CHAPTER ONE

INTRODUCTION

1.1     BACKGROUND OF THE STUDY

Entrepreneurship in Nigeria started when people in the villages and farming communities produced more products than they needed, as such; they had to exchange these surpluses with those who needed them within their immediate and neighbouring communities. The exchange of goods for goods or services was based on trade by barter initially, until commodity money was developed and used. Exchange encouraged specialization among producers, and the communities came to realize that they can concentrate on the areas of production they are best fitted. Consequent on the above, the culture of entrepreneurship started in Nigeria (Nicks, 2008; Raimi and Towobola, 2011).

The socio-economic impact of entrepreneurship on the sustainable economic growth of the Nigerian economy is difficult to accurately measure or estimate, but it is believed to be highly dynamic and significant (Chu, Kara, Benzing, 2010). However, a study estimated that between 45 and 60 percent of the urban labour force work for small private enterprises or what is otherwise called small businesses (Nwaka, 2005 in Chu, Kara, Benzing, 2010).

Recently, entrepreneurship has been beneficial because the Nigerian private sector comprising of small and medium enterprises provides diverse employment opportunities for 50 percent of the country's population and 50 percent of the its industrial output (Ariyo, 2005).

On account of encouraging entrepreneurial initiatives, the country has experienced exponential growth in the number of private firms. However, majority of these businesses are very small when their operations are measured in terms of capital, employment and revenues (Attahir and Minet, 2000). Added to the above is difficulty confronted by small businesses in accessing bank credits, but the most serious and damaging problem threatening the state of entrepreneurship in Nigeria is a lack of government interest and support for micro, small enterprises (Ariyo, 2005; Chu et al., 2008). Besides, entrepreneurship and small and medium enterprises development is hampered by plethora of challenges like bad roads, bribes by government officials, multiple taxes, epileptic power supply and rising overhead costs on transportation and communication. All these challenges and similar others have attracted global attention (Business Environment and Enterprise Performance Surveys, 2007).

More importantly, economic growth has eluded Nigeria on account poor utilization of its numerous oil wealth for communal benefits, as current socio-economic indicators suggest that the nation’s mineral wealth has become worthless and a source of misery (Alan, 2007). However, when it comes to linking entrepreneurship to growth at the national level, there is a relative void despite recent efforts of the Global Entrepreneurship Monitor (GEM) research program (Reynolds et al., 2001).

Rural areas have traditionally been a field for primary production. Additionally, they have not only supplied industrial areas with food and raw materials, but also used to be the main source of human resources and original capital accumulation, which provided the basis for the economic and demographic growth of the center. At the same time, there are a number of values, which are generally considered to be positive and have been sustained better in, rural, than in urban areas these rural values are clean environment, natural beauty and cultural traditions. These are natural parts of rural life and nobody thought about them as important resources for economic development (Nemes, 2005). But these rural areas are suffering from many problems as Ghauri (2009), expressed that the world has been experiencing worst food crisis and hunger in rural areas is nothing new. Rising food prices have developed into a global crisis. Indeed the 800 million people estimated to be living in hunger in the world; the vast majority is in rural areas. It is indeed a cruel irony that those workers and small farmers who feed the world often have the least resources to feed themselves and their families. Therefore, this study is carried out to investigate the importance of entrepreneurial development and socio-economic growth in rural communities of Akwa Ibom State.

1.2     STATEMENT OF THE PROBLEM

For decades, Nigeria is one of the Africa's most populous country, has experienced severe economic hardships. As a result of this ugly situation, poverty has been running unchecked, job opportunities have vanished, and Nigeria's prosperity has dwindled considerably. Many entrepreneurs have the initiative to start new ventures, but lack the skills, tools, and support to succeed. Corruption, economic instability, and a lack of infrastructure and management capacity have also combined to stifle new business growth.

          Therefore, this study seeks to investigate the importance of entrepreneurship in the growth of an economy.

1.3     OBJECTIVES OF THE STUDY

The objectives of the study are to find out the following:

1)      To find out the role of entrepreneurship in socio-economic growth of rural communities.

2)      To examine the relationship between entrepreneurship and economic growth.

3)      To examine whether entrepreneurial development increase the economic  growth in rural communities in Nigeria.

4)      To examine the effects of the choice between entrepreneur and the employment in Nigeria.

5)      To make useful recommendations based on the findings of this study.

1.4     RESEARCH QUESTIONS

The following research questions were formulated to guide this study:

1)      What are the role entrepreneurs in socio-economic growth of rural communities?

2)      Is there any relationship between entrepreneurship and economic growth?

3)      Does entrepreneurial development increase the economic growth in rural communities in Nigeria?

4)      Is there any effect of the choice between entrepreneur and the employment in Nigeria?

1.5     RESEARCH HYPOTHESES

Hypothesis 1

H0:     There is no significant relationship between the role entrepreneurs and socio-economic growth of rural communities in Akwa Ibom State.

H1:     There is a significant relationship between the role entrepreneurs and economic growth of rural communities in Akwa Ibom State.

Hypothesis 2

H0:     There is no significant relationship between entrepreneurship and economic growth.

H1:     There is a significant relationship between entrepreneurship and economic growth.

1.6     SIGNIFICANCE OF THE STUDY

This study after its due and careful completion would in no iota of doubt be useful unreservedly to the following:

          To the business world, it would help entrepreneurs and managers, in full actualization of the essence of investment. To the government, it would help government to encourage in entrepreneurs by way of supporting them through finance and provide them enable environment.

          To the academia, it will through more light to some minute but significant areas which previously were not considered as major factors in the management appraisal and study in the area of business management. To the students, it would serve as a reference source to students (researchers) who might want to further studies in the similar topic. 

1.7     SCOPE OF THE STUDY

This study is limited to Eket Local Government Area of Akwa Ibom State and upon the research topic, which is centered on the entrepreneurial development and socio-economic growth in rural communities of Akwa Ibom State.

1.8     LIMITATION OF THE STUDY

          The limitation to this study was inability of management to divulge certain information which they consider sensitive and fear of publication which might be detrimental to their operation.

          Another limitation to the study is time constraint. The period within which the study is conducted is short for a thorough research work, hence gathering adequate information becomes very difficult.

          Also, finance is one of the limitations to the study. They researcher facing financial constraints to meet all the needed educational requirements including this research work. This caused the researcher to restrict his research work to one company for possible completion of the study.  

          Finally, lack of materials on the topic, therefore the researcher resolved to seek friendly approach in order to obtain the needed materials or information from the establishment or organization under study through the administration of questionnaire.

1. 1. This material content is developed to serve as a GUIDE for students to conduct academic research work
2. 2. As a source for additional understanding of the subject.
3. 3. As a source for ideas for your own research work (if properly referenced).
4. 4. For PROPER paraphrasing (see your university definition of plagiarism and acceptable paraphrase)
5. 5. Direct citing (if referenced properly)
Thank you so much for your respect to the authors copyright.