Abstract
This study analyzed the risk-taking propensity amongst the four cultural groups and its impact on the business performance, from a sample of Small and Medium Enterprises (SMEs) within the Gauteng Province of South Africa. The data was collected using two sets of questionnaire measuring risk taking propensity and perceived business performance. 83 responses were returned from 400 respondents. The results indicate that male on average show higher risk taking, while difference in risk taking propensity between male and female was not statistically significant. A very weak or no correlation between risk taking and business performance scores for both the genders were found, indicating that gender and culture does not play a role in the relationship between risk taking and business performance. However study found that there was significant difference in risk taking behavior by different culture groups, Zimbabweans were the highest risk takers, while Chinese, Pakistanis and South Africans differed in their risk taking behavior.
Highlights
After 22 years of black rule, South Africa is still at transition stage in terms of distribution of wealth
South Africans had a higher percentage of shareholding, while Zimbabweans were second and Pakistanis were third, Chinese were last on both ownership and shareholding
This study found that males on average show higher risk taking profiles compared to women in general
Summary
After 22 years of black rule, South Africa is still at transition stage in terms of distribution of wealth. As an added mechanism to citizen empowerment, South African government has embarked on enhancing entrepreneurship to create jobs and redistribute wealth. To this end several schemes have been launched by the Government to enhance entrepreneurial activities. South African borders are open to immigrants and there are good number of small businesses operated by Chinese, Pakistanis, Zimbabweans, other African nationals (Ethiopians, Congolese, Kenyans etc.), while majority of Indians and Pakistanis from apartheid regime own big businesses in South Africa Given this background, the objective of this study was to analyze the risk-taking propensity amongst the various cultural groups and its impact on the business performance, from a sample of Small and Medium Enterprises (SMEs) within the Gauteng Province of South Africa, which is the seat of highest entrepreneurial activities in South Africa
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