A comparative study of the entrepreneurial motivation of undergraduate and graduate students in Japan

Abstract

As entrepreneurs and start-ups have become increasingly significant components of world economic growth, Japan has enacted and discussed various policies to spur entrepreneurship. However, scant attention has been paid toward motivating its youth to embrace the entrepreneurial spirit. Therefore, this study focuses on undergraduate and graduate students and investigates their motivations to become entrepreneurs. The study has three findings. First, the entrepreneurial motivation of Japanese students ranks lower than that of students in the USA, China, India, Spain and Belgium. Second, compared to the motivations of students in other countries, Japanese students’ motivations to launch start-up businesses are few in terms of leadership and independence but many in terms of social contribution. Third, Japanese students believe that their lack of business knowledge and competence creates significant risks and barriers to launching start-up businesses. Finally, the paper discusses the impact of culture and barriers on entrepreneurial innovation in Japan compared to other countries.

Keywords

entrepreneurship graduate student Japan motivation start-ups

With the increasing importance of entrepreneurship for economic development, many studies have examined the role of entrepreneurship in the growth of firms and competitiveness (Acs, et al., 2014; Carlsson et al., 2009; Galloway and Brown, 2002; Hessels and Van Stel, 2011; Minniti and Levesque, 2010; Shane and Venkataraman, 2000; Van Stel et al., 2005). Entrepreneurs have become the main drivers of world economic growth (Audretsch and Keilbach, 2004; Holcombe, 1998) and start-ups its core components (Lee and Peterson, 2000). Entrepreneurship affects economic development in several ways, including via the introduction of new products, job creation and an increase in productivity (Van Praag and Versloot, 2007; Wong et al., 2005). Lüthje and Franke (2003) suggest that changing needs and a globalized market are significant factors that motivate students and business professionals to create new businesses and explore alternatives to established firms.

As a result, although some studies raise doubts as to whether entrepreneurship can be taught (Henry et al., 2005), entrepreneurship programs have increased globally (Giacomin et al., 2011). These programs are part of universities’ attempts to promote social and economic development through entrepreneurship training and venture creation. Thus the entrepreneurial education model, paradoxically, includes both increased university autonomy and greater involvement of external stakeholders (Etzkowitz, 2016).

In Japan, various policies for higher education have been implemented, such as the “Plan to Create 1,000 Start-up Business” (2005) and the “Act on Strengthening Industrial Competitiveness” (2013). Since the systems for intellectual property and other appropriabilities for universities have been improved, the effect of the utilization of university-generated knowledge on innovation activities has increased (Nishikawa and Kanama, 2019). As a result of these initiatives and activities, the market value of start-ups emerging from universities has exceeded one trillion yen in Japan. However, this is only a fraction of the value created by similar programs and activities in the USA and other advanced countries. Therefore, to accelerate and expand the impact of entrepreneurship education programs, the Japanese government has started to focus on mechanisms and policies to encourage entrepreneurship, and thereby start-up businesses, emerging from universities.

However, there is little research in Japan on undergraduate and graduate students as potential resources for entrepreneurship. This paper therefore focuses on their entrepreneurial motivation and quantitatively examines three research questions (RQs):

RQ1: Compared to other countries, how much entrepreneurial motivation do undergraduate and graduate students in Japan have? Why is it high or low?

RQ2: What are the main entrepreneurial motivations of undergraduate and graduate students in Japan? Are there any differences between Japanese students and students from other countries?

RQ3: What barriers do undergraduate and graduate students in Japan face when they consider launching a start-up business? Are there differences between Japanese students and students from other countries?

There are few empirical studies related to entrepreneurial motivation (Nabi et al., 2017). However, several noteworthy theories have been widely employed as tools to aid our understanding of a variety of behaviors, and thereby entrepreneurial motivation. One of these is the Theory of Planned Behavior (TPB). This theory suggests that different behavioral intentions can be predicted, with high accuracy, from attitudes toward behavior, subjective norms and perceived behavioral control. These intentions, together with perceptions of behavioral control, account for the considerable variance in the actual behavior of individuals (Ajzen, 1991). This paper uses this knowledge as a theoretical background, and as a clue, for understanding and analyzing entrepreneurial motivation.

In addition, we consider the survey of Giacomin et al. (2011) for empirical analysis. They carried out their questionnaire survey several times in the USA, China, India, Belgium and Spain. We translated the survey into Japanese and administered it in two Tokyo universities.

Literature review

Research on entrepreneurship motivation¹ and training is diversified across disciplines and identifies a variety of issues. Here, we organize these issues as follows.

