The Role of Competencies and Education in Increasing Entrepreneurial Intention in Creative Economy

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Christine W.

Sandroto, Yussi Ramawati, Syarief Darmoyo / The Role of Competencies and Education in Increasing Entrepreneurial Intention in Creative Economy / 31-
44

ISSN: 2089-6271 | e-ISSN: 2338-4565 |https://doi.org/10.21632/irjbs

Vol. 11 | No. 1

The Role of Competencies and Education in


Increasing Entrepreneurial Intention in
Creative Economy
Christine Winstinindah Sandroto, Yussi Ramawati, Syarief Darmoyo
Atma Jaya Catholic University of Indonesia, Jl. Jenderal Sudirman 51, Jakarta 12930

ARTICLEINFO ABSTRACT

Keywords: entrepreneurial The creative economy is being increasingly encouraged by the Indonesian
competencies, education level, government, the existing entrepreneurs are mostly engaged in the culinary
creative economy,
entrepreneurial intention industry. This study aims to describe the role of competencies and
education in increasing entrepreneurial intention in the creative economy.
Three hundred and five questionnaires were distributed to creative
Kata Kunci: entrepreneurs, consisting of 162 respondents in Jakarta and 143 in
kompetensi wirausaha,
tingkat pendidikan, Balikpapan using convenience sampling. Research findings show that there
ekonomi kreatif, intensi is no difference between the mean scores of entrepreneurial competencies
wirausaha in Jakarta and Balikpapan. Furthermore, the level of education has a
positive effect on (i) entrepreneurial intention, (ii) entrepreneurial
professional attraction, and (iii) entrepreneurial networking support. There
is a positive relationship between education level and monthly revenue, as
well as between entrepreneurial competencies and monthly revenue. The
findings of this research would suggest government and education
institution to further develop entrepreneurship education and train them
with various methods and to cultivate interests in other creative sub-sectors.

SARIPATI

Ekonomi kreatif saat ini semakin digalakkan oleh pemerintah, namun


kenyataannya hanya bidang kuliner yang diminati oleh pelaku usaha.
Penelitian ini bertujuan untuk menggambarkan peran competencies dan
pendidikan untuk meningkatkan ketertarikan berwirausaha di bidang
kreatif ekonomi. Populasi dalam penelitian ini adalah para pelaku usaha
pada kreatif ekonomi di Jakarta dan Balikpapan. Penelitian ini
menyebarkan kuesioner kepada 305 responden yang terdiri dari 162
responden di wilayah Jakarta dan 143 di Balikpapan, dengan teknik
convenience sampling. Hasil penelitian menunjukkan bahwa tidak ada
perbedaan nilai rata-rata entrepreneurial competencies antara Jakarta
dan Balikpapan. Lebih lanjut tingkat pendidikan berpengaruh positif
terhadap (i) entrepreneurial intention, (ii) professional attraction
Corresponding author: entrepreneurial, dan (iii) networking support entrepreneurial. Terdapat
christine.wins@atmajaya.ac.id

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International Research Journal of Business Studies | vol. XI no. 01 (2018)

