INCOME, SAVINGS AND INVESTMENT PATTERNS OF SMALL-SCALE AGRO-BASED ENTREPRENEURS IN ANAMBRA STATE, NIGERIA
ABSTRACT
The study examined income, savings and investment patterns of small-scale agro-based entrepreneurs in Anambra State. The study utilized primary data to achieve this objective. The data were collected through multi-stage random sampling technique from 160 respondents. These data were analyzed with descriptive statistics including 4-point Likert rating scale, and multiple regressions. Tests of significant effects and differences were carried out with t-test and analysis of variance (ANOVA) techniques. Research results indicated that the average age of the small-scale agro-based entrepreneurs were 40years, while majority (33.8%) of them fell within the age range of 31-40 years. Also, majority (57.5%) of the small-scale agro-based entrepreneurs were males, while 43.8% of them were married. Household size of six to ten persons was the highest at 41.3% with an average of 9 persons per household, while twenty five percent of the agro-based entrepreneurs had completed their primary school education. Furthermore, majority (26.9%) of the entrepreneurs were engaged in groundnut processing, while the average experience of the entrepreneurs was 9 years and majority (38.1%) of them had 6 – 10 years of experience. Further results showed that the average monthly income of the small-scale agro-based entrepreneurs was N12,031.25 while their average monthly savings was N4,550.00. Majority (58.3%) of the small-scale agro-based entrepreneurs saved with esusu. Further results showed that majority (46.3%) of the entrepreneurs invested within N21,000 – N30,000 in their businesses while 46.3% of them also sourced their investment capital through personal savings with only 2.5% of them receiving loans from bank to finance their investments. There were no significant (p>0.1) differences in investment pattern of the agro-based entrepreneurs across the agricultural zones. Furthermore, the results showed that the socio-economic characteristics were significant (p<0.1) in explaining the changes in income, savings and investment patterns of the agro-based entrepreneurs. Age, educational level, savings level, asset level and level of skill acquired were positive and significant (p<0.05) in affecting the income pattern of the agro-based entrepreneurs. Also, the savings level of the entrepreneurs were positively and significantly (p<0.01) affected by their income and asset levels, and level of skill acquired, while the effects of household size and educational level were negative and significant (p<0.05). Furthermore, educational level, level of skill acquired, savings level and amount of money borrowed by the entrepreneurs had positive and significant (p<0.05) relationship with their investment pattern while the effects of household size and amount of interest paid on borrowed money were negative and significant (p<0.05). Further results showed that the challenges facing small-scale agro-industry were at an average of 2.85 on a 4-point Likert rating scale. These challenges included erratic power supply, lack of accessibility to their business areas, multiple government taxation and low patronage. The study recommended policies that will enhance the income, savings and investment levels of small-scale agro-based entrepreneurs in Anambra State.
TABLE OF CONTENTS
Title Page i
Certification ii
Dedication iii
Acknowledgement iv
Abstract v
Table of Contents vi
List of Tables x
List of Figures xi
Chapter One: Introduction
1.1 Background of the Study 1
1.2 Problem Statement 4
1.3 Objectives of the Study 6
1.4 Hypotheses of the Study 7
1.5 Justification of the Study 7
Chapter Two: Review of Related Literature
2.1 Concept of Small-Scale Agro Based Entrepreneurs 9
2.1.1 Meaning of Small Scale Industries/Enterprises 11
2.1.2 Roles of Small-Scale Agro-Based Entrepreneurs
in Economic Development 12
2.2 Socio-Economic Characteristics of Small-Scale Agro-Based Entrepreneurs 13
2.2.1 Gender of Small-Scale Agro-Based Entrepreneurs 14
2.2.2 Age of Small-Scale Agro-Based Entrepreneurs 14
2.2.3 Education Level of Small-Scale Agro-Based Entrepreneurs 14
2.2.4 Marital Status of Small-Scale Agro-Based Entrepreneurs 15
2.2.5 Occupational Categories of Small-Scale Agro-Based Entrepreneurs 15
2.2.5 Income Level of Small-Scale Agro-Based Entrepreneurs 16
2.3 Sources of Capital/Funds for Investment by Small-Scale Agro-Based
Entrepreneurs 16
2.4 Patterns of Investment and Savings of Small-Scale Agro-Based Entrepreneurs18
2.4.1 Patterns of Investment of Small-Scale Agro-Based Entrepreneurs 18
2.4.2 Patterns of Savings of Small-Scale Agro-Based Entrepreneurs 19
2.5 Factors Affecting Income, Savings and Investment Patterns of
Agro-Based Entrepreneurs 20
2.6 Factors Affecting the Income of Small-Scale Agro-Based Industry 22
2.7 Theoretical Framework 27
2.7.1 Life Cycle Hypothesis 27
2.7.2 Permanent Income Hypothesis 28
2.7.3 Keynesian and Accelerator Theories 30
2.8 Analytical Framework 30
2.8.1 Likert Scale 31
2.8.2 Multiple Regression 31
2.8.3 Analysis of Variance (ANOVA) 32
2.8.4 T- Test 32
Chapter Three: Research Methodology
3.1 Area of Study 33
3.2 Sampling Technique 34
3.3 Data Collection 34
3.4 Analytical Technique 35
Chapter Four: Results and Discussions
4.1 Socio-Economic Characteristics of Small Scale Agro Based Entrepreneurs 39
4.1.1 Age of Small-Scale Agro-Based Entrepreneurs 39
4.1.2 Sex of Small-Scale Agro-Based Entrepreneurs 40
4.1.3 Marital Status of Small-Scale Agro-Based Entrepreneurs 40
4.1.4 Household Size of Small-Scale Agro-Based Entrepreneurs 41
4.1.5 Educational Level of Small-Scale Agro-Based Entrepreneurs 42
4.1.6 Type of Agro-Based Activity Engaged by Small-Scale
Agro-Based Entrepreneurs 43
4.1.7 Nature of Business of Small-Scale Agro-Based Entrepreneurs 44
4.1.8 Years of Experience of Small-Scale Agro-Based Entrepreneurs 44
4.1.9 Possession of Requisite Skills by Small-Scale Agro-Based Entrepreneurs 45
4.2 Income and Savings Status and Patterns of Small-Scale
Agro-Based Entrepreneurs 46
4.2.1 Income Status of Agro Based Entrepreneurs 46
4.2.2 Income Sources of Small-Scale Agro-Based Entrepreneurs 47
4.2.3 Savings Status of Small-Scale Agro-Based Entrepreneurs 48
4.2.4 Savings Patterns of Small-Scale Agro-Based Entrepreneurs 49
4.3 Investment Patterns of Small-Scale Agro-Based Entrepreneurs 50
4.4 Sources of Capital for Investment by Small-Scale Agro-Based entrepreneurs51
4.4.1 Sources of Capital 51
4.5 Factors Affecting Income, Savings and Investment Patterns of Small-Scale
Agro-Based Entrepreneurs in Anambra State 52
4.5.1 Factors Affecting Income Pattern of Small-Scale Agro-Based Entrepreneurs52
4.5.2 Factors Affecting Savings Pattern of Small-Scale Agro-Based Entrepreneurs54
4.5.3 Factors Affecting Investment Pattern of Small-Scale Agro-Based Entrepreneurs55
4.6 Factors Affecting the Income of Small-Scale Agro-Based Industry 57
Chapter Five: Summary, Conclusion and Recommendations
5.1 Summary 60
5.2 Conclusion 62
5.3 Recommendations 63
References 65
Appendices 72
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