Entrepreneurship education programs and training systems

Entrepreneurship education began in the 1930s and is claimed to have originated in Japan (Bell et al., 2004; Kuratko, 2005). It evolved in the USA in the 1970s and spread across the world. In the 2000s, more than 500 entrepreneurship education programs were launched in the USA (Bell et al., 2004). In Japan, several entrepreneurship courses and seminars were established in graduate schools during this time (Ogura, 2011).

Whether or not entrepreneurship motivation and intention can be taught extrinsically is still open to debate. In the initial stages of entrepreneurship research, some researchers approached their research themes with the hypothesis that entrepreneurs were born with specific characteristics and talents – that is, they were entrepreneurs by nature. Later research did not find evidence to validate this notion (Aulet, 2013). As Drucker (1985) suggested, entrepreneurship could be taught and enhanced by training. One piece of theoretical evidence is that there is a logical way of thinking that uniquely serves entrepreneurs in starting businesses – defined by Sarasvathy (2001), this is called “effectuation.” Effectuation includes a set of decision-making principles that expert entrepreneurs have been observed to employ in situations of uncertainty.

As entrepreneurship education programs have surged across the globe (Gibb, 2002; Giacomin et al., 2011), there is increasing recognition that entrepreneurship can be fostered and that programs can indeed promote entrepreneurial skills and mindsets (Piperopoulos and Dimov, 2015). Various studies have reported that entrepreneurship education can be a driving force for developing entrepreneurial motivation and intention (Fayolle and Liñán, 2014; Hamidi et al., 2008; Souitaris et al., 2007; Wu and Wu, 2008).

Souitaris et al. (2007), and Fayolle and Liñán (2014) argue that entrepreneurship education is one of the strongest factors triggering students” interest in start-ups. Barba-Sanchez and Atienza-Sahuquillo (2018) find a positive contribution of entrepreneurship education to entrepreneurship intention in their survey of engineering students in Spain. Furthermore, Blenker et al. (2011) suggest that “everyday practice” constitutes the foundation of all entrepreneurial education because it establishes the core entrepreneurial competence. Participating in entrepreneurship courses has both an individual and a peer effect (Bergmann et al., 2018). Pittaway and Cope (2007) also suggest that entrepreneurship education has an impact on student propensity and intention. Souitaris et al. (2007) found that entrepreneurship education in a school of natural science increased students’ performance as entrepreneurs. However, Doran et al. (2018) suggest that entrepreneurial attitudes stimulate GDP in high-income countries but have a negative impact in middle- to low-income countries.

As described above, universities and colleges have much to contribute in stimulating innovative and growth-oriented entrepreneurship: students with more positive attitudes and stronger subjective norms have stronger entrepreneurial intentions (Refaat, 2009). As already noted, the growth in entrepreneurship education is based on the premise that it can contribute to the development of students’ entrepreneurial attitudes, abilities and skills, and hence enhance their intention to launch new ventures (Piperopoulos and Dimov, 2015).

In contrast, some studies show a negative or no relationship between entrepreneurship education and entrepreneurial intention. Von Graevenilz et al. (2010), based on a survey in universities in Germany, find that entrepreneurial intention gradually decreases after entrepreneurship education. Similarly, Fayolle et al. (2006) find no significant change in students’ entrepreneurial intentions before and after mandatory entrepreneurship education.

Entrepreneurs create innovation in various fields. In some academic disciplines, such as engineering, medicine and the social sciences, it is more difficult to design entrepreneurship programs specific to the discipline. This is because these disciplines require more advanced and specific knowledge than general arts programs. Therefore, entrepreneurship education must be multidisciplinary and must simultaneously include advanced knowledge of each discipline (Mitchell et al., 2000).

Entrepreneurs’ motivations and behaviors: cultural and geographical factors

Based on the TPB, three factors influence intention: attitude toward behavior, subjective norms and perceived behavioral control. In contrast with habituated behavior, the TPB emphasizes steps and causality while providing a useful conceptual framework for dealing with the complexities of human social behavior. Bagozzi et al. (1989) suggest that intentions are the single best predictor of planned behavior.

In addition, some studies on developing entrepreneurial intention have applied the TPB. Entrepreneurial activity can be considered as intentionally planned behavior. Intentions serve as important mediating variables between the act of starting a business and potential exogenous influences. Intentions with regard to behavior are critical for understanding other antecedents, including undertaking a new business start-up (Krueger et al., 2000). Kirkley (2016) identifies the key values individuals believe in and their interpretation in the context of entrepreneurial behavior. The four specific values identified are independence, creativity, ambition and daring, and these are considered critical in the motivation of entrepreneurial behavior.

