A Study Of The Impact Of Institutions On Rural Farmers’ Entrepreneurial Performance In Ghana

The study examined the mechanisms through which institutional factors impact on performance of rural farm entrepreneurs and farm enterprises in the context of a developing country.In the recent times,agriculture entrepreneurship has received much attention by policy makers and researchers as a key policy strategy for rural poverty alleviation,rural employment and economic development in the developing countries such as Ghana.Nonetheless,farm entrepreneurs in the developing countries such as Ghana face several institutional obstacles in their attempt to improve their business performance,identify entrepreneurial opportunities and develop the entrepreneurial orientation of their farm enterprisesHowever,several previous studies who attempted to explain what holds back the entrepreneurial performance in the agriculture sector in Ghana have failed to pay much attention to the impact of the institutional factors.In Ghana,the agriculture sector is more institutionalized where prevailing institutional factors can either constrain or promote the performance of the agriculture enterprises.In line with this backdrop,this study explored the pathways through which institutions impact on performance of farm entrepreneurs and farm enterprises in the context of Ghana.The objectives of the study were: firstly,to examine the direct and indirect impacts of institutional factors on farm-level entrepreneurial performance through the mediation role of entrepreneurial orientation.Secondly,‘to investigate the direct and indirect impacts of the institutional on farmerlevel entrepreneurial performance through the mediating role of entrepreneurial opportunities’.Finally,to examined the interactive effects of social capital and institutional factors on farmerlevel entrepreneurial performance in Ghana.Further,the institutional theory offered the main theoretical foundation for the study.The social capital theory and resource based theory were also utilized to support part of the arguments and propositions in line with the institutional theory in the study.Subsequently,a general and specific conceptual models were built based on the theoretical framework to highlight on the hypothesized relationships in the study.In this study,the concept of institutions was operationalized to connote the three key institutional environments namely regulatory,normative,and cognitive institutions.In terms of the study setting,the study was conducted in the rural communities in Ghana in the West Africa sub-region.A primary cross-sectional data were collected from both farm enterprises and farm entrepreneurs to test the specific conceptual models in accordance with the research objectives.Based on this,the data were collected from a total sample of 371 farm enterprises and246 farm entrepreneurs in rural farming business in Ghana.The instruments for the data collection was mainly structured questionnaires designed from items already validated in literature with high reliability Cronbach’s alpha values(α > 0.7).The cross-sectional quantitative research design was employed.The quantitative data analyses were performed using the Partial Least Square-Structural Equation Modelling(PLS-SEM)with Smart-PLS computer software versions 3.0.Based on PLS-SEM,the data analyses were conducted based on the measurement models and the structural models while the findings based on the research objectives are presented as follows.Based on the research objective 1 the study,examined the direct impact of the regulatory,normative and cognitive institutions on performance and entrepreneurial orientation of farm enterprises.The study further predicted the indirect impacts of the institutional factors farm-level entrepreneurial performance through the mediating role of farm-level entrepreneurial orientation as a mechanism(Chapter 5).The findings revealed that,farm-level EO has a strong positive impact of farm entrepreneurial performance.Moreover,the results demonstrated that,the regulatory,normative and cognitive institutions simultaneously have positive impacts on farm-level entrepreneurial orientation.Cognitive institutions,have significant positive direct and indirect impact on entrepreneurial performance of farm enterprises through a partial mediation role of entrepreneurial orientation.The regulatory and normative institutions have negative direct impact on entrepreneurial performance of farm enterprises.Nonetheless both regulatory and normative institutions have significant positive indirect impact on entrepreneurial performance of farm enterprises through the partial mediation role of entrepreneurial Orientation.In line with the research objective 2,the study investigated the direct impacts of regulatory,normative and cognitive institutions on entrepreneurial opportunity exploitation,opportunity recognition and performance among the individual farm entrepreneurs in rural areas in Ghana.The study again tested the mediating roles of entrepreneurial opportunity exploitation and opportunity recognition as mechanisms through which institutions influence performance among the farm entrepreneurs.The results show that,entrepreneurial opportunity exploitation and opportunity recognition have significant positive impacts on rural farmers’ entrepreneurial performance.Again,the results showed that,the regulatory,normative and cognitive institutions have significant positive influence of entrepreneurial opportunity exploitation and opportunity recognition of the rural farm entrepreneurs.Similarly,the results show that,the institutions simultaneous contribute positively to the entrepreneurial performance of the farmers in rural agriculture.In addition,entrepreneurial opportunity recognition and opportunity exploitation partially mediate the impacts of regulatory,normative and cognitive institutions on entrepreneurial performance of the farm entrepreneurs in rural agriculture.Finally,based on the research objective 3,the study tested the interactive effects of social capital and the institutional factors(regulatory,normative and cognitive institutions)on entrepreneurial performance using data from the rural farm-entrepreneurs in Ghana(Chapter 7).The findings show that Social capital contribute positively to the entrepreneurial performance of the farmers in rural agriculture.Again,the results show significant positive interaction effect of social capital,regulatory,normative and cognitive institutions on entrepreneurial performance of the farmers in rural agriculture.The results infer that,social capital strengthens the impacts of the institutional environments on the entrepreneurial performance of the farmers in rural agriculture.In conclusion,study is among the pioneering studies in Ghana to employ structural equation modelling approach to explore the mechanism on farm entrepreneurial performance through EO constructs,opportunity exploitation and opportunity recognition.This study contribute to extending understanding the application of the institutional theory in farmer entrepreneurship context of the developing country.The findings suggest institutions have more positive indirect on farm performance through entrepreneurial Orientation and entrepreneurial opportunities impacts more than the direct impacts.The study makes both theoretical and methodological contributions agriculture entrepreneurship literatures,entrepreneurship orientation,business opportunity studies.The findings from this study has implication to developing policies and practice to improve rural agriculture,improve rural incomes,alleviate poverty and improves rural livelihoods.Further,the study contribute to policy for rural job creation and youth employment through improving farm entrepreneurship.The study contributes to policy that targets food security.The findings finally contributes to management decisions to improve performance of agriculture enterprises through strengthening the entrepreneurial orientation posture of the farm enterprises.Strengthening the institutions in Ghana can help develop agriculture entrepreneurship and contribute to rural development and economic growth.