The Effect of perceived university support and perceived institutional support on entrepreneurial intentions

Abstract

Despite efforts taken to nurture entrepreneurship among young graduates in Sri Lanka, graduates still tend to show greater preference for paid employment over self-employment. This phenomenon is true for both students passing out from business as well as non-business degree programmes. Recent studies on entrepreneurial intention indicates that the effect of contextual factors such as university support and institutional support for entrepreneurship could enhance the entrepreneurial activities among students. Thus, the current study explored the effect of perceived university support and perceived institutional support for entrepreneurship on an individual’s entrepreneurial intention. A sample of 234 immediately passed out students from Sri Lankan state universities took part in the study and data was analysed using structural equation modelling. Findings showed that both perceived university support as well as perceived institutional support have had a significant positive effect on entrepreneurial self-efficacy, while entrepreneurial self-efficacy had a significant positive impact on entrepreneurial intention. These findings revealed the importance of university support and institutional support to foster entrepreneurship among graduates in Sri Lanka. The study recommends practical implications for government policy makers and other stakeholders in higher education sector. Steps should be taken to improve university support for entrepreneurship beyond mere entrepreneurship education. Further, policy makers should create a favourable and supportive institutional environment in order to enhance student’s entrepreneurial intention.