hubungan yang positif antara tingkat pendidikan dan pendapatan/ bulan,


serta terdapat hubungan yang positif antara entrepreneurial competencies
dan pendapatan/bulan. Saran dalam penelitian ini agar lebih
mengembangkan pendidikan kewirausahaan dan mempertajam dengan
berbagai metoda. Mengedukasi dan melatih agar tertarik pada bidang
industri kreatif lainnya selain kuliner.
INTRODUCTION regulation. The overall potential of the
Indonesia is one of the world’s most nation’s creative economy needs to be
economicallyperforming countries. In 2015, the continuously developed by mapping out the
country recorded 4.79% Gross Domestic Product creative economic potentials in every province
(GDP) growth, higher than the 2.4% global in Indonesia.
economic growth. This positive climate provides
the Indonesian government with an opportunity to The creative economy contributed 7.13
strengthen the foundations of the economy, percent to the GDP during 2010-2014. In
specifically in the real sector. One of the sectors 2010, the GDP contribution was recorded at
that deserve to be prioritized is the creative Rp473 trillion, while in 2013 the number
economy, Creative economy can also be called as increased to Rp641 trillion. The highest
creative industry or cultural industry. The creative growth of creative economies can be traced to
economy has an advantage over some sectors, i.e. Jakarta, Bandung, Yogyakarta, and Bali
an economy that is centered on the skills of the (Enciety News, 2015). Conversely, in
human resources; unlike those that heavily rely on Kalimantan, the growth of creative industries
the exploitation of natural resources. For example, remains not only low but also due to the
art, architecture, book, technological innovation, underdevelopment of most of the sub-sectors.
and animation are all results of derived ideas. The Kalimantan is, however, superior when it
creative economy industry is the hope for comes to food and craft (Pro Kaltim, 2016).
Indonesia amid the global economic turmoil
(Bekraf, 2017). The creative economy employes creativity,
skill, aptitude, and individual competence.
In 2014 - 2015 the value-added of the creative The creative economy is able to support long-
economy sector was estimated to be 111.1 trillion term government programs, therefore it is
Rupiah, with fashion, culinary, and handicraft appropriate if the level of competitiveness is
subsectors as the largest contributors to this also complemented by the competence of the
number (Kemenperin, 2015). This surely improves human resources and entrepreneurial intention
the competitiveness of products and businesses in in the creative economy.
Indonesia. As a result, there are many start-up
businesses that are emerging in the country. The Aside from working as an employee, people
government also expresses its support of the can choose to be an entrepreneur. Some
creative economy by issuing Presidential people perceive that being an entrepreneur is a
Regulation No. 6 of 2015 on Creative Economy valuable opportunity (opportunity
Board which was amended by Presidential entrepreneurship). Others become
Regulation No. 72 of 2015. There are sixteen entrepreneur due to unemployment (necessity
creative economic subsectors mentioned in the entrepreneurship). Necessity entrepreneurs are
generally not highly educated. It is not
© 2018 IRJBS, All rights reserved. surprising that previous articles suggest that
necessity entrepreneurs possess the lower
likelihood to success compared to opportunity
entrepreneurs (J. H. Block & Wagner, 2010; J.

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Christine W. Sandroto, Yussi Ramawati, Syarief Darmoyo / The Role of Competencies and Education in Increasing Entrepreneurial Intention in Creative Economy / 31-
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Block & Sandner, 2009; Verheul et al., 2010). Fashion; 7. The Movie, Animation, and
Nevertheless, these necessity entrepreneurs Video; 8. Photography; 9. Craft; 10. Culinary;
may end up successful if they receive 11. Music; 12. Publishing; 13. Advertising;
adequate training and education to improve 14. Performing Arts; 15. Art; and 16. Television
their competence, along with government and Radio. Indonesia expects every province to
support that includes the introduction of develop several creative sub-sectors in order to
policies that promote creative economy. increase the economic growth in their respective
regions.
Based on the given introduction, this research
would examine the competence of creative Entrepreneurship
entrepreneurs, identify the creative industries Entrepreneurship is defined as «the occupational
that are of interest, and assess how the level choice to work for one’s account and risk»
of education influences entrepreneurial (Stephan and Uhlaner, 2010). An entrepreneur is
intention and new venture creation. somebody who creates a new business in the face
of risk and uncertainty for the purpose of achieving
LITERATURE profit and growth by identifying significant
REVIEW Creative opportunities and assembling the necessary
Economy resources to capitalize on them (Scarboroug and
According to Tian & Gao (2011), a creative Cornwall, 2016). Starting part-time business is a
economy is a form of advanced economic popular gateway to entrepreneurship. Part-time
development that relies on fewer natural entrepreneurs have the best of both worlds: they
resources. Its main driver is not purely can ease into business for themselves without
technology or information, but human sacrificing the security of a steady paycheck and
creativity, creative and unique products that benefits. The Internet (and particularly e-bay) and
combine culture, spirit, and habit. The mobile communication devices make establishing
creative industry is a human-oriented and running a part-time business very easy; many
industry. Protection of intellectual property parttime entrepreneurs run online businesses from
serves to preserve the vital energy of the a spare bedroom in their homes or from wherever
creative industry. Companies gain benefit they are (Scarboroug and Cornwall, 2016).
from symbiotic mutualisms and access to
high industry value chains. According to According to Reynolds et al., (2001), there are two
Wang & Peng (2009), creative industry is types of entrepreneurs: necessity entrepreneurs
different from the consumer goods industry, and opportunity entrepreneurs. The difference
where production depends on machines or between these two types of entrepreneurs lies in
labor. The creative industry generates output their underlying motives for starting a business.
from intellectual capital, marked with Necessity entrepreneurs are those who are driven
originality. into the entrepreneurial world as needbased (Block
and Wagner, 2010). They become entrepreneurs by
The Creative Economy default because they do not have an alternative
Board (or known in Indonesia as (Verheul et al., 2010), i.e. a non-voluntary decision
Bekraf) is a non-ministerial government (Reynolds et al., 2001). Moreover, this kind of
institution responsible for the sixteen sub- constraint usually does not satisfy one’s self.
sectors of the creative economy: 1. (Bhola et al., 2006).
Application and Game Development; 2.
Architecture; 3. Interior design; 4. Visual Opportunity entrepreneurs are those who establish
communication design; 5. Design Products; 6. a business to pursue an opportunity (Block and