Shah et al. (2020) investigate the impact of the three factors of the TPB on entrepreneurial intention and the moderating role of entrepreneurship education in the relationship between the three factors. Their results suggest that entrepreneurship education positively contributes to a strengthening of attitudes toward entrepreneurial intention. Entrepreneurship education improves the level of perceived self-efficacy and, therefore, attitudes toward entrepreneurship intention. They also find that entrepreneurship education weakens the relationship between subjective norms and entrepreneurship intention.

Nevertheless, there are many unanswered questions on entrepreneurial motivations and behaviors. This is due to the difficulty in investigating and estimating the complex psychological and environmental indicators of entrepreneurial motivation. Furthermore, entrepreneurship differs significantly across educators, local areas and countries (Fayolle and Liñán, 2014). Bae et al. (2014) suggest that national culture may affect the formation of entrepreneurial behavior. The positive relationship between entrepreneurial intention and entrepreneurship education becomes stronger in high “power distance” countries than in countries with low power distance, in high in-group collectivist countries than in low in-group collectivist countries, and in countries with low uncertainty avoidance than in those with high uncertainty avoidance.

Giacomin et al. (2011) conduct a comparative analysis on student entrepreneurship in the USA, China, India, Belgium and Spain. They suggest that the differences may be attributable to national culture. (This research is discussed in more detail below in the section on statistics.) Pruett et al. (2009) also suggest that in China, similar to attitudes in Korea in the recent past, entrepreneurship culture is not sufficiently developed and families tend to disagree on start-up businesses.

There has, however, been little research on entrepreneurship culture in Japan. Generally, Japan is believed to provide a less welcoming cultural and social environment for entrepreneurs than other advanced countries. Based on Hofstede’s cultural dimensions theory, which is a framework used to distinguish between different national cultures and cultural dimensions (Hofstede et al., 2010), Japan has one of the highest scores for uncertainty avoidance based on a six-dimension index. This means that Japan is one of the countries that most avoids uncertainty (Hofstede Insights, 2019). Lee et al. (2005) report that entrepreneurship education can have a larger impact in countries with a lower understanding of entrepreneurship activities, such as Japan.

Most policies in Japan for promoting entrepreneurship education and start-ups do not offer effective incentives to motivate entrepreneurship in students. Therefore, this paper investigates how much entrepreneurial motivation students in Japan possess and what constitutes their main entrepreneurial motivation. In addition, the paper addresses barriers to the creation of start-ups. Previous studies indicate that not all individuals who want to create a start-up business actually follow through. Lee and Peterson (2000) warn entrepreneurs not to start a new business without the appropriate knowledge, regardless of their motivation. On the other hand, Lüthje and Franke (2003) suggest that there are multiple barriers, attributable to the social environment, for individuals who ultimately decide not to launch a business. These barriers include cultural and psychological issues. Therefore, in this paper, a comparison of the entrepreneurial culture in Japan and other countries is also conducted.

Data

Graduate students in natural sciences and social sciences at two universities in Tokyo were surveyed from December 2015 to January 2016. Participation in the survey was voluntary and anonymous. The students were fully informed about the survey at the outset. One of the universities has four Masters programs, in physics, chemical engineering, biotechnology and computing. A total of 79 students were enrolled in these programs at the time of the survey. In the other university, 42 Masters students in business management were potential respondents, and all answered the questionnaire. The survey was administered during the final class of each program without prior notification. In total, 114 valid responses were received from 121 Masters students.

Questions were asked about academic major, gender, school grade (first or second grade of the Masters program), scholarship status and whether the student hoped to pursue a doctoral degree. The respondents consisted of 84 males and 30 females; 85 were from the first grade in the Masters programs and 29 were from the second grade.

The questionnaire was based on the survey carried out by Giacomin et al. (2011), and has been replicated several times in the USA, China, India, Belgium and Spain. For the purposes of this study, it included additional original questions. The English questionnaire was translated into Japanese. Most of the answers were measured using a 5- to 7-point Likert scale.

Furthermore, Giacomin et al. (2011) targeted undergraduate students for their survey. Therefore, since graduate students have deeper knowledge of technologies, this research also extended its coverage to undergraduate students in order to allow comparison with the previous research. The survey for undergraduates was conducted in April 2017 in Tokyo. The respondents were sophomore and junior students of a school of management, as in the previous study.

