Bayesian hierarchical analyses for entrepreneurial intention of students

Abstract

In recent years, entrepreneurship has become an important issue due to national economic development and the contribution of society. Data with a hierarchical structure received more attention and occur frequently in social science, public health and epidemiological researches. In such research, binary outcomes are common. Multilevel logistic regression models allow one to account for the clustering of subjects within clusters of higher-level units when estimating the effect of subject and cluster characteristics on subject outcomes. Traditional logistic regression is inappropriate when data are hierarchically structured. Therefore, this study presents multi-level Bayesian logistic analysis for entrepreneurial intention of students using classical and Bayesian approach. The descriptive result revealed that about 57.4% of the students had an entrepreneurial intention while 42.6% do not have an intention. The results also showed that entrepreneurial education/training and entrepreneurial attitudes significantly predicts students’ entrepreneurial intention at 5% level of significance. The model results indicate that the effects of the selected variable on entrepreneurial intention vary across university. By failing to take into account the clustering within university (level 2), Bayesian multilevel effects are not taken into consideration in modeling, the β coefficients in multilevel logistic model using classical approach are distorted somewhat in both directions either in over or under direction. This study also evaluates and compares the behavior of maximum likelihood and Bayesian estimators to investigate the relationship between covariates and the response. Both point and interval estimation performances were investigated. The results revealed that lower standard errors of the estimated coefficients in the Bayesian logistic regression approach as compared to classical approach. Moreover, the results revealed that the length of the Bayesian credible interval is smaller than the length of the maximum likelihood confidence interval for all factors. In order to identify the most plausible method between Bayesian method and maximum likelihood estimation of the data, AIC, BIC and DIC are adopted in this paper. The result of the study depicts that the Bayesian method performs better and more efficient than maximum likelihood estimation. The study recommends that the government as well as the universities should design programs that facilitate entrepreneurship to change the mindset, attitude, and intention of those students who do not have knowhow about entrepreneurship as a future career.