Barriers and Incentives for Youth Entrepreneurship Start-Ups: Evidence from Bangladesh

Abstract

Reducing unemployment of youth has become one of the most difficult challenges for Bangladesh where youths constitute one third of total population. This study examined a range of key constraints that impede young people in Chittagong, Bangladesh, from starting and running a business and at the same time the study identified incentives, initiatives and measures that may improve young entrepreneurship. For a qualitative intervention, 44 complete questionnaires were analyzed who were selected from Chittagong, the second largest in Bangladesh, following a convenience and purposive sampling technique. Results reported that most cited start-up challenge is neglecting knowledge-based innovation, being their own boss is the main motivation to engage in business, parents and family mainly influenced young people to start business while financial risk is the most pressing de-motivator to start-up business. The results also suggest that attracting funds for the business is the most important problem to run a business successfully, and lack of savings; securities and credibility, and experience are the key start-up financing constraints. The prime educative constraints are the lack of adopting enterprise education and inadequate curricula and programs, tax systems and levels is the major administrative and regulatory barrier and lack of contracts and networks is the main constraint of business support services. The study draws implications for policy makers, the Ministry of Youth Development, Chamber of Commerce and Industry, and the government to adopt multi-faceted, multi-targeted, and multi- tiered approaches addressing the start-up constraints and problems to facilitate and encourage youth entrepreneurship.