Statistics

Strength of entrepreneurship motivation

Table 1 shows the result of the 7-point Likert scale regarding students’ strength of entrepreneurial motivation. The curves of the five countries other than Japan are similar in structure, resulting in scores between 3 and 5. Japanese students have comparatively lower entrepreneurial motivation, especially among undergraduates.

Table 1.

Strength of students’ entrepreneurial motivation.

	Japan (Gr.)	Japan	USA	China	India	Belgium	Spain
1 Not at all	18.1	28.9	4.9	5.4	5.5	4.4	2.5
2	24.1	21.1	12.8	10.8	8.7	12.3	9.2
3	25.6	15.8	19.0	20.8	19.1	23.5	17.1
4	17.0	9.6	19.7	25.3	30.5	28.6	24.2
5	8.0	13.2	26.9	24.4	25.2	20.7	25.3
6	5.0	8.8	12.1	8.7	6.8	7.2	16.3
7 Very strong	3.0	2.6	4.6	4.5	4.1	3.2	5.5

Note: “Gr.” = graduate students.

Source: Japanese data are based on author’s survey; other data are based on Giacomin et al. (2011).

Students’ motivation for start-up business

Table 2 shows the students’ motivations for start-up business using a 5-point Likert scale. The curves of countries other than Japan are similarly shaped, though a few details differ. Based on this analysis, there are two findings. First, factors with high scores in the other five countries have relatively low scores in Japan, especially “Personal independence,” “Being at the head of an organization,” “Creating jobs” and “Managing people.” These factors are commonly related to independence and leadership. Second, the original factors in the questionnaire, “Contributing to the domestic economy” and “Contributing to the regional community,” have high scores. “Contributing to the regional community” is the highest motivation factor for start-ups in Japan, which is discussed later.

Table 2.

Motivation for start-up business.

Motivation	Japan (Gr.)	Japan	USA	China	India	Belgium	Spain
The chance to implement my own ideas	4.49	3.58	4.55	4.20	4.56	4.36	4.40
Creating something of my own	4.39	3.50	4.35	4.11	4.46	4.19	4.10
Personal independence	2.85	2.50	4.43	3.91	4.52	4.08	3.86
Being at the head of an organization	2.75	2.30	4.06	3.54	3.98	3.92	3.31
The opportunity to be financially independent	3.30	3.39	4.27	3.60	4.51	3.80	3.61
Improving my quality of life	3.17	3.26	4.21	3.71	4.51	3.74	3.78
Creating jobs	2.50	2.50	3.63	2.89	4.10	3.63	3.30
Managing people	2.30	2.63	3.72	3.33	4.18	3.62	3.11
Receiving fair compensation	3.54	3.39	3.65	3.08	4.17	3.51	3.36
Making more money than by working for wages	3.49	3.55	3.71	3.67	3.93	3.43	3.20
Dissatisfaction in a professional occupation	3.33	3.58	3.54	3.02	3.48	3.37	3.45
Building personal wealth	3.44	3.21	3.97	3.61	4.15	3.35	3.36
Having more free time	3.58	3.11	3.62	2.97	2.84	2.99	2.86
Gaining high social status	3.41	2.97	2.92	3.45	4.03	2.99	2.64
The difficulty of finding the right job	3.00	3.11	3.39	2.59	3.72	2.93	3.36
Following a family tradition	2.80	2.66	2.97	2.63	3.05	2.51	1.74
Contributing to the domestic economy	3.88	3.30
Contributing to the regional community	4.58	4.40

Note: “Gr.” = graduate students.

Source: Japanese data are based on author’s survey; other data are based on Giacomin et al. (2011).

Barriers to start-up businesses

The barriers students believe they face in launching a business were investigated and the results shown in Table 3. Four factors – “Excessively risky,” “Lack of entrepreneurial competence,” “Lack of knowledge of the business world and market” and “Lack of experience in management and accounting” – have higher scores in Japan than in the other five countries. Paradoxically, Japanese graduate students score higher than Japanese undergraduates on these four factors, which are related to students perceptions of themselves as lacking competence and experience.

Table 3.

Barriers to start-up businesses.

