Determinants of SMMEs Survival in post-war communities in developing countries: testing the interaction effect of government support

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Date
2017Author
Candiya Bongomin Okello, George
Munene, John C.
Mpeera Ntayi, Joseph
Akol Malinga, Charles
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Show full item recordAbstract
The main purpose of the study is to test the interaction effect of
government support in the relationship between business skills, capital adequacy,
access to finance, access to market, entrepreneurial education, and Small Medium
and Micro-enterprises (SMMEs) survival in post-war communities in northern
Uganda.
Design/methodology/approach – cross sectional research design was used in the
study and quantitative data were collected from 304 SMMEs located in Gulu District
using a semi-structured questionnaire. Structural equation modelling (SEM) through
use of Analysis of Moment Structures was adopted to establish the interaction effect
of government support in the relationship between business skills, capital adequacy,
access to finance, access to market, entrepreneurial education and SMMEs survival
in post-war communities in northern Uganda. Further, Pearson’s correlation analysis
was used to show the association between the variables under study.
Findings – the results revealed that there is a significant interaction effect of
government support in the relationship between business skills, capital adequacy,
access to finance, access to market, entrepreneurial education and SMMEs survival
in post-war communities in northern Uganda. Besides, the results indicated that
business skills, capital adequacy, access to finance, access to market, entrepreneurial
education, and government support have significant and positive impacts on SMMEs
survival in post war communities in northern Uganda.
Research limitations/implications – the study employed cross-sectional research
design, thus, ignoring longitudinal study approach. Besides, the sample was selected
from only Gulu District, therefore, leaving out other Districts located in northern
Uganda.
Practical implications – advocates of recovery programmes and interventions in
developing countries should consider government support as a vital factor in
promoting business skill, capital adequacy, access to finance, access to market, and
entrepreneurial education in order to promote SMMEs survival in post-war
communities. In addition, governments in developing countries should offer
investment incentives and tax waivers to infant SMMEs in post-war communities
like in northern Uganda.
Originality/value – the study examined the interaction effect of government support
in the relationship between business skills, capital adequacy, access to finance, access
to market, entrepreneurial education and SMMEs survival in post-war communities
in developing countries. Thus, to the best of our knowledge, this is the first attempt
to test the interaction effect of government support in the relationship between
business skills, capital adequacy, access to finance, access to market, entrepreneurial
education and SMMEs survival in post-war communities in northern Uganda. The
use of government support as a moderator in the relationship between business
skills, capital adequacy, access to finance, access to market, entrepreneurial
education and SMMEs survival is scarce in entrepreneurship literature and theory.
This creates uniqueness in this study.
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