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International Research Journal of Business Studies | vol. XI no. 01 (2018)

Wagner, 2010). They mobilize efforts to take accounting affair competence, (vi) management
advantage of business opportunities based on competence, (vii) globalization competence, (viii)
personal interests (Verheul et al., 2010); thus, business law competence, (ix) enterprise resource
enabling them to enter the entrepreneurial world by planning competence, and (x) information
choice. Oftentimes, entrepreneurs who are driven technology competence.
by necessity are more to experience failure
compared to opportunity (Bhola et al., 2006; Block Entrepreneurial Intention
and Wagner, 2010; Block and Sandner, 2009; Soutaris et al. (2007) (as referenced in
Verheul et al., 2010). Additionally, necessity Mohammad et al., 2015) define
entrepreneurs do not normally have the formidable entrepreneurial intention as one’s desire to
educational background. However, these begin an entrepreneurial activity. Shapero &
entrepreneurs might achieve success if they receive Sokol (1982) argue that intention of becoming
adequate training and education to improve their an entrepreneur depends on the following
competence, along with government support that three dimensions: perceived desirability,
includes the introduction of policies that promote perceived feasibility, and propensity to act.
creative economy. Shapero & Sokol (1982) adapted the Planned
Behavior theory that was proposed by
Entrepreneurial Fishbein & Ajzen (1975) and specifically
Competency applied it to the field of entrepreneurship.
Competency is defined as an underlying
characteristic of an individual that is causally Ajzen (1991) furtherly developed the theory of
related to criterion-referenced effective and/or Planned Behavior. This theory comprises
superior performance in a job or situation. There several variables: (i) background factors; (ii)
are five characteristics of competence: motives, behavioral belief; (iii) normative beliefs; (iv)
traits, self-concept, knowledge, and skills (Spencer subjective norm; (v) control beliefs; and (vi)
and Spencer, 1993). Knowledge and skills are perceived behavioral control perception.
usually associated with hard skill competencies, According to the theory of Planned Behavior,
while personality is usually associated with soft a person can be determined to act in a certain
skill competencies (Shermon, 2004). way only if he or she has control over his or
her behavior. This theory not only emphasizes
Spencer and Spencer (1993) state that the rationality of human behavior but also the
entrepreneurial competencies include both hard belief that the target behavior is under the
and soft skills: (i) achievement, (ii) thinking and control of the individual’s consciousness; or a
problem-solving, (iii) personal maturity, (iv) behavior depends not only on the intentions of
influence, (v) directing and controlling, (vi) the individual but also on other factors that are
orientation to others, and (vii) additional not under the control of the individual such as
competencies. Based on the duties and scope of the availability of resources and opportunities
responsibilities, experts develop entrepreneurial to perform such behavior. Theory of Planned
competence. Entrepreneurial hard skill Behavior dictates the intention is a function of
competencies, according to Chou, Shen, and Chen, three determinants, they are: being personal,
and Hsiao (as referenced in Riyanti, Sandroto, and reflecting social influences and relating to
Warmiyati, 2016), consisting of ten competencies control problems (Ajzen and Fishbein, 2005).
among business students: (i). entrepreneurial spirit
and entrepreneurial competencies, (ii) marketing Education Level and Entrepreneurial
competence, (iii) business and economics intention Previous studies have found that the
competence, (iv) financial competence, (v) creation of new ventures had been planned

