The impact of entrepreneurs' perceptions and social media usage on their intention to formalise their MSMEs in Egypt
Journal of Entrepreneurship and Public Policy
ISSN: 2045-2101
Article publication date: 31 October 2023
Issue publication date: 2 November 2023
Abstract
Purpose
The formalisation – switch from the informal to the formal sector – of micro, small and medium enterprises (MSMEs) has serious ramifications on the Egyptian economy. This study investigates the effect of the factors perceived by Egyptian informal entrepreneurs to encourage/deter formalisation on those entrepreneurs' intentions of formalising their MSMEs. Social media (SM) usage is a novel factor whose impact on the intention of formalisation is also examined.
Design/methodology/approach
The conceptual framework of the theory of planned behaviour (TPB) is used, and a logistic regression model is utilised. Relevant data were collected from self-assessment questionnaires of a sample of Egyptian informal female and young male entrepreneurs, who constitute the majority of informal entrepreneurs in Egypt.
Findings
Results reveal that for female entrepreneurs, only the support of the government and other institutions positively affects their intention of formalisation, whilst direct costs and lack of family support affect their intention negatively. For young male entrepreneurs, the number of employees and prospects of contract enforcement positively affect their intention of formalisation, whilst being involved in a trading activity affects it negatively. For both groups, higher levels of education and SM usage adversely affect their intention of formalisation. These varying results have a crucial policy implication: the one-size-fits-all public policies intended to stimulate formalisation might not work, and thus, more tailored policies are required.
Originality/value
Worldwide, research on the impact of SM on the formalisation of MSMEs is scant, if existent. In Egypt, research on MSMEs is limited, those focusing on the impact of SM on Egyptian MSMEs are even scarcer and those targeting SM's effect on their formalisation are absent.
Keywords
Acknowledgements
This study is funded by the British University in Egypt (YIRG) (No: YIRG2017-06). The authors would like to thank Nevine ElSherif, Lina Tageldin and AbdelRahman Mokhtar for providing excellent research assistantship and Professor John Adams for providing valuable comments. An earlier draft of this study was presented and is in the proceedings of the 10th European Conference on Social Media, ECSM, 2023, 18-19 May.
Citation
Miniesy, R. and Fakhreldin, H. (2023), "The impact of entrepreneurs' perceptions and social media usage on their intention to formalise their MSMEs in Egypt", Journal of Entrepreneurship and Public Policy, Vol. 12 No. 3/4, pp. 209-233. https://doi.org/10.1108/JEPP-04-2023-0037
Publisher
:Emerald Publishing Limited
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