Psychological factors predicting the likelihood of youth entrepreneurship in Ethiopia

BACKGROUND: Entrepreneurship is a critical strategic instrument for any country’s overall social and economic sustainable growth. OBJECTIVE: This study aimed to address the psychological characteristics that predict the likelihood of youth considering entrepreneurship in Ethiopia. METHODS: To achieve this objective, this study used a quantitative research approach and an explanatory research design. The study’s target group was 9850 entrepreneurs who are currently engaged in a variety of entrepreneurial activities. Using a multistage sampling technique, the researchers selected 385 respondents as a sample size out of the target population. RESULTS: This study used a survey questionnaire as a tool for data collection and applied binary logistic regression analysis for the data analysis. The study found that psychological traits factors, such as the need for achievement, need for independence, locus of control, and risk-taking prosperity variables, are significant in predicting the likelihood of youth considering entrepreneurship as an attractive life venture. CONCLUSIONS: By looking at the influence of personality factors on entrepreneurial intentions, this study adds to the current body of knowledge in entrepreneurship research. The study contributes to policymakers and other stakeholders to support micro and small enterprises. Furthermore, owners and practitioners can utilize the findings of this study as a guide.