Nautwima, J.P.; Asa, A.R.; Atiku, S.O. Testing Unemployment–Entrepreneurship Nexus in Namibia Using the Schumpeterian Approach. Sustainability2023, 15, 14023.
Nautwima, J.P.; Asa, A.R.; Atiku, S.O. Testing Unemployment–Entrepreneurship Nexus in Namibia Using the Schumpeterian Approach. Sustainability 2023, 15, 14023.
Nautwima, J.P.; Asa, A.R.; Atiku, S.O. Testing Unemployment–Entrepreneurship Nexus in Namibia Using the Schumpeterian Approach. Sustainability2023, 15, 14023.
Nautwima, J.P.; Asa, A.R.; Atiku, S.O. Testing Unemployment–Entrepreneurship Nexus in Namibia Using the Schumpeterian Approach. Sustainability 2023, 15, 14023.
Abstract
: There remains no acquiescence that confirms the extent to which unemployment and entrepreneurship influence each other in developing countries. Thus, an incessant invite for further debate attracted the need to assess the relationship between unemployment and entrepreneurship in terms of business formation in Namibia Given that, this study examines the relationship between unemployment and entrepreneurial activities in Namibia. Time series data were collected from the World Bank database to investigate the relationship between unemployment and entrepreneurship in Namibia. Unit root test was conducted using both the Augmented Dickey-Fuller test and the Phillips-Perron test to measure stationarity of the data and found all the variables to have no unit root after the first difference. Thus, we employed the Johansen-Juselius test of cointegration, and the results revealed the absence of a long-run relationship between the variables. Hence, we performed a vector autoregressive (VAR) model to estimate the short-run relationships and found that Namibia exhibit both the refugee and Schumpeter effects. Finally, the direction of causality between the variables was measured using the Pairwise Granger causality test and the results revealed that none of the variables was proven to granger cause the other, concluding that they are all independent of each other. Therefore, in pursuit of unemployment mitigation, we recommend policymakers to focus on other aspects beyond entrepreneurship when devising policies without jeopardizing the ease of business start-up procedures. This will incentivize entrepreneurial activities, which can eventually address other macroeconomic issues beyond unemployment.
Keywords
entrepreneurship; unemployment; unit root; Johansen-Juselius cointegration; VAR model; OLS; granger; Namibia
Subject
Business, Economics and Management, Economics
Copyright:
This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