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Christine W. Sandroto, Yussi Ramawati, Syarief Darmoyo / The Role of Competencies and Education in Increasing Entrepreneurial Intention in Creative Economy / 31-
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(Bird, 1988; Autio et al., 1997; Tkachev and (3) a better understanding of entrepreneurship
Kolvereid, 1999 in Mushtaq et al., 2011 and not only by entrepreneurs, but within a wider
Shapero and Sokol, 1982). The difficult and section of society including local and regional
challenging nature of entrepreneurship causes authorities, development agencies, financing
many freshlyestablished businesses to fail. institutions and the organisations of the civil
Entrepreneurship requires enhanced sector (Konczol, 2004). The rising demand
management capabilities to grow businesses for entrepreneurship learning reveals the
and fight off competitions. Several studies requirement to depart university prepared
have given the evidence of the importance of with the understanding and expertise essential
university education to anticipate and clarify to carry on in modern day’s competitive set.
individual behaviors related to new venture After gaining the required entrepreneurial
creation (Kolvlereid, 1996; Krueger 1993 in skills and abilities, the attitude has changed
Mushtaq et al., 2011). Entrepreneurship and they were more attracted toward
education and training have an immediate entrepreneurship. The importance of know-
impact on students and their behavioral how and learning has broadly drawn
intention (Kolvereid and Moen, 1997). This attention, specifically to the enhanced
indicates that there is a difference between information the education is providing
those who take entrepreneurial and non- (Mushtaq et al, 2011)
entrepreneurial education. Education,
therefore, plays an important role in Studies about the role of the entrepreneurial
improving entrepreneurship and number or network reveal that the network is related to
entrepreneurs. In new venture creations, businesses being started (Gartner & Carter, 2003).
entrepreneurs usually rely on network support, Prior studies have found that past entrepreneurial
social norms, the perception of feasibility, and experience tends to expand a set of heterogeneous
entrepreneurial experience. After possessing social networks that are beneficial for the
the aforementioned entrepreneurial skills and development of start-up businesses (Mosey &
abilities, the attitude of the graduate change; Wright, 2007). Networking behavior is defined as
they are more interested in entrepreneurship. individuals’ attempt to develop and maintain
The rise in interest is triggered by the learning relationships with others who have the potential to
process, considering that education provides assist them in their work or career. Networking is a
the information needed (Cooper, 1985). type of proactive behavior. It is also noted as an
important source of sales prospect (Macintosh &
The transformation of thought to become an Krush, 2017).
entrepreneur is well thought out and
deliberate, and this is influenced by education Self-reliance is needed in relation to the level of
(Krueger, Reilly, and Carsrud, 2000). As a creativity and modernity of a person in choosing
result of the adjustments and improvements the latest methods and knowledge to apply to local
in the formal education system and the conditions (Acho-Chi, 1998). Self-reliance is
vocational and other professional training defined as a mindset that observes individual
programmes, some important objectives minds and physical resources, as the basic reserve
could be achieved, they are: (1) a better to describe on the search of one’s aims and goals
transferability of the different programmes- and discovers sentimental accomplishment not
through the credit system; (2) a more only in attaining the objectives but encompassing
transparent system of qualificationthrough the them by means of personal resources (Rahman,
professional qualification of training 1993).
programmes and training organisations; and

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International Research Journal of Business Studies | vol. XI no. 01 (2018)

Based on the phenomena that have been 9. There is an effect of level of education on
mentioned, this study would assess entrepreneurial professional attraction.
competencies, the respondents’ preferred sub- 10. There is an effect of level of education on
sectors of the creative economy, and how networking support.
educational attainment influence entrepreneurial 11. There is an effect of level of education on
intention and new venture creation (professional selfreliance.
attraction, networking support, and self-reliance). 12. There is a correlation between education level
The findings of the study are expected to determine and monthly revenue.
the development of entrepreneurial spirit in the
nation’s creative economy. 13. There is a correlation between
entrepreneurship competencies and monthly
Research Question revenue.
To measure entrepreneurial competencies and to
measure how the effect of educational level toward Population and Sampling
entrepreneurial intention, professional attraction, The population of this research included all
networking support, and self-reliance in creative creative entrepreneurs, both full time and part
economy in Jakarta and Balikpapan. time in Jakarta and Balikpapan. These cities
were chosen due to the similarities on
METHODS potential and existing differences on industry
This descriptive study employs the management. Convenience sampling was
causalcomparative technique. Questionnaires were performed: questionnaires were distributed to
distributed to the respondents to measure five 305 entrepreneurs—162 in Jakarta and 143 in
variables: entrepreneurial intention, professional Balikpapan. The sampling method used in this
attraction, networking support, self-reliance, and study is non-probability sampling, ie not all
level of education. subjects have equal opportunity to be a
research sample (Kerlinger & Lee, 2000).
Conceptual Hypothesis
1. There is a difference in achievement Data and Measurement
competency between Jakarta and Balikpapan. In measuring the research variables, this study
2. There is a difference in thinking and adapted the scales that had been formerly
problemsolving competency between Jakarta developed. Entrepreneurial competencies
andBalikpapan. (EC) were measured using Spencer and
3. There is a difference in personal maturity Spencer scale (1993) containing 23 items of
competency between Jakarta and Balikpapan. questions for achievement dimensions (ACH),
4. There is a difference in influence competency 6 questions for thinking and problem-solving
between Jakarta and Balikpapan. dimensions (TPS), 13 questions for personal
5. There is a difference in directing and maturity (PM) dimensions, 11 questions for
controlling competency between Jakarta and influence dimension (INF), 6 questions for
Balikpapan. directing and controlling dimension (DC), and
6. There is a difference in orientation to others 14 questions for orientation to others (OTO)
competency between Jakarta and Balikpapan. dimension.
7. There is a difference in entrepreneur
competencies between Jakarta and Respondents were asked to indicate their level
Balikpapan. of approval of question items on a 7-point
8. There is an effect of level of education on Likert scale, ranging from strong
entrepreneurial intention. disagreement (1) to strong agreement (7).

