Analysis of Households’ Willingness and Ablity to Participate in Micro- Enterprise in Gambella Town of Western Ethiopia: In Case of Nuer and Agnwaa Community

Abstract

Microenterprises have great role for socio-economic development in developing countries.  In spite of these benefits, the role of these businesses in our country is very much insignificant.  Moreover, in Gambella especially in Nuer and Agnwa communities are not actively participate in microenterprises. Thus, this research focused on analyzing the determinants of   the households’ willingness and ability to participate in micro enterprise. The results of the study with nominal logit model revealed seven variables were significant at less than 10 per cent probability level. Age of the household is significant and positively associated with willingness to participate in microenterprise activities. Education level had negative impact on probability of being participant in microenterprise activity, which is significant at less than 5 percent probability level. This means more educated households have negative interest in the involvement of microenterprise activities. Access to factors of productions and households’ business ability are significant at less than or equal 5 percent probability level. These variables are positively correlated with the dependent variable. Moreover, dependency ratio and willingness-ability combination are significant that are negatively associated with households’ willingness to participate in microenterprise activities. Variables like having willingness, being male family and dependency ratio are positively related with dependant variable business ability. Having land and having willingness-having ability are negatively associated with dependent variable business ability. Therefore, governments, regional state and university should play their role to intervene and to transform the societies to producer and commercial class.

Keywords: microenterprise, logit model, Nuer and Agnwa community, business willingness and business ability