The role of mobile and broadband penetration in entrepreneurial activity for the sub-Saharan African region

Abstract

PURPOSE OF THE STUDY : Entrepreneurship is highly relevant to sub-Saharan African (SSA) countries where policies have recently been implemented to facilitate new business start-ups by focusing on fixed and mobile broadband technology. This study investigates the extent to which mobile and broadband penetration in SSA countries is associated with entrepreneurial activity and new business density rates. DESIGN/METHODOLOGY/APPROACH : Data sets from the International Telecommunication Union, Global Entrepreneurship Monitor, and World Bank are analysed across thirteen SSA countries. FINDINGS : Broadband penetration has an increasing trend pattern over the years analysed. Results reveal a positive relationship between the rate of mobile penetration, broadband penetration, and new business density rates, while a negative relationship was detected between the rate of mobile penetration, broadband penetration and the rate of total entrepreneurial activity. RECOMMENDATIONS/VALUE : Policymakers and leaders must realise that as with other forms of infrastructure, broadband and mobile networks have a substantial impact on the entrepreneurial activity and are essential factors in the establishment of new businesses. MANAGERIAL IMPLICATIONS : Leaders and managers need to invest in infrastructure in terms of ICT which could reduce the cost of operations, distribution, and marketing for existing entrepreneurs and encourage potential entrepreneurs to engage in start-ups (Herrington & Kelly, 2013).