Effects of financial literacy on entrepreneurial intention among higher education students

Key findings from this study

• The study found that financial knowledge significantly predicts entrepreneurial intention among Ethiopian university students.
• The researchers report that positive attitudes toward financial management positively influence students' intent to become entrepreneurs.
• The study found that financial behaviour did not exert significant effects on entrepreneurial intention despite its inclusion as a literacy dimension.

Overview

This study examines how financial literacy dimensions affect entrepreneurial intention among Ethiopian university students. The research focuses on students enrolled in institutions offering entrepreneurship curriculum alongside financial training. Financial literacy emerges as a critical factor influencing students' motivation and capacity to establish and manage ventures.

Methods and approach

The study employed quantitative methodology with an explanatory research design. Researchers distributed 400 online questionnaires to students in Ethiopian higher education institutions; 365 responses met inclusion criteria, yielding a 91% response rate. Partial least squares structural equation modelling (PLS-SEM) constructed both measurement and structural models to assess relationships between variables.

Results

The PLS-SEM analysis validated the survey instruments as reliable and contextually appropriate. Financial knowledge and attitude demonstrated significant positive effects on entrepreneurial intention. Financial behaviour, however, showed no statistically significant relationship with entrepreneurial intention among the sample. The measurement model confirmed construct validity across all assessed dimensions.

Implications

The differential impact of financial knowledge and attitude versus behaviour suggests that cognitive and affective dimensions of financial literacy warrant distinct policy attention. Government and institutional stakeholders should prioritize financial literacy programs targeting knowledge acquisition and attitude development among students. Enhanced curricula integrating financial competency training may strengthen entrepreneurial intentions in post-secondary contexts.

Scope and limitations

This summary is based on the study abstract and available metadata. It does not include a full analysis of the complete paper, supplementary materials, or underlying datasets unless explicitly stated. Findings should be interpreted in the context of the original publication.