Barriers to start-up business	Japan (Gr.)	Japan	USA	China	India	Belgium	Spain
Excessively risky	4.55	4.05	4.25	3.76	4.00	4.07	3.94
Lack of initial capital	4.01	4.11	4.18	3.92	4.32	3.94	4.25
Lack of entrepreneurial competence	4.69	4.47	3.86	3.65	3.89	3.82	3.53
Current economic situation	3.31	3.76	4.18	3.68	4.30	3.67	3.94
Fear of failure	4.08	3.79	3.44	3.28	3.41	3.53	3.16
Fiscal charges (taxes, legal fees, etc.)	3.88	3.92	3.54	3.12	3.61	3.52	3.26
Lack of knowledge of the business world and market	4.64	4.29	3.70	3.48	4.02	3.41	3.27
Lack of ideas regarding what business to start	4.03	4.13	3.68	3.51	3.93	3.41	2.72
Lack of experience in management and accounting	4.57	3.95	3.76	3.37	3.92	3.37	3.62
Lack of available assistance in assessing business viability	3.33	3.26	3.52	3.41	3.61	3.35	3.14
Lack of legal assistance or counseling	3.33	3.13	3.42	3.26	3.67	3.33	3.43
Lack of formal help to start a business	3.09	3.16	3.52	3.25	3.51	3.31	3.43
Problems with employees/contracted personnel	2.55	2.89	3.27	3.05	3.68	3.18	2.61
Start-up paperwork and bureaucracy	2.44	2.79	3.18	3.03	3.17	3.12	2.86
Having to work too many hours	3.59	2.76	3.41	2.81	3.17	3.09	2.75
Lack of support from people around me	3.38	2.61	3.46	3.30	3.69	2.87	2.68

Note: “Gr.” = graduate students.

Source: Japanese data are based on author’s survey; other data are based on Giacomin et al. (2011).

Analytical methodology and results

To quantitatively examine the research questions, factor analysis and multi-regression analysis were conducted. Factor analysis was conducted with the major factor method, promax rotation and eigenvalue above 1.00. Items that did not indicate sufficient factor loading (less than 0.399) were excluded. Then, factor analysis was again conducted with major factor method and promax rotation, and was repeated until all items indicated a factor loading of more than 0.400.

The regression model aimed to answer the following questions: (1) What is the main entrepreneurial motivation of undergraduate and graduate students in Japan to create start-up businesses? (2) What kinds of barriers do undergraduate and graduate students in Japan face?

Equation (1) shows the regression model. Factor represents the key variables, set from factor analysis as explanatory variables. Motivation, the strength of entrepreneurial motivation as shown in Table 1, was used as the explained variable. The X values are control variables for gender, grade (M1 or M2), scholarships (regardless of loan or grant) and the desire to pursue a doctoral program. Here, i indexes the individuals and ε is the error term. Lastly, the α coefficients are the parameters to be estimated.

As the first step of the analysis, the variables of gender, grade, scholarships and the desire to continue education were entered as inputs, and the adjusted R ² was calculated. Each primary factor was subsequently entered as input.

M o t i v a t i o n_{i} = α_{1} + α_{2} \times F a c t o r_{i} + \sum_{j = 3} α_{j} X_{i}^{(j)} + ∊_{i}

The results of the factor analysis are shown in Tables 4 and Table 5. When the α coefficient of each subscale was calculated to examine the internal consistency of the subscale, a sufficient value was obtained despite slightly low values in certain areas. As a result, five factors – creation and self-realization, independence, better financial condition, creating own job and social contribution – relating to entrepreneurial motivation for start-up business were obtained. Similarly, four factors – financial risk, psychological barriers, lack of managing ability and experience, and lack of any assistance – relating to barriers to start-up business were obtained.

Table 4.

Results of factor analysis of entrepreneurial motivation for start-up business.

Creation and self-realization:
The chance to implement my own ideas	0.841
Creating something of my own	0.705
Eigen value	4.455
Determination coefficient	60.39%
Independence:
Personal independence	0.839
Being at the head of an organization	0.817
Gaining high social status	0.799
The opportunity to be financially independent	0.705
Managing people	0.570
Eigen value	4.887
Determination coefficient	53.37%
Better financial condition:
Improving my quality of life	0.744
Receiving fair compensation	0.623
Making more money than by working for wages	0.621
Building personal wealth	0.590
Eigen value	3.822
Determination coefficient	51.58%
Creating own job:
The difficulty of finding the right job	0.802
Dissatisfaction in a professional occupation	0.746
Creating jobs	0.611
Eigen value	4.715
Determination coefficient	65.39%
Social contribution:
Contributing to the regional community	0.705
Contributing to the domestic economy	0.608
Eigen value	4.455
Determination coefficient	66.93%

Table 5.

Results of factor analysis on barriers to start-up business.

