypotheses:
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1. The positive effects of entrepreneurial educational among potential

youths entrepreneurs, which was proved by David 2014.
2. The different rate of business success between youth who had received
entrepreneurial education and those who had not, as indicated by
Matlay 2008.
3. Results will show that entrepreneurship education produces among
others the entrepreneurial intention, Zhang et al 2014.

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