The nexus between financial literacy and entrepreneurship ability among university students in emerging markets

Abstract

This study investigates the level of financial literacy and entrepreneurship ability among university students in emerging markets while examining the relationship between university student's financial literacy level and their entrepreneurial abilities. Data was collected by distributing 90 questionnaires to students of Yogyakarta State University, Indonesia covering cross educational majors. Out of the sample, a total of 84 returned completed questionnaires were used for analysis. The findings from this study revealed that 45% of the respondents were able to answer one of The Big 3 financial literacy questions correctly, 21.4% answered two questions correctly while none answered all three questions correctly. This implies that the level of financial literacy Yogyakarta State University is low and corroborates findings of similar studies done in Indonesia. However, the respondents reported a high level of entrepreneurial ability as almost 80% of the respondents reported having satisfactory levels of entrepreneurial abilities, 7% had an outstanding entrepreneurial ability while the remaining 13% had a considerable level of entrepreneurial ability. Using Pearson correlation analysis, the study revealed that although financial literacy and entrepreneurial ability are positive related, the relationship is however not statistically significant at alpha 5%.