Financial risks:
Lack of initial capital	0.869
Fiscal charges (taxes, legal fees, etc.)	0.799
Eigen value	6.645
Determination coefficient	72.55%
Psychological barriers:
Excessively risky	0.887
Current economic situation	0.707
Fear of failure	0.672
Lack of support from people around me	0.671
Eigen value	0.570
Determination coefficient	53.37%
Lack of management ability and experience:
Lack of entrepreneurial competence	0.711
Lack of knowledge of the business world and market	0.688
Lack of ideas regarding what business to start	0.624
Lack of experience in management and accounting	0.590
Eigen value	2.453
Determination coefficient	61.53%
Lack of assistance:
Lack of available assistance in assessing business viability	0.825
Lack of legal assistance or counseling	0.805
Lack of formal help to start a business	0.797
Eigen value	5.804
Determination coefficient	69.29%

Next, multiple regression analysis was conducted based on the results of the factor analysis. In the regression model, the factors – five in Table 4 and four in Table 5 – were set as explanatory variables. The strength of entrepreneurial motivation, as in Table 1, was used as the explained variable.

The results of the multiple regression analysis are shown in Tables 6 and 7. Among the five factors considered for entrepreneurial motivation, or the motivators, independence and social contribution increased motivation. Conversely, significant results could not be obtained for three motivators – job creation and self-realization, better financial condition and creating one’s own job. With respect to barriers to starting a business, a statistically significant negative result was observed in two cases – psychological barriers and lack of competence and experience.

Table 6.

Results of multiple regression analysis of entrepreneurial motivation for start-up business.

Explained variable: entrepreneurial motivation	Model 1	Model 2	Model 3	Model 4	Model 5
Gender	0.004	0.018	0.011	0.017	0.004
Grade (M1 or M2)	0.125*	0.087	0.096	0.104	0.067
Scholarship	0.008	0.012	–0.025	–0.011	–0.025
Hope for doctoral program	0.080	0.061	0.064	0.048	0.053
Creation and self-realization	0.430	0.311	0.211	0.295	0.195
Independence		0.180*	0.201*	0.211**	0.224*
Better financial condition			0.200	0.227	0.127
Creating own job			0.199	0.161	0.080
Social contribution					0.261**
R²	0.203	0.219	0.199	0.255	0.259
Adjusted R²	0.198	0.212	0.222	0.250	0.278
F-value	1.27	2.65**	2.75**	3.02***	7.56***

Note: *p < 0.05; **p < 0.01; ***p < 0.001.

Table 7.

Results of multiple regression analysis of barriers for start-up business.

Explained variable: entrepreneurial motivation	Model 1	Model 2	Model 3	Model 4
Gender	0.005	0.020	0.008	0.023
Grade (M1 or M2)	0.115	0.090	0.085	0.059
Scholarship	–0.002	–0.031	–0.025	–0.026
Hope for doctoral program	0.080	–0.003	–0.123	–0.009
Financial risks	–0.255	–0.251	–0.240	–0.451
Psychological barrier		–0.633*	–0.300	–0.155*
Lack of management ability and experience			–1.08***	–1.12***
Lack of assistance				–0.279
R²	0.109	0.137	0.150	0.218
Adjusted R²	0.198	0.180	0.189	0.260
F-value	1.52**	2.86**	3.49**	4.470***

Note: *p < 0.05; **p < 0.01; ***p < 0.001.

These results highlight three findings from the analysis of the entrepreneurial motivation of undergraduate and graduate students in Japan. First, there is a lack of entrepreneurship motivation in Japanese students compared to students in the USA, China, India, Belgium and Spain. This does not change even when graduate students are included. Second, among various motivational factors in starting a business, the factors related to independence and leadership, such as “Personal independence” and “Being at the head of an organization,” score lower in Japan than in the other countries. For Japanese students, the factors for social contribution, such as “Contributing to the domestic economy” and “Contributing to the regional community,” score the highest, as shown in Table 2. The multiple regression analysis suggests that these factors are likely to lead to strong motivation to start a business (Model 5 in Table 6). Third, the barriers to launching a start-up business, such as “Extremely risky,” “Lack of entrepreneurial competence” and “Lack of experience in management and accounting,” score higher in Japan than in the other countries. This indicates that Japanese students have less confidence in their own competence, as shown in Table 3. The regression analysis also shows that strong recognition of these risks leads to a decrease in students’ desire to start their own business (Models 3 and 4 in Table 7).

These three findings are discussed in the next section.