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Christine W. Sandroto, Yussi Ramawati, Syarief Darmoyo / The Role of Competencies and Education in Increasing Entrepreneurial Intention in Creative Economy / 31-
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Validity and reliability test results show the 0.837 - 0.897 and significant at 0.01;
scale to be valid and reliable (correlation Cronbach ‘alpha coefficient PA = 0.931,
coefficient EC ranged from 0.595 - 0.872; p Cronbach’ alpha coefficient NS = 0.946, and
<0.01, ACH ranged from 0.696 - 0.837; p Cronbach ‘alpha coefficient SR = 0.882).
<0.01, TPS ranged from 0.859 - 0.913; p
<0.01, PM ranged from 0.675 - 0.848; p Education level is defined as (i) the last
<0.01, INF ranged from 0.768 - 0.858; p formal education diploma received by the
<0.01, DC rangesd from 0.796 - 0.898; p respondent, and (ii) the duration of formal
<0.01 OTO ranged from 0.844 - 0.931; p education pursuit in terms of years.
<0.01 Cronbach ‘alpha coefficient EC =
0.990, Cronbach ‘alpha coefficient ACH = Data Analysis
0.970, Cronbach’ alpha coefficient TPS = Data were analyzed descriptively and
0.945, Cronbach ‘alpha coefficient PM = inductively. Descriptive statistics were used
0.951, to describe the research variables and the
Cronbach’ alpha coefficient INF = 0.951, demography of the respondents, as well as the
Cronbach ‘alpha coefficient DC = 0.915, and perceptions of entrepreneurial competencies
Cronbach’ alpha coefficient OTO = 0.979). with crosstabs and mean score. Inductive
statistics were performed to test the
Entrepreneurial Intention (EI) was measured hypotheses using linear regression and
through a scale developed by Alhaj, Yusof, independent samples t-test, and Spearman’s
and Edama (2011). This scale consisted of 7 rank correlation.
question items. Respondents were asked to
indicate their level of approval of the item Description of Respondents
questions on a 7-point Likert scale, ranging Three hundred and five entrepreneurs participated
from strong disagreement (1) to strong in this research: 162 respondents in Jakarta and
agreement (7). The validity and reliability test 143 in Balikpapan. Some questionnaires were
results show that this scale was valid and returned incompletely, i.e. some questions left
reliable (correlation coefficient EI ranged unanswered; this caused inequality in the number
from 0.825 - 0.941 and significant at 0.01; of respondents for some questions. Outliers were
Cronbach’ alpha coefficient EI = 0.806). also eliminated prior to analysis.

Professional attraction (PA), Networking Descriptive Statistics


support (NS), and Self-reliance (SR) were The characteristics of the respondents are presented
measured using the scale developed by in Table 1.
Mushtaq et al., (2011). The scale consisted of
3 questions each for PA and NS, and 4 In Jakarta, the majority of the respondents are in
questions for SR. Respondents were asked to the 16-to-26 age range and male. In Balikpapan,
indicate their level of approval of the item the majority of the entrepreneurs are middle-aged
questions on a 7-point Likert scale, ranging (38-48 years of age) and female. In Jakarta and
from strong disagreement (1) to strong Balikpapan, majority respondents are married. In
agreement (7). The validity and reliability test terms of experience, most of the respondents have
results show that the three scales were valid only been working as entrepreneurs for less than
and reliable (correlation coefficient PA six years. Both in Jakarta and Balikpapan, the
ranged from 0.887 - 0.940 and significant at p highest percentage for education is senior high
= 0.01, the NS ranges from 0.943 - 0.958 and school and followed by an undergraduate degree,
is significant at 0.01, and the SR ranged from while the rest are spread out among primary

