Investigating key factors affecting the success of entrepreneurs: using logit and probit models

Document Type : Research Article

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Abstract

Today is based on science and knowledge, as humanity has entered the age of information and communication after leaving the agrarian and industrial societies; it witnessed three: digital, internet and entrepreneurship revolutions. Today is the era of entrepreneurship and entrepreneurs are leading the revolutionary that are based on knowledge, information and awareness. Evidence from developed countries suggests that the entrepreneurship has been causes of economic growth and development, and the only economic solution to treat stagnancy and inflation in Iran is to increase the supply and production which, in turn, depend on knowledge, creativity, innovation and entrepreneurship, investment in which is essential to achieve sustained development. The main purpose of this study is to investigate the effects of demographic and environmental factors on the success of entrepreneurs using logit and probit models in Shahid Salimi industrial town in Tabriz in 2016. The data were collected form 121 economic activist who were randomly selected form the population. We use the Cochran formula to estimate the sample size and use the panel of experts to determine the validity of the questionnaire and use Cronbach's alpha coefficient to estimate reliability. The Cronbach's alpha coefficients for the main variables of the research are between 0.61 and 0.86. That it indicates the appropriate reliability of the research tool. The data were then analyzed using probit and logit models. The empirical results indicated that the level of education has a negative and significant impact on the success of entrepreneurs. In addition, years of experience, physical capital, financial and non-financial support of the government, attitudes, self-efficacy and social value have positive and significant effects on the success of entrepreneurs. According to the obtained results, the LR statistic in both models (logit and probit method) indicates the significance of the whole regression at 1% level. the calculations by the logit method show that by increasing one unit of years of experience, physical capital, financial and non-financial support of the government, attitudes, self-efficacy and social value, assuming the stability of other conditions, The probability of entrepreneurship in the mean increases respectively, 0.12, 0.35, 0.21, 5.77, 1.40 and 0.63 unit. Also, by increasing one unit of education level, assuming the stability of other conditions, the probability of entrepreneurship in the mean decreases, 0.27 unit. So that the calculations by the probit method show that by increasing one unit of years of experience, physical capital, financial and non-financial support of the government, attitudes, self-efficacy and social value, assuming the stability of other conditions, The probability of entrepreneurship in the mean increases respectively, 0.11, 0.33, 0.21, 5.24, 1.31 and 0.56 unit. Also, by increasing one unit of education level, assuming the stability of other conditions, the probability of entrepreneurship in the mean decreases, 0.25 unit. Therefore, considering the importance of entrepreneurship in the country, the researcher recommends the promotion of variables increasing the success of entrepreneurs as well as a fundamental reconsideration of the quality of education in Iran. In other words, the empirical findings of the research indicate that to succeed the entrepreneurs and through which more economic growth and development, attention to invest and the transformation of national assets and wealth into physical capital and non-financial support of the government that create entrepreneurial businesses and access to the banking facility are essential. Due to the fluctuations in the price of oil and the ending of these resources, it is recommended, that reduces dependence on oil and gas revenues and move towards the growth of export of innovative products. Thus, it will be obtained through the attention and support of investment in human beings and the creation of efficient human capital through education and accumulation of experience. Also, by educating and translating the culture of belief and self-efficacy, and providing an environment in which social values and attitudes toward entrepreneurship good achievements can be achieved.
 
 

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References

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Journal of Applied Economics Studies in Iran
Volume 6, Issue 24
December 2017
Pages 153-175

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