Discussion

Entrepreneurial motivation: comparison of Japan with other countries

We see from the results that Japanese students have weaker entrepreneurship motivation compared to students in the USA, China, India, Belgium and Spain. To discuss the characteristics of individuals involved in entrepreneurial activities, this paper cites data provided by the Global Entrepreneurship Monitor (GEM) project. GEM explores and assesses the role of entrepreneurship in national economic growth. One of its main purposes is to measure entrepreneurship in each country, and its proxy, Total early-stage Entrepreneurship Activity (TEA). Entrepreneurial aspirations and attitudes toward seeking business opportunities are linked to entrepreneurial activities. These characteristics are critical to the promotion of entrepreneurship. Arenius and Minniti (2005) argue that, when making decisions with respect to their employment, individuals consider a set of subjective perceptions about entrepreneurship. They form these subjective perceptions based on the presence of role models, confidence in their skills and ability, risk propensity and alertness to unexploited opportunities.

Based on these aspects, Honjo (2015) and Takahashi et al. (2013) use data from GEM for four indices concerning entrepreneurial attitudes – entrepreneurial network, perceived opportunities, perceived capabilities and fear of failure – and examine the factors that motivate individuals to engage in a business start-up, while comparing them to other developed countries. With respect to entrepreneurial attitudes, they show a positive and significant relationship between entrepreneurial network, perceived opportunities, perceived capabilities and business start-up for all countries, including Japan. They also show that the entrepreneurial levels for business start-ups are lower in Japan than in other countries, even after controlling for personal attributes. However, they also provide interesting evidence that those individuals who have perceived that they possess capabilities such as the knowledge, skill and experience required to start a new business are more likely to engage in a business start-up in Japan when compared to other countries, although Japanese individuals on average are less likely to do so. In other words, among individuals throughout the world who are believed to possess new business capabilities, Japanese individuals have stronger entrepreneurial intention and motivation.

Looking at the fear of failure, we can consider a different insight into Japanese entrepreneurial attitudes. Suzuki (2019) and Inoue (2016) suggest that Japanese individuals who do not fear the risk of failure are more likely to engage in a business start-up. They also imply that, in Japan, the more an individual obtains business capabilities such as knowledge, skill and experience, the more they feel the fear of failure and the less likely they are to start a new business. Takahashi et al. (2013) also suggest that there is little evidence of this tendency in other countries, implying that it may be a characteristic applying only or mainly to individuals in Japan.

Entrepreneurial motivation and culture

Many previous studies have investigated the relationship between culture and entrepreneurship across nations (Bae et al., 2014; Uhlaner and Thurik, 2006; Wennekers et al., 2007). The findings are diverse. Morales and Holtschlag (2013) focus on the relationship between post-materialism and entrepreneurship at the individual level across 39 countries. They find that post-materialism decreases a person’s likelihood of becoming an entrepreneur. This effect of post-materialism is more negative in countries with high levels of entrepreneurship. Individuals in materialistic societies are more likely to be entrepreneurs than in post-materialistic societies such as Japan. The Small and Medium Enterprise Agency (2014) reports that the ratio of those with entrepreneurial intention among the total productive-age population was 2.2% in 1979 and decreased to 1.0% in 2012. This suggests that, with growing post-materialism and an aging society, strengthening social norms for regional society may have caused a decrease in this ratio. This argument is consistent with the results of the present study.

Regarding the second finding, a survey by the Japan Productivity Center showed a rapid increase in the desire to make a social contribution among Japanese people in their 20 s (Japan Productivity Center, 2014). In other studies on younger Japanese individuals, researchers also find a shift in entrepreneurial motivations toward social contribution (Kanama, 2013; 2016). The results of the present study are consistent with those of these previous findings. Furthermore, motivational factors such as challenging work and upgrading ability, which had previously been the most important factors, have gradually decreased in importance (Japan Productivity Center, 2014).

Bae et al. (2014) examine the impact of four cultural dimensions on the relationship between entrepreneurship education and entrepreneurial intention: (1) power distance, (2) in-group collectivism, (3) gender egalitarianism and (4) uncertainty avoidance. Power distance is the degree to which individuals accept power. For example, students in low power distance countries are more likely to engage in discussion and challenge a teacher’s authority. The relationship between entrepreneurship education and entrepreneurial intention is stronger when the individuals are in a society with a high-power-distance culture. Consequently, we can expect that when students in countries with high power distance enroll in entrepreneurship education they will accept the authority of entrepreneurship educators.

Uncertainty avoidance signifies a lack of tolerance for uncertainty. The entrepreneurship education–entrepreneurial intention relationship also becomes stronger in countries with low uncertainty avoidance than it does in those with high uncertainty avoidance (Hofstede et al., 2010). When students enroll in entrepreneurship education, they recognize the uncertain nature of entrepreneurship much more than before. Once students recognize the uncertainty in entrepreneurship, they may become less interested in engaging in it, particularly in cultures where uncertainty avoidance is high.