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International Research Journal of Business Studies | vol. XI no. 01 (2018)

school, junior high school, and diploma. Both Overall entrepreneurial competencies in both
cities show that most respondents are fulltime Jakarta and Balikpapan are high, In Jakarta, the
entrepreneurs. They are all mostly full-time highest dimension is the orientation to others,
entrepreneurs. Finally, when it comes to monthly whereas achievement, thinking and
revenue, there are those who earn more than 500 problemsolving, personal maturity, influence, and
million Rupiah in Jakarta, but most entrepreneurs directing and controlling are moderate to high. In
in both cities earn less than 10 million Rupiah Balikpapan the highest dimension is an
every month. achievement, thinking and problem solving, and
orientation to others

Table 1. Characteristics of Respondents


Percentage

Jakarta Balikpapan
Age (n=161) (n=140)
16 - 26 42.9 12.1
27 - 37 28.0 29.3
38 - 48 15.5 37.1
49 - 59 11.8 20.0
60 - 72 1.9 1.4
Gender (n=161) (n=139)
Male 57.1 38.1
Female 42.9 61.9
Marital status (n=152) (n=136)
Married 57.2 86.8
Not married 39.5 12.5
Widow/widower 3.3 .7
Number of years working as entrepreneur (n=144) (n=69)
< 6 60.4 54.5
6 - 11 21.5 23.9
12 - 17 6.9 10.3
18 - 22 4.2 5.2
23 - 28 3.5 2.8
29 - 35 3.5 3.3
Education (n=155) (n=139)

Primary school 3.2 .7


Junior high school 14.2 10.8
Senior High School 54.8 57.6
Diploma 2.6 0.0
Undergraduate degree 23.9 29.
Postgraduate degree 1.3 1.4
Type of Entrepreneur (n=155) (n=142)
Full-time 68.4 83.1
Part-time 20.0 11.3

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Christine W. Sandroto, Yussi Ramawati, Syarief Darmoyo / The Role of Competencies and Education in Increasing Entrepreneurial Intention in Creative Economy / 31-
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Others 11.6 5.6


Monthly revenue (n=156) (n=131)
(in millions of rupiah)
< 10 42.3 57.3
10 - 30 25.0 30.5
31 - 50 10.3 8.4
510 - 100 10.3 1.5
101 - 500 7.1 2.3
> 500 5.1 0.0
is high, while personal maturity,
influence, and directing and controlling
is moderate to high.
Table 3 shows that:
• There is a difference in thinking
and problem solving between
Jakarta and Balikpapan (p
<0.05).
• There is a difference in
directing and controlling
between Jakarta and Balikpapan
(p <0.1).
• There is a difference in
orientation to others between
Jakarta and Balikpapan (p
<0.05).

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International Research Journal of Business Studies | vol. XI no. 01 (2018)

Table 2. Entrepreneurial Competencies

Competencies Jakarta (N=138) Balikpapan (N=117)


Achievement 5.34 Moderate to high 5.40 High
Thinking and problem solving 5.21 Moderate to high 5.44 High
Personal maturity 5.22 Moderate to high 5.28 Moderate to high
Influence 5.26 Moderate to high 5.28 Moderate to high
Directing and Controlling 5.29 Moderate to high 5.10 Moderate to high
Orientation to others 5.80 High 6.12 High
Entrepreneurial Competencies 5.35 High 5.44 High

Table 3. Entrepreneurial Competencies

Independent-Sample t Test

Area N Mean Std. Deviation t-value


Achievement Jakarta 159 5.30 .777 -0.909
Balikpapan 138 5.33 .982

Thinking & Problem Solving Jakarta 158 5.18 1.015 -2.187b


Balikpapan 136 5.43 .937

Personal Maturity Jakarta 157 5.22 .708 -0.803


Balikpapan 136 5.25 .880

Influence Jakarta 158 5.23 .851 -0.158


Balikpapan 134 5.28 .779

Directing & Controlling Jakarta 158 5.27 .961 1.653c


Balikpapan 135 5.09 .948

Orientation to Others Jakarta 157 5.78 .754 -3.216a


Balikpapan 135 6.09 .882

Entrepreneur Competencies Jakarta 159 5.32 .787 -1.488


Balikpapan 138 5.37 1.005

Note : a p < 0.01; b p < 0.05; c p <0.1


• There is no difference in achievement
between Jakarta and Balikpapan (p>
0.1).
• There is no difference in personal
maturity between Jakarta and Balikpapan
(p> 0.1).
• There was no difference in mean
influence between Jakarta and
Balikpapan (p>
0.1).

