Exploratory Factor Analysis on the Entrepreneurial Intention among Management Students in Nepal

Abstract

Entrepreneurship is known to be an important engine of economic success and employment among the youth but its development among youth continues to be a complicated psychological process. This research is an examination of the underlying dimensions of entrepreneurial intention among management students in Nepal, a country with high unemployment amongst the youth and where a sense of urgency to adopt a culture of start-ups is evident. Based on the Theory of Planned Behavior (TPB), the study mainly seeks to determine the factors that influence student orientation towards self-employment as well as analyzing the predictive ability of psychological and institutional antecedents. Adopting a descriptive-cum-analytical design, data were collected via a systematic survey of 373 management students from Tribhuvan University-affiliated campuses in Nepal. The questionnaire was structured based on Luiz and Mariotti (2011) and it was found to have high internal reliability with Cronbachs alpha of 0.760. The statistical analysis was performed with Exploratory Factor Analysis (EFA) based on Principal Component Analysis (PCA) with Varimax rotation with the help of Kaiser-Meyer-Olkin (KMO) and Bartlett tests. The findings showed a strong six-factor model that explained 72.563% of the total cumulative variance. The most dominant factors were found to be cost management (loading 0.932), decision-making under uncertainty (0.910), and risk avoidance (0.904) and institutional support and perceived benefits of entrepreneurship. These results validate the idea that entrepreneurial intention is a strategic decision and is deliberate and consistent with the TPB. The researchers find that university degrees might serve as the theoretical basis, but there is no sufficient experience and mentorship without these resources. The implications are that academic institutions need to shift to strategic alliances with the corporate sector, and the financial literacy and resilience training should become part of the curriculum. Policymakers can motivate graduates to shift traditional job-seeking and innovative job-creation, leading to sustainable economic growth in a country.