Many Japanese scholars have pointed out that uncertainty avoidance is high in Japan and that Japanese individuals are likely to avoid risk-taking activities in their culture and society (e.g. Ogawa and Matsumoto, 2016; Sato, 2009). These studies also imply that the education system of elementary, junior and senior high school in Japan tends to establish a clear hierarchical relationship not only in a class but also in a club team, and makes it function with strong collectivism. Those schools also tend to keep students homogenized. The system has been gradually changed since the late 2000s, with a shift from collectivism to individualism. Still, these typical Japanese cultural and societal traits will likely affect entrepreneurial motivation to some extent, and it seems probable that they will make the social contribution motivation stronger.

Barriers to entrepreneurship

As for the barriers to entrepreneurship, which relate mainly to competence and experience, education programs on business start-up should normally eliminate fears and anxieties about risk-taking, and thus foster the ambition to start a business. Previous literature has described a positive relationship between entrepreneurship programs and students’ intention (e.g. Giacomin et al., 2011; Piperopoulos and Dimov, 2015; Souitaris et al., 2007). From the results obtained using GEM data on entrepreneurial attitudes, Arenius and Minniti (2005), Morales-Gualdrón and Roig (2005) and Koellinger et al. (2013) suggest that the relationship between entrepreneurial attitudes and three factors – entrepreneurial network, perceived opportunities and perceived capabilities – has a positive significance. In contrast, the relationship between entrepreneurial attitudes and fear of failure has a negative significance. The results of the present study indicate that barriers to entrepreneurial attitudes in Japan do not derive from a lack of legal assistance and public support. Japanese perceived barriers to entrepreneurial attitudes, therefore, depend on factors such as culture and its perception, and not on regulation and legal obstacles.

With regard to social norms and regional culture, some previous studies have focused on their persistence in entrepreneurial activities. The level of entrepreneurial activities differs across regions, and the differences are enduring (Andersson and Koster, 2011; Fotopoulos, 2014; Fritsch and Mueller, 2007). Since individual decisions are affected by social norms and regional culture (Fritsch and Storey, 2014), the diversity of entrepreneurial intensity could be explained by the regional factor (Bosma et al., 2008; Sternberg, 2009). Where there is entrepreneurial intensity, there is an entrepreneurship culture (Andersson and Koster, 2011; Fritsch and Wyrwich, 2014). In Japan, the limited tolerance of risk-taking and an absence of role models for starting a new business in regional society may be reasons for its low entrepreneurial intensity (Takahashi et al., 2013).

Conclusion

This paper focuses on students’ entrepreneurial motivation and investigates how much entrepreneurial motivation undergraduate and graduate students in Japan have compared to their counterparts in other developed counties, what their main entrepreneurial motivation is, and what kinds of barriers they face when they consider launching a business. To quantitatively examine these research questions, factor analysis and multi-regression analysis were conducted.

There are three key findings from the results of the study. First, there is a lack of entrepreneurship motivation in Japanese students compared to students in other advanced countries. Second, among various motivational factors related to starting a business, those concerning independence and leadership score lower in Japan than in the other countries. For Japanese students, factors related to social contribution score the highest. Third, among the barriers to launching a business, a lack of entrepreneurial competence and experience score higher in Japan than in the other countries, suggesting that Japanese students have less confidence in their own competence.

However, the study also finds interesting and unique characteristics for Japanese students. According to a comparison of Japan with other countries with regard to entrepreneurial motivation, using evidence from GEM, individuals who believe that they possess capabilities such as the knowledge, skill and experience required to start a business are more likely to engage in start-up in Japan than their counterparts in other countries. As for barriers to entrepreneurship, education programs on start-up would usually be expected to eliminate or reduce fears about risk-taking. However, the more individuals obtain business capabilities, the more they feel the fear of failure and hesitate to start a new business.

Finally, it is important to note a limitation of this study and a consequent task for future research. In this paper, launching a business has been considered as symbolic of entrepreneurship. This is because of the difficulty in finding surrogate variables that represent entrepreneurial motivation. However, entrepreneurship is ultimately connected to a variety results and outcomes, including, for example, product development in a large firm or policy-making by a public official. Future studies should investigate such diverse behaviors.

Footnotes

Declaration of conflicting interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) received no financial support for the research, authorship, and/or publication of this article.

ORCID iD

Daisuke Kanama

Notes

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