Entrepreneurship Development and Challenges of Insecurity in Nigeria
Keywords:
Insecurity, Entrepreneurship, Terrorism, Small-Scale Enterprises, GovernanceAbstract
This study investigated the impact of insecurity on entrepreneurial development in Nigeria over the period 2002–2022. The analysis focused on how insecurity, proxied by the Nigerian Terrorism Index and refugee inflows, influenced entrepreneurship using self-employment rates and loans to small-scale enterprises as indicators. To ensure robustness, governance and corruption variables were incorporated as control factors. The Autoregressive Distributed Lag (ARDL) framework was employed to capture both the short-run dynamics and the long-run equilibrium relationships among the variables. The results reveal that insecurity, particularly terrorism, exerts a statistically significant negative effect on entrepreneurial development. Terrorism reduces self-employment opportunities and limits access to credit facilities for small-scale enterprises, thereby undermining entrepreneurial growth. Refugee inflows also impose additional pressures on the entrepreneurial environment, although their short-run effect is relatively modest compared to the long-run. Governance, on the other hand, demonstrates a positive influence, as improvements in institutional quality enhance entrepreneurial outcomes. Conversely, corruption consistently exerts a negative effect, eroding trust in economic systems and constraining business opportunities. The error correction term confirms the presence of a long-run equilibrium relationship, indicating that shocks to the system gradually return to stability. Based on these findings, the study recommends strengthening security measures to reduce terrorism, implementing effective policies for integrating refugees into productive sectors of the economy, improving governance structures, and reinforcing anti-corruption frameworks. Such interventions are essential for creating a stable and enabling environment that supports sustainable entrepreneurial development in Nigeria.
References
Achumba, I. C., Ighomereho, O. S., & Akpor-Robaro, M. O. M. (2013). Security challenges in Nigeria and the implications for business activities and sustainable development. Journal of Economics and Sustainable Development, 4(2).
Acs, Z. J., Desai, S., & Klapper, L. F. (2015). What does “entrepreneurship” data really show? Small Business Economics, 31(3), 265-281. https://doi.org/10.1007/s11187-008-9137-7
Adegoriola, A. E., & Adolphus, A. J. (2021). Impact of Insecurity on Small and Medium Scale Enterprises (SMEs) in Nigeria. In Proceedings of 3rd Annual National Conference, Federal University Lafia, Nasarawa State, Nigeria 26th–28th October.
Afolabi, S. (2024). Perceived effect of insecurity on the performance of women entrepreneurs in Nigeria. FUW-International Journal of Management and Social Sciences, 9(2).
Alowonle, A. N. (2021). Insecurity and the plights of women entrepreneurs in Ondo State, Nigeria. International Journal of Adult and Development Education, 1(1).
Asgary, N. H., & Maccari, E. A. (2019). Entrepreneurship, innovation and sustainable growth: Opportunities and challenges. Routledge.
Assenova, V. (2019). What is the relationship between entrepreneurship and innovation output? Evidence from 219 economies over 1960–2018.
Collier, P., & Hoeffler, A. (2004). Greed and grievance in civil war. Oxford Economic Papers, 56(4), 563-595.
Ekoja, G. O. (2022). Entrepreneurial ventures and insecurity in Nigeria: A case of selected enterprises in Kaduna State, Nigeria. Nigerian Journal of Management Sciences, 23(2).
Ekoja, G. O., Tamunomoni, A. C. B., Okafor, C. A., & Okpebenyo, W. (2022). Entrepreneurial ventures and insecurity in Nigeria: A case of selected enterprises in Kaduna State, Nigeria. Nigerian Journal of Management Sciences, 23(2), 162.
Fayaz, N., Khandai, S., Zupic, I., & Kaur, A. (2022). Going back to the roots: A bibliometric and thematic analysis of women entrepreneurship. Dynamic Relationships Management Journal, 11(2), 97-115.