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There is no difference in entrepreneurial REULTS AND


competencies between Jakarta and DISCUSSION
Balikpapan (p> 0.1). The study finds that entrepreneurial
Table 4. The Preferred Sub-Sector of Creative Economy
Jakarta (n=151) Balikpapan (n=124)

Applications and Game Development 2.0 Percentage 1.6


Sub-Sector of Creative Economy
Architecture 4.6 0.8
Product Design 6.6 12.1
Visual Communication Design 0.7 0.0
Interior design 3.3 1.6
Fashion 27.8 8.1
Movie, Animation, and Video 3.3 0.0
Photography 3.3 0.0
Craft 1.3 16.1
Culinary 39.7 54.8
Music 2.0 0.8
Publishing 1.3 0.0
Advertising 1.3 1.6
Performing arts 1.3 0.0
Art 0.7 0.8
Television and Radio 0.7 0.8
Others 0.0 0.8

Table 4 shows that the preferred creative economy competencies of entrepreneurs in Jakarta
sub-sectors for Jakartans are culinary (39.7%), and Balikpapan are high. The high
followed by fashion (27.8%) and the rest. In dimension of entrepreneurial
Balikpapan, the most popular sub-sector is also competencies in Jakarta is the orientation
culinary (54.8%), followed by crafts (16.1%) and to others dimension, while in Balikpapan
the others. it is an achievement, thinking and
problem-solving, and orientation to
Hypothesis Testing others. Furthermore, there is a positive
Inductive Statistics and significant correlation between
Based on the results displayed in Table 5, it can be entrepreneurial competencies and
concluded that education level has a positive and monthly revenue. This indicates that
significant effect on (i) entrepreneurial intention, higher entrepreneurial competencies
(ii) entrepreneurial profession attraction, and (iii) would lead to higher monthly revenue;
entrepreneurial networking support. However, hence, entrepreneurs should gradually
education level does not influence self-reliance. improve their competencies in order to
earn more revenue. They should also
Additionally, as shown in Table 6; there is a consider being trained by professional
positive and significant correlation between teachers, who have professional
education level and monthly revenue, as well as competencies and knowledge-based
between entrepreneurial competencies and competencies comprising pedagogical
monthly revenue. knowledge (Moynihan et al., 2015).

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International Research Journal of Business Studies | vol. XI no. 01 (2018)

The preferred sub-sectors of creative economy in Level of education has a positive and
Jakarta is culinary, followed by fashion and the significant effect on (i) entrepreneurial
intention, (ii) entrepreneurial profession
Table 5. Simple Regression Analysis
R R² Adj. R² F-value t-value
Modelᵃ Unstd. β
1. Entrepreneurial Intention (EI) .111 .012 .09 3.457d 34.570 12.141b

.411 1.859d
EI = EL + ɛ
2. Professional Attraction (PA) .137 .019 .015 5.356c 19.385 13.200b
.264 2.314c
PA = EL + ɛ
3.. Networking Support (NS) .131 .017 .013 4.623c 15.618 18.060b
.145 2.150c
NS = EL + ɛ
4. Self-Reliance (SR) .016 .000 -.003 .075 22.431 16.622b
-.029 -.273
SR = EL+ ɛ

Note: ᵃ EI = Entrepreneurial Intention; PA= Professional Attraction; EC= Entrepreneurial Capability; SI= Self Independence;
SR= Self Reliance; EL= Education Level; b p < 0.01; c p < 0.05; d p < 0.1

Table 6. Correlation Analysis


Monthly Revenue Education Level Entrepreneurial Competencies
Spearman's rho .235 b
.135a

Sig. (2-tailed) .000 .024


N 281 279
attraction, and (iii) entrepreneurial

Note : a p < 0.01; b p < 0.05


networking support. These findings
correspond with studies by Krueger
(1993, as referenced in Mushtaq et al.,
2011 and Krueger et al., 2000). It can be
determined that level of education has an
remaining sectors. In Balikpapan, the most popular important role in improving
sub-sector is also culinary, followed by a craft and entrepreneurial intention and that it can
the rest. These preferred sub-sectors correspond increase the potential for new venture
with the demand and condition of the respective creation. A person’s level of education
cities. Culinary is the industry of choice because also determines the sustainability of
the food is a basic need. Different cities also have product innovation in a creative
their unique specialties. People are generally proud economy; proper education and training
of their food culture and it is relatively not difficult would ensure a lasting creative economy
to market them. Moreover, Jakarta is nation’s
capital; it is no wonder that it serves as the Fifty-seven percent of the respondents in
country’s fashion barometer, thus the popularity of Jakarta are male. Plenty of males become
fashion industry in Jakarta. While in Balikpapan; entrepreneurs in Jakarta by capitalizing on
the availability of natural resources and distinct new business in the culinary and fashion sub-
culture give rise to the craft industry. sectors because they can be managed on a
part-time basis. Contrariwise, in Balikpapan,
the respondents are 61.9% female. They are