Frynas, J. G., & Mellahi, K. (2015). Global Strategic Management. Oxford University Press.
Fyllingen, V. D., & Furrebøe, K. H. (2022). Job insecurity and intention to leave, from a job insecurity climate perspective (Master's thesis, Handelshøyskolen BI).
Goni, K. M., Yusuff, Y. Z. M. I., & Abdullah, T. (2022). Insecurity in Nigeria and ensuing consequences to entrepreneurial development. http://hdl.handle.net/123456789/3541
Harima, A., Harima, J., & Freiling, J. (2021). The injection of resources by transnational entrepreneurs: Towards a model of the early evolution of an entrepreneurial ecosystem. In The Dynamics of Entrepreneurial Ecosystems (pp. 102-129). Routledge.
Institute for Economics & Peace. (2024). Global Terrorism Index 2024: Measuring the impact of terrorism. https://visionofhumanity.org/resources/global-terrorism-index-2024/
Kamuri, S. (2022). Understanding entrepreneurial vision for growth, innovation, and performance in Kenya’s leather industry. Journal of Global Entrepreneurship Research, 12(1), 119-130.
Kimenyi, M. S., Adibe, J., Djiré, M., Jirgi, A. J., Kergna, A., Deressa, T. T., Pugliese, J. E., & Westbury, A. (2014). The impact of conflict and political instability on agricultural investments in Mali and Nigeria. Brookings Institution.
Ksoll, C., Macchiavello, R., & Morjaria, A. (2023). Electoral violence and supply chain disruptions in Kenya's floriculture industry. Review of Economics and Statistics, 105(6), 1335-1351.
Li, Y. (2024). Comparative study of entrepreneurial motivation in Finnish native and immigrant females: Business continuation perspectives (Master's thesis, Y. Li).
Makdisi, S. A., & Soto, R. (Eds.). (2023). The Aftermath of the Arab Uprisings. Routledge.
Naudé, W. (2010). Entrepreneurship, developing countries, and development economics: New approaches and insights. Small Business Economics, 34(1), 1-12. https://doi.org/10.1007/s11187-009-9198-2
Naudé, W. (2019). The decline in entrepreneurship in the West: Is complexity ossifying the economy?
Ndubuisi-Okolo, P. U., & Onuzulike, N. F. (2022). Insecurity and performance of business activities in Anambra State, Nigeria. Journal of Economics, Management and Trade, 28(11), 85-93.
OECD. (2019). Perspectives on Global Development 2019: Rethinking development strategies. OECD Publishing.
Okechukwu, E. U., & Nwekwo, M. N. (2020). Youth entrepreneurial development: A panacea for overcoming security challenges and unemployment in Nigeria. Unizik Journal of Business, 3(1).
Okpalaojiego, E. C. (2021). Causes and implications of insecurity on entrepreneurial development and small business operations in Nigeria: The panacea. Academic Journal of Current Research, 8(6), 95-109.
Omeje, A. N., Jideofor Mba, A., & Anyanwu, O. C. (2023). Impact of insecurity on enterprise development in Nigeria. Journal of Entrepreneurship in Emerging Economies, 15(6), 1416-1437.
Onuoha, A. C., Anele, N. I., & Okwara, C. A. O. (2024). Prevalence of insecurity and survival of entrepreneurial business in Imo State, Nigeria. International Journal of Advancement in Education, Management, Science and Technology, 4(2), 30.
Pesaran, M. H., Shin, Y., & Smith, R. J. (2001). Bounds testing approaches to the analysis of level relationships. Journal of applied econometrics, 16(3), 289-326.
Salami, U. J., & Otakey, A. H. (2022). Assessment of the impact of insecurity on women's entrepreneurial activities in Shiroro Local Government Area of Niger State.
World Bank. (2020). Global Economic Prospects, January 2020: Slow growth, policy challenges. World Bank Group.
World Bank. (2021). World development report 2021: Data for better lives. https://www.worldbank.org/en/publication/wdr2021