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Christine W. Sandroto, Yussi Ramawati, Syarief Darmoyo / The Role of Competencies and Education in Increasing Entrepreneurial Intention in Creative Economy / 31-
44

homemakers who become entrepreneurs to fulfill Technology-related education also includes


household needs. Other than taking care of how using technology to transfers money and
children, they make the most of their culinary or its accessibility, support costs, and other
crafts hobbies by monetizing them. security factors (Mbogo, 2010). If this
advancement is successfully conducted, it can
MANAGERIAL transform necessity entrepreneurs into
IMPLICATIONS opportunity entrepreneurs, as well as convert
As shown in Table 1, the majority of the part-time entrepreneurs into full-time.
respondents are not highly-educated. Based on the
findings of this study, the entrepreneurs’ education When it comes to revenue, the majority of
should be upgraded because the level of education the entrepreneurs in this research yield
not only affects entrepreneurial intention but also less than 10 million Rupiah every month.
increases the potential for new business creations. Even though this number is greater than
Most respondents are merely high school the country’s minimum wage, it is still
graduates. This implies that most of them are the revenue amount and not profit or
necessity entrepreneurs due to the unavailability of disposable income. This figure can
alternative jobs. This type of entrepreneurs has a certainly be increased and one way to do
greater risk of failure (Verheul et al., 2010). it is through product innovation. The
Furthermore, most of these entrepreneurs have uneven development of the creative
only just begun their businesses; over half of the economy in Jakarta and Balikpapan
respondents have only been operating for less than necessitate further training, research, and
six years. Early stage businesses are vulnerable discussion on product innovation,
and more likely to fail (Cowling & Bygrave. particularly for sub-sectors other than
2003). If these businesspeople are necessity culinary, fashion, and craft. The
entrepreneurs, then they need to be trained and Indonesian Creative Economy Board
educated: both hard skill and soft skill should accommodate these advancements
competencies. Entrepreneurial skills are required; in every city.
they increase confidence and focus on providing
solutions to work problems. Skill as an Enhancement of entrepreneurial
entrepreneur is also needed by employees because competencies through education should
it can make them more confident and focus on the be executed in other Indonesian cities as
goal in providing solutions in various problems well. As a result, existing local products
related to their work tasks (Ikupolati et al., 2017). can be sustained, and product innovations
can be strategized. This can give rise to
Other sub-sectors in the creative industry should exciting products that are authentic and
also be considered: application and game unique to each culture. Finally, besides
development; architecture; interior design; visual product innovation, the entrepreneur
communication design; product design; movie, should improve their networking
animation, and video; photography; music; behavior, because networking is noted as
publishing; advertising; performing arts; art; and an important source of sales prospect
television and radio. As Table 4 has shown, the (Macintosh and Krush, 2017).
numbers from all the other sub-sectors combined
are still lower than culinary. This is certainly an In this study, the education level has no
opportunity for every prospective entrepreneur. effect on self-reliance. This finding needs
However, it should be noted that these other sub- to be investigated further in next study.
sectors require technological acumen.

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International Research Journal of Business Studies | vol. XI no. 01 (2018)

CONCLUSION further research, training, and discussion


This study finds that level of education has a on product innovation to tackle the
positive and significant effect on (i) uneven
entrepreneurial intention, (ii) entrepreneurial
profession attraction, and (iii) entrepreneurial
networking support. This is in line with
previous studies that affirm the role of level of
education in improving entrepreneurial
intention and increasing potential new venture
creation. (Krueger, 1993 as referenced in
Mushtaq et al., 2011; Krueger et al.,
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Furthermore, most entrepreneurs in this
As for other cities in Indonesia, entrepreneurs
research were not highlyeducated.
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competencies in order to keep promoting
The findings of this study would suggest the
existing local products, as well as to innovate
Indonesian Creative Economy Board conduct
new products that are authentic and unique